Credit Number 3880-Vn

CREDIT NO. 5352-VN

IRRIGATED AGRICULTURE IMPROVEMENT PROJECT

abbreviations

B/C / Benefit/Cost
CPC / Commune People’s Committee
CPIM / Centre of PIM
CPMU / Central Project Management Unit (under CPO)
CPO / Central Project Office
CQS / Consultant Qualification Selection
CSA / Climate Smart Agriculture
DARD / Department of Agriculture and Rural Development
DOSTE / Department of Science and Technology
DPC / District People’s Committee
DR / Discount rate
DRC / District Resettlement Committee
RPF / Resettlement Policy Framework
DSU / Dam Safety Unit
EAP/EMP / Environmental Action Plan/Environmental Management Plan
EIA / Environmental Impact Assessment
EIRR / Economic Internal Rate of Return
EMDP / Ethnic Minorities Development Plan
EPP / Emergency Preparedness Plan
FAO / Food and Agriculture Organization
FIRR / Financial Internal Rate of Return
GIS / Geographic Information System
GOVN / Government of Vietnam
IBRD / International Bank for Reconstruction and Development
ICB / International Competitive Bidding
ICD / International Cooperation Department
ICM / Integrated Crops Management
ICOLD / International Committee of Large Dams
IDA / International Development Association
IDMC / Irrigation and Drainage Management Company
IPM / Integrated Pest Management
km / Kilometre
km2 / Square kilometre
M / Metre
m2 / Square metre
m³ / Cubic metre
m3/sec, m3/s / Cubic metre per second
MARD / Ministry of Agriculture and Rural Development
MIS / Management Information System
mm / Millimetre
mm/day / Millimetre per day
Mm3, MCM / Million cubic metre
MOC / Ministry of Construction
MOF / Ministry of Finance
MOLISA / Ministry of Labour, Invalids and Social Affairs
MOSTE / Ministry of Natural Resources and Environment
MPI / Ministry of Planning and Investment
NCB / National Competitive Bidding
NOL / No-objection letter
O&M / Operation and Maintenance
ODA / Official Development Assistance
OP / Operational Policy
PAD / Project Appraisal Document (by the World Bank)
PAF / Project Affected Family
PAH / Project Affected Household
PAP / Project Affected Person
PDR / Preliminary Design Report
PIM / Participatory Irrigation Management
PMF / Possible Maximum Flood
PMIS / Project Management Information System
PPMU / Provincial Project Management Unit
PPC / Provincial People’s Committee
PPD / Plants Protection Department
PRC / Provincial Resettlement Committee
QCBS / Quality-Cost Based Selection
RAP / Rapid Assessment Process
RAP / Resettlement Action Plan
SCADA / Supervisory Control and Data Acquisition
SDR / Special Drawing Right [of WB]
SS / Single Source
ToT / Training of Trainees
TOR / Terms of Reference
UNDP / United Nations Development Programme
USD, US$ / United States Dollar
VAT / Value Added Tax
VNĐ, VD / Vietnam Dong
V-M / Vice Minister
VIWRP / Vietnam Institute of Water Resources Planning
VAWR / Vietnam Academy of Water Resources
VWRAP / Vietnam Water Resources Assistance Project
WB / World Bank
WUA / Water User Association
WUO / Water User Organization

CPO.PMR.June14.EN.doc 10 July 2014

Ministry of Agriculture and Rural Development (MARD) Vietnam Irrigated Agriculture Improvement Project – Cr.5352-VN

Central Project Office (CPO) IDA Mission report, July 2014

EXECUTIVE SUMMARY

Project overview

The “Irrigated Agriculture Improvement” Project aims to improve the sustainability of irrigated agriculture production systems in 7 provinces in the Northern mountainous and Central regions, including Ha Giang, Phu Tho, Hoa Binh, Thanh Hoa, Ha Tinh, Quang Tri and Quang Nam. The project total estimated cost is USD210 million, including USD180 million funded by the International Development Association (IDA) and USD30 million funded by the Government (approximately USD22 million of central counterpart fund and USD8 million of provincial counterpart fund). The Financing Agreement was signed on April 24, 2014 and expected to become effective since July 23, 2014. The project is implemented from 2014-June 2020. The project consists of 4 components with costs allocated as follows :

Component 1: Improved Irrigation Water Management (US$ 9.5 million)

Component 2: Irrigation and Drainage Scheme Level Improvements (US$ 170.5 million)

Component 3: Support Services for Climate-Smart Agricultural Practices (US$ 23 million)

Component 4: Project Management, and Monitoring and Evaluation (US$ 7 million)

Project implementation status during implementation deployment phase. Completed contents include: approval of Resettlement Policy and Ethnic Minorities Development Frameworks, overall Environmental Impact Assessment and Management Plan; Announcement of the project and safeguards policies in the project area; Approval of FSs of component projects; Completion of technical design of renovation items of Quang Nam, Thanh Hoa irrigation schemes and Hoa Binh pumping stations subproject; on-going verification of detailed design (DD) for Ke Go subproject (Ha Tinh); deployment of DD preparation for remaining subprojects; Regarding safeguards policies, RAPs, EMPs/ECOPs of Quang Nam, Thanh Hoa, Hoa Binh (pumping stations subproject), Quang Tri, Ha Tinh, Phu Tho, Ha Giang have been completed.

Project implementation management arrangement: MARD has made decision on establishing CPMU (under CPO), establishing the Project steering committee headed by the Vice Minister and participated by leaders of MARD’s Departments and PCs of project area provinces, Establishing a Task Force of Component 3 including staff of the Crop Production Department, Plants Protection Department, and Directorate of Water Resources. In provinces, PPMUs have been established.

Approval and issuance of the project operating manual (POM)

Key officers, including financial management officers, procurement officers, social and environment officers have been appointed for CPMU and PPMUs.

Mobilization of Consultants:

The project general Consultant: the project TA Consultant is being selected (under short-listing process); TORs have been drafted for the third-party supervision consultant (ISC), Independent Audit Consultant, M&E Consultant, RAP/MASSCOTE Consultant for large irrigation schemes, namely Khe Tan, Rac River, South Ma River, Truc Kinh, Ha Thuong, La Nga, Overall training program preparation consultant, Technical requirements preparation consultant for procurement of GIS and remote sensing technology.

Provinces: already mobilized DD preparation consultants (except for Phu Tho and Quang Tri), DD verification consultant; drafted TORs for CSA Consultant.

Total implementation cost as of June 30, 2014 is USD4.8 million (VND101.3 billion), equivalent to 2.29% of the project total cost of US$210 million.

Overall disbursement as of June 30, 2014 is US$2.42 million of national counterpart fund, equivalent to 1.15% of the project total cost. Loan fund has not yet been disbursed.

Achieved results in term of indicator not yet applied.

Component 1 – Improved irrigation water management Organizing 3 TOT classes on irrigation works management in Ha Tinh. Conducting recruitment of RAP/MASSCOTE assessment consultants for large schemes (except for Phu Ninh and Ke Go where this job was done during the project preparation), Technical requirement preparation consultant, GIS and remote sensing technology development support consultant. TOR preparation consultant is expected to start from August through December 2014.

Component 2 – Irrigation and Drainage scheme level improvements

Ha Giang completed draft DD of Hung An and Yen Ha schemes, processing verification job.

Hoa Binh approved DD of turbine pumping stations in Tan Lac, Mai Chau Districts; Nai, Dong Chui turbine pumping stations and Nuoc Tra electric pumping station. Drafted bidding documents for these packages.

Phu Tho completed the Basic designs. Carrying out recruitment of detailed DD preparation consultant.

Thanh Hoa complete draft DD, processing verifivation job.

Ha Tinh completed draft DD of Ke Go and Rac River schemes. Processing verification job of Ke Go DD.

Quang Tri Deploying recruitment of detailed DD preparation consultant.

Quang Nam completed draft DD of Phu Ninh scheme and approved DD and drafted bidding documents of 3 packages. Deploying preparation of DD for Khe Tan scheme.

Component 3 – Support services for Climate-smart agricultural practices On the basis of CSA consultant TOR updated with WB’s comments, CSA consultant TORs have been drafted in provinces. TORs for CSA consultants of Ha Tinh, Quang Nam, Phu Tho, Hoa Binh and Quang Tri provinces are pending for WB’s comments; those of Thanh Hoa and Ha Giang provinces are being finalized.

CPO.PMR.June14.EN.doc 10 July 2014

Ministry of Agriculture and Rural Development (MARD) Vietnam Irrigated Agriculture Improvement Project – Cr.5352-VN

Central Project Office (CPO) IDA Mission report, July 2014

PROJECT IMPLEMENTATION PROGRESS AS OF JUNE 30, 2014

1 COMPONENT 1: IMPROVED IRRIGATION WATER MANAGEMENT

1.1 Introduction

General objective: To innovate the management and exploitation of irrigation works in line with the market mechanisms under the State management to improve the efficiency of irrigation works utilization and contribute to improve the agricultural production efficiency in a sustainable way in climate change adaptive conditions.

Expected results:

- Develop an organizational model and irrigation and drainage management mechanism in line with contract-based service delivery mechanism. The 7 project provinces will prepare and implement the 5-year and annual irrigation modernization plans. 2 provinces (1 in the Northern mountainous area and 1 in the Central region) shall apply the ordering mechanism in irrigation and drainage services delivery to learn from experience.

- IMCs will be equipped and installed SCADA system, use of information technology in operational management and business management; Prepare, carry out and evaluate results of operational plan implementation, and training for capacity building of operation and maintenance management.

- Enhance the participation of farmers in irrigation management through establishment of and capacity building for water user organizations/cooperatives, water user association and move into decentralization and transfer of irrigation management;

- Learn from experience, recommend MARD to revise and finalize Circular, Guidelines on management, operation and delivery of irrigation and drainage services.

Component total fund: USD9.5 million (equivalent to VND200.5 billion)

- ODA fund : USD8.02 million (equivalent to VND169.2 billion).

- Counterpart fund: USD1.48 million (equivalent to VND31.28 billion).

Of which: Central counterpart fund: VND31.28 billion; Local fund: 0

Fund allocation for Spending items: (unit: USD1,000)

Item / ODA fund / Counterpart fund / Total fund
A. Items owned by provinces / 5,464 / 405 / 5,869
1. Consulting services / 350 / 0 / 350
2. Goods/Equipment / 5,114 / 0 / 5,114
2.1. Support for IMC / 4,336 / 0 / 4,336
a/ SCADA system* / 2,108 / 0 / 2,108
b/ Office equipment for management job / 948 / 0 / 948
c/ GIS map of the irrigated area** / 760 / 0 / 760
d/ Business management database / 520 / 0 / 520
2.2. Support for WUA / 778 / 0 / 778
a/ On-farm water gauges, office equipment / 778 / 0 / 778
3. Management/Other expenses / 0 / 405 / 405
B. Items owned by CPO / 1,800 / 325 / 2,125
a/ General technical assistance (TA) Consultant / 1,800 / 0 / 1,800
b/ Management cost and others / 0 / 325 / 325
C. Contingency / 753 / 753 / 1,506
Total / 8,017 / 1,483 / 9,500

Note: * SCADA system is installed for 4 province, namely Ha Tinh, Thanh Hoa, Quang Tri and Quang Nam.

** GIS map is not made for Phu Tho

1.2 Actual progress

Technical assistance Consultant is part of the project general technical assistance consultants. QCBS applied. Currently under Short-listing stage.

Sample TOT on irrigation works management in Ha Tinh: January 2014; Under the project, 03 TOT classes have been held on PIM for 126 people from districts of Ha Tinh province. Participated by representatives of DARDs and IDMCs of 6 provinces. Expenditures from counterpart fund.

Irrigation scheme assessment consultant with MASSCOTE/RAP methods for large irrigation schemes (except for Ha Tinh, Quang Nam where this was done during the project preparation stage): Drafted submission for approval of outlines and estimates. Procurement plan submitted to MARD. Expected cost of VND1.3 billion from the counterpart fund.

Technical requirements preparation consultant for procurement of GIS development consultance serving IMCs’ management job and application of remote sensing technology to monitor the cropping development: Drafted submission for approval of outlines and estimates. Procurement plan submitted to MARD. Expected cost of VND120 million from the counterpart fund.

1.3 Financial progress

Unit: USD1,000

Implemented value / Disbursement value / Remark
Loan fund / 0 / 0
Counterpart fund / 12.5 / 0
Total / 12.5 / 0

1.4 Monitoring indicator assessment:

Not yet applied.

2 COMPONENT 2: IRRIGAITON AND DRAINAGE SCHEME LEVEL IMPROVEMENTS

2.1 Introduction

General objective: This component will support infrastructure improvement investments for a total command area of 83,400 ha, including the upgrading and modernization of selected existing irrigation and drainage projects in the project area and provisions for some small multi-purpose village ponds. The improved schemes will provide reliable irrigation and drainage services, ensuring safety of works against natural disaster risk, flexibly meeting requirements of climate-smart agricultural production.