1. The Project Development Objective (PDO) is: To improve upstream watershed management and increase agricultural water productivity in selected Gram Panchayats in Himachal Pradesh.
2. The project will have the following PDO indicators:
Component 1: Sustainable Land and Water Resource Management (US$55.04 million; US$44.03 million IBRD)
3. This component promotes participatory and sustainable land and water management (SLWM) through financing the planning and implementation of upstream investments in selected micro-catchments. GP-level resource management plans (GP-RMPs) will be prepared to ensure that local investments are properly targeted and appropriate to the local geographic and socio-economic context. Hydrological monitoring stations will be established in the watersheds to continuously monitor water quality and quantity to assess the potential impact of project interventions. These stations will also lay the foundation for future water budgeting (to facilitate climate change adaptation by planning land use and agricultural investments based on the available water) and hydrological modelling at the watershed level that will enable the preparation of more holistic catchment area treatment (CAT) plans that identify the highest priority sites for future investments to ensure the greatest impact for source sustainability and water quality. The main implementers and beneficiaries will be HPFD staff and communities including user groups set up (or strengthened, where appropriate) under the project. The component will include a combination of technical assistance (TA), investments, and partnerships with other agencies. This support will lead to improved ecosystem management, improved forest cover (carbon sequestration), increased water quality and quantity and sediment regulation (climate resilience), reduced erosion (and thus reduced disaster risk from landslides), and improved community participation (including women, youth, and disadvantaged groups) in and benefits from SLWM that are expected to serve as a model for other states through the Lighthouse India approach. Subcomponent 1A: Improved planning for participatory and sustainable land and water management
4. Subcomponent 1A will strengthen landscape planning. Specifically: (a) consultants will design and the Project Management Unit (PMU) will procure and install a network of hydrological monitoring stations at key locations (to be determined by consultant expert analysis), to be maintained by the HPFD; (b) the PMU will prepare GP-RMPs; (c) consultants will be hired to support additional diagnostic studies, designs, and assessments; and (d) the PMU will develop GP-RMPs through a participatory process led jointly by the HPFD, GPs and community user groups and which will ensure the active inclusion of women and disadvantaged groups. Agriculture extension officers and social extension officers will undergo training to effectively understand and adapt the specific needs of women cultivators in GP-RMPs. As a part of the participatory rural appraisal (PRA) exercise, the preparation of GP-RMPs will take active steps to include interventions suggested by women’s federations and community-based organizations with active participation from women. This subcomponent will also include the design and implementation of a catchment monitoring and evaluation (M&E) system.
5. Approval of the GP-RMPs will necessitate spot checks and verification on site. The preparation of the GP-RMPs will achieved through: (i) a technical consultant to design the GP-RMP structure and mapping requirements; (ii) an Information Technology (IT) consultant to design the database and Geographic Information System (GIS), including data input technology to store, collate, monitor progress and report on GP-RMP preparation, approval and implementation; (iii) the project team of social, agricultural, and forest extension officers will undertake community mobilization and facilitate the participation in plan preparation; (iv) PMU field teams in cooperation with the beneficiaries will prepare the GP-RMPs; and (v) the plan will be reviewed by the District Project Officer (DPO) and approved by the PMU and the GP following on-site verification. Implementation of the GP-RMP will be monitored through the PMU/ HPFD, including through: (i) updating the project database to collate, report and monitor implementation progress; (ii) verification on site of activity completion reports; and (iii) ongoing site inspections to ensure sufficient survival rates and proper maintenance. Subcomponent 1B: Implementation of participatory and SLWM investments as identified by the GP-RMPs
6. This subcomponent will finance the implementation and maintenance of investments identified in the GP-RMPs, including the technical specifications for works and equipment supply and terms of reference for consultancy services. These investments will be implemented by GPs with technical supervision from the PMU and may include, but are not limited to, the following:
7. Other investments at the project level rather than GP- or micro-catchment level would include:
8. The sub-component will also support the establishment and financing of an operation, maintenance and investment fund (OMIF) in each of the participating GPs. The OMIF will be established under existing GP financial management procedures to meet the operations and maintenance (O&M) responsibilities of community infrastructure related to SLWM constructed under this project and that already existed. Initial funding to the OMIF will come from community contributions with the project providing top-up funds through matching grants (MGs) to GPs. The underlying principle of the OMIF is to incentivize local revenue generation for, and investment in, O&M of GP-managed SLWM-related infrastructure through this ‘matching’ financing. Top-up grants will be provided once the OMIF have reached defined thresholds in terms of revenues raised and legitimate expenditures on O&M activities. Details will be provided in the Grants Manual.
Component 2: Improved Agricultural Productivity and Value Addition (US$31.38 million; US$25.10 million IBRD)
9. This component would support interventions in downstream areas where the primary (existing or potential) water use is for irrigation in agriculture. It would seek to augment the use of irrigation as a principle strategy for shifting from low-value cereal production to climate resilient crop varieties and higher-value fruit and vegetable production but would do so with a focus on increasing climate resilience and water productivity to maximize the financial returns for water use. The project will seek to leverage additional support from (i.e. seek convergence with) other government programs particularly those of the agriculture, horticulture, and animal husbandry departments. Key interventions include farm-level infrastructure to increase high-productivity water utilization (drip and sprinkler irrigation) – essential elements of CSA – plus the necessary communitylevel primary and secondary distribution systems and training and input/ equipment supply for CSA. The project will only work in downstream areas where upland interventions are being implemented. Convergence with the relevant line departments and relevant World Bank-financed projects (e.g. HP Horticulture Development Project) will be ensured through the project’s executive committee (EC). In addition to improving livelihoods the proposed activities will reduce pressure on forests and contribute to increased carbon sequestration and reduced erosion and are expected to be of interest to other forested states, with outcomes showcased through the Lighthouse India approach under Component 3.
10. The implementation of this component will be informed by a value-chain scoping exercise to identify the barriers experienced by small and marginal farmers, predominantly women, in accessing CSA technologies, post-harvest equipment and subsidies and to identify potentially viable clusters of producers based on economic geography. The interventions will focus on: (a) improving the service delivery mechanism of on-farm and off-farm activities through training and capacity building of agriculture extension officers and social extension officers; (b) undertaking demonstrations of agriculture technology and conducting farmer field schools to cater to the needs of small and marginal farmers, including women; and (c) generating awareness through interactive communication campaigns. The list of sub-project investments will include a subset of activities predominantly carried out by women. These include diversification of crops to high-value vegetables, livestock-based activities for small and large ruminants, livestock mangers and postharvest interventions, such as maize chaffing. To incentivize uptake of technologies/ innovations, the project will calibrate the beneficiary contribution for individual women cultivators and women’s groups. User groups formed to manage resources under agriculture extension services will have active participation from women, including appointing women in decision-making roles.
11. This component will also use the MG instrument to partially finance productive assets for individual and group beneficiaries. The exact share of beneficiary contribution will be calibrated according to the specific items (those with higher positive environmental externalities securing a lower beneficiary contribution) and for different beneficiary groups depending on their relative level of need/ access to finance. A key principle is that private goods for individual beneficiaries will, on average, require a greater beneficiary contribution. To ensure women participate in extension trainings and access additional technical support to develop grant proposals, female facilitators will also be hired and trained to provide additional training and support to women-only groups. It will also ensure equal access for defined disadvantaged groups within the project areas. Details will be set out in the Grants Manual.Subcomponent 2A: Improved water productivity
12. Subcomponent 2A will support investments in the provision of water by investing in primary and secondary distribution infrastructure at the community level and farm-level irrigation equipment. The project will finance through a MG scheme decentralized water infrastructure assets within GPs based on robust GP-RMPs (developed under Component 1) and subordinate village-level agriculture and water management plans. This will include water harvesting, storage, and distribution infrastructure, such as (small) pond excavation, community tank renovation, roof rainwater tank installation, strengthening of traditional irrigation channels, and gravity and lift intake and distribution structures. To ensure these investments lead to increases in water productivity rather than only water availability, the project will only invest in increasing water utilization in GPs where: (i) upstream investments in source sustainability are being implemented under Component 1; and (ii) investments under Subcomponent 2B will support increased adoption of climate smart technologies and high value crop production to ensure the productivity of subsequent water use will be maximized, thereby achieving ‘per drop, more crop.’ Subcomponent 2B: Adoption of Climate Smart Technologies and Diversification into High-Value Crops
13. This component supports the adoption of CSA practices in conjunction with increased access to irrigation for existing cropping patterns and/or diversification into high-value, climateresilient crops. The project will utilize HP’s agricultural research and extension system and existing Government-backed interventions and will enter into technical agreements to finance the incremental operational costs of existing delivery agencies and will hire consultancy services where complementary non-state services are required. Where knowledge of appropriate CSA practices is limited, the project will partner with the research institutions (to cover their operational costs) to strengthen the evidence base. Interventions to support high value crops, including medicinal and aromatic plants, will take a value chain perspective and will be based on the analysis of market potential. Such interventions will include consultancy services covering inter alia market analysis and strategies for value addition. This component will also fund essential modest “last-mile” market access investments (e.g. works contracts for the provision of footbridges and ropeways but not roads or investments requiring land acquisition). This subcomponent will utilize the MG scheme (under a second ‘window’) to subsidize essential productive assets to individual farmers, specifically active women farmers and women-headed households, and farmer groups.
14. Based on the outcomes of the value chain analysis, the project will adopt a cluster-based approach where relevant. This is essential to avoid fragmentation and an unsustainable scattering of project investments and to generate the volume to benefit from economies of scale in production and marketing/ processing that is essential to competitive agriculture. HP benefits from extensive analytical work on potential clusters in a range of commodities and has considerable experience in such approaches (including through other World Bank-financed operations). The project will include TA support for business incubation if an appropriate cluster emerges where this potential can be realized. Prospective clusters in specific value chains can only be determined once GP-RMPs have been concluded; requisite analysis will be undertaken alongside the GP-RMPs accordingly.
Component 3: Institutional capacity building for integrated watershed management (US$3.67 million; US$2.94 million IBRD)
15. The long-term objective of this component is two-fold: firstly, to support a more comprehensive and holistic approach to managing the state’s water resources while recognizing competing uses within HP and in other states; secondly to facilitate better alignment of institutional mandates for Integrated Watershed Management (IWM) and strengthen the HPFD’s institutional structure and capacity for improved service delivery. In the short term, this component will focus on building the capacity of the HPFD as the key government institution responsible for managing twothirds of the state’s land area and identifying future reforms through institutional assessments. It will also produce and share knowledge on these topics through a Lighthouse India approach.
Subcomponent 3A: Improving the governance structure for integrated watershed management
16. Through the convening power of the HPFD and its role in managing watersheds, this subcomponent will provide TA to support integrated watershed management (IWM). The subcomponent will support an institutional assessment to: (a) identify the institutions that affect water supply, quality, use, and management and their roles, responsibilities, and mandates; (b) conduct a strengths, weaknesses, opportunities, and threats analysis of the current institutional framework and highlight any overlaps and/ or gaps that undermine IWM; (c) identify opportunities for institutional coordination and synergy; and (d) build consensus on the need for reform and develop the goals and vision for institutional collaboration, a time-bound action plan, and an implementation road map. The results of this assessment are expected to inform the GoHP and other state governments on the necessary reforms to relevant institutions that will result in effective interagency cooperation and, ultimately, IWM. Stronger institutions will lead to improved planning and responsiveness to climate change impacts. This sub-component will be implemented by a consultancy company specializing in change management.
Subcomponent 3B: Institutional reform and strengthening of the Himachal Pradesh Forest Department
17. This subcomponent building on subcomponent 3A will support the further institutional development of HPFD. It will provide TA to conduct a functional review of forest institutions (FRFI) that will produce a vision, goal and time-bound action plan for change that is expected to inform institutional reform in HP and other states. This subcomponent will also help develop an initial set of prioritized institutional governance reforms. These reforms may include inter alia: (a) the development and implementation of a comprehensive HPFD IT and knowledge strategy that integrates all relevant applications on a common geospatial platform and allows for watershed-level planning; (b) the development and implementation of a comprehensive HPFD M&E system; (c) the establishment of a centralized staff performance monitoring system; and (d) the development of regulatory and management standards for pastures. Finally, this subcomponent will finance training and capacity-building activities based on a comprehensive training plan. The trainings will cover diverse subjects and will be designed with a climate change lens to build climate resilience; for example, trainings on GP-RMP development will include guidance on how to ensure that climate change is adequately addressed in these plans, and the extension trainings will emphasize CSA practices and technologies to increase the adaptive capacity of farmers, as well as the resilience and resource use efficiency agricultural production systems in HP. Training modules will be made available online to enable stakeholders in other states to benefit from this knowledge. The consultancy contracts required would include: (i) FRFI; (ii) Development and implementation of an IT Strategy including monitoring and evaluation; (iii) Development and delivery of new training modules. The IT Strategy will incorporate the hydrological monitoring system under sub-Component 1A. Component 4: Project Management (US$9.90 million; US$7.92 million IBRD)
18. This component will support the project management function, including key staff and operational costs. The project management entity will be in the form of a PMU under the auspices of the HPFD, although at least in the medium-term financing will be required for staff on secondment from other Departments and externally recruited staff in areas with skillsets outside the current bureaucratic capacity. A key example is agribusiness, for which few existing staff of Departments have the required expertise. It would also support the project monitoring and evaluation functions, as well as grievance redress apparatus, and project communications and outreach, including the contribution to Lighthouse India through which project lessons can be shared with other States. This component will also include retroactive financing for project preparation.
19. The project will be implemented in 428 selected GPs in 32 Development Blocks of the ten districts of Shimla, Solan, Sirmour, Bilaspur, Hamirpur, Mandi, Kullu, Chamba, Kangra & Una. Several economically disadvantaged (‘backward’) GPs will be included in the project area. The stakeholders are primarily engaged in agriculture and horticulture with some livestock-based activities. The transhumant groups include Gaddis & Gujjars, who are dependent on the forest for rearing their livestock.
20. The key beneficiaries include individual farmers, including women, and farmer groups; disadvantaged groups, including the poor and scheduled populations, as well as nomadic/ transhumant/ pastoral communities; and GPs. These stakeholders will benefit from improved access to irrigation water, climate smart extension services, and productive assets, as well as future reductions in land degradation. Women, and the community at large, will also benefit from employment opportunities in nursery and plantation activities and the development of high value agricultural value chains and Non-timber Forest Products (NTFPs). Community members will benefit from training on improved production and post-harvest practices, as well as technical and financial support to invest in sustainable value chain development. Improvements in fodder availability as a result of the Component 1 investments will particularly benefit women and Scheduled Tribes (STs), as they are most involved with livestock management. The project will also increase the skills and capacity of HPFD staff and other government officials.