World Bank Document › external › default › WDSContent...Document of The World Bank Report No: ICR00001393 IMPLEMENTATION COMPLETION AND RESULTS REPORT (IDA-38210) ON A CREDIT

Document of The World Bank

Report No: ICR00001393

IMPLEMENTATION COMPLETION AND RESULTS REPORT (IDA-38210)

ON A

CREDIT

IN THE AMOUNT OF SDR 128.8 MILLION

($181.0 MILLION EQUIVALENT)

TO THE

REPUBLIC OF INDIA

FOR THE

MAHARASHTRA RURAL WATER SUPPLY AND SANITATION PROJECT

“JALSWARAJYA”

June 28, 2010

Sustainable Development Department Urban and Water Unit India Country Management Unit South Asia Region

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CURRENCY EQUIVALENTS (Exchange Rate Effective March 19, 2010)

Currency Unit = Indian Rupee INR 1.00 = US$0.02 US$1.00 = INR 46.68

FISCAL YEAR

ABBREVIATIONS AND ACRONYMS

AG Auditor General PDO Project Development Objective AWMA Aquifer Level Water

Management Association PHRD Policy and Human Resources

Development Fund AWMP Aquifer Water Management Pilot PIP Project Implementation Plan BPL Below Poverty Line PMU Project Management Unit CA Chartered Accountant PRA Participatory Rural Appraisal CAG Comptroller and Auditor General

of Government of India PRI Panchayati Raj Institutions

CAS Country Assistance Strategy PWD Public Works Department CBC Capacity Building Consortium PWSS Piped Water Supply Schemes CBO Community-Based Organization QAE Quality at Entry CDD Community-Driven Development QAG Quality Assurance Group COM Community Operations Manual QSA Quality of Supervision

Assessment DAMT District Appraisal and Monitoring

Team RF Regional Facilitator

DFMT District Financial Management Team

RSPMU Reform Support and Project Management Unit

DFT District Facilitation Team RSU Regional Support Unit DO Development Objective RWSS Rural Water Supply and

Sanitation DWMSC District Water Management and

Sanitation Committee SAC Social Audit Committee

EA Environmental Assessment SASDE South Asia Sustainable Development Environment

EMP Environmental Management Plan SDR Special Drawing Rights ERR Economic Rate Return SEE Sustainability Evaluation

Exercise ESR Elevated Service Reservoir SHG Self-Help Group GoI Government of India SIL

Specific Investment Loan

GoM Government of Maharashtra SO Support Organization GP Gram Panchayat SOE Statement of Expenditure GR Government Resolution TDP Tribal Development Plan GSDA Groundwater Survey

Development Agency TOT Training of Trainers

GSR Ground Service Reservoirs TSC Total Sanitation Campaign ICBF Initial Capacity Building Fund TSP Technical Service Provider ICRR Implementation Completion and

Results Report UC Utilization Certificate

IDA International Development Association

UNICEF United Nations Children’s Fund

IEC Information, Education, and Communication

VAP Village Action Plan

IGSs Income-Generating Schemes VP Village Panchayat KFW Kreditanstalt fur Wiederaufbau-

(German Funding Agency) VPSF Village Panchayat Strengthening

Fund KM Knowledge Management VWSC Village Water Supply and

Sanitation Committee lpcd Litres Per Capita Per Day WASM Water and Sanitation Mission M&E Monitoring and Evaluation WASSO Water and Sanitation Support

Organization MB Measurement Book WATSAN Water and Sanitation MDG Millennium Development Goals WDC Women’s Development

Committee MIS Management Information System WEF Women Empowerment Fund MJP Maharashtra Jeevan Pradhikaran WSS Water Supply and Sanitation MOU Memorandum of Understanding WSSC Water Supply and Sanitation

Committee MRD Ministry of Rural Development WSSD Water Supply and Sanitation

Department MTR Mid-Term Review WTP Water Treatment Plant NGO Non-Government Organization ZP Zilla Parishad NPV Net Present Value NRDWQSP National Rural Drinking Water

Quality Surveillance Program

O&M Operation and Maintenance ODF Open Defecation Free OFA Overall Financing Agreement OMT Operations and Monitoring Team PAD Project Appraisal Document PC Public Contribution

Vice President: Isabel M. Guerrero

Country Director: N. Roberto Zagha

Acting Sector Manager: William Kingdom

Project Team Leader: N. V. V. Raghava

ICR Team Leader: Rosanna Nitti

INDIA MAHARASHTRA RURAL WATER SUPPLY & SANITATION PROJECT

“JALSWARAJYA”

CONTENTS

Data Sheet

A. Basic information B. Key dates C. Ratings summary D. Sector and theme codes E. Bank staff F. Results framework analysis G. Ratings of project performance in ISRs H. Restructuring (if any) I. Disbursement profile

1 Project context, development objectives, and design .......................................... 1 2. Key factors affecting implementation and outcomes .......................................... 4 3. Assessment of outcomes.................................................................................... 10 4. Assessment of risk to development outcomes ................................................... 15 5. Assessment of Bank and borrower performance ............................................... 16 6. Lessons learned.................................................................................................. 18 7. Comments on issues raised by borrower/implementing agencies/partners ....... 20

Annex 1. Project costs and financing ........................................................................... 22 Annex 2. Outputs by component .................................................................................. 23 Annex 3. Fiduciary issues............................................................................................. 37 Annex 4. Economic and financial analysis................................................................... 40 Annex 5. Bank lending and implementation support/supervision processes ............... 46 Annex 6. Beneficiary survey results ............................................................................. 48 Annex 7. Stakeholder workshop report and results ...................................................... 54 Annex 8. Summary of Borrower’s ICR and/or Comments on Draft ICR .................... 55 Annex 9. Comments of cofinanciers and other partners/stakeholders ......................... 65 Annex 10. List of supporting documents...................................................................... 66 Annex 11. List of participating districts (26)................................................................ 67 Map IBRD 32546

A. Basic information

Country: India Project name:

Maharashtra Rural Water Supply and Sanitation Project “Jalswarajya”

Project ID: P073369 L/C/TF number(s): IDA-38210 ICR date: 06/28/2010 ICR type: Core ICR Lending instrument: SIL Borrower: Government of India Original total commitment:

SDR 128.8 million Disbursed amount: SDR 128.8 million

Revised amount: SDR 128.8 million Environmental category: BImplementing agencies: Government of Maharashtra, Water Supply and Sanitation Department Cofinanciers and other external partners:

B. Key dates

Process Date Process Original date Revised/actual date(s)

Concept review: 11/12/2002 Effectiveness: 10/29/2003 10/29/2003 Appraisal: 05/08/2003 Restructuring(s): NA NA Approval: 08/26/2003 Midterm review: 09/30/2006 01/05/2007

Closing: 09/30/2009 09/30/2009

C. Ratings summary C.1 Performance rating by ICR Outcomes: Satisfactory Risk to development outcome: Low Bank performance: Satisfactory Borrower performance: Satisfactory

C.2 Detailed ratings of bank and borrower performance (by ICR) Bank Ratings Borrower Ratings

Quality at entry (QAE): Satisfactory Government: Satisfactory Quality of supervision (QSA):

Satisfactory Implementing agency/agencies:

Satisfactory

Overall Bank Performance:

Satisfactory Overall borrower Performance:

Satisfactory

C.3 Quality at entry and implementation performance indicators

Implementation performance Indicators

Quality assurance group (QAG)

assessments (if any)

Rating

Potential problem project at any time (yes/no):

Yes QAE: Moderately Satisfactory

Problem project at any time (yes/no):

Yes QSA: None

Development objective (DO) rating Before closing:

Satisfactory

D. Sector and theme codes Original Actual

Sector code (as % of total Bank financing) Other social services 5 5 Sanitation 15 15 Subnational government administration 40 40 Water supply 40 40

Theme code (as % of total Bank financing) Decentralization 22 22 Indigenous peoples 11 11 Other human development 22 22 Participation and civic engagement 22 22 Rural services and infrastructure 23 23

E. Bank staff Positions At ICR At approval

Vice president: Isabel M. Guerrero Praful C. Patel Country director: N. Roberto Zagha Michael F. Carter Sector manager: William Kingdom Gajanand Pathmanathan Project team leader: N. V. V. Raghava Meena M. Munshi ICR team leader: Rosanna Nitti

F. Results framework analysis

Project development objectives (PDOs) To: (i) increase rural households’ access to improved and sustainable drinking water supply and sanitation (WSS) services; and (ii) institutionalize decentralization of rural water supply and sanitation (RWSS) service delivery to rural local governments and communities.

Revised project development objectives (as approved by original approving authority)

Not applicable. (a) PDO indicator(s)

Indicator Baseline

value

Original target values

(from approval

documents)

Formally revised target values1

Actual value achieved at credit

closure2

% of gram panchayats (GPs)3

where water schemes are fully functional and are delivering potable water to households as per Government of Maharashtra (GoM) criteria4

NA

100% (for base

2,800 GPs)

100%

(3,216)

76%

(2,298 GPs where water supply

commissioned)

% of households5 using sanitation facilities in project villages.

19%

50%6 50%

77% (898,351)

% of GPs where 100% open defecation free (ODF) status has been achieved

0%

NA

40%

(1,286)

61%

(1,848) % of GPs where community perception of environmental sanitation is satisfactory

5%

NA

60%

(1,930)

87%

(2,629) No. of GPs that demanded, planned, implemented, and completed RWSS schemes following project processes and then exited from the project

0 2,800 3,216 841 (GPs that have exited from

the project)7

1 The percentage targets in this column were fixed at the midterm review (MTR), to be achieved by credit closure. The total GPs in the project at the time of the MTR were 3,216. The figures in parentheses are the actual numbers at the time of the MTR, based on the percentage of total GPs at that time. 2 Credit closed on September 30, 2009. The GPs in the project at credit closure were 3,021. The percentage shown is out of 3,021. The figures in parentheses are the actual numbers at credit closure. 3 The gram panchayat (GP) is the local government at the village level. A GP can include more than one village for the purpose of local governance. 4 To be reachable within 1.6 kilometers (km) distance, 30 meter (m) vertical distance. 5 Total project households at credit closure were 1,162,606. 6 PAD indicator A3.4, annex-1. 7 Though only 841 GPs exited from the project, overall water service is operational in 2,298 GPs. Beyond credit closure, the GoM plans to follow up with other exiting GPs.

No. of GPs where full community capital contributions have been achieved by the release of a second fund installment 8

0 2,800 3,216 3,021

% of GPs holding a minimum of 6 gram sabhas9 per year on the planning, implementation, and operation and maintenance (O&M) of RWSS

0%

90%10 (for base

2,800 GPs)

80% (2,573)

93%11 (2,810)

% of GPs having more than the stipulated 40% average attendance in the gram sabha during planning and implementation phases

5% NA

75% (2,412)

93%12 (2,810)

% participation of women in the gram sabha meetings, across all GPs

5%

NA

33%

53%

(b) Intermediate outcome indicator(s)

Indicator Baseline value

Original target values (from

approval documents)

Formally revised target values

Actual value achieved at credit

closure13

% of GPs where the scheme is functional and O&M is fully financed by community contributions

0%

70%14 80%(2,573)

100%

(in 2298 GPs having functional

schemes) % of GPs with more than 33% of leadership positions in all village committees held by women

0%

NA

60% (1,930)

89% (2,690)

8 This represents the critical stage of implementation. 9 A gram sabha is a village assembly that makes decisions concerning village development or other local issues. 10 PAD indicator A1.2, annex-1. 11 Last assessed in March 2008. 12 Last assessed in March 2008. 13 International Development Association (IDA) credit closed on September 30, 2009. 14 PAD indicator A3.1, annex-1.

G. Ratings of project performance in ISRs

No.Date ISR archived DO IP

Actual disbursements (US$ millions)

1 10/09/2003 Satisfactory Satisfactory 0.00 2 05/14/2004 Satisfactory Satisfactory 9.00 3 12/22/2004 Satisfactory Satisfactory 10.41 4 06/07/2005 Satisfactory Satisfactory 11.24 5 01/03/2006 Satisfactory Moderately unsatisfactory 15.41 6 09/20/2006 Satisfactory Moderately unsatisfactory 72.52 7 01/27/2007 Satisfactory Satisfactory 102.98 8 08/21/2007 Satisfactory Satisfactory 149.56 9 03/26/2008 Satisfactory Satisfactory 171.70 10 08/29/2008 Satisfactory Moderately satisfactory 194.12 11 07/29/2009 Satisfactory Moderately satisfactory 194.45

H. Restructuring (if any) Not applicable. I. Disbursement profile

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1. Project context, development objectives, and design

1.1 Status at time of appraisal

Maharashtra is located in western India. It has a total population of about 97 million (58% rural), in 35 districts. Two of these are urban districts (Mumbai and Mumbai suburban). For administrative purposes the state has six revenue divisions.15 The rural population resides in 40,785 villages in 45,500 habitations. The project included 26 selected districts (see list in Annex-11).

Water supply and sanitation (WSS) policies. At the project’s start in 2003, Maharashtra was the only state in India with a uniform policy regime in the rural water supply and sanitation (RWSS) sector, in line with a national reform agenda. Since July 200016 policies have been in place to promote demand-driven approach over the traditional top-down, supply-driven approach; to support decision making at the community level.

Rural water supply sector. At the start of the project, state line agencies such as Maharashtra Jeevan Pradhikaran (MJP),17 the Groundwater Surveys and Development Agency (GSDA), and zilla parishads (ZPs)18 were responsible for identifying needs and designing and commissioning schemes. Village communities had little say in these matters but contributed toward operation and maintenance (O&M) by way of water charges.

Water resources. Maharashtra receives an average annual rainfall of 650 to 1,360 millimeters (mm), most of it during June through September, with some areas receiving less than others. The state has five major river basins.19 Groundwater has been the primary source of water supply for domestic (meeting nearly 80 percent of rural water demand), agricultural, and industrial uses. Irrigation claims the largest share (over 50 percent of total irrigated area). Groundwater development, as well as its judicious management, is a major challenge faced by the state.

Rural water quality. Groundwater in the state is generally potable; however, in certain areas concentrations of fluoride, nitrate, iron, and salinity are higher than permissible limits. In 2005 the Government of Maharashtra (GoM) tested public water sources for contamination; in all districts, almost 10 percent of public drinking water sources were affected by chemical contamination leading to serious health hazards.

Rural sanitation. Prior to 1997, the government did little to promote the use of household toilets. In 1996–97, a program was initiated to motivate communities to construct individual toilets and to achieve universal coverage. In 2000 subsidies were provided for an additional 1.7 million toilets; however, only about 57 percent of the toilets constructed were used. In 2004 only 4 million of Maharashtra’s 10.9 million rural households (37 percent) had sanitation facilities.

Total Sanitation Campaign. The Total Sanitation Campaign (TSC) of the Government of India (GoI), initiated in 1999, is a comprehensive program to build sanitation facilities in rural areas, with the broader goal of eradicating the practice of open defecation, with nominal subsidies to poor households and a strong emphasis on information, education, and communication (IEC);

15 Konkan, Pune, Nashik, Aurangabad, Nagpur, and Amravati. 16 Government Regulation (GR) No. GPP-1099/CR328/WS-07 Mantralaya, Mumbai, dated July 27, 2000. 17 MJP is the state’s water sector institution. 18 The zilla parishad is the local government at the district level. 19 The Godavari, Krishna, Tapi, Narmada, and west-flowing rivers in the Konkan coastal strip.

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capacity building; and hygiene education to effect behavior change. To help this endeavor, the GoI also launched the Nirmal Gram Puraskar,20 which uses cash awards to recognize the efforts of panchayati raj institutions (PRIs). At the start of the project, the GoM had fully adopted this program. 1.2 Original project development objectives (PDOs) and key indicators

To address urgent RWSS needs while setting the stage for the gradual assumption of responsibility by communities themselves, the project was expected to: (i) increase rural households’ access to improved and sustainable drinking water supply and sanitation services; and (ii) institutionalize the decentralization of RWSS service delivery to local governments and communities. The project was expected to cover roughly about 10 percent of the total GPs in the state. Several key performance indicators are used to measure progress toward the two major development objectives:

• For objective 1: (i) an increase in the number (or percentage) of households with access to safe sources of water and improved sanitation services; (ii) an increase in the number (or percentage) of tribal households with access to safe sources of water and improved sanitation services; (iii) a decrease in the incidence of water-related and waterborne diseases; and (iv) an improved outlook on the part of households toward the quality and safety of WSS—and access to it.

• For objective 2: (i) an increase in the number of GPs planning, implementing, and managing sustainable rural water and sanitation services; and (ii) an increase in the proportion of state and district investment funds for WSS transferred to GPs.

1.3 Revised PDOs and key indicators, and reasons/justifications

The PDOs were not revised. The project team nevertheless dropped an activity related to the Zilla Parishad (ZP) Incentive Fund, and the operation and maintenance pilot under component D (the pilot component) because of a lack of sufficient response from the beneficiaries. This was done following the midterm review (MTR) team’s recommendations given in 2007. Since the change was minor, it did not warrant formal project restructuring.

In addition, based on the recommendations of a quality at entry (QAE) review conducted by the Bank’s quality assurance group (QAG), the indicators were reviewed and simplified at the time of the MTR, to ensure that they were more realistic and measurable.

1.4 Main beneficiaries

By credit closure on September 30, 2009, water schemes in 2,298 GPs were fully functional, delivering potable water services to around 0.9 million rural households and covering a population of 6.7 million. Schemes in 423 tribal GPs were fully functional, delivering potable water services to 154,219 tribal households and covering an estimated tribal population of 1.1 million.21

20 Literally, “award for clean village.” 21 It is important to note that after the closing of credit on September 30, 2009, the GoM continued to implement the project, with the aim of completing all the committed activities by September 30, 2010. By then the project is expected to benefit all 3,021 GPs that were included by credit closure, in 26 out of the 33 rural districts of

3

On the sanitation front, by credit closure, around 1,848 GPs (out of which 346 are tribal) were declared open defecation free (ODF), and about 898,351 project households (out of which 162,529 are tribal) benefitted from access to safe sanitation facilities.

The women in the project GPs benefited by being able to participate in the gram sabhas, where female attendance rose from almost zero at the start of the project to 53 percent by project closure. The project empowered women to play an affective role in village planning far beyond WSS issues, laying the foundation for women’s empowerment and participation in local governance and overall development activities.

The GoM has also benefited through the saving of O&M subsidies; by September 30, 2009, the communities of about 2,298 GPs were fully meeting this cost on their own.

Finally, the GoI has witnessed the tangible benefits enjoyed by village communities because of improved WSS services. Around 1,159 project GPs received the Nirmal Gram Puraskar (clean village award) by March 2008 at the hands of the President of India and, significantly, approximately 23 percent of the award-winning GPs in the state were from the project.

1.5 Original components (as approved)

The project consists of four components: (i) community development and infrastructure building, (ii) institutional strengthening, (iii) sector development and strengthening, and (iv) piloting new initiatives (also called the pilot component). The total project cost, including contingencies, is estimated at $268.6 million, of which respective estimated shares were: the International Development Association (IDA) - $181 million, local communities - $14 million, and government - $73.6 million. The following is a full list of components and sub-components. Component objectives and outputs by credit closure are indicated in Annex-2. Component A: Community development and capacity building (cost at appraisal $187 million; revised cost22 $250.90 million)

A1 Community development

� Community capacity building.

� Women Empowerment Fund (WEF).

� Village panchayat (VP) strengthening.

A2 Community infrastructure

� Groundwater recharge and source strengthening.

� Water-supply schemes.

� Community, school, and environmental sanitation infrastructure.

A3 Tribal development program

Maharashtra, covering an estimated population of about 8.9 million people. Out of the total project GPs, around 626 are tribal GPs comprising 1,293 villages and 1,663 padas (hamlets) in 17 major districts (Thane, Nashik, Nandurbar, Buldhana, Yavatmal, Gadchiroli, Chandrapur, Gondiya, Bhandara, Wardha, Nagpur, and six other districts—Parbhani, Hingoli, Solapur, Akola, Washim, and Jalgoan), which translates into 228,236 households (over 1.646 million people), possibly the largest tribal population benefitting from any IDA-financed project. 22 Revised costs in this section represent the GoM’s total estimated cost (computed as of credit closure) for completing all the project’s components, as expected by September 2010.

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Component B: Institutional strengthening (cost at appraisal $54.6 million; revised cost $28.74 million)

B1 Capacity building

B2 Information, education, and communication (IEC), including sanitation and hygiene promotion

B3 Monitoring and learning

B4 Project management Component C: Sector development and strengthening (cost at appraisal $4.5 million; actual cost: $0.69 million)

C1 Knowledge management (KM) and policy support

C2 Water-quality monitoring Component D: Pilot components (cost at appraisal $12.5 million; revised cost $5.77 million)

D1 Local government incentive fund

D2 Groundwater aquifer management pilot

D3 O&M pilot fund

1.6 Revised components

At the MTR, the subcomponent D1 (local government incentive fund) was slightly changed to delete the ZP incentive fund portion; subcomponent D3 (O&M pilot fund) was removed completely. The deleted subcomponent constituted less than 2 percent of the total project cost and did not have any negative impact on achieving the PDOs.

1.7 Other significant changes

Not applicable. 2. Key factors affecting implementation and outcomes 2.1 Project preparation, design, and quality at entry (QAE) The project started in a facilitating environment. The year 2000 was a watershed year in the history of the RWSS sector in Maharashtra. From this year onward, the GoM operationalized RWSS sector reforms across the state, adopting community-driven development (CDD) approaches, much ahead of the Jalswarajya project’s start in October 2003. Maharashtra was the first state in India to declare a statewide RWSS policy.23 The GoM’s strong focus on sanitation, evident in programs like the Sant Gadge Baba Campaign24 and the TSC (both launched in 2000),

23 GR No. GPP-1099/CR 328/WS-07 Mantralaya, Mumbai, dated July 27, 2000. 24 To promote health and hygiene awareness in the community and thereby reduce the incidence of water-related and waterborne diseases, the GoM introduced the Sant Gadge Baba Clean Village Sanitation Campaign. Under this

5

catalyzed the process. As communities mobilized, program results were quick and visible. Banking on these returns, Maharashtra’s strong PRI25 system effectively adopted new approaches, and village communities started seeing the benefits. With the many initiatives taken up by Maharashtra, the state served as a source of information and experience for implementing large programs across wide geographical areas. It is against this backdrop that the project was conceived.

Quality at entry. The World Bank team prepared the project in close consultation with the GoM, specifically the WSSD. The project design was based on the successful results of two previous IDA-supported RWSS projects—Kerala and Karnataka II—that supported broad sector reform programs in both states. The project’s institutional structure was based on a careful analysis of the Kerala and Karnataka models and lessons learned from the failures of the institutional arrangements of previous RWSS projects. As part of its strategy to deepen the broad decentralization process down to the GPs, the GoM focused on empowering existing district and local governments and making them accountable, with necessary checks and balances. The project introduced the devolution of substantial management and financial powers to the GPs, which was a major breakthrough for Maharashtra’s decentralization effort. At the time of appraisal, such devolution stopped at the district level.

The project’s development objectives at appraisal were wholly consistent with and in support of the overall Country Strategy for India (CAS document No. 22541), specifically the aims of strengthening the environment for development and growth, and of supporting interventions that benefit the poor and disadvantaged. The project specifically implemented the CAS program priorities of: (i) supporting effective and inclusive decentralization by empowering local communities in rural areas; (ii) building and implementing consensus on key policy and institutional reforms; (iii) funding investments in rural infrastructure linked to reforms in service delivery; (iv) using NGOs and alternative service providers; (v) promoting cost sharing; (vi) targeting the poorest areas and most vulnerable groups; and (vii) integrating interventions for maximum impact.

The project fully supported the Millennium Development Goals (MDGS) of: (i) promoting gender equality and empowering women (goal 3, target 4); (ii) providing sustainable access to safe drinking water (goal 7, target 10); (iii) improving access to sanitation (goal 7, target 11); and (iv) increasing the proportion of development assistance allocated to basic social services (goal 8, target 12).

Institutional design. The project adopted a distinct institutional structure at the district level with the creation of a separate District Facilitation Team (DFT), District Appraisal and Monitoring Team (DAMT), and District Financial Management Team (DFMT). These teams had the respective roles of capacity building, appraisal and monitoring, and financial control. They drew staff from the government on deputation (government employees, paid under the project with financial incentives) and supplemented them with professionals from the private sector (a first-time occurrence at the district level); all reported to the head of the district, called the chief

campaign the rural community would be oriented toward health and hygiene habits by the Panchayati Raj Institutions and the villages would then be motivated to participate in clean village competitions, based on government-prescribed indicators. No financial support from the government was given under this program and villages participated voluntarily. This program received overwhelming support. Villages were awarded prizes for achieving a clean village status. This program turned out to be a great success in mobilizing and motivating the community toward the common cause of village development. 25 PRIs are local self-governments in rural areas.

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executive officer. The sub-district-level institutions (called blocks) and the village-level gram sevaks, however, were not involved in the project, mainly with a view to keep the supply-driven approaches of traditional RWSS delivery practices from prevailing.

In this setup, the collaboration of the government and private sector staff took time to develop. For example, the private staff looked ahead to regular salary increments, but these were not considered by the GoM. As the subdistrict machinery was not involved in the project from the beginning, coordinating implementation at the district level was found to be overwhelming and the opportunity of building closer relations with villages (possible through subdistrict units) was missed. It was only toward the end of project implementation that the GoM started to mobilize subdistrict institutions.

With the help of the districts, the project GPs have also hired a number of support organizations (SOs) and technical service providers (TSPs) to support them on social and technical aspects. 2.2 Implementation

Project readiness. The project was implemented by the GoM with the support of the WSSD. The project was supported by a PHRD grant (TF26724) of $720,000, which covered a range of technical expertise needed to assist the GoM in project preparation. The IDA supported this process through several preparation missions that utilized specialists in relevant areas. The government also carried out intensive learning studies that were critical to the project design.

In addition, given the innovative nature of this demand-driven project, the GoM chose three districts26 to implement the initial pilot of the intensive hands-on “learning by doing” phase. The lessons learned from the pilot phase were then incorporated into the overall project design.

Project implementation. Despite the initial efforts and resources mobilized to ensure readiness, in the early stages of implementation it soon became clear that some project subcomponents and addendums (or sub-sub components) were not fully designed during the project appraisal, but instead stated in only general terms in the Project Appraisal Document (PAD). Consequently, the implementing agency had to dedicate considerable effort to designing the implementation mechanisms for each subcomponent (for example, women’s empowerment, the income generation fund, and the groundwater aquifer management pilot). Within this context, the initial pilot phase was useful in consolidating the project design.

Other than this initial shortcoming, there was good overall operational performance and both PDOs were achieved. Action plans and work programs were, for the most part, fully implemented and followed through within the agreed time frame after each project supervision mission and MTR. But procurement and financial management (FM) remained somewhat weak. This weakness was repeatedly reflected in the Bank’s implementation status reports, particularly in the later stages of project implementation. On hindsight, the Bank could have taken a more hands-on approach by (i) providing recommendations on how to improve control over the project-related procurement and FM functions, (ii) addressing specific constraints on implementing the CDD approach, and (iii) providing additional training. These actions could have helped the implementing unit perform better.

Midterm review (MTR). The MTR was carried out on November 27, 2007. The MTR revealed good results; that is, most participating communities had by then accepted that their participation

26 Thane, Satara, and Osmanabad.

7

was important for the effectiveness, efficiency, and sustainability of WSS services. It was observed that the WSS reform initiatives were gradually changing the social environment, and enabling rural communities to come together in new ways. For example, one spin-off benefit was an impressive revival of gram sabhas as forums for participatory dialogue among village communities. Women were observed to be coming forward in unprecedented numbers to express their views on village development issues and were actively taking part in key decisions. More and more villages were becoming ODF, with recognition due to the GoM’s emphasis on sanitation programs. Finally, the MTR noted that the institutions at the state, district, and village levels were working harmoniously, responding to community needs, and mobilizing skills both from within the government and the private sector. The project’s implementation progress, which had been rated as unsatisfactory a year earlier, was upgraded to satisfactory in view of the targets met.

Because of the project’s satisfactory status, no major changes were proposed other than to simplify the project by reducing the scope of some pilot components and by improving project-monitoring indicators. The MTR team also encouraged the closer monitoring of activities.

Implementation performance ratings. The project teams adequately highlighted risks to the project throughout its life and suggested mitigating measures. At credit closure, there were no major implementation issues. It was suggested that the teams continue to focus on accelerating the pace of implementation and exit from the project GPs after appropriate capacity building, handing over the project to the ZPs for integration into regular programs. 2.3 Monitoring and evaluation (M&E) design, implementation, and utilization

The project successfully developed a management information system (MIS)27 capable of generating information on project performance and progress, and disseminated it among all the stakeholders. The MIS helped monitor implementation, share lessons learned, and work in partnership to achieve project objectives. It is worth mentioning that the MIS was developed internally, within the Reform Support and Project Management Unit (RSPMU), which was testimony to a well-built institutional capacity. The MIS team is capable of customizing it as required based on advice received from the project management, the RSPMU specialists, and Bank teams. All the districts use this system regularly and provide constructive feedback.

Seeing the benefits of this system, the GoM is taking steps to scale it up to integrate a number of thematic databases and to apply it across all its programs as part of its effort to streamline institutions. An integrated MIS would also be a more reliable tool for future interventions in the sector.

The GoM piloted the concept of peer-to-peer learning through community monitoring of interventions done in neighboring villages. The GoM found this approach to be low cost but of high value for communities. Moving forward, the RSPMU expects to engage some of the more efficient GPs as the GoM’s terminal nodes to monitor a cluster of nearby GPs (five or six), train them, and intervene as the GoM’s extended arm. This would reduce the cost of capacity building to the state and ultimately generate sizeable local resources to implement RWSS programs across the state (spreading over more than 250,000 sq km). This would also serve to better monitor the pulse of the programs in real time.

27 A fully functional online web-based MIS system with facility to track project progress and outcomes.

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2.4 Safeguards and fiduciary compliance

Environmental safeguard. The project design took into account the Bank’s policies and included procedures to ensure full compliance with environmental safeguards in accordance with OP 4.01. Guidelines on procedures for environmental screening, environmental assessment, consultation disclosures, and the Environmental Management Framework stated in the Community Operational Manual were further refined following the QAE in 2005, and team supervision was strengthened. Major issues addressed through the environmental framework were water quality, sanitation and environmental management in large schemes, and the environmental sustainability of different project schemes. To ensure compliance each village, as part of its village action plan (VAP), developed an environmental management plan (EMP) appropriate to its situation using the project environmental checklist. There were two separate checklists, for large and small schemes, supported by a set of implementation guidelines. The major issue to be addressed in large schemes is the appropriate disposal of: (i) sullage, considering that the amount of wastewater generated is too great to be managed at the individual household level; and (ii) backwash water from the water treatment plants (WTPs).

Some villages, such as Rendal, have developed innovative plans to sell the wastewater generated to farmers for irrigation, with the earnings to be used for the management of the water-supply system. Such possible trade-offs and alternate ways for the management of wastewater are worth documenting and disseminating as good practices for other RWSS projects and programs.

Social safeguard. The project has not resorted to involuntary land acquisition and hence OP 4.12 has not been triggered. Available information indicates that land acquisition activities have been consistent with the guidelines provided by project authorities, which were fully in line with the Bank’s requirements.

Indigenous people. The Bank’s operational policy relating to indigenous people (OD 4.20 at project appraisal, currently replaced by OP 4.10) was triggered by the tribal component of the project. The project presents best practices for tribal development as it represents the largest coverage of tribal groups in any Bank-funded project to date. By credit closure, schemes in 423 tribal GPs were fully functional, delivering water to 154,219 tribal households (both individual and group) and covering about 1.1 million members of the state’s tribal population. Noticeably, sanitation coverage (access to toilets at the household level) of tribal habitations has reached 71 percent, a sustainable number by all indications. In fact, the target communities have met all their contribution requirements and have participated in the construction of good-quality WSS schemes. Tribal youths have also been trained as paraprofessionals, who were used to ensure culturally appropriate communication in support of the scheme.

Financial management. Potential weaknesses in the area of FM, identified at the time of appraisal, did materialize in the early stages of project implementation. A major issue was GPs’ lack of capacity to move from simple bookkeeping to actual FM and to maintaining accounting records at required standards. Despite the availability of a Financial Management Manual and guidelines for financial reporting and monitoring, it was clear from the early phases of project implementation that these tools were still too complex and not fully adequate to support the project’s CDD approach, and therefore needed to be revised to reflect the reality on the ground. In addition, while the PAD and, subsequently, the Bank supervision team insisted that village accounting staff be trained in the maintenance of records (such as ledgers, asset and materials registers, and so on), more attention should have been paid to the actual constraints that the

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implementing agency was encountering on the ground. As a result, the maintenance of accounting records at the GP level remained an area of concern throughout implementation.

Compliance with annual village-auditing requirements was generally satisfactory. In most cases, the quality of audits was also satisfactory, though some delays were observed in the submission of audit reports, mostly due to the sheer number of project villages to be audited.

The recording and treatment of community contributions at the district level for accounting and auditing purposes was a problem, going up to the level of suspension of disbursements for non submission of acceptable audit reports by RSPMU (details in Annex-3). The issue could have been prevented had there been clear guidelines and a common understanding between the Bank and the RSPMU early in the project.

The legal covenant requiring a computerized FM system to be in place by September 30, 2005, was met in 2007; thus, there was a two-year lag before the accounting software was finally installed and made operational.

Procurement. Most project procurement was the responsibility of the villages, coordinated through the VWSCs, and monitored by the district units. The main procurement risk, already identified at appraisal, was related to the fact that the project’s demand-based approach was relatively new and required simplified procurement procedures and processes. In addition, an effective but decentralized procurement management system was needed to manage the large volume of contracting done at the community level and to review the relevance of procedures. To mitigate the risks, the implementing agency, through the IEC campaign, provided procurement orientation to the VWSCs. While the VAPs contained implementation plans, only limited information was provided on the specifics of the Bank procurement procedures for shopping and recordkeeping. Admittedly, the project faced daunting challenges and institutional capacity weaknesses in conforming to the project procurement guidelines. These included delays in providing and updating procurement plans and inadequate compliance with shopping procedures, adoption of model bid documents, and monitoring of procurement by the districts and RSPMU (further details in Annex-3).

Apart from procedural issues, on hindsight some CDD procurement issues could have been solved earlier in the project’s implementation if a more proactive and hands-on approach had been adopted, both by the Bank and the implementing agency. But thanks to a demand-driven and participatory approach, the project maintained good performance overall in terms of transparency and accountability. 2.5 Post-completion operation/next phase

The sustainability evaluation exercise (SEE) conducted by the GoM in August 2009 clearly showed that the project had laid a solid base for the long-term sustainability of interventions (see section 3.6 for more details). An impact assessment study28 conducted midway through project implementation in 2005 and 2007 also pointed to the positive impacts of increased access to water supply, increased toilet usage, and reduced coping costs for village communities while at the same time highlighting the need for more focus on hygiene awareness. By credit closure, the

28 Study titled: “Of Taps and Toilets: Evaluating Community-Demand-Driven Projects in Rural India”, conducted by the Environment Unit of the Bank

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GoM was considering another such impact assessment study with Bank assistance. The SEE was also useful in identifying some general issues to be addressed in order to strengthen the prospects of sustainability, including the need to: (i) install multiple programmable controllers in pump houses to tide over disruptions in power supply; (ii) install online chlorinators to replace the current manual practice of adding a bleaching powder solution to overhead tanks; and (iii) establish separate O&M bank accounts for every scheme in a GP. As part of its sustainability initiatives, the GoM is following up on these measures.

Exit process. In every GP, the implementing agency carries out a systematic exit process, with a detailed checklist of actions, to confirm that all remaining activities are properly completed. This includes the closing of books of accounts and audits, sustained capacity building for O&M, and the further strengthening and institutionalizing of district support. Since this process is time consuming, at credit closure, the Bank committed to further continue to provide technical assistance support for a year.

Statewide scaling up of the Jalswarajya approach. The GoM has decided to institutionalize Jalswarajya’s demand response and decentralized service-delivery approach across the RWSS sector in Maharashtra, with immediate effect. The government resolution—dated August 1 and August 25, 2009—provides detailed guidelines for new policies, procedures, institutional structures, and implementation arrangements for the planning, implementation, and O&M of the state’s RWSS schemes. One of the important features of the new institutional structure is that its staff will be multidisciplinary, like that of the Jalswarajya project, whose experienced staff will be absorbed into the new institutions. The GoM is planning to request continued Bank support of this new initiative. 3. Assessment of outcomes

Overall rating: Satisfactory

3.1 Relevance of objectives, design, and implementation

The relevance of PDOs is high—they are as relevant to the country’s water sector development needs today as they were at appraisal. They rightly focus on streamlining institutions, at both the state and district levels, and on making sustainable WSS services available in Maharashtra.

At the state level, the project effectively catalyzed reform initiatives, providing new institutional models for decentralized service delivery. It has helped increase acceptance of community participation and demand-responsive principles on the part of all stakeholders, including politicians, government functionaries, and community members. It has also triggered the creation of support agencies in districts, which sets the stage for future government programs. Most importantly, thanks to the project, Maharashtra, a predominantly male-dominated society, has now accepted the involvement of women in village governance as a must for its development.

At the village level, the gram sabha has become an active forum for local self-governance, decision making, and accountability. New initiatives, such as local governance incentive funds and aquifer management processes, have been tested for wider replication across the state. Linkages with the Geological Survey and Development Agency have also been successfully established to use existing technical skills in groundwater management.

3.2 Achievement of project development objectives

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PDO 1. Increase rural households’ access to improved and sustainable drinking WSS services.The project has delivered results on the ground by increasing water access and improving sanitation in the project GPs. By credit closure, water service was fully operational in about 2,298 GPs (76 percent of the project total), constituting around 0.9 million households and 6.7 million people. After credit closure, the GoM plans to commission water services in all 3,021 project GPs, to reach all 8.9 million targeted beneficiaries by September 30, 2010, 29 and to then formally exit from these GPs.

By credit closure, the project had built around 4,140 new piped water schemes, with increased service levels and household connections—on average covering about 78 percent house connections (HSCs) (57 percent – direct; 21 percent – group) and the remaining 22 percent of households depended on either borewells or handpumps. The communities, including tribal groups, have contributed their fair share to the capital costs ($20.72 million). The fact that over 65 percent of the GPs collected O&M costs from consumers for 3–6 months in advance is an indicator of the project’s sustainability.

Around 1,848 GPs in the project (including tribal GPs) have also become ODF, thanks to the project’s awareness-raising efforts, backed by the intensive TSC adopted by the GoM across the state. The project has provided capacity-building support for sanitation, while the GoM has financed toilet construction through the TSC program. Apart from making the areas ODF, increased awareness of solid waste management has led to improved levels of environmental sanitation at the village level. The project has also provided support for building soak pits and compost pits, connecting drains for sullage water, and building end-of-village sullage treatment units.

Rural water services in about 423 out of the 626 tribal GPs are already fully operational, benefiting about 1.1 million tribal members; and about 346 tribal GPs (55 percent) have become ODF. The tribal GPs are now enjoying reliable and safe WSS services for the first time ever.

PDO 2. Decentralize rural WSS service delivery to local governments and communities. At the village level, the GPs and VWSCs have successfully planned, designed, and constructed water-supply schemes and sanitation facilities that are fully functional, against which a tariff is being collected for O&M purposes.

Governance and accountability have been strengthened through gram sabhas and social audits. Gram sabha attendance and the regularity of meetings have significantly improved; women’s participation in gram sabhas has increased considerably. Seeing this success, the GoM is now adopting more or less the same approach in all programs across the state, irrespective of funding source. The new approach involves the principles of demand-driven selection, community participation, decentralized planning, and devolvement of power to the GPs and VWSCs.

With a new government regulation (GR) issued in August 2009, this new approach has been formalized and is going to be scaled up. In order to operationalize and implement the GR, the RSPMU created under the project will be retained and institutionalized as the WSS organization to lead the sector reform process. These are the greatest indicators of the success of Jalswarajya in achieving PDO2.

29 The ultimate population that will be reached in these villages after 15 years.

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In addition, another GR was issued in August 2009 to ensure that the GP’s sarpanch30 become the president of the VWSCs and a gram sevak31 become its secretary. This would consolidate the position of the VWSCs as an integral part of the GP. Moreover, the GSDA has been given the role of strengthening the water-supply sources in tanker-fed villages, villages facing overdeveloped watersheds, and in low rainfall zones. 3.3 Efficiency (Net present value [NPV]/economic rate of return [ERR]; cost effectiveness, for example, unit rate norms, least cost, and comparisons; and financial rate of return)

An ex-post economic analysis of water-supply investment was carried out. Based on the key benefits (derived and expected) from the project, at a project cost of $286 million, the ERR for the project at credit closing was calculated at 23.22 percent. The NPV of the project (at an assumed discount rate of 12.5 percent) was calculated at INR 7,594 million ($165.1 million, at an exchange rate of INR 46=$1). This compares well with a similar analysis done at the time of project conceptualization. The design cost of the project at that time was $268 million, projected ERR was 19.85 percent, and the NPV of projected costs and benefits was $89 million. For a project with such far-reaching and intangible impacts, the actual scale of benefits was far beyond the financially computed return.

Unit rate efficiency comparison. Capital cost per capita for the Jalswarajya schemes is lower than that of other schemes in Maharashtra (INR 1,043 in the Jalswarajya schemes as compared to INR 2,116–2,346 in other schemes, resulting in a saving of about INR 1,188 per capita). In another study, the “Effectiveness of Rural Water Supply Schemes in India,” conducted by the Bank in June 2008, it was estimated that in the Jalswarajya villages, at a consumption level of 40 liters per capita per day (lpcd) on average, the savings in O&M cost per household per month would be around INR 69.1 due to the improved efficiency of operations. The cost of water supply in demand-driven schemes is lower than that of supply-driven schemes. 3.4 Justification of overall outcome rating (Combining relevance, achievement of PDOs, and efficiency)

Rating: Satisfactory

The overall outcome of the project is rated as satisfactory on the basis of the high relevance of the project, the level of achieving of PDOs, the efficiency of investments made, and community members’ satisfaction as revealed during the beneficiary surveys conducted before the ICR mission.32 While a satisfactory rating has been provided, some aspects of the project outcomes could be considered highly satisfactory, in particular tribal coverage, the mobilization and empowerment of women, and the GoM adoption of Jalswarajya at the state level, including the integration of the RSPMU’s project management system across all its programs.

An impact assessment study was carried out by the Bank’s environment unit (SASDE) during project implementation (in 2005 and 2007), covering about 10,000 households in 95 project villages of 4 project districts (Nasik, Buldana, Osmanabad, and Sangli) and in 147 control villages of the same profile in the same 4 districts. At that time, when the project was yet to be

30 The sarpanch is the elected head of the GP. 31 Nominated secretary of the GP—an administrative representative of the government. 32 The assessments carried out were: sustainability evaluation through community participation, intervillage community monitoring, and assessment of benefits to tribal GPs.

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completed, the study concluded that investments were reaching the people, who are using more water and enjoying the benefits of better sanitation, and that there was a good chance of sustainability in the project villages. The other conclusions of the study are given in section 3.6. 3.5 Overarching themes, other outcomes, and impacts

(a) Poverty impacts, gender aspects, and social development

Poverty impact. The project has reached the poor population at the grassroots (village) level, people who otherwise would not have been reached through public sector agencies. Supporting villages implies reaching more people living below the poverty line. The project also boasts a best practice example for tribal development as it represents the largest coverage of tribal groups of any Bank project to date—by credit closure it had reached close to 1.1 million tribal people with improved water supply.

The SHGs created at the village level have successfully taken up income-generation activities. About 28,340 out of the 49,308 SHGs under the project have earned an average of INR 1,500–2,000 per month per female member. There are 49,308 SHGs in the project GPs, with 739,626 women members, 28,851 of whom are engaged in income-generating schemes (IGSs). Field experience shows that these women earn, on average, INR 40–60 per day (around $1–1.5) from IGSs.

Gender aspects. In more than 3,000 GPs, women have benefitted from being able to participate in gram sabhas. The project has thus empowered women to play an effective role in village planning, implementation, and management, and their involvement has gone far beyond WSS issues. The project has laid down the foundation for women to participate in local governance systems and overall development activities.

Social development. The project has helped empower local communities and improved their voice and choice. The transparent processes employed, inclusive of local-level social audit mechanisms, and the emphasis on gram sabhas have helped strengthen local governance systems.

Community management of groundwater. The project has adopted the concept of water budgeting at the village level. Under this approach, each project GP displays the water availability data (water received through precipitation, run off, irrigation use, domestic use, and so on). While the scientific validity of the exercise is questionable, this approach helped focus community attention on the need to conserve water and put indirect pressure on an controlled extraction by private farmers. Through this exercise, the villagers know the overall water replenishment and withdrawals for various purposes, resulting in effective local initiatives for control of groundwater use. The aquifer management pilot, with early indications of success, also contributed to changing the sector approach to managing groundwater giving a strong focus to community based actions. Further scale-up can lead to sustainable use of groundwater in a state with predominantly hard-rock strata.

(b) Institutional change/strengthening

The institutional objectives vis-à-vis implementation of the decentralized service-delivery approach through GPs and communities were not only achieved but far exceeded; the project was instrumental in preparing the state for further scaling up.

The creation of a Water and Sanitation Mission (WASM) at the state level, with representation from various senior administrative officials as a policy-making body; the GoM’s plans to

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upgrade the RSPMU as a water supply and sanitation support organization (WASSO), with expertise derived from the market and other government agencies as an executive body supporting the WASM; and the GoM’s plans for creation of similar units at the district level are critical indicators of the project’s contribution to the long-term strengthening of state institutions. The GoM’s plan to integrate the RSPMU’s project management systems across all its programs has considerably increased the capacity of the GoM to manage projects and monitor performance on a regular basis.

The SHGs created at the village level are expanding their capacities to take up roles as O&M operators at the village level for WSS schemes.

The project has also set out to restructure the state’s water sector institution, the MJP, to improve its effectiveness. This institution was earlier involved in the execution and maintenance of water-supply facilities for both municipal bodies and regional rural water schemes. By credit closure, a plan was prepared to set up two separate companies from the MJP to provide need-based support to the municipalities and multivillage schemes—one focusing on the execution of major capital works and the other on supporting O&M. The GoM is expected to further refine the plan and to respond appropriately, based on its strategies in both the urban and rural water sectors. (c) Other unintended outcomes and impacts (positive or negative)

One stand-out benefit was the employment that the project was able to generate by being implemented at the village level, and the creation of SOs and TSPs at the district and village levels as resources for the future—not only for the WSS sector but for all other sectors. Also, the increased capacities of the VWSCs have helped villages to apply similar approaches to the development of other sectors.

The project has also created local leadership capacities. Many of the committee presidents/members of the VWSC/Women’s Development Committee (WDC)/social audit committee (SAC) were subsequently elected as local leaders to the PRI institutions.33 In addition, the women SHGs have been encouraged to become small-scale service providers for the GP, managing O&M and collecting water fees. This shift is possible and sustainable thanks to a new culture of paying for services received—a culture that was introduced by the project.

In recognition of all its positive direct and indirect impacts and outcomes, the project received the “People’s First Award” from the Social Development Unit of the Bank at the Bank’s Sustainable Development Forum in 2010, where it competed against other projects financed by the IDA/Bank. 3.6 Summary of findings of beneficiary survey and/or stakeholder workshops

The following assessments were carried out during project implementation:

Impact assessment study (conducted in 2005 and 2007; see section 3.4)

Sustainability evaluation through community participation (August 2009)

Intervillage community monitoring (August–December 2009)

33 For example, an internal assessment carried out by the GoM in 538 GPs where elections were held during the project period indicated that the VWSC members of these GPs have been elected as follows: 281—GP presidents; 33—ZP members; 1—member of the state legislative assembly.

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Impact assessment study. This study indicated that, even as the project was under implementation, about 10 percent of additional households had gained access to water supply; toilet use went up from 16 to 34 percent; household water consumption went up by 11 lpcd (from 30 to 41 lpcd); monthly coping costs reduced by about INR 500/household/month in summer and INR 378/household/month in the rainy season. Further, the study concluded that there was a 50 percent higher chance of communities contributing to the water-supply scheme and 25 percent of having an active VWSC. Even better results were reported in the villages, with more than 50 percent of households having access to water (through HSCs) and toilets. But the study could not find significant behavioral changes in terms of hygiene, and no change in water quality, and so could not document health impacts during the study period. The study therefore recommended: (i) increasing water-supply access to households through HSCs and increasing access to sanitation through toilets; and (ii) strategizing the IEC and capacity-building efforts to support desired hygiene practices. The GoM is actively implementing these recommendations and also planning to carry out another round of impact evaluations after the project is completed.

Sustainability evaluation through community participation. In August 2009, the RSPMU, through its district teams, carried out a participatory SEE (on source, institutional, technical, and financial parameters) in a representative sample of 52 project GPs (two per GP) in Phase I, and later in October 2009, in 104 other GPs. The results showed that out of the 156 GPs participating in Phases I and II, scheme operations were highly sustainable in 26 GPs (17 percent), highly likely for 115 GPs (74 percent), likely for 13 GPs (8 percent), and uncertain for 2 GPs (1 percent). With only 1 percent of the sample showing uncertain sustainability, the project is very likely to sustain this success over the years after its closing date (further details in Annex-6).

Community monitoring. The project undertook intervillage community monitoring exercises between August and December 2009, covering 60 GPs in all 26 districts. This is the first-of-its-kind exercise in any of the Bank-supported RWSS projects in India, wherein the community of one village visits another village for observation of its services, systems, and institutions. The objective is to develop a forum for sharing, analysis, and learning. The results indicated: i) high levels of satisfaction (99 percent) of community with improved service levels; ii) provided pointers to sustainability of schemes (high source sustainability – 90 percent; tariff collections in all GPs – 81% GPs collected O&M funds more than required expenditure); and other benefits to community in terms of time savings in collection of water etc (further details in Annex-6). 4. Assessment of risk to development outcomes

Rating: Low

The likelihood of changes that would be detrimental to the ultimate achievement of the project’s outcome is low. The GoM has already adopted similar initiatives across statewide RWSS programs. At present there is sufficient political commitment to policy reforms by the GoM and GoI to scale-up successful endeavors. Most of the elected gram sabha leaders have shown great interest in continuing this trend and have signaled to the GoM their willingness to request an even larger amount if a new IDA/World Bank project were to become available in future.

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5. Assessment of Bank and borrower performance

5.1 Bank performance

Overall Rating: Satisfactory

(a) Bank performance in ensuring quality at entry


The project was formally reviewed through the QAE process by the QAG on July 19, 2005. The panel rated the overall QAE of this operation as moderately satisfactory while the dimension of Strategic Relevance and Approach was rated as highly satisfactory. With two minor exceptions, all the other quality dimensions and the Bank inputs and processes were rated as fully satisfactory. One exception was the implementation arrangements, rated as moderately satisfactory because of the failure to further advance the introduction of an M&E system during project preparation, leaving much of it to the implementation stage. The other exception was the moderately unsatisfactory rating of environmental aspects, largely due to insufficient quantitative analysis on how to deal with adverse environmental issues. In retrospect, the project may be considered fully satisfactory as it successfully met its objectives of increasing rural household access to improved drinking water and sanitation services and decentralizing WSS to local governments and communities.

(b) Quality of supervision


The supervision teams worked extensively with the GoM during the first 2 years of implementation in 26 districts, and selected GPs to carry out project activities. The supervision teams continued their hands-on approach and remained close to the clients, which earned them praise throughout the country as well as in the Bank. The field presence of the Bank supervision team, from September 16, 2005, onward (TTL based in India) was instrumental in maintaining a continuous dialogue with the GoM, specially with the changing leadership within the WSSD and RSPMU.34 This partnership was also essential in maintaining effective coordination with other partners (donors, NGOs).

Procurement. The implementing agency did not fully appreciate the significance of procurement in improving the overall quality of project implementation and mobilizing much-needed institutional capacity early. Meanwhile, Bank guidelines were mostly applied in a rigid manner, without much effort to adapt them to the specific requirements of the CDD project and the reality on the ground. The procurement postreviews could have been conducted earlier in the project to identify problem issues and find solutions. In addition, the scope of postreviews did not generally include field visits; instead, villages’ procurement documentation was brought to the state level. Field visits by the postreview team, supplemented by a greater investment of time and energy by the Bank team in supporting communities and providing guidance on a real-time basis, could have fostered the due diligence lacking in many instances. The sheer size of the program and its logistical constraints could be seen only in hindsight and may be a lesson to be kept in view while preparing future CDD projects.

34 The principal secretary of the WSSD changed thrice during the course of project implementation (Mr. B. C. Khatua; Mr. V. S. Dhumal; and Mr. A. K. Jain). Similarly, the project director of the RSPMU has also changed thrice (Mr. Sudhir Thakre; M. Sanjev Kumar; Mr. Rajan Khobragade).

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Financial management. Because of a decentralized implementation arrangement, FM supervision remained somewhat challenging at the district and village level. Bank-accredited FM specialists were part of every supervision mission in an attempt to maintain a hands-on approach. During the supervision missions, an FM team of two to three members conducted intensive field visits to a sample of districts including the GPs. During these visits, the FM arrangements were reviewed, issues identified and discussed with the project management, and mitigation measures agreed upon. The Bank also helped by participating in the meetings between the implementing agency and the auditor general (AG) offices to enhance the understanding of the issues by all parties. Despite these efforts, the treatment and handling of community contributions in district accounts remained a prickly issue. This and other issues led to the project remaining under statement of expenditure (SOE) suspension for nine months under OP/BP 10.02. A clear guideline on the treatment of community contributions and a focused review of compliance from the beginning of the project could have avoided such problems. (c) Justification of rating for overall Bank performance Rating: Satisfactory

The overall quality of Bank supervision was rated as satisfactory. In the context of achieving the PDOs, it must be highlighted that the borrower and the sectoral stakeholders widely acknowledged the Bank’s support during project supervision. This support went far toward setting the stage for future development in the WSS sector and for Maharashtra becoming a role model for the rest of India.

5.2 Borrower performance

Overall rating: Satisfactory

(a) Government performance


The government’s performance is rated as satisfactory on the basis of its strong supporting role during project preparation and implementation. Because of the good dialogue maintained, the project always enjoyed support from both the old and new governments, whose top priorities matched perfectly with the PDOs, especially the decentralizing of WSS services at the village levels. The government also repeatedly hinted at scaling up the model to eventually cover the entire country.

(b) Implementing agency or agencies performance


The implementing agency’s performance was rated as satisfactory. The reform support project management unit, under the WSSD, implemented the overall project and went the extra mile to achieve the PDOs. It organized several workshops to introduce the projects to 26 selected districts, disseminating technical information. It was successful in developing a robust MIS database to track real-time progress of project activities. The implementing unit succeeded in establishing a good rapport with the district teams, various regional facilitation units, as well as the gram sabha (at the village level), an element considered essential to effectively implementing activities in over 3,000 GPs. Its institutional capacity was also proven to be adequate to provide technical assistance to an increasing number of districts.

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The RSPMU nevertheless fell short of adequately carrying out the required fiduciary activities (such as timely financial audits and financial monitoring reports, procurement monitoring, and so on). In the districts, there was lack of clarity regarding procurement oversight. In this process, there was too much reliance on the VWSCs to handle procurement and inadequate support at the village level, which led to weaknesses in compliance with the agreed procurement guidelines.

(c) Justification of rating for overall borrower performance


Overall borrower performance takes into consideration both the government and the implementing agency’s performance during preparation and implementation. On the basis of the justification provided above, the borrower’s overall performance was rated as satisfactory. At the time of project closing, the borrower had complied with most of the covenants and agreements needed to achieve development outcomes. 6. Lessons learned

The design and implementation of the project offers the following considerations that might be useful in shaping future projects of this nature:

(1) Demand-driven approach and participation are critical to the sustainable delivery of RWSS. While the VWSCs were created in 2001, it was only through the implementation of the project that the approach to the delivery of the RWSS in Maharashtra witnessed a real shift from being supply driven to demand driven. The project clearly demonstrated that investing in participatory processes to identify, articulate, and satisfy the demand for WSS services at the level of the GPs might start slow, as it requires time to develop local capacity and decentralize delivery, but that the process pays off over time. In fact, the project registered a slow disbursement curve during the first two years of implementation and a very fast acceleration over the last three years, once capacities and local systems for service delivery were in place. The strategic use of community-empowering tools—for example, peer-to-peer learning, start-up grants for capacity building and women’s empowerment, and incentives for good behavior—greatly contributed toward activating the VWSCs, building trust in the program, and fostering innovative approaches for sustainable service delivery and O&M.

(2) Initial capacity building is an important activity to prioritize before the formation of local committees. The project introduced an initial capacity building fund (ICBF) through which a sum of INR 40,000 (around $1,000) was released immediately once the villages were selected. This money was used for organizing observational visits for a substantial number of villagers to model villages. Interestingly, this had several impacts: (i) the immediate release of money, however small, improved project credibility, and people realized that this was not a routine government project; (ii) exposure to other villages motivated communities to initiate implementation (seeing is believing) even before any investments were made; (iii) the selection process for village committees improved after the visits were organized (a busload of men and women went on each visit), and this created a threshold level of willingness and motivation.

(3) Sustainable operation and maintenance (O&M). Despite the fact that fully sustainable O&M of the assets delivered by the project has not yet been achieved across all the target GPs, the project created a basis for future sustainability by introducing the culture of

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paying for a service. This was a new concept for villages, which for decades had been accustomed to expecting free service delivery from the government, and the shift was possible only thanks to community participation and a high level of transparency. End users are now aware of the costs of delivering services and are more than willing to pay them. In addition, the project supported outsourcing the collection of water-use fees to women’s SHGs, leading to very successful outcomes in terms of cost recovery and O&M. As a result, the use of SHGs as small-scale water providers was institutionalized in the GR of August 2009, to be extended to the whole of Maharashtra.

(4) Special needs of quasiurban and periurban areas. A key lesson emerging from project implementation is that communities can be more effectively mobilized in smaller villages with more cohesive social backgrounds. When the population is in the range of 10,000, implementation becomes increasingly complex and requires different approaches. In fact, larger villages behave like small municipalities, where the end users are less willing to become directly involved in implementation and O&M, and politics play a stronger role. Different processes for delivery and O&M are then required. The situation becomes even more complex in the case of periurban areas, where the additional dimension of having to coordinate with a large urban area further complicates sustainable WSS delivery.

(5) Integrated village development and the need for coordination among different sectors at different levels. Through the delivery of WSS services, the project has provided a new model at the village level that could be extended to and/or bundled with other services (for example, health, education, street lighting, solid waste management), depending on specific village needs, in order to achieve the multiplier effects of integrated development. But coordinating sectors and programs is a challenge; in some of the most successful villages, the GPs took the lead in promoting such integration. A similar level of integration would ideally be achieved at the block and district levels, and the GoM is committed to launching a statewide policy to promote such integration.

(6) Aquifer management and multivillage collaborations. Even if on a limited scale, the Component D2 (groundwater aquifer management pilot) has demonstrated that villages sharing common aquifers can successfully work together to recharge groundwater tables. This is an important lesson that should be scaled up to the national level to ensure the future sustainability of critical water sources that are otherwise quickly depleted.

(7) Integrated M&E system and monitoring cycle. While the project successfully implemented an MIS system to manage all project data, the system was never fully integrated to measure indicators across project components and to produce comparable data. For example, each subcomponent had its own data set and M&E system; data collected using different methodologies could not be integrated across components. In addition to weak horizontal integration, the data collection systems did not always allow the easy transfer of data between the local and central levels due to lack of vertical integration. Based on this lesson, the GoM is currently assessing the M&E system to identify weaknesses and gaps and to develop an integrated MIS to support the next phase of the project.

(8) Adaptation of fiduciary requirements to the demand-driven approach and large-scale intervention approach. Several lessons can be drawn from the experience of the project both in terms of procurement and FM.

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• First, a hands-on approach was needed to adapt fiduciary guidelines and procedures to the reality on the ground. In this regard, the Bank team should have regularly visited sample villages to gauge the evolving situation and identify innovative solutions. A simpler version of direct contracting up to a realistic contract value threshold could have better facilitated village-level procurement. Similarly, a simpler version of the procurement plan suitable to CDD projects could have been provided. Postprocurement reviews should have been conducted regularly from early on, by visiting the sample villages rather than asking that procurement documents be brought to the state level. The reviews should have also assessed institutional weaknesses and clarified staff roles. This could have revealed systemic problems early on in the project.

Similarly, a simpler accounting method suitable to village accounting (such as cash books, stock records, and so on) and more aligned to the systems adopted by the GoM under its own acts would have been helpful. The handling of community contributions, a critical issue, should have been clarified with clear guidelines to be reviewed by the implementing units.

In addition, a greater amount of knowledge exchange across similar projects would have increased overall efficiency.

• The project utilized an iterative approach that required a good monitoring and learning system to ensure compliance. To this end an MIS system was developed, but it needs to be further strengthened and built upon to support the future scale-up of interventions (particularly in light of the RSPMU’s likely transformation into a WSS organization for the GoM).

• Also, given the vast scale of the project’s coverage and the future scale-up of its approach to the entire state, it is very important to build as much as possible on existing local human resources and capacities. This is a better approach than simply increasing the number of staff or creating new functions at the local level. For example, gram sevaks who are already familiar with the GoM’s procurement and FM procedures could more easily learn about additional project requirements and provide the necessary support to GPs. The staff at the block level (subdistrict) could better monitor fiduciary aspects as well as issues related to project implementation. Also, experienced villages in exit status could transfer their experience to other villages. Overall, the simplified guidelines and procedures developed under the project should be formalized and used as a reference for the future scale-up of interventions.

7. Comments on issues raised by borrower/implementing agencies/partners

(a) Borrower / implementing agency The Government of Maharashtra provided comments on an earlier draft of the ICR (see Annex 8 for the detailed comments) expressing overall satisfaction with the quality of the document and the way it captured outcomes and performance, commending the capacity of the ICR to capture lessons both in terms of best practices and shortcomings. In addition, the GoM strongly recommended to objectively capture the key lessons with regard to Procurement and Financial Management, which was done in the revised ICR under Section 6 above. Other generic comments provided by the GoM focused on the need to provide

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additional documentation with regard to project impact and its future institutional sustainability, which were responded to under the relevant sections and annexes in the revised ICR.

(b) Co-financiers Not applicable.

(c) Other partners and stakeholders (e.g., NGOs/Private Sector/Civil Society)

Not applicable.

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Annex 1. Project costs and financing

(a) Project cost by component (in US$ million equivalent)

Components Appraisal estimate

(US$ millions)

Actual/latest estimate (US$

millions)

Percentage of appraisal

A. Community development and infrastructure building

174.00 250.90 144.19

B. Institutional strengthening 52.00 28.74 55.27C. Sector development and

strengthening 4.50 0.69 15.33

D. Pilot component 11.50 5.77 50.17E. Unallocated 10.00 0.0 –

Total baseline cost 252.00 286.10 113.53Physical contingencies 4.10 0

Price contingencies 12.50 0Total project costs35 268.60 286.10 113.53

Total financing required 0.00 286.10 113.53

(b) Financing

Source of funds Type of co-financing

Appraisal estimate (US$ millions)

Actual/latest estimate36 (US$ millions)

Percentage of appraisal

Borrower 73.60 70.93 96.37Local communities 14.00 20.72 148.00

IDA 181.00 194.45 107.44268.60 286.10

35 Total project costs estimated to complete the project in all respects, even after credit closure (target set by the GoM for completion is September 30, 2010). 36 By credit closure, this was the position.

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Annex 2. Outputs by component37

Component A: Community development and capacity building (i) Community capacity building

Objectives. The objective of this component is to facilitate the formation of an inclusive, responsible, and skilled VWSC and to build its capacity so as to empower it to plan, implement, operate, and maintain the WSS facilities through a participatory process of informed decision-making and collective action within the sphere of the gram sabha and GP.

No

Item

PAD target Status at closing

1 No. of districts undertaking project implementation 26 26 2 No. of GPs selected 2,800 3,021 3 OFAs signed 2,800 3,288 4 GPs conducting mahila and gram sabhas (per month) 2,800 3,021 5 Release of ICBF 2,800 3,277 6 Formation of committees (VWSC, SAC, WDC) 2,800 3,218 7 Capacity-building plan prepared and appraised 2,800 3,164 8 SOs appointed NA 3,277 9 Baseline surveys completed 2,800 3,215 10 PRA completed for source identification/strengthening 2,800 3,194 11 VAP appraised 2,800 3,119 12 Community contribution collected 100% 98% 13 No. of schemes commissioned NA 2,298 14 No. of paraprofessionals appointed/trained NA 15,200

Village-level institutional achievements are the following:

Institution/ committees

Functions

Institutions formed

VWSC Planning and implementation arm of GP 3,218 WDC Facilitates empowerment of women (voice and choice) 3,218 SAC Oversees project processes/outcomes 3,218 VWSC subcommittees

Assists VWSC in procurement/finance/supervision functions

9,708

Gram sabha Final decision-making authority 108,792 Mahila gram sabha

Ensures active participation of women in the gram sabha

108,792

Pada committee Maintains water-supply/sanitation facility for a habitation (tribal GPs formed; tribal committees formed)

577/573

GPs Decentralized local government accountable to local citizens 3,021

37 Shows status at credit closing, that is, by September 30, 2009.

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Training No. of training workshops conducted 56,728 No. of persons trained 2,097,325

(ii) Women Empowerment Fund

Objective. This component aims to empower women to play an effective role in villages in the planning, implementation, and management of WSS facilities.

No Item

PAD target

Status

at closing

1 No. of districts undertaking project implementation 26 26

2 No. of GPs selected 2,800 3,391

3 No. of WEF proposals appraised and approved 2,800 3,045

4 Additional SHGs promoted by Jalswarajya NA 29,976

5 Existing/defunct SHGs revived NA 19,332

6 GPs where % of women members in VWSC/SAC/WDC >= 50% 2,800 3,021

7 No. of GPs where SHGs linked to other departmental programs NA 20,203

8 New economic activities promoted NA 28,851

9 No. of GPs conducting mahila/gram sabhas regularly 2,800 3,021

10 No. of GPs where women attendance in gram sabhas >=40% 2,800 3,021

11 No. of SHGs functioning NA 49,308

12 WEF plan prepared 2,800 3,021

(iii) Village Panchayat Strengthening Fund (VPSF) Objective. To build the institutional capacity of the VPs to enable them to perform a guiding, coordinating, and monitoring role of project implementation at the village level.

Activities under VPSF PAD target

Status as of closing

Procurement of furniture, loudspeaker set, camera, library books, and stationary; printing expenses; remuneration of accountant; purchasing of computer, TV, VCD player, chairs, tables, cupboards, mandap, and generator; painting expenses; resource center; and so on.

2,800 3,163

A2 Community infrastructure (i) Groundwater recharge and source strengthening Objective. To ensure that rural water-supply schemes are constructed around a groundwater resource that is dependable.

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Sources. Under the groundwater management component, the GPs have sourced their water supply from different kinds of sources—both groundwater and surface water. A majority of sources are groundwater based (almost 98 percent), with a limited number of surface water sources such as rivers, canals, and irrigation tanks tapped through trench galleries/jackwells. Wherever possible the existing dug wells have been deepened/repaired.

Achievements. The key strength of the project was to involve the community in identifying potential source locations and then using the district geologists’ technical expertise to confirm the sources. Due to this practice, the community was very satisfied and the sustainability of the sources was 97 percent. An unintended benefit is that by credit closing, out of the 1,114 project villages/hamlets that were being supplied water through tankers earlier, 981 villages now have sustainable water sources and thus no need of tankers.

Different types of sources and their completion status

Groundwater source type

Total

Completed Ongoing Not

started Dug well existing—deepening 1,025 1,005 7 13 Dug wells existing—minor repairs 524 484 25 15 New dug wells 786 739 47 0 New dug wells w/piped water schemes 2,277 2,248 29 0 Borewell with hand pump 1,805 1,798 2 5 Borewell/tubewell w/power pump 365 362 1 2

Total 6,782 6,636 111 35 98% 1.6% 0.5%

From the above table, it can be seen that about 98 percent of the groundwater sources have been completed, with a limited number yet to be started while others are ongoing. Out of the sources selected, a small number have failed due to (i) unfavorable hydrogeological conditions, that is, hard-rock strata, a limited aquifer, or high run-off rates; (ii) inadequate rainfall; or (iii) a collapsing of sources (particularly in the Nandurbar district). Due to this failure, 76 wadis had to be supplied with tankers, particularly in drought-prone districts with rocky strata, when the water availability reduced/sources failed. Type Total Inadequate

Yield %

New dug wells 3,065 102 3.32 Bore wells/tube wells 2,170 66 3.04

Total 5,235 168 3.21

Various types of strengthening measures and their status Rooftop rainwater harvesting 939 12 1.2 Cement Nalla Bandhara (local term for concrete bund) 346 1 -Hydrofracturing of borewell 454 1 - Unconventional measures 9 0 0 Other structures 903 9 1 Total 2,651 23 0.9

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Best practices. Various existing practices of the GSDA for source strengthening—including innovations developed by the GSDA such as bore-blast techniques, fracture sealing by cementation, and hydrofracturing—have been adopted vigorously under the project. The village sources have been located nearer to habitations as far as possible, integrating the traditional wisdom of villagers with the technical skills of district geologists. This has reduced the overall cost of source development and increased sustainability. (ii) Water-supply schemes The objective of this subcomponent is to develop cost-effective and sustainable water-supply facilities either by improving existing facilities or by setting up new facilities through a process of community consultation, collective action, and technical facilitation. Achievements. Apart from creating highly sustainable water-supply facilities, the project has many notable achievements to its credit. These include: (i) design and successful implementation of water-supply schemes, with per capita supply of 40 lpcd, and provision of HSCs for about 77 percent of households with 100 percent HSCs in several schemes resulting in the removal of public standposts; (ii) planning of almost all water supply schemes as single-village schemes with local sources and ensuring sustainability of the sources; (iii) a per capita cost for implementing water-supply schemes of $23 (INR 46=$1), which includes the cost of physical infrastructure and is less than the prevailing norms in the state (ranging from $46 in the non-Konkan region to $51 in the Konkan region); (iv) provision of disinfection facilities and prompt use of the same to ensure supply of safe drinking water; (v) community operating schemes controlling pumping hours to suit their water requirements despite erratic power supply (beyond the control of communities and the water-supply department), and also installation of multiple programmable pump controllers (ROBOTs) to ensure control of pumping hours for power and water conservation; (vi) ensuring full-cost recovery including provision for depreciation with minimum average levels of six months of tariffs in O&M accounts (with tariffs ranging from $7.8 to $26 per year); and (vii) installation of water-recycling facilities for agriculture reuse at some places. Best practices. Best practices were adopted by several community in the project. Notable practices are: (i) in Kharsundi village (Atpadi Taluk), where the women persuaded the community to opt for the rejuvenation of the existing water-supply scheme over a new scheme, thus saving about INR 100 lakhs ($217,400) in construction and O&M costs; and (ii) the artificial recharge for development of sustainable sources, through a participatory approach in Ussara village (Bhandara district). Status of house connections. As a policy, the GoM aims to achieve 100 percent coverage either with individual HSCs or group connections,38 thus eliminating standposts. The RSPMU had also targeted a minimum 80 percent coverage with HSCs before exiting from the GP and is making efforts toward this. By credit closure, 78 percent of project households (57% - direct, rest - group) had been provided with HSCs.

38 Wherever households cannot afford individual connections, they come together and establish a group connection.

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A3 Tribal development program The objective of this subcomponent is to build the institutional capacity of tribal groups and to improve their access to sustainable WSS services with specific focus on tribal settlements. The Tribal Development Plan (TDP) includes financing of the following activities: (i) community development, including technical assistance in building the community-level capacity of tribal populations to self-manage their activities; (ii) support of infrastructure for drinking water supply including source strengthening, water conservation and recharge measures, community sanitation, and environmental and hygiene promotion; (iii) development of paraprofessionals especially for supporting health initiatives; and (iv) empowerment of tribal women and youth by implementing the WEF. Tribal Development Plan (TDP). Consistent with Bank policy (OP 4.10, formerly OD 4.20), a TDP has been prepared as an integral part of this project. Recognizing local needs, the plan provided for nearly 12 percent39 of project costs, the largest single allocation dedicated to tribal communities. The component objective is to build institutional capacity of tribal groups and to improve their access to sustainable WSS services.

Out of the 26 Jalswarajya districts, this subcomponent was implemented in 626 tribal GPs of 17 districts of Maharashtra. Progress to date:

No

Item

PAD targets

Status as of closing

1 No. of districts undertaking project implementation 26 17 2 No. of tribal GPs selected 671 626 3 OFAs signed 671 626 4 GPs conducting mahila and general grama sabhas (p/m) 671 626 5 Release of ICBF 671 626 6 Formation of committees (VWSC, SAC, WDC) 671 626 7 Capacity-building plan prepared and appraised 671 626 8 SOs appointed 671 626 9 Baseline surveys completed 671 626 10 PRA completed for source identification/strengthening 671 626 11 WEF plan appraised 671 626 12 Average percentage of Public Contribution collected (cash +

labour) 100 98

13 VAP (addendum 2) appraised 671 626 14 No. of GPs which started civil works 671 626 15 No. of GPs which completed water-supply works 671 438 16 No. of GPs where WSS operational 671 423 17 No. of GPs becoming ODF 671 346

39 The tribal population of Maharashtra was estimated at 8 percent of total population at the time of project preparation.

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To create awareness of WSS issues in tribal communities, a program of developing sanitation and hygiene promotion centers (SHPCs) in ashram schools run by the GoM in tribal areas has been taken as an entry point activity. Out of 26 project districts, this program was implemented in 414 tribal ashram schools in 21 districts. Progress on SHPCs in government tribal ashram schools

No. of districts : 021 No. of ashram schools : 414 No. of ashram schools seeking water-supply facilities : 238 No. of ashram schools started water-supply works : 205 No. of ashram schools seeking repairs in sanitation facilities : 175 No. of ashram schools started repairs in sanitation works : 161 No. of ashram schools seeking new sanitation facilities : 152 No. of ashram schools started new sanitation works : 147 No. of ashram schools due for swachhata doot40 trainings : 414 No. of ashram schools completed swachhata doot trainings : 414 Key achievements

The project has served a crucial role in tribal communities, which are mainly outside the range of normal developmental benefits. Some key achievements are: (i) over 1.6 million tribal people have benefited from Jalswarajya, perhaps the largest tribal population to be benefitted by any Bank-supported project; (ii) tribal groups have mobilized community contributions (cash and kind) to the tune of INR 88.2 million ($1.92 million); and (iii) for the first time ever, many of the tribal GPs have enjoyed piped-water supply. Despite their location in difficult-to-access areas and dispersed settlements, the per capita cost of water-supply infrastructure has been below INR 1,215 ($26.4). Initial studies indicate that tribal habitations are recovering 100 percent of their O&M costs through user fees. Over 420 tribal GPs have collected advance O&M tariffs of up to 6 months, 162,529 tribal households and 346 tribal GPs have become ODF, and sanitation coverage has risen to 71 percent. Component B: Institutional strengthening

B1 Capacity building

The objective of this component is to develop a shared vision and build competencies among key stakeholders at the state and district levels to enable them to perform their respective roles.

Status. The project has contributed significantly to the capacity building of officials, contracted professionals, support organizations, TSPs and nonofficials, and village communities. These in turn have contributed toward community capacity building. The project strategy of using capacity-building consortiums (CBCs) to carry out this process has been constrained by the lack of availability of a sufficient number of capable agencies and uneven performance by those selected to undertake the job. The project had to step in and, with the help of district teams and

40 Swachhata doot is a messenger on sanitation and hygiene.

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other institutions, take the responsibility of organizing a large number of programs. The project has also used the training of trainers (TOT) approach by the community to multiply capacity-building efforts across a wide range of GPs/villages, districts, and stakeholders. Capacity-building programs have evolved continuously over the project period, adjusting to needs on the ground and the project context. The project has also piloted a SEE in six GPs in each project district, using in-house resources.

The cumulative annual achievements on capacity building are summarized below: Year State level District level Village level Total

Program Persons Program Persons Program Persons Program Persons 2003–04 4 187 4 175 63 699 72 1,061 2004–05 2 300 339 24,834 3,304 222,175 3,645 247,309 2005–06 10 390 719 38,694 9,573 393,222 10,302 432,306 2006–07 3 78 1,706 2,584 9,464 388,116 11,173 413,998 2007–08 7 276 4,104 11,928 23,506 690,769 27,617 702,973

2008–09 7 220 10,736 405,871 10,613 399,417 21,356 805,508

2009–10 (part)

1 52 27 1,381 205 2,927 142 4,360

Total 3,434 1,503 17,635 512,747 56,728 2,097,325 74,307 2,607,515

From the above table it can be seen that there has been a massive effort to impart training to over 2.6 million stakeholders across 26 districts and over 3,000 GPs. B 2 Information, education, and communication (IEC) including Sanitation, and Hygiene Promotion

The objective of this subcomponent is to develop and implement a development communication strategy in the state that will focus on promoting behavioral changes among all stakeholders in improved sanitation and hygiene practices and on empowering the rural poor in their interactions with partnering institutions. IEC Status. IEC has played a key role in supporting all project components and has adopted a diverse range of innovative approaches. The IEC programs have continuously evolved over the project period, responding to the project context and needs. The campaign has progressively travelled from initial awareness creation, mobilization, and planning implementation to O&M phases. The focus of the IEC at Credit closure was on: (i) water quality, (ii) O&M systems, (iii) collection and dissemination of success stories, and (iv) sharing lessons learned. The operations and monitoring team (OMT) at the state level was provided with the services of an IEC specialist and a health and sanitation specialist, and the DFTs at the district level with funds for communication and dissemination equipment, access to the media, and production and distribution of display posters, folders, and pamphlets to households, wall writings and paintings, street plays, and other media events. IEC primarily focused on a core set of the most crucial health protection messages relating to the importance of: (i) water disinfections and safe home storage; (ii) hand washing after defecation and before preparing food; and (iii) using latrines and

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toilets versus open-field defecation. Innovative demonstration methods were used to enhance learning effectiveness.

Status of Sanitation and Hygiene promotion: The Sanitation and hygiene promotion included supporting the GoM’s sanitation strategy of stopping open defecation and hygiene behavior change of village community. The key targets on Sanitation front have been the following. The achievements by Credit closure on these targets are listed below.

Outputs against Sanitation targets at Credit Closure Indicator Baseline

value Target values

Actual achieved

% of households41 using sanitation facilities in project villages.

19%

50%

77% (898,351)

% of GPs where 100% open defecation free (ODF) status has been achieved

0%

40%

(1,286)

61%

(1,848) % of GPs where community perception of environmental sanitation is satisfactory

5%

60%

(1,930)

87%

(2,629) % GPs where environmental sanitation works are complete

84%

% schools with sanitation coverage 100%

While the overall sanitation achievements have been above the planned target values, there are regional variations. All divisions show a large percent of GPs having achieved a 50% ODF status, with the lowest being in Aurangabad division at 74 percent and Konkan and Pune leading with 94%. At the district level, two districts which are below the 50% ODF status, Osmanabad and Nandubar have slower achievements due to the remoteness of tribal areas with scattered settlements and low availability of adequate water for sanitation purposes in the summer. The Table below summarises achievements at the division level.

Sanitation performance of regions, at credit closure

Particulars Pune Aurangabad Konkan Nashik Nagpur Amravati (% GPs) (% GPs) (% GPs) (% GPs) (% GPs) (% GPs)

Toilet coverage and ODF status • GPs having

achieved full ODF status

89 44 90 54 65 37

• Households with Toilets

84 65 94 73 84 70

41 Total project households at credit closure were 1,162,606.

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• Schools with Toilets

100 100 100 100 100 100

Environmental sanitation • GPs where

environmental sanitation works are complete

82 95 94 78 81 69

• Total sanitation works completed

78 91 73 76 68 64

The overall access to household toilets in Jalswarajaya villages has increased from 25% to 77%. Aurangabad and Konkan divisions have lead overall on improved environmental sanitation in project villages, at 95 and 94% each. The district with the highest percent of sanitation works completed by Credit closure is Aurangabad at 91% with the lowest achievements in Amravati at 64%. The environmental sanitation works in the villages largely consist of the development of drains and their management, sullage management and the collection and disposal of solid waste. However there have been some concerns, specifically on environmental sanitation. These mainly pertain to the proper management and maintenance of the systems, which varies from village to village in the project area, which are being addressed by Government of Maharashtra. B3 Monitoring and learning

The objective of this component is to generate information on the performance and progress of the project and to disseminate it among all the stakeholders for monitoring project implementation, learning lessons, and empowering them to work in partnership with one another for the attainment of project objectives.

Status

Monitoring system

The online web-based MIS system—with a facility for tracking project progress and outcomes—has evolved over time through improvements made to it in terms of format, indicators, and so on. The best news is that this system was developed internally within the RSPMU. The team working on the MIS at the RSPMU can customize it as required based on the advice received from the project management and RSPMU specialists. Seeing the benefits of such a system, the GoM now wants to scale it up and apply it across all its programs, as part of its plan for streamlining institutions. The district teams also have accepted this system and are providing regular feedback and updates.

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B4 Project management The objective of this subcomponent is to: (i) strengthen the capacity of the ZP to perform its new facilitating roles successfully and (ii) set up and strengthen state-level institutional arrangements for policy development and coordination and monitoring so that the reform programs in the WSS sector are scaled up throughout the state. This subcomponent will finance project management costs at the district and state levels. At the district levels, the expenditures would include setting up the district water management and sanitation committees (DWMSCs) including costs of contracted professional services, office furniture and equipment, transportation, and incremental operating costs such as government staff incentives, travel, and subsistence. At the state level, the subcomponent will finance setting up of OMT, RSU, and six small units at the division level (including professional costs, transportation, and associated incremental operating costs). The GoM mobilized a new project manager on August 1, 2009, who stayed with the project until credit closure and is continuing beyond. Out of 245 staff positions in the districts, about 48 were vacant (20 percent) as of September 2009, 30 of which were leadership positions. The GoM recognizes this critical issue and has promised the mobilization of its staff. Component C: Sector development and strengthening C1 Knowledge management The objective of this component is to establish an optimally linked learning network, involving state-, district-, and community-level stakeholders aimed at exchanging and using information and knowledge relating to various aspects of the sector and supporting policy development. Under this component, the following work was done:

(i) Maintenance of a sector website, and various sector data (habitation data, census data, water-quality data, TSC data, Jalswarajya project data, comprehensive action plan data)

(ii) Maintenance of an online help desk providing online help on queries from districts (iii) Regular capturing and dissemination of best practices from the field on a quarterly

basis (iv) Organizing of exposure visits and workshops as needed

As part of the scaling up of the RWSS programs in the state, the GoM would like to establish a permanent setup at the state level to manage knowledge and learning across the state. C2 Water-quality monitoring The objective of this subcomponent is to institute an effective water-quality-monitoring system so as to provide safe water to all communities. This subcomponent will finance: (i) statewide one-time testing of all drinking water sources and subsequent follow-up measures; (ii) water-quality monitoring and surveillance activities of state agencies; and (iii) the introduction of a system to empower village communities to monitor the performance of state agencies. Expenditure will include testing, analysis, and mapping of water quality on a statewide basis;

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incentives to water-quality-testing staff at the district level; and costs of village-level sample testing for bacteriological contamination. At the village level, a simple water-quality-monitoring system will be developed, taking into consideration the lessons learned from the Kerala and Karnataka II RWSS projects. Mahila mandals will be trained to monitor the water quality using simple kits and communities will be empowered to demand independent testing of water if a doubt arises as to its quality. Status. Chemical water-quality testing of all public drinking water sources had been completed in the project districts as well as in the nonproject districts of the state in 2005–06. Based on the results, both within and outside the project, measures were taken to address the issues of villages affected by poor-quality water. In the initial phase of the project, community awareness was created through IEC about the importance of water quality and monitoring. Field-test kits for chemical and bacteriological contamination were distributed to all GPs. Training was also given to communities at the GP level for use of these kits under the National Rural Drinking Water Quality Surveillance Program (NRDWQSP). In the project, many leading SHGs have come forward for O&M of the water-supply scheme, under which they would also be responsible for water-quality monitoring. Much attention is paid to water-quality-monitoring issues in the O&M training given to selected personnel at the GP level. At present, related activities are being monitored under the NRDWQSP. Component D: Pilot components D1 Local government incentive fund ZP/GP incentive fund pilot The objective of this subcomponent is to support selected GPs and ZPs to develop beyond the needs of the RWSS sector; to establish a more effective, accountable, and responsive approach to institutional building; and to contribute toward improving the quality of local governance in Maharashtra and furthering its decentralization.

ZP incentive fund. The idea was to generate a baseline for ZP governance and service delivery through an assessment of three selected ZPs. But this subcomponent did not take off due to a lack of response and hence was dropped at the MTR.

GP incentive fund. The GP incentive fund pilot is being implemented in nine districts; namely, Thane, Nashik, Satara, Sangli, Osmanabad, Yavatmal, Chandrapur, Nagpur, and Buldhana. The pilot, titled “Amchaya Gavat Amhi Sarkar” (meaning “we are the government in our village”), was formally launched on April 30, 2005. In an awareness campaign, various IEC activities such as distribution of posters, street plays, and so on were carried out to encourage GPs to participate in the competition. A workshop was organized for sarpanchs and gram sevaks to create awareness of the pilot and to motivate the GPs to participate in large numbers after project launch. All the GPs in these nine districts were entitled to participate in the pilot. Sensitization workshops were conducted from August to September 2005 for the sarpanchs and gram sevaks of the GPs participating in the campaign. As a result of the extensive IEC campaign for

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community mobilization, as many as 1,200 GPs participated. Through a careful selection process, one GP in each block was selected in the project districts. GPs were given a capacity-building fund of INR 50,000 to cover the costs of exposure visits, baseline surveys, GP-level capacity building, IEC, and the formation of a village committee.

Orientation workshops in the selected GPs were undertaken from April to July 2006 in all districts. Development officers of the blocks from which GPs were selected for this project were trained at Yashada, Pune, for capacity building during May to June 2006. One hundred and five GPs were selected for this pilot project from these nine districts in a competition, out of which seven GPs proved unable to implement the pilot project. This phase provided an incentive of no more than INR 10 lakhs for preparing and implementing the Village Development Plan (VDP) and Panchayat Development Plan. GPs could undertake any innovative activities based on the resources available to them, to promote self-sufficiency in the VPs. GPs were free to decide village development plans as per their needs. CBOs like self-help groups, mahila mandals, and youth mandals could be actively involved in preparing the VDPs. The community managed the economic activities under the VDP. But while this approach was carefully administered, the very selection process made it into a reward program (rather than an incentive program). VDPs were to be approved by the district committee headed by the additional CEO of the concerned ZPs. Physical progress (GP incentive fund pilot):

No Item No. of GPs

1 GPs selected for this project 98 2 No. of GPs that signed OFA 98 3 No. of GPs that received capacity-building fund 98 4 No. of GPs that formed GP-level committees 98 5 GPs that completed baseline survey 98 6 No. of GPs that did Participatory Rural Appraisal 987 GPs that prepared draft VDPs 62 8 No. of GPs whose VDPs were approved by the district committee 32 9 No. of GPs that started documentation 26 10 No. of GPs that started income generation 26

D2 Aquifer water management pilot (AWMP) To objective of this sub-component is to develop and test approaches for the holistic and sustainable management of water resources with the involvement of key stakeholders.

Over years it has been seen that isolated village- or watershed-based groundwater management approaches have not resulted in sustainable groundwater management. It is observed that as groundwater aquifers do not confine themselves to village, block, or district boundaries, there must be concerted efforts to act at the aquifer level beyond such artificial boundaries. The existence of such an aquifer must be clearly defined and managed by the local community. The project has successfully implemented a novel concept of aquifer-level water management (previously untried in India), extending the concept of community participation to groundwater management in three districts of Maharashtra—Aurangabad, Pune, and Buldana. For this

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purpose federations of the aquifer water management associations (AWMAs) were formed out of village-level committees. At the district level, technical and monitoring teams have been formed to oversee implementation of this pilot component. The committees, with technical facilitation from district geologists, have planned and implemented low-cost structural measures to arrest the additional available run-off, which otherwise would have been wasted. At the aquifer level, nonstructural measures such as changing cropping patterns, and controlling and monitoring the groundwater withdrawals have been conceived and implemented by all the villages identified as part of the aquifer. As in the main project, each community has to contribute 10 percent against the capital cost of these measures. Support organizations have been hired to undertake capacity building. The pilot proved to be useful and has emerged as a rational tool in ensuring the sustainability of groundwater to meet various needs such as drinking, domestic needs, and agricultural and even industrial needs. What is interesting and encouraging is that this model is found to be replicable elsewhere.

Aquifer water management pilot

Benefit statement

Districts No Particulars Details

Aurangabad Pune Buldana Total

I Technical details

Area covered in sq km 178.25 95.74 159.68 433.67

Area in hectares 1 sq km 100 ha 17,825 9,574 15,968 43,367

Average rainfall in mm per year

630 394 795 1,819

Total run-off in hectares meter per year

Area x rainfall 11,230 3,772 12,695 27,697

II Groundwater availability (ham)42 Availability of groundwater before AWMP

410 218 354 982

Additional availability due to AWMP

175 75 225 475

Total available groundwater after AWMP

585 293 579 1,457

III Net available water from run-off [based on item I above] 15% of total run-off (ham)

15% of run-off 1,685 566 1,904 4,155

80% dependability (ham) 80% above 1,348 453 1,523 3,324

Net available water in kilo litre (KL) per year

1 ham = 10,000 KL

13,480,000 4,530,000 15,230,000 33,240,000

IV Benefits per head/family Project population in the aquifer areas

Pop 2001 x 1.5 40,371 15,626 42,238 98,235

Gross availability of Total run-43

2,782 2,414 3,006 2,819

42 Water that would have percolated to ground from run-off. Based on assessments by the GSDA.

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water per head (KL)/year off43/population

Net availability of water per head (KL)/year

Net available water44/ pop

334 290 361 338

Net availability of water per family (KL)/year

1 family = 5 persons

1,670 1,450 1,805 1,690

V Area that can come under irrigation based on groundwater (item II) Area under irrigation before AWMP (ha)

588 4,661 3,642 8,891

Additional area after AWMP (ha)

2,000 500 1,400 3,900

Total area (ha) 2,588 5,161 5,042 12,791

VI Irrigation potential for crops (area in hectares that can be irrigated, based on groundwater (Item II))

Jowar OR 900 KL/year 14,978 5,033 16,922 36,933

Wheat OR 1,800 KL/year 7,489 2,517 8,461 18,467

Cotton OR 3,300 KL/year 4,085 1,373 4,615 10,073

Sugarcane 11,500 KL/year 1,172 394 1,324 2,890

VII Indirect benefits (through reduction in tanker usage)45 No. of tankers/year for last 5 years

49 54 4 107

Expenditure on tankers (INR mill) in the last 5 years

37.9 3.9 2.1 43.9

Cost saved on tankers/year (INR mill) since they are no longer Required in the aquifer areas

7.6 0.8 0.4 8.8

D3 O&M Pilot Fund The objective is to develop (i) an O&M capacity-building model for ongoing drinking-water-supply schemes that are outside the purview of the proposed project’s community infrastructure component and (ii) an action plan for scaling up the model to eventually cover the entire state. This sub-component was dropped from the project.

43 From item (I). 44 From item (III). 45 Some of the villages in the aquifer areas were being provided with water by mobile tankers in summer.

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Annex 3. Fiduciary issues

Financial Management 1. This annex provides details on issues related to the treatment of community contributions to the project. 2. As per the project design, the community has to contribute 10 percent of the costs of village water-supply subprojects in cash/kind in nontribal areas and 5 percent in tribal areas; the rest will be financed by bank credit and the GoM counterpart financing. Against the “subprojects” category, the Bank reimburses 90 percent of expenditure. On disbursements to villages, the project has adopted a new model in CDD projects of providing advances to communities in installments, which the districts reconcile after appraisal of the expenditure made against certificates of progress (called utilization certificates, UCs) given by the community. Each installment follows satisfactory appraisal of the previous one. Before the installment is received, the community mobilizes its cash portion, and along with the installment money received, executes the work. 3. On treatment of community contribution in the accounts at the districts, the FM manual states:

Even though contributions from the beneficiaries (particularly cash) will not flow into the ZP (District) Bank account, it is necessary that the same be recorded for accounting and FM purposes, as well as from an MIS point of view. Accounting entries in ZP books to record Beneficiary Contributions will thus be required at first payment on signing of MoU and then on completion of each milestone.

4. During the early phases of implementation of the project and until early 2008, there were no regular updates at the district level on actual community contribution figures received. The community contributions were shown on a pro-rata basis in the financial statements, while the actual data were being collected and updated from the villages. 5. The client was initially claiming only 90 percent of the GoM plus the Bank portion (see paragraph 2, above), for three fiscal years: 2003–04, 2004–05, and 2005–06. On discovery of this, just before the MTR, the Bank team advised the client to claim the entire eligible amount, that is, 90 percent of the subproject costs. The client had then shown the consolidated community contribution part (10 percent of subproject cost) on a pro-rata basis, for the first time in the FY 2006–07 accounts. The statutory auditor disallowed these expenses to the tune of $10 million for that fiscal year, stating that they were not actual expenses. These claims were later recertified by the auditor upon submission of the actual figures by the client in 2008. 6. But the process of reflection of community contributions on a pro-rata basis in the district accounts continued in FY 2007–08 as well. After continuing discussions with the auditor in 2008 on audit objections and the handling of community contributions, the client decided to stop recording community contributions in the district accounts for the last quarter. The financial statements for FY 2007–08 were submitted to the auditor, with community contributions shown in three quarters on a pro-rata basis and without it in the last quarter. To this effect, notes were

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not included in the financial statements. As in 2006–07, the auditor disallowed the community contribution provision and certified the other eligible expenses. Such an audit report was submitted to the Bank, but was not accepted by the Bank, which stated that this was a material change that affected the within-year consistency of accounts. The Bank’s advice to the client was to either include community contributions for the whole year or remove them completely, with the disclosure clause added accordingly, and to get the financial statements recertified with the auditor. 7. Due to the volume of work involved in compiling the actual village expenditure and in balancing figures at the district level, the client expressed its inability to reflect these figures in the district accounts of FY 2007–08, by the target date for submitting the financial statements (May 15, 2008), which meant the auditor would not be able to complete the work in time. Therefore, the client did not show these figures for the entire FY 2007–08, and followed the same process for FY 2008–09 as well. The Bank and the client agreed that at the time of final claims, the community contribution portion could be reconciled. 8. In the above process, the recertification of the FY 2007–08 audit report by the auditor, its resubmission, and the acceptance by the Bank took time. The project went into suspension of disbursements against SOEs under OP/BP 10.02 in February 2009, which was lifted only in November 2009. The pending claims could be settled only during the four-months grace period given for the submission of claims after the project closure in September 2009. 9. As can be seen from the case above, the discovery of partial claims by the client (against full eligibility of 90 percent against subproject costs, the treatment of community contribution at the district level, its reflection in the district accounts, and so on) could have been better addressed had there been clarity both on the part of the Bank and the client from the beginning. Procurement 10. Although the Community Operations Manual (COM) contained details of procurement procedures, it soon became evident that these were too complex to easily adapt to the reality on the ground. For example, factors such as an insufficient number of suppliers and contractors in remote areas, the unwillingness of available suppliers to give quotes for the relatively long holding period of 30 days before VWSCs could make decisions, and the suppliers’ demands to be paid “in cash” immediately for the delivery of goods affected compliance with Bank procedures. The Bank’s requirement of a report compiling annual procurement information from all villages remained unfulfilled or delayed in most cases. Similarly, some of the Bank’s review requirements remained unfulfilled because of a lack of fully accredited procurement staff at the state level and designated procurement specialists at the district level. In addition, the Bank’s procurement procedures were different from those of the GoM, which were more widely used at the local level, adding to the general confusion. It was only in September 2006 that a revised and simplified procurement manual for the communities was prepared; the much-needed training of procurement staff materialized only later, during project implementation. The Bank did provide training workshops on some occasions, but the project could not derive the intended benefit due to a lack of experienced procurement staff, particularly at the district level. The much-needed procurement specialist to the RSPMU could be mobilized only toward the end of the project, along with the coordinators for procurement and FM at the district level. For a significant part of

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the project implementation, the project’s procurement function at the RSPMU level was overseen by the accounts coordinator, juggling work on the FM side. The implementing agency also did not fully realize the importance of procurement in the effective delivery of outputs until late in project implementation.

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Annex 4. Economic and financial analysis

(including assumptions in the analysis) Socioeconomic and financial analysis

Jalswarajya, which literally means “water self-governance,” was launched in Maharashtra by the World Bank in 2003; credit closure occured in September 2009. The project aimed at improving rural households’ access to better and sustainable drinking water-supply and sanitation services, and institutionalizing decentralization of WSS service delivery to rural local governments and communities. This analysis attempted to arrive at a socioeconomic and financial return on the project. At credit closure, the project covered 3,021 GPs from 26 districts with a total population of about 6.7 million (1.16 million households).

Summary of economic returns of the project

Based on the economic analysis carried out for the project at credit closure, the economic benefits from Jalswarajya have been mapped for the next 15 years. The project has demonstrated the direct benefits of improving access to water and sanitation to rural communities and the consequent reduction in costs/time including the cost of illnesses borne by community members. The income of rural women has also been increasing through the credit support program taken up under the project. Also, for the government there was a reduction in the capital cost and removal of subsidies on O&M for the project villages.

Based on these key benefits, at a project cost of $286 million, the ERR for the project at credit closing was calculated at 23.22 percent. The NPV of the project (at an assumed discount rate of 12.5 percent) was calculated at INR 7,594 million ($165.1 million). This compared well with a similar analysis done at the time of project conceptualization. The design cost of the project at that time was $268 million, projected ERR was 19.85 percent, and the NPV of projected costs and benefits was $89 million. For a project with such far-reaching and intangible impacts, the actual scale of benefits was far beyond the financially computed return.

Estimated at project design stage

Estimated at credit closure

Project cost (US$ million) 268 286 ERR (%) 19.85 23.22 NPV INR million US$ million

4,460

89

7,594.4 165.1

Exchange rate (US$ to INR ) 50 46

Detailed analysis Overall project statistics upon credit closure (September 30, 2009) Number of districts 26Number of GPs 3,021Major tribal districts 11Minor tribal districts 6Tribal GPs 626Total population 67,00,000

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Average size of household 5.8Total number of households in the project 11,62,606Tribal population 16,46,000Tribal households 2,28,236Average size of tribal household 7Water supply completion rate in GPs 76%Water supply completion rate targeted (by September 2010) 100%Water supply post project completion (lpcd) 40Water supply at the time of project start (lpcd) 27Number of women in project SHGs 739,626Number of women engaged in IGS 28,851Average income per day (INR) 50

Source: Internal data from Jalswarajya team.

Components of financial and economic analysis Project cost. The total project cost estimated at Credit closure was $268 million. At an exchange rate of INR 46 per dollar, the total investment into the project is INR 13,160 million. The cost from 2004 to 2010 was apportioned at 1.8 percent, 13.7 percent, 34.7 percent, 23.9 percent, 8.1 percent, 10.8 percent, and 6.9 percent for each project year, respectively. The expenditure made before 2004 was insignificant, and was therefore added to 2004.

For the analysis, it was assumed that the GoM would complete the entire project by September 30, 2010, and the full targets and benefits would reach all targeted beneficiaries. Therefore, in the analysis, the total costs that would be spent by the GoM by project closure ($286 million) have been used. The benefits as assessed at credit closure (September 30, 2009) have been projected for future years.

Benefits from the project. Social projects are driven by various tangible and intangible benefits that accrue to the recipient society over the years of project sustenance. Jalswarajya has played a key role in triggering several direct and indirect, tangible and intangible benefits to the households in the project area. Improvement in WSS facilities has resulted in time saved by households who had to go some distance to collect water; health benefits from drinking better and safer water, reduction in capital and O&M expenses; time saved by not going to open areas for defecation; better health of the entire community due to reduction in open defecation, and reduction in the incidence of malaria, diarrhea, and typhoid. The project also focused on community participation in the delivery of services and women empowerment through extensive IEC and release of seed money for ventures through WEFs. These benefits have been used in the analysis. The analysis is available in project files. In addition, there are other intangible benefits such as induced behavioral changes both in the rural community and particularly among women through their increased participation in decision making at the village level, which have also been discussed below.

Basis of analysis. The following section discusses the basis used in the analysis against each benefit referred to in paragraph 2 above.

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a. Time saved by households in the collection of water. Though water in most rural households is collected by women, this analysis has not been done for time saved by men and women separately, but is focused on time saved for individuals collectively in the dry and rainy seasons. The percentage of time saved in various activities is assumed based on the Handbook for the Economic Analysis of Water Supply, Chapter 6, Asian Development Bank, 1997.

i. Benefits in the dry season. On average, time saved by an individual either by way of

access to house connection or a public shared connection is about 1646 minutes per day. This results from a reduction in commuting time to and waiting time at the nearest water source before the implementation of the Jalswarajya in their GP. This is discounted for the actual time put to economic use out of the total time saved and multiplied by the minimum per day wage rate for agricultural labor in Maharashtra as per Schedule of Rates provided by the Public Works Department.

ii. Benefits in the rainy season. Time saved during the rainy season is lower, on

average, by about 7 minutes per person per day. The remaining formula for computing value of benefits remains the same.

b. Incremental water. Water supply in Jalswarajya GPs before the start of the project was

estimated to be about 27 lpcd.47 The project design is for the delivery of 40 lpcd for the projected population for the next 15 years. The existing population is benefiting from the increased water supply at design capacity. By credit closing, incremental water supply was benefiting 76 percent of the project GPs48 at an average cost of INR 1,043 per capita in 2009. It is assumed that by full completion of the project by the GoM by September 30, 2010, benefits of incremental water supply will reach 100 percent of the population of the targeted GPs. This is being considered as a one-time benefit.

c. Savings in O&M (power, water, maintenance) costs. One of the achievements of

Jalswarajya has been the full cost recovery for O&M including provision for depreciation with minimum average levels of six months of tariffs in O&M accounts, with tariffs ranging from $7.8 to $26 (tariff data from RSPMU). As per a study done by World Bank in June 2008, the “Review of Effectiveness of Rural Water Supply Schemes in India,” if the “cost of water in demand-driven schemes is brought down compared to that of the supply-driven schemes; there would be savings of resources of about INR 10 per KL”. In Jalswarajya villages, at a consumption level of 40 lpcd, the savings in O&M per household per month (because of demand-driven schemes) is INR 69.1 per month per household due to the improved efficiency of operations.

d. Capital costs saved. Another achievement of Jalswarajya has been the competitive per capita costs achieved for implementing water-supply schemes at $23 (INR 46=$1), which includes the cost of physical infrastructure. This is less than the prevailing norms in the

46 Data from RSPMU 47 Descriptive Statistics of Heath Outcomes: Of Taps and Toilets: Evaluating Community-Demand-Driven Projects in Rural India, 2009. 48 Data from RSPMU

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state, ranging from $46 in non-Konkan region and $51 in the Konkan region. This translates to a per capita capital cost saving of INR 1,188 (INR 1,043 in Jalswarajya schemes as compared to INR 2,116–2,346 in other schemes, resulting in a saving of INR 1,188 per capita). The benefit has been derived by multiplying a one-time savings in project execution cost to 76 percent (WSS completion rate in GPs by credit closure49) in 2009 and the balance 24 percent in 2010. INR 1,043 is the average capital cost per capita across all 26 districts under Jalswarajya. District-level per capita capital cost data are also available at the RSPMU. It is evident that scheme execution has been done in a cost-effective and efficient manner under Jalswarajya.

e. Reduction in household coping costs due to better WSS. As against 61 percent households with access to better water supply in 2005, 74 percent reported the same in 2007.50This resulted in a reduction of monthly coping costs of households from INR 1,064 to INR 562. The benefit has been calculated for 13 percent (74 percent minus 61 percent) households in Jalswarajya.

f. Value of time saved by using private and public toilets. On average, a person took 8.1

minutes51 (0.13 hours) to go to a community sanitation site before project implementation. Use of private toilets reduces this time to almost zero and about 7.5 minutes are saved per trip. This, discounted for the actual time put to economic use out of the total time saved52 and multiplied by the per hour wage rate as given in the Schedule of Rates, PWD, gives the benefits accruing from the use of private toilets. Households using sanitation facilities have increased from 19 percent to 77 percent; 75 percent of the increased households with access to toilets are assumed to be using private toilets after project completion, while the remaining 25 percent use public toilets. Use of public toilets reduces time to 6.1 minutes and hence 1.5 minutes (0.025 hours) are saved per trip. On average, five trips to the sanitation site are assumed per day.

g. Reduction in household cost of illness, such as diarrhea. As against 27 percent of

households reporting at least one case of diarrhea in 2005, only 22 percent reported the same in 2007.53 During this period, the household cost of illness due to diarrhea came down from INR 391 to INR 289.54 The benefit has been calculated for 5 percent of the households in Jalswarajya.

h. Women empowerment and income multiplier through credit support. Seed money of

INR 206 million55 has been given to WEFs (run by women SHGs) being on-lent to needy

49 Data from RSPMU 50 Descriptive Statistics of Heath Outcomes: Of Taps and Toilets: Evaluating Community-Demand-Driven Projects in Rural India, 2009. 51 Descriptive Statistics of Heath Outcomes: Of Taps and Toilets: Evaluating Community-Demand-Driven Projects in Rural India, 2009. 52 As referred in item 3 (a). 53 Descriptive Statistics of Heath Outcomes: Of Taps and Toilets: Evaluating Community-Demand-Driven Projects in Rural India, 2009. 54 Descriptive Statistics of Heath Outcomes: Of Taps and Toilets: Evaluating Community-Demand-Driven Projects in Rural India, 2009. 55 RSPMU data.

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women to set up their own ventures and gain financial independence. An average return of 15 percent has been assumed on this seed money on a year-to-year basis. Additionally, there are 49,308 SHGs in the project GPs, which include 739,626 women of whom 28,851 are engaged in IGSs. Field experience shows that these women earn on average about INR 40–60/day (around $1–1.5) from IGSs, assuming they are gainfully employed for 250 days/year.

i. Benefits of communication and capacity building. The program supports IEC specialists

in various locations who take on KM, capacity building, and sharing of best practices as their key areas of work. In its last year, the program got free media coverage due to the relationships and goodwill of these IEC specialists. This coverage was very useful in spreading best practices and knowledge across GPs. On a paid basis, the media coverage would have cost at least INR 10 million. This is conservative because the economic benefits of knowledge dispersion are intangible. The GoM is planning to continue similar institutional arrangements in future across the districts, and it is assumed that similar benefits will accrue in future as well.

j. Other intangible benefits (not used in the analysis):

i. Tanker-free villages. It needs to be noted that out of 1,114 villages included in Jalswarajya that were tanker fed before the project started, 981 are now tanker free. Supply of water through tankers is slow, costly, and unsafe for the supplier and consumer. The economic benefit of this development is over and above the ERR stated in the analysis.

ii. Governance and accountability have been strengthened through the gram sabhas

and social audits. Gram sabha attendance and meeting regularity have significantly improved.

iii. Participation of women in gram sabhas. Attendance of women in gram sabhas

has risen from almost 0 to 53 percent. The project has empowered women to play a role (in village planning, implementing, and managing) that has gone far beyond WSS issues—it has laid the foundation for women’s participation/empowerment in local governance systems and overall development activities. The indirect economic benefits of this change are over and above the ERR stated in the analysis.

iv. IEC and capacity building. Besides sharing best practices and building awareness

among village communities, IEC is resulting in the active functioning of the VWSC committees, their willingness to contribute to the share of capital and O&M costs of WSS, and behavioral changes (to value water as a resource and avoid wastage, regularly hand wash, achieve 100 percent ODF, and so on) over a longer period of time, which will result in economic health benefits over the long run.

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v. 61% percent of the project’s GPs have also become ODF, due to the awareness-raising efforts of the project, backed by the intensive TSC adopted by the GoM across the state.

Other assumptions used for the analysis Exchange rate $ to INR 46Population growth rate 2%GDP growth rate 4%Economic usage of time saved on various activities 52%Number of working hours in a day 8Number of days a person is gainfully employed 250Minimum daily wage of an agricultural laborer in Maharashtra INR 68 Annual increase in wages 2.98%Cost per KL in supply-driven schemes INR 36 Cost per KL in demand-driven schemes INR 26 Return on investment on seed money provided by the WEF 15%Expected reduction in diarrheal morbidity due to improvement in WSS 37.5%Man days lost due to diarrhea (direct) 2Average expenditure per diarrheal ailment in Maharashtra INR 163 Social discount rate for NPV workings 12.5%

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Annex 5. Bank lending and implementation support/supervision processes

(a) Task team members

Names Title Unit Responsibility/ specialty

Lending Meena Munshi Sr. Economist SASDA TTL R. R. Mohan Sr. Social Development Specialist SASDI Co-TTL Vivek Srivastava Sr. Public Sector Specialist AFTPR Institutions SpecialistSmita Misra Sr. Economist SASDU Economic Analysis P. C. Mohan Lead IEC Specialist AFTRL IEC Manvinder Mamak Sr. Financial Management Specialist SARFM FM M. Balachandran Financial Management Specialist SDNCA FM Kiran R Baral Sr. Procurement Officer SARPS Procurement R. S. Pathak Sr. Irrigation Engineer SASDA Water Resources Rachel Beth Kaufmann Health Specialist SASEI Health Aspects Parmesh Shah Lead Rural Development Specialist SASDA CDD N. V. V. Raghava Sr. Infrastructure Specialist SASDU Engineering S. Satish Sr. Social Development Specialist SASDI Tribal Aspects N. R. Tankhiwale Consultant SASDU Groundwater R. Soopramanien Council LEGMS Legal Priti Kumar Sr. Environmental Specialist SASDI Environment Barbara Verardo Sr. Rural Development Specialist SASDA Social AnthropologistGhazali Raheem Consultant SASDA Implementation Ramesh Deshpande Consultant SASDA Implementation Vijaylakshmi Das Consultant SASDA Gender Jacqueline Julian Sr. Program Assistant SASDA Costab Specialist Sujata Pradhan Program Assistant SASDU Project Support Theodosaias Karmiris Program Assistant SASDA Project Support

Supervision Meena Munshi Sr. Economist SASDA TTL (till 2005) N. V. V. Raghava Sr. Infrastructure Specialist SASDU TTL (Sep.2005) R.R. Mohan Social Development Specialist SASDI Co-TTL Rosanna Nitti Economist SASDU TTL ICR Parmesh Shah Lead Rural Development Specialist SASDA CDD Priya Goel Sr. Financial Management Specialist SARFM FM Asha Bhagat Financial Management Consultant SARFM FM J. V. R. Murthy Water Institutions Development Specialist ETWSA Water Institutions Ranjan Samantaray Sr. Natural Resources Management Specialist SASDA Environment Priti Kumar Sr. Environmental Specialist SASDI Environment Sanjay Pahuja Sr. Water Resources Specialist SASDI Groundwater P. C. Mohan Lead IEC Specialist AFTRL IEC G. V. Abhyankar Consultant SASDU Engineering Moho Chaturvedi Environment Consultant SASDI Environment Asit Nema Sanitation Consultant SASDU Sanitation

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Manmohan Bajaj Sr. Procurement Specialist SARPS Procurement D. M. Mohan Engineering Consultant SASDU Engineering N. R. Tankhiwale Groundwater Consultant SASDU Groundwater Shivendar Kumar Procurement Consultant SARPS Procurement Geeta Shivdasani Program Assistant SARPS Procurement Puneet Kapoor Financial Management Consultant SARFM FM Hemant Chadha Financial Management Consultant SARFM FM Kaushik Mehta Financial Management Consultant SARFM FM Ramola Bhuyan Financial Management Specialist SARFM FM Neha Dhoundiyal Financial Management Specialist SARFM FM D. K. Baxi Sr. Procurement Specialist SARPS Procurement Manvinder Mamak Sr. Financial Management Specialist SARFM Financial

Vidya Mahesh Program Assistant SASDU Project Support

Lilian Macarthur Program Assistant SASDU Project Support

ICR Richard James Operations Consultant SASDU Primary Author Michael John Webster Senior Water Supply and Sanitation Specialist ECSS6 Peer Reviewer Mohammad Benouahi Consultant MNSSD Peer Reviewer

(b) Staff time and cost Staff time and cost (Bank budget only)

Stage of project cycle No. of staff weeks US$ thousands (including

travel and consultant costs) Lending

FY01 2 7.94 FY02 45 193.45 FY03 101 425.91 FY04 11 41.18 FY05 0.00 FY06 0.00 FY07 0.00 FY08 0.00

Total: 159 668.48 Supervision/ICR

FY01 0.00 FY02 0.00 FY03 0.00 FY04 32 111.63 FY05 33 112.45 FY06 32 81.00 FY07 31 84.90 FY08 26 103.37 FY09 32 0.00

Total: 186 493.35

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Annex 6. Beneficiary survey results

As part of the beneficiary assessments at credit closure, the RSPMU conducted beneficiary surveys to gauge the level of the project’s benefits and impacts. Overall, the assessments concluded that the project’s benefits were reaching the community and that the community has accepted the project model positively. These assessments have also raised issues to be considered by the GoM in its future programs/policies, in terms of increased support of GPs in O&M capacity building and in ensuring sustainability of institutional arrangements (that is, VWSCs’ increased monitoring role and backup support from districts). This annex presents the results of these surveys. The assessments conducted by the RSPMU are:

1. Sustainability evaluation through community participation (August 2009) 2. Intervillage community monitoring (August–December 2009)

1. Sustainability evaluation The SEE was conducted in August 2009 to assess the likelihood of the sustainability of schemes built under the project. The parameters covered for this evaluation were (i) source sustainability, (ii) functioning of water-supply schemes (technical), (iii) financial sustainability, and (iv) institutional sustainability. A total of 156 GPs—6 in each district—that are in the O&M phase for more than 6 months were selected. A team comprising one person each from the social, technical, and accounting skills teams was selected from among the district team members. The team was selected by the respective heads of the RSPMU, based on their knowledge of the field and their proven ability to carry out such assessments. Initial orientation programs were carried out for the district teams. About 11 parameters (see attachment-1) were to be judged on a scale from 1 to 5 by each group as they visited the GPs. Various sub parameters and formats were developed by the RSPMU to guide the evaluation teams. Process used. The assessment was conducted using the following process: 1. Assessment was done during the regular water-supply cycles in the GPs, without altering or

modifying them. 2. Assessment was done following the participatory approach by involving the committee

members and the community. The regional facilitators (RFs) and district team leaders attended the process at the GP level and monitored the process.

3. Initially a transect walk was conducted on day one to know the scheme and its components,

plan for observations under the supply cycle, and collect basic information on the GP regarding technical, financial, and record-related issues.

4. A second transect walk was conducted with the community during the actual supply cycle to observe the distribution pattern, disinfection arrangements, quantity of water supply, equity in distribution, supply pressure, and so on.

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5. Finally, in a village gathering, votes by raising hands were given on a scale of 1–5 for

various parameters selected and the actual situation observed.

6. The results were shared in a wrap-up meeting with the community to highlight the required corrections to be carried out.

Summary of results

The results are summarized as follows:

Sustainability category No. of GPs % Highly likely (>90% score) 26 16.7 Likely (70–90% score) 115 73.7 Uncertain (50–70% score) 13 8.3 Unlikely (<50% score) 2 1.2

In terms of specific parameters: source sustainability is 92 percent, functioning of water-supply schemes 87 percent, financial sustainability 60 percent, and institutional sustainability 69 percent. As can be seen, financial and institutional sustainability has to be focused by ensuring adequate support at the VWSC level and by regular and ongoing capacity building, which has to be taken care of by the GoM as part of its sustainability improvement measures.

Key lessons The assessment reconfirmed that the following issues must be addressed by the GoM in order to better support GPs and thus improve sustainability after project closure.

a. For sustainability, water tax charges should be according to O&M expenditure, which needs to be revised from time to time. Special efforts are required for inculcating the habit of the rational water tariff setting by the committees in general and the GPs in particular. Proper documentation of water tax collection and expenditure is required.

b. To make the scheme more sustainable, facilitation and training on the O&M aspect is

required and regular reminders will be required post project for at least 6 months. c. Specific intervention is required on the aspects of judicious use of water. Adequate

water supply promotes sustainable use of individual toilets by villagers. d. In terms of institutional sustainability, regular community monitoring is a must for

sustainability. The VWSC should have adequate capacity for such monitoring. A greater involvement of women in such monitoring and O&M would also enhance sustainability. The SHG movement under the project has promoted good habits in coordination, cooperation, and participation, which is leading to the development of professional views among female members.

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2. Community monitoring The project undertook an intervillage community-monitoring exercise between August and December 2009, covering 60 GPs in all 26 districts. This was a first-of-its-kind exercise in any of the Bank-supported RWSS projects in India, wherein the community from one village visited another village to observe its services, systems, and institutions. The objective was to develop a forum for sharing lessons across villages. Process used The exercise was done in GPs in which the systems were functioning for more than one year. Out of 60 GPs selected, about 43 had exited from the project. The visiting community group included the chairman/secretary of the VWSC, head/secretary of the GP, chairman of the WDC, the water operator, and SHG members. The exercise was facilitated by the district teams. The format of monitoring included focused group discussions, interviews of villagers, site visits, and desk reviews (attachment-2 presents the format used). Results The exercise concluded that: (i) almost all GPs (99 percent) were satisfied with the improved service levels; (ii) 90 percent of the sources were sustainable during the summer season; (iii) schemes in 96 percent of the GPs were functioning on the day of the visit; (iv) in 61 percent of GPs, women were involved in O&M activities; (v) in all GPs tariffs were being collected, and separate O&M accounts were being maintained in 93 percent of the GPs; (vi) 81 percent of the GPs collected O&M funds more than the required expenditure; and (vii) in all GPs chlorination was satisfactorily functioning, but in 15 percent cases, record maintenance had to improve. Regarding sanitation, in 54 percent of GPs, 100 percent of households had access to toilets. In terms of impacts: (i) in about 76 percent of cases, GPs reported a reduction in waterborne diseases; (ii) on average there was a time savings of 1–5 hours in the collection of water; and (iii) people could now avoid traveling to far-off sources (0.5–5 km) due to improved sources available nearer to their habitations.

Specific results of this exercise are the following:

Sl. No

Parameter measured Yes %

GPs

No %

GPs

Remarks

1 Has any source-strengthening measure been implemented? 57 43 2 Did the source go dry during the last summer? 10 90 3 Whether the scheme is functioning satisfactorily on the day of

visit? 97 3 Proxy indicator

of sustainability 4 Whether water supplied from the scheme is sufficient? 98 2 5 Whether the community is involved in monitoring of

disinfection/chlorination?

88 12 Need to improve

6 Whether women are involved in O&M activities (for example, any one—disinfection, proper use of hand pumps, timely collection of O&M charges, and so on)

60 40 Can improve further for sustainability

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7 Whether a tariff collection system exists? 100 0 8 Does the VWSC maintain O&M account books? 93 7 Handholding

shall be done for the remaining 3%

9 Whether a regular person is appointed for O&M? 95 5 10 Whether water tax collection is more than O&M expenditure

including power charges? 82 18

11 What is the situation of waterborne diseases before and after Jalswarajya project? Whether it has improved?

77 23 Need to focus IEC and hygiene improvement

Other measures Parameters 1 What is the percentage of collection of O&M charges in the

last six months? Upto 100% collection—38% GPs 50–80% collection—35% GPs <50% collection—27% GPs

2 What is the percentage of household connections? Less than 50%, up to 80%, 100%

Upto 50% households connected—20% GPs 50–80% connected—60% GPs 100% connected—20% GPs

3 Is there any system for chlorination and are records being maintained?

Yes—85% Exists, but records not maintained—15%

4 How many households are having toilet facilities in village? 55% GPs have 100% household coverage with toilets; others catching up

5 How much distance is traveled by women for drinking water before the Jalswarajya Project (which is now saved)?

15% GPs saved up to 0.5 km 47% GPs saved 0.5–1.5 km 38% GPs saved > 1.5 km

6 How much time women can save due to Jalswarajya (because of water availability)?

Regions Amrawati—2 to 3 hours Kokan—1 to 4 hours Aurangabad—1 to 5 hours Nashik—1 to 5 hours Nagpur—1 to 4 hours

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Attachment 1 Sustainability assessment format Name of scheme/habitation/village: _____________________ Name of GP: _____________________ Name of taluka/district: _____________________ Date commissioning of water: Supply scheme: _____________________ Date of visit: _____________________ Name of district team leader: _____________________ Name of VWSC president: _____________________ Scoring criteria:

Always = 5; > 90 percent of the days = 4; between 70–90 percent days = 3; between 50–70 percent days = 2; less than 50 percent of the days = 1 Parameter score on a scale 1–5 (poor to best) Sl. No.

Parameter Score

Source sustainability 1 Is water source delivering as per design capacity since commissioning of the WSS

scheme? 2 Are all system components working satisfactorily—pumping station, overhead tank,

distribution system, and so on?

3 Is water supply provided every day for at least 2 hrs? 4 Do all group/house connections covered by the scheme receive water every day?

Water-supply system functioning 5 Do schedule caste households receive water supply every day through group or house

connections?

6 Are distribution pressures adequate—especially at the tail end? 7 Is the disinfection system functioning? 8 Has the quantity of water supply per household increased after Jalswarajya?

Financial sustainability9 O&M expenses fully met from user charges only? (excluding 6-month advance

deposit). Are project funds never used for meeting O&M expenditure? 10 Are people regularly paying water bills?

Institutional sustainability 11 VWSC is functional and effective?

Sustainability assessment: Highly likely = > 90 percent; likely = 70–90 percent; uncertain = 50–70 percent; and unlikely = < 50 percent.

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Attachment 2

Community monitoring format Sr. No.

Indicators Methodology Remark

1 Has any source strengthening measure been implemented?

Transit walk

2 Did the source go dry during the last summer? Discussion with the VWSC

3 Whether the scheme is functioning satisfactorily on the day of visit?

Transit walk

4 Whether water supplied from the scheme is sufficient? Discussion with the VWSC and beneficiaries

Individual household taps should be observed

5 Whether the community is involved in monitoring of disinfection/chlorination?

Discussion with the VWSC

6 Whether women are involved in O&M activities (for example, any one of disinfection, proper use of hand pumps, timely collection of O&M charges, and so on)?

Discussion with the VWSC and WDC

7 Whether a tariff-collection system exists? Registers Check the registers and O&M receipts

8 Does the VWSC maintain O&M account books? Registers 9 Whether a regular person is appointed for O&M? Registers 10 What is the percentage of collection of O&M charges

in the last six months? Registers 50%, 75%, or more?

11 Whether water tax collection is more than O&M expenditure including power charges?

Registers

12 What is the percentage of household connections? Less than 50%, up to 80%, 100%.

Registers Verify household connections

13 Is there any system for chlorination and whether records are maintained?

Registers

14 How many households are having toilet facilities in the village?

15 How much is the fund balance in the O&M bank account?

Registers

16 How much distance is traveled by women for collecting drinking water before the Jalswarajya Project (which is now saved)?

Registers and interview

Direct discussion with women

17 How much time women can save due to Jalswarajya (because of water availability)?

Interview Direct discussion with women

18 What is the situation of waterborne diseases before and after Jalswarajya project?

Registers and group discussions

Review records of aanganwadis and public health centres

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Annex 7. Stakeholder workshop report and results

(if any) Not Applicable

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Annex 8. Summary of Borrower’s ICR and/or Comments on Draft ICR

Part A: Project Evaluation Report from the GoM

Maharashtra Rural Water Supply & Sanitation Project (Jalswarajya) Project Details Name of the Project : INDIA: Maharashtra Rural Water Supply and Sanitation Project (Jalswarajya) Project ID : P073369, Area of Operation : 26 Rural districts of Maharashtra Project Implementation Period: 2003-2009

Project Finance Data Project Outlay: IDA –US $181 Mn, GoM-US$ 73.60 Mn, Beneficieries – US$ 14.00 Mn Terms: Standard Credit, Grace Period: Nil

1. Consolidated Physical Achievement end of September 2009

DemographyNo. of Districts 26 No. of GPs 3021 No. of Villages 4391 Habitations 5120 Population 8,846,000 Households 11,62,606

Water Supply (The figures show the progress achieved by Sept 2009) Existing Dug Wells rejuvenated 1483 / 1745 Only Dug Wells as the Access Point 739 / 786 New Dug Wells with Piped Water Supply 2248 / 2277 Bore Well with Handpump as the Access Point 1798 / 1806 Bore/ Tube Well with Power pump for Mini Piped Water Supply 357 / 360 Storage Created (New ESRs & GSRs ) 2979 / 3319 Water Quality affected habitations tackled 396 / 547 Slipped Back & Not Covered habitations tackled 976 / 1560 Source Strengthening Measures 2638 / 2731 Individual Household connections 62% 720815 / 1162606 Water Supply started GPs 2298 / 3021

Sanitation Gutters 1538 / 1843 Soak pits 651 / 803 Compost Pits 333 / 390 Sanitary Complex 26 / 28 ODF GPs 1848 / 3021

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Other Components

Aqifer Pilot No. of Aquifers 3 Area 433.6 Km2

Soil Conservation Works 10% Percolation Works 10% Direct Recharge Works 80% Total No. of Works 261 / 937 PC Collection 96% Additional Storage 475 Ham Additional Irrigation Potential 3900 Ha GP Incentive Fund No of GPs prepared draft Village Development Plan (VDP) 62 No of GPs of which VDPs approved by the District Committee 32 NO of GPs started documentation 26 No of GPs started income generation 26 Tribal Development Sanitation & Hygiène Promotion Centres (SHPC) 414

Cost Analysis (A) Total Project Costs $ 286.10 Million (B) Cost of water Supply and Sanitation $216.23Million

% of B to A 75.58 % Project Population 8.846 Million Per Capita Cost $24.44 Cost of Community Development, pilots and project Management $69.87 Million

Project Cost by Component Component Original Allocation

in % Actual Expenditure in %

Reasons for variation

A Community Development and Infrastructure

70.55 85.70 No of VPs increased from 2800 to 3021. Project population increased from 5.6 million to 8.85 million

B Institutional Strengthening

19.32 10.04 The reduction in costs is due to reduced project management costs, effective IEC and capacity building with lesser costs, in- house MIS system resulting in savings.

C Sector Development 1.63 0.24 State Water Quality Analysis with lesser costs dropping of some of the activities during implementation resulting in lower costs

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D Pilots 4.70 2.02 Dropping of two pilots and reducing the size of the pilots due to complexity and pressures of timely completion of the project.

E Un Allocated 3.80 2.00

2. Development Objectives Achievements on Development Objectives a) Outcomes:

i % of GPs with more than 33% women representation in leadership position in all

village committees (indicates women empowerment) – 89%. ii % GPs wherever the scheme is functional, there the O&M is fully financed

through tariff contribution by community – 98%.

The biggest outcome of this whole project has been the lesson that water supply is no more a mere ‘dry’ and technical thing. In fact it is much more than the estimates and the MB recording. For the first time the engineers learnt the importance of having dialogue with the community. Putting belief in the community at the same time maintaining a strict quality check was not an easy job, however the way project has unfolded it has established the fact that rural water supply is more a ‘social engineering’ than civil engineering.

b) Outputs:

i. 874,000 households gained access to safe drinking water (this covers a population of 6,700,000 people) – 1,646,000 tribal people covered under the project

ii. Sustainability Audit shows that the probable sustainability of the Project is above 80%

iii. 3219 (out of 3908) Piped Water Supply schemes operational iv. Overall in 2298 GPs (out of 3021) where water supply facilities operational

(76%) v. 1848 GPs (out of 3021) fully Open Defecation Free including 346 Tribal GPs

vi. 1159 GPs received Nirmal Gram Puraskar form Govt. of India vii. Sanitation Coverage - 991,000 (out of 1,162,606 HH) households

3. Other Key Project achievements

� Aquifer Pilot – Institutionalization of groundwater management in 3 Aquifers has created a way forward for implementation of Aquifer based source protection. People have completely removed water guzzling crops like sugarcane, grapes etc. Water availability is monitored continuously & usage is planned in the peoples’ meetings.

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� M&E System – A comprehensive M&E system developed in house is able to provide data required for day to day monitoring. One can get idea of any particular work in a GP instantly. Various reports generated from online data have been found very useful. Unique review formats are available online and the system saves a lot of time and man power required for collection of data.

� Sanitary Napkin – In Jalswarajya beyond the project target innovative activity of manufacturing sanitary napkin carried out. The brand name of Nirmal Sanitary Napkin is established. This product manufactured by rural women for the rural women to get affordability & availability ate village level. State Government is looking forward to exempt vat of raw material & market linkage with Government institutions for sustainability of the project.

� Khambegaon Pattern - Khambegaon is one of ideal village in Jalswarajya which has taken up of operation & maintenance of water supply scheme as an income generation activity of SHG. Due to their smooth functioning of scheme and regular water tax collection State Government have decided to scale up the activity. Thus Government has issued GR in favor of SHG to create more and more Khambegaon Pattern in State.

� Sanitation & Hygiene Promotion Centers (SHPC) – To create an awareness in the tribal community on water supply and sanitation issues, the programme of developing SHPC in govt. tribal ashram schools has been taken as an entry point activity in 414 Govt. Tribal Ashram Schools in 21 districts of Maharashtra; which consists, Swachhata doot (a Messenger on Sanitation & Hygiene) trainings to the students, teachers, staff & parents in 414 ashram schools (40 swachhata doots per ashram school = 16560 ) ; Drinking water supply facility in 230 ashram schools; Sanitation (new) facility in 154 ashram schools & Sanitation (repairs) facility in 173 ashram schools, which has been helpful for 1,46,627 tribal students in 414 govt. tribal ashram schools directly & the families of all those students indirectly.

� Development of Cadre of TSPs & SOs – Around 1000 TSPs & 400 SOs (NGOs) were engaged in implementation of Jalswarajya project. More than 15000 village motivators were trained and are serving the people.

� Cholrinator - Chlorinator is invented by Kikwari & Bhagurdi village of Nashik district; it is an easy tool which directly chlorinates water through the rising main pipe line. This is comparatively reduced the dangerous practice of man climbing on ESR. Other Jalswarajya villages are adopting this invention.

� Underground Gutter (Washim Pattern) - To enhance sanitation & environmental hygiene, washim district have started underground gutter system from which almost GPs were covered in district & thus became the washim patter for underground gutter. Underground waste water management play important role in personal & community health, project is replicating these activities.

� Ladder Railing - Innovative practices carried out in project to reduce the risk of waterman life. Almost in all GP’s railing is done on the ladder.

� Roof Top Rain Water Harvesting - Looking at the non-maintenance of the similar projects, aquifer level water management is demonstrating use of quality material in the project. To avoid any contamination to ground water a nine stage water filter is used. To avoid leakages a shaft is also used in the project for the sustainable development. This is replicated in almost entire mini watershed (in 9 villages / 12 wadi) for the common cause.

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� Mobile Connection - A village of Mohomuk, Nashik District has adopted sprinkler system for individual connection which reduces 75% of amount for distribution system. Jalswarajya is promoting this low cost effective system to those villages who cannot afford individual connection this activity is running successfully in trial villages.

� Overflow Connected to Distribution - Generally in all WSS, ESR has two pipes one inlet & second outlet also small opening for over flow. In Jalswarajya project in all GP’s overflow pipe is fitted from ESR & connected to the distribution pipe so as to use water by villagers in case of tank overflow.

� Earthquake Resistant Design - In Jalswarajya project all ESR are designed under earthquake resistance design. These designs are adopted according to earthquake zones. Disaster risk management is implemented in the project.

� Acrylic Colour for ESR - Generally normal paint was painted to ESR & pump house which gets off within a year leaving dark spots. In project acrylic colour is made compulsory to paint ESR & Pump house which gives beautiful appearance for 6-7 years. All GP’s adopted these practices.

� In Sindhudurg district, a unique idea has been evolved by the TSP and district team in which wss network of some adjoining habitation has been established and in case of failure of any one habitation wss, the same can be served by the adjoining habitation wss. This system can remove the inconvenience of habitant and administration worried for emergency arrangement

� All government schools under the project are covered with the toilet facilities with the help of GoI funded TSC programme

� Project Benefits and Beneficiaries

� Increase access to safe drinking water – WS started in 2294 (76%) GPs & 1848 (61%) GPs achieved ODF status

� 49291 Women SHGs are formed and 28340 Income Generation activities started. � Community Participation achieved by organizing Gram Sabha (assembly of all

voters of village through which there is a listening to the voices of the poor as Gram sabha is organized in free and fair manner.

� Average 53% Women attendance was recorded in Gram Sabha, which is unprecedented.

� Strengthening of PRIs at different level with more accountability and transparency.

� Better convergence of WATSAN development, health, tribal and secrtorial activities as the project has various components

� Improvement in health & hygiene awareness at all the level of stakeholders � Informed decision making & increased ownership by community with their

participation in various stages of the project and financial contribution.� Project benefits have largely accrued to all the stake holders. Rural population

especially women and tribal have immensely benefited. Water at the doorsteps has not only reduced drudgery and saved time but also has contributed significantly to other development parameters like reduction in the health expenses, increased school attendance especially of girl child. Involvement of women in the decision making process has been a welcome step and has helped in

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removing/diluting the traditional gender roles. Apart from that the project has tremendously helped in raising the overall capacities of the government officers, contractual staff, SOs, TSPs, which will help GOM in a longer run.

4. Institutional building and Project support

� GoM has given legal status to VWSCs by amending the existing Gram Panchayat Act.

� Decentralization of decision making is achieved in RWSS sector with emphasis on peoples’ participation and sustainability.

� Various committees are formed at GP level and have a statutory status given by GoM

� Structured capacity building plans as per the phase of the Project ,for all stakeholders

� Large scale Capacity Building & IEC resulted in responsive community � Women participation in decision making was assured by way of Women Gram

Sabha preceding general Gram Sabha. � Some existing provision like countersignature of district officials before making

payments, issuing work orders etc. were removed before stating the project. � No per capita cost norms were prescribed, which gave a greater freedom to the

people while framing their projects through Gram Sabha � Creation of separate bank account for the project enabled VWSC & WDC to carry

out their activities independently � In Project need based IEC activities were conceptualized and implemented in the

village. � The project helped in establishing VWSCs as the basic institution at the village

level. GOM through amendment in the village panchayats act 1958 provided legal status to them. Apart from that creation of the dedicated teams at the district levels also facilitated the whole process. Now GOM is thinking to create similar dedicated teams at the district level WSSO for facilitating the processes in all rural water supply schemes.

5. Bank’s performance

a) Lending: Bank finances were made available within short time intervals and in general there were no hiccups. Overall support received in this respect was Satisfactory.

b) Supervision: Bank Missions visited the project twice a year and issued timely guidance. Overall support received in this respect was Satisfactory.

c) Overall Performance of Bank Overall support extended was satisfactory barring the Procurement & Accounts issues. Procurement processes were not insisted rigorously initially. Bank insisted more upon compliance of remarks of Accountant General in the later stage, which was not the condition set at the beginning.

d) In Finance Management Bank provided discrete and conflicting opinion on record of Beneficiary contribution, which resulted in suspension of Project disbursement.

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e) Since Bank official have global experience project expected to provide cross learning in various states and out of India which could not happen to the expectation of Project.

f) Bank’s performance was over all satisfactory and good. Reimbursements were timely and institutional support in terms of setting processes and principles of the project were good. The only problem areas were little sharing of global best practices & knowledge management. It could have been more. Accounting of beneficiaries’ contribution was another area where Bank could have guided in more detail, which would have helped in timely completion and thereby avoiding brief suspension of the project reimbursements.

6. Borrower Performance

e. During Preparation – Performance at Govt. and RSPMU level was satisfactory. Performance of districts was varied. Mostly, preparation stage was over by 2006, which is satisfactory.

f. During Implementation – A system of Ranking of districts and regions was introduced, which created a spirit of competition, which helped in expediting the project. 76% target was achieved by the end of original target date, which is satisfactory.

g. Overall – Satisfactory.

7. Long Term Impact

� Decentralization of powers to PRIs � Govt. machinery was molded in Social mode – Engineers became Social

Engineers and Social Specialist & villagers got acquainted with the day to day technical skills.

� Villagers gained enough capacity to implement other projects also Long term impact of the project can be gauged from the fact that GOM issued a circular

dated 1st August 2009, wherein it decided that from now on wards all the rural water supply scheme shall be implemented on the lines of the Jal Swarajya. Further GOI has also come up with their NRDWP guideline which is inspired by the success of WASMO & WB aided water supply project like Jal Swarajya, Jal Nidhi, etc. GOM has clearly given its mandate to accept the principles and the processes of the project for better planning, implementation and the management of the rural water supply schemes. 8. Lessons Learnt

� It is possible to entrust development works to the community � Institutionalization is possible, if there are enough incentives – ownership, status,

decision making powers etc. � There is reduction in cost, as the involvement of large scale Govt. machinery is

not required

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The biggest lesson learnt during this project is the way community operates itself to plan, implement and manage the water supply schemes. Communities operating through the VWSC showed tremendous amount of capacity and effort to implement and run the scheme. There were obvious risks and dangers associated regarding mal practices, theft etc, however barring few VWSCs, most of them worked in a responsible manner. This project has really galvanized the VWSCs into a vibrant and capable body, which is the sync with the true spirit of the 73rd & 74th amendment of the constitution. 10. Hurdles / difficulties/Risks faced:

� Frequent transfers of Govt staff and quitting the jobs by private sector specialists � Dearth of good quality TSPs & availability throughout the districts � Attitudinal problems – once an officer/ specialist is changed he brings new/

different approach/ attitude � Following all the CDD Process � Change in the policy in case there is a change in leadership at various level � Capacity Building component not upto the mark � The biggest hurdle the project faced was the attitude of set institutions like

bureaucracy, Zillah parishads, also gram panchayats to some extent. How a nascent institution like VWSC can really implement such big schemes? Initially very few people believed that this project can be a success. However as VWSCs started performing, all other hurdles/difficulties/risks slowly gave way. Of course capacity building played a great role; however in some areas like procurement policies, contract management, etc. it was not up to the mark to some extent.

9. Looking forward

• Convergence of all development at GP level • Delegating more powers to GP • Creation of cross sector linkages • Jalswarajya principles have influenced all other major programs in the sector e.g.

Bharat Nirman Program (NRDWP) guidelines are based on Jalswarajya principles • Capacity Building of the community on greater scale • Achieving higher degree of sustainability

10. Sustainability

� All the programs in the sector shall be based on Jalswarajya principles. Involvement of the community in planning, implementation and O&M will lead to greater level of sustainability.

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Part B: Comments from GoM on the draft ICR

Overall quality of the draft ICR is good and it adequately captures the all relevant development indicators and the processes. It has successfully painted a clear picture as to what was expected out of the project and what the project has really achieved. Overall outcome rating of the project as ‘satisfactory’ seems justified. Similarly the Bank and borrowers’ performances have also been pegged at satisfactory level which also seems justified. The ICR puts borrower’s performance regarding financial and procurement management somehow under poor light. Under Financial management the ICR says” Compliance on audits was weak and the legal covenant on audit submission in a timely manner was seldom met”. Probably if that is true, then financial management team with the Bank have also failed to guide the project implementing agency in a timely manner. Borrower strongly resent this sweeping statement. Similarly under procurement management also it says that “some of the requirements of review by the World Bank remained unfulfilled because of the absence of a fully accredited procurement staff at the state level”. Again it has to be mentioned that procurement issues were not highlighted from the very beginning with the same urgency as it was in the later stage of the project. Necessary guidance was found lacking on this front also. It would have been better if borrower’s performance could be judged more objectively with a due regard to the overall socio-economic conditions. Also a thorough understanding of the government processes would have definitely helped a lot. 2. General Comments on the ICR:

A. There could be a mention of number of missions (visits) with time line, along with major outcomes associated with each mission.

B. Incremental benefits have been shown with respect to earlier conditions, but a kind of pre-post table could have been better.

C. In the Economical Analysis part, importance of use of online monitoring system, man-hours saved, accuracy achieved could have been also analysed and emphasised.

D. Probably the road ahead could have been dealt in a more detail. A broad future map could have been made in consultation with the borrower. This would have helped the borrower tremendously.

E. A comparative chart or analysis with other similar programs could have been done. This would have helped to understand the project more objectively.

Over all the draft ICR is a well written document highlighting the efforts taken over past six years. It is essentially a part of knowledge management system which the Bank has carefully built over the years. Not only it gives in depth analysis of the processes involved but also it highlights the lessons learnt, best practices which have emerged, along with the shortcomings and failures which project faced. It will certainly help both the Bank as well as the borrower immensely in achieving common goals and objectives. It will also serve the purpose of ready

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made reference for other state governments who are planning similar projects, people working in the rural water and sanitation sector, academic institutions etc.

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Annex 9. Comments of cofinanciers and other partners/stakeholders

Not Applicable

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Annex 10. List of supporting documents

1. Project Appraisal Document, July 17, 2003 2. Project Implementation Plan (PIP), Government of Maharashtra, Water Supply and

Sanitation Department, June 2003 3. Community Operational Manual, June 2003 4. Project preparation/appraisal mission documents, May 2002–May 2003 5. Back to office reports and aide-memoires 6. Implementation status reports—October 2003 through September 2009 7. Midterm Review, January 2007 8. Country Assistance Strategy (CAS) (Document No. 22541), June 27, 2001

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Annex 11. List of participating districts (26)

No. Name of district

No. of GPs in this district

No. of villages in this district

Projected ultimate population to be served in this district (million)

1 Thane 117 210 3.98 2 Sindhudurg 75 135 2.41 3 Ratnagiri 131 249 3.63 4 Satara 141 135 3.76 5 Sangli 119 119 5.91 6 Solapur 100 102 3.5 7 Kolhapur 115 117 4.56 8 Nasik 130 129 5.08 9 Nandurbar 58 156 3.07 10 Jalgaon 100 123 3.52 11 Buldhana 141 211 4.16 12 Yavatmal 126 221 2.83 13 Akola 98 135 2.26 14 Washim 110 144 2.54 15 Nagpur 133 326 2.41 16 Chandrapur 114 242 2.79 17 Bhandara 112 150 2.67 18 Gondia 102 150 3.44 19 Gadchiroli 76 251 2.41 20 Wardha 109 201 1.79 21 Osmanabad 143 152 4.4 22 Beed 139 145 4.68 23 Latur 146 159 3.83 24 Hingoli 138 138 2.8 25 Parbhani 130 146 3.12 26 Jalna 118 145 2.91

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