FOR OFFICIAL USE ONLY FE COpy

Transcription

1 Document of The World Bank Public Disclosure Authorized FOR OFFICIAL USE ONLY FE COpy Report No IN INDIA STAFF APPRAISAL REPORT TAMIL NADU EXTENSION PROJECT March 25, 1981 Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Education and Agricultural Institutions Division South Asia Projects Department This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.

2 CURRENCY EQUIVALENTS US$1.00 = Rupess (Rs 8.0 WEIGHTS AND MEASURES Metric System ABBREVIATIONS AAO - Assistant Agricultural Officer AO - Agricultural Officer ADA - Additional Director of Agriculture ADA - Assistant Director of Agriculture AEO - Agricultural Extension Officer APC - Agricultural Production Commissioner BDO - Block Development Officer DDA - Deputy Director of Agriculture DEA - Department of Economic Affairs DOA - Directorate of Agriculture DOE - Directorate of Agricultural Extension (GOI) DOH - Directorate of Horticulture DRD - Directorate of Rural Development DTC - District Technical Committee DVAO - Divisional Agricultural Officer DYAO - Deputy Agricultural Officer GOI - Government of India GOTN - Government of Tamil Nadu HYV - High Yielding Varieties ICAR - Indian Council of Agricultural Research IRRI - International Rice Research Institute JD - Joint Director of Agriculture TNAU - Tamil Nadu Agricultural University SDAO - Subdivisional Agricultural Officer SMS - Subject Matter Specialist SWC - Scientific Workers Conference T&V - Training and Visit System of Agricultural Extension VEW - Village Extension Worker(s) VLW - Village Level Worker(s)

3 FOR OFFICIAL USE ONLY INDIA TAMIL NADU AGRICULTURAL EXTENSION PROJECT Table of Contents Page No. I. BACKGROUND... 1 A. Introduction... I Agriculture in India... I Agricultural Extension... 2 Existing State Projects... 3 B. The State of Tamil Nadu... 6 General Description... 6 Agriculture Structure... 6 Agricultural Production... 6 Agricultural Services in Tamil Nadu... 7 Marketing... 9 II. THE PROJECT A. General Description B. Detailed Features The Extension Methodology Incremental Staff Requirements.12 Training.13 Housing.14 Transport.14 Equipment.14 Operating Expenses.15 Monitoring and Evaluation.15 III. COST ESTIMATES AND FINANCING..15 A. Cost Estimates.15 B. Proposed Financing.16 C. Procurement.17 D. Disbursement and Audit.17 IV. ORGANIZATION AND MANAGEMENT Extension Service Input Supplies State Level Coordination Linkages between Extension and Research Monitoring and Evaluation V. BENEFITS, JUSTIFICATION AND RISKS VI. AGREEMENTS REACHED AND RECOMMENDATIONS This document has a restricted distribution and may be used by recipients only in the performance of their ofricial duties. Its contenst may not otherwise be disclosed without World Bank authorization.

4 Table of Contents (continued) ANNEXES 1 - Table 1 Summary of Project Costs Table 2 Incremental Staff Salaries Table 3 Civil Works Table 4 Incremental Vehicles and Equipment Table 5 Incremental Operating Costs Table 6 Training Costs Table 7 Horticulture Extension Table 8 Horticulture Extension f Table 9 Requirement of Extension Staff by Year Table 10 Staff Requirements Table 11 Requirement and Availability of Extension Staff by Subdivision 2 - Training 3- Table I Implementation Schedule Table 2 Estimated IDA Disbursements 4 Table 1 Economic Analysis Table 2 Economic Price for Paddy CHART - World Bank MAP IBRD 15429

5 INDIA TAMIL NADU AGRICULTURAL EXTENSION PROJECT I. BACKGROUND A. Introduction 1.01 The proposed project would be the tenth in a series of IDA-assisted projects designed to reorganize and strengthen agricultural extension in India. 1/ Under the project, the Government of Tamil Nadu (GOTN) would reorganize its extension service to provide farmers, on a regular and systematic basis, with up-to-date advice on farming practices best suited to their specific conditions and capable of having an immediate impact on production and income. This would be achieved by strictly programmed visits from regularly trained field staff, supported by professional advice from the Department of Agriculture (DOA) and from research. 2/ The project was prepared by GOTN with assistance of staff of the Bank's Resident Mission in India. Appraisal took place in October This report is based on the findings of the appraisal mission consisting of Messrs. C.P.R. Nottidge, R.J.G. Le Breton (IDA), T. Lohavisvapanich (FAO/CP), d.m. Mathur and G.R. Galgali (Consultants). Agriculture in India 1.02 The area of India is 3.29 M km of which 55% is cultivable and about 25% of net cultivated area irrigated. India's population of over 650 M is growing at an annual rate of about 2%. National income has grown at about 3.5% per annum since 1950, and the per capita GNP reached US$190 in Although average per capita income has increased, in general, there has been little change in the living standards of the vast mass of urban and rural poor, conservatively estimated at 300 M people with incomes below the poverty line of US$79 per capita per year. Thus, GOI's development plans give priority to alleviating poverty and creating employment, especially in rural areas. 1/ The nine previous projects are described in the following appraisal reports: Assam Agricultural Development Project, Cr. 728-IN. West Bengal Agricultural Extension and Research Project, Cr. 690-IN. Rajasthan Agricultural Extension and Research Project, Cr. 737-IN. Madhya Pradesh Agricultural Extension and Research Project, Cr. 712-IN. Bihar Agricultural Extension and Research Project, Cr. 761-IN. Orissa Agricultural Development Project, Cr. 682-IN. Composite Agricultural Extension and Research Project (Haryana, Gujarat and Karnataka), Cr. 862-IN. Kerala Agricultural Extension Project, Cr IN. Maharashtra Agricultural Extension Project (Appraised in October 1980) 2/ The main principles of the proposed extension reform are described in Agricultural Extension: The Training and Visit System (World Bank, 1977).

6 Agriculture is the dominant sector of the Indian economy and contributes about 40% of GNP. It engages about 70% of the labor force and provides the base for about 60% of India's exports. During the last decade, GO! development plans have emphasized agriculture and sought to raise foodgrain production by increasing the use of irrigation, fertilizers, plant protection chemicals, and seeds of improved varieties. In support of this, GOI has modernized and expanded its agricultural credit institutions and accelerated the development of irrigation. More recently, increased attention has been givei- to the establishment of improved extension services and upgrading the research capabilities needed to support this extension effort These efforts appear to be bringing significant results. Over the past decade foodgrain production has grown at about 2.75% p.a., sufficient to meet consumer demand, eliminate imports (which had averaged nearly 5 million tons per year for the 15 years preceeding 1976) and lower real foodgrain prices to consumers. At the same time India was able to build up sufficient buffer stocks of rice and wheat to cope with the 1979/80 drought with comparative ease, and to export about million tons of rice in 1980/81. While these developments are very encouraging, great efforts will be required to maintain this pace. Moreover, per capita production of a number of other important crops, including cotton and oilseeds, has fallen during the period. Furthermore, India's agriculture is particularly susceptible to the vagaries of weather and foodgrain production can vary as much as 20% between successive years. Although expansion of irrigation facilities to reduce this variation remains a priority, GOI recognizes that the bulk of India's cropped area and over half of its farmers, cannot, in the foreseeable future, benefit from water-intensive agricultural technologies. Moreover, although much appropriate research is available, yields under rainfed conditions have shown little or no improvement over this period-- a fact which prompts this project's emphasis on rainfed as well as irrigated farming. Agricultural extension 1.05 State Governments have direct responsibility for agricultural extension; they operate through their Departments of Agriculture (DOA), generally with the cooperation of other state departments, including Community Development. While organization varies between states, in states where extension services have not been reorganized through the type of project appraised in this report, the extension service is generally headed by the Director of Agriculture who reports to the Secretary of Agriculture. He is assisted by staff located at state, zonal and district levels. The Collector (the senior representative of the civil administration at the district level) coordinates activities between the various agencies of government, with the District Agricultural Officer (DAO) representing DOA. Below the district level, Agricultural Extension Officers (AEO) generally report on routine matters to the Block Development Officer (BDO), an official of the state Community Development Department. In some states, locally elected councils (panchayats) also play a role and the BDO are responsible to these bodies. Given the multitude of local activities and lack of direct administrative control by DOA, AEO are often diverted to non-agricultural activities. The village level worker (VLW), a multipurpose worker and generally an employee of the Community Development Department, is supposed to spend 75-80% of his time on agricultural extension under the direction of the AEO. However, the VLW is administratively responsible to the BDO and the lack of a well-defined agricultural program, combined with the demands of his other activities, generally result in his spending very little time on agricultural extension. The same is generally true of the AEO. What little extension work is done is neither planned systematically, nor supervised adequately.

7 Over the years, dissatisfaction with the effectiveness of the multi-purpose worker for increasing agricultural production has led to the development of a variety of special programs focusing on particular crops, areas, or techniques. Staff employed under these schemes are usually under the administrative control of various subject matter departments of DOA. In a given state, such schemes usually cover only a few districts and only part (e.g., one crop) of the farmers' operations. These schemes have tended to dissipate extension efforts in many uncoordinated directions and divert attention and resources from the need to reform the main line extension agency In addition to the organizational problems mentioned above, the extension service often suffers from inadequate and outdated staff training. There are usually too few staff to cover the farming community adequately and they lack sufficient mobility to reach farmers systematically and regularly. Furthermore, government-owned housing is scarce and rented accommodation hard to come by in rural areas where extension workers need to be based. Linkages with research have been tenuous and irregular. All these factors have hampered effective extension work. They have resulted in a general stagnation in agricultural production, with most extension personnel having low status, low pay and poor morale With yields in irrigated and rainfed areas remaining at levels well below potential, GOI has become increasingly concerned with improving agricultural extension. A new system of extension--the Training and Visit System (T&V)--based on frequent and regular farm visits by full-time, and adequately trained extension personnel was developed in 1974 with IDA assistance. Under this approach, a substantial portion of the multipurpose VEW is transferred from Community Development Departments to DOA to work exclusively on agricultural extension. The results from the Chambal Irrigation Project in Rajasthan,1/ where the system has been in operation since 1974, were so encouraging that the approach has been subsequently adopted in ten states under projects discussed below. Existing State Extension Project 1.09 The Rajasthan Agricultural Extension and Research Project (Cr IN, US$13 M, effective in February 1978), was an outgrowth of the favorable results obtained with the new approach to agricultural extension pioneered under the Chambal Command Area Development Project (Cr. 562-IN, effective September 1975) and the Rajasthan Canal Command Area Development Project (Cr. 502-IN, effective December 1974). The Government of Rajasthan is presently reorganizing and strengthening extension and supporting adaptive research to serve 2.9 M of the state's 3.7 M farm families in 17 districts where an immediate potential for improving agricultural production exists. Project implementation has picked up rapidly. Farmers have responded favorably to the system, and adopted new practices like seed treatment, basal dressing with fertilizers, and intercropping with kharif pulses which have helped them to grow a good crop even under drought conditions. There is now a need for more intensive work by researchers to develop more sophisticated 1/ This covered about 84,000 farm families and 360,000 ha of which about two-thirds is irrigated.

8 -4- technological packages since farmers have developed confidence in the extension staff and are highly receptive to new techniques and skills As a result of experience with improved extension activities in the Chambal Irrigation Command Area, Madhya Pradesh requested IDA assistance in extending the reorganization of agricultural extension services to cover both irrigated and rainfed areas in 15 of 45 districts in the state (Cr. 712-IN, for US$10 M, effective September 1977). Progress was good in the early stages of the project, but slowed down later due to frequent changes in project management. The major problems noted by the various early supervision missions were staff shortages, slow construction of buildings and houses, inadequate liaison between research and extension organizations and slow implementation of the T&V system, although district phasing had proceeded as planned. Despite this, there has been considerable improvement during the past year and almost all posts have now been filled. Having overcome cumbersome bureaucratic tendering procedures, the building program is now gaining momentum. Liaison between research and extension has been well established resulting in a substantial involvement of research workers in training extension staff and with greater emphasis being given to resolving farm related problems within the overall research program. At a recent survey, 75% of contact farmers were aware of the day of visit of the VEW and almost all could identify him by name. About 81% of contact farmers have adopted at least one of the recommended practices In project districts, there has been a 300% increase in the use of clean and graded seed, a 35% increase in the planting of seed of improved varieties and a 28% increase in the use of seed dressings. Fertilizer use, both under rainfed and irrigated conditions, has increased by 66% over 1976/77 levels (as compared to 48% in other districts of the state) and the use of soil testing facilities increased by 69%. In October 1980, IDA appraised a project to extend the T&V system to cover all districts of the state Eastern India, including Assam, Bihar, Orissa and West Bengal, is the country's "rice bowl." Despite its high potential, foodgrain yields are low and production has barely kept pace with population growth. The stagnation of agricultural production has been partly due to the inability of the extension service to give meaningful advice to farmers; similarly, research has failed to focus on the majority need for simple, low cost means of improving production. Orissa was the first state to reorganize its agricultural extension service throughout the entire state (Cr. 682-IN, for US$20 M, effective June 1977). Virtually all of the state's 3.4 M farmers are now covered by the program and according to the most recent supervision mission, good progress has been made and farmers have responded well and have accepted, on a widespread basis, new practices for increasing production, e.g., introduction of mustard as a new crop, seed treatment, and use of manually operated seed drills. In addition, the supervision mission has reported favorably on the way extension messages are reaching even the remotest villages During the preparation and appraisal of the West Bengal Agricultural Development Project (Cr. 541-IN, effective August 1975), which supports minor irrigation development in a portion of the state, one of the major constraints

9 was identified as a lack of effective agricultural extension. Consequently, the project included a component to strengthen extension in six districts along the principles established in the Chambal and Rajasthan Canal Areas. The initial impact of extension reorganization was so favorable that the state decided to expand the coverage. This was provided in Cr. 690-IN, for US$ 12 M, effective August Initially, the project was highly promising: 2,400 multipurpose workers were transferred from the Community Development Department to the control of DOA and were trained in the dissemination of specific messages for farmers and, together with DOA technical staff, worked with farmers in identifying and solving field problems. In the latter part of 1977, however, a new Government of West Bengal (GOWB) suspended its earlier decision to place the Village Extension Worker (YEW) under the administrative control of DOA pending a thorough review. This drastically reduced the ability of VEWs to visit farmers regularly, and extension operations came to a virtual halt in most of the state. GOWB has now re-established the single line of command, placing all extension staff under DOA, thus removing the major obstacle to project implementation. Although recruitment and training of new VEW has started, the tempo of work has not yet reached former levels due to an injunction being brought against the Government by some staff transferred from the Community Development Department. The injunction was partly lifted in January 1981 allowing newly recruited VEW to $tart field work Under the Assam Agricultural Development Project (Cr. 728-IN, for US$8.0 M, effective September 1977), Assam became the third state in the eastern region to reorganize its extension service. The project now covers all of the approximately 1.9 M farm families in Assam's plains districts. In the first districts covered, improved farm practices such as transplanting of paddy, use of HYV paddy, increased area and higher yields of HYV wheat and increased consumption of fertilizers resulted. In the more recently covered districts, the effects of extension work are already starting to be seen. - Unfortunately, in view of political unrest in Assam, it has not been possible to supervise the project since November Under the Bihar Agricultural Extension and Research Project (Cr. 761-IN for US$8 M, effective May 1978), through a reorganization of existing staff, some 9,000 VEW were to reach all of Bihar's 7.6 M farm families. However, very little progress has been made so far with the reorganization. Ihe posts of Director of Agriculture and Additional Director of Agriculture (Extension) remain vacant and the extension system is operating in only 5 of 31 districts. The persistent delay by the Government of Bihar in filling key posts and general commitment to the project is of great concern. More recently, government has expressed renewed commitment to the project and some staff have been appointed. IDA and GOI are following the situation closely. The state government has been alerted that unless significant progress is made by March 31, 1981, IDA will have to reassess its involvement in the project The Composite Agricultural Extension Project (Cr. 862-IN for US$25 M) became effective in December Under this project, the governments of Gujarat, Haryana and Karnataka have undertaken the reorganization of extension services in their states. The project also includes strengthening of the capability of the Directorate of Agricultural Extension of the Government of India (GOI) in order that it may assist all states in the implementation and operation of the reorganized extension system. Extension activities are going well in Haryana and Karnataka. In Gujarat, the quality of extension work is not

10 - 6 - uniform. While in some districts its impact is highly effective, in other districts it has suffered from inadequate supervision by the State DOA. The State Government has been urged to remedy the situation The most recent project, the Kerala Agricultural Extension Project (Cr IN for US$10 M) became effective in June Recently, there have been changes at the top administrative and political levels in agriculture with the result project implementation has made little progress. A recent supervision mission discussed project proposals with the new officials and agreed on a modified program for implementation. Field work has begun in three districts and will start in the remaining districts in May, The beneficial results of the system are not being achieved with equal success in all areas due to local problems. The decision to transfer control of considerable numbers of multipurpose extension workers to the Department of Agriculture and assign them to work exclusively on agriculture requires a major political commitment and reorganizational efforts. It has been difficult for some state governments to make this decision and maintain it once made. In addition, the absence of timely financial sanctions, tardy staff recruitment, and protracted procedures for acquisition of land have sometimes slowed progress, although these problems have now been overcome in most states. Encouraged by the impact which the Training and Visit system of extension is having in areas where it has been successfully operating, GOI is seeking to bring about similar reorganization throughout all states in India. The GOI Directorate of Agricultural Extension (DOE) has taken the initiative to help states overcome initial difficulties. Although these projects are demanding in terms of IDA supervision, their great potential for sustaitned increases in food production and improved incomes for the rural sector justifies continued IDA participation. General Description B. The State of Tamil Nadu 1.19 Tamil Nadu, situated in the south of the Indian sub-continent, occupies an area of about 130,000 km. Its estimated population of 46.8 M million (1979) represents about 7% of the Indian total. The State's per capita income in 1977/78 was Rs 1,036 compared to an all-india average of Rs 1,189. About 60% of the working population is engaged in agriculture which accounts for 43% of the State's GDP. The State is divided into 15 districts, subdivided into 151 taluks The State has two main geographical regions; first the coastal plain km wide which runs from Madras to Cape Comorin and from the Bay of Bengal to the Eastern Ghats (hills) with mainly sedimentary soils and an average rainfall of about 1,200 mm. The second region being the central plateau lying between the Eastern and Western Ghats with mainly red soils on crystalline rock formations and with an average rainfall of about 800 mm. The Western Ghats are the watershed for the main rivers flowing into the Bay of Bengal of which the Cauvery is the most important. There are three main seasons; the SW monsoon from June to September (maximum month 100 mm of rain); the NE monsoon from October to December with the heaviest rainfall (maximum month 700 mm) and the dry season from January to May with little rain. Temperatures range from 25 0 C in January to 31.5 C in June.

11 -7 Agriculture Structure 1.21 The net sown area is about 6.3 M ha (48% of total area), while a further 3.6 M ha (28% of total area) is classified as pasture, fallow or cultivable waste land. About 2.9 M ha (46% of net sown area) is irrigated of which the most important source is tanks (38%) followed by canals (36%) and wells (26%) Farm holdings in Tamil Nadu are small and often fragmented. Eighty percent of holdings are up to 2 ha in size (representing 36% of farm land), 16% range between 2 and 6 ha (32% of farm land) with the balance of 4% (52% farm land) above 6 ha. There is a high proportion of tenant farmers who at present have relatively limited rights and who generally are unable to mortgage the lands they farm. A ceiling has been placed on individual land ownership and operational farm units are often greater than statistics would imply because of divided ownership among many members of the same family. Nonetheless, the small size of farms is an important factor in the sta te's agricultural economy. Agricultural Production 1.23 Although paddy is the state's most important single crop (representing about 36% of cropped area), rice production, which in 1977/78 amounted to 5.9 M tons, is barely adequate to meet local consumption demands and in drought years must be imported from other states. The remainder of the cropped area is divided among cereals (27% of cropped area), oilseeds-- mainly groundnuts (16%), pulses (6%), cotton (4%), sugarcane (2%), and a variety of other commercial and subsistence crops (9%). The total production of cereals and pulses averaged 7.1 million tons over the three years to 1977/78, while of the commercial crops, 1977/78 production of sugar (jaggery) was 1.02 M tons, cotton 686,000 tons and oilseeds 1,018,000 tons. Agricultural Services in Tamil Nadu 1.24 Extension Services. At present, most field level extension work is carried out through several special crop schemes under the Directorate of Agriculture, notably for paddy, cotton, coconut, tobacco, sugarcane and pulses. These schemes were established in the early 1970s because GOTN found that the previous system, which relied entirely on multipurpose Village Level Workers (VLWs) under the control of the Directorate of Rural Development, could not carry out regular intensive extension work. While this approach made an impact in the limited areas of its operation, some problems have emerged: (a) the coverage per unit is limited. Thus, given the available staff, only a relatively small proportion of the state's farmers (about 10%) could be reached; (b) frequent regular training was not a feature of the system; (c) separate staff for different crops led to duplication of efforts by the agricultural department and high operating costs;

12 (d) farmers, who normally grow a variety of crops, had to consult several different sources for advice; (e) the number of "units" in a district grew too large to be effectively supervised by District staff; (f) extension staff at the units lacked mobility, became officebound due to growing paper work and became input supply agents, rather than agents of technological change; and (g) there was no regular systematic contact between the extension staff and the farmers. In addition, the Directorates of Horticulture and Oil Seeds (recently formed) provide advice to farmers, the former department being solely responsible for all agricultural extension activities in Nilgiris District where tea, coffee, deciduous fruits, spices and vegetable crops constitute the main crops grown. During the past decade, much emphasis has been laid by the Directorate of Agriculture on the introduction of high yielding varieties, developing and advocating packages of agricultural practices and increasing the use of fertilizers, plant protection chemicals, weedicides and mechanized land preparation. More recently, the emphasis on increased production shifted to the area approach, wherein intensive farming practices were introduced for the specific needs of each of the agroclimatic zones, e.g., Drought Prone Area Program, Integrated Dryland Area Development Program, Intensive Agricultural Development Program and the Intensive Agricultural Area Program. Despite these efforts, the annual growth in food grain production over the last 10 years has been less than 5% and that of commercial crops has widely fluctuated with seasonal conditions. Moreover, yields from rainfed crops are still a cause for concern although production could be increased considerably through the adoption of improved husbandry practices Training. The Tamil Nadu Agricultural University (TNAU), established in 1971 at Coimbatore and employing some 1,500 staff, is the primary agricultural training institution in the state. In 1979, it awarded 331 B.Scs, 128 M.Scs and 22 Ph.Ds in agriculture and allied fields. TNAU's Extension Wing provides in-service training to extension service staff at its main campus and at research stations. The Directorate of Agriculture is represented on the Extension Education Council chaired by the Vice Chancellor of TNAU, which meets to develop training programs as required. There are also two training centers currently operating in the state, one in Coimbatore district, and the other in Madurai District, with a total capacity for training of about 140 students. At present, these centers are used primarily to train multipurpose Assistant Agricultural Officers/Demonstrators and who are generally employed on special crop development schemes. The State Agricultural Institute at Kudumiamalai trains farmers and departmental staff and has facilities for training in use of agricultural machinery Research. Responsibility for agricultural research in Tamil Nadu rests primarily with the Directorate of Agriculture and is conducted on its 25 research stations located throughout the state. The main areas of work are in the paddy, coconut, groundnut, cotton and sugarcane crops. Research is largely concentrated on the stations, although limited work is done on

13 -9- farmers' fields in a few villages surrounding the various research stations. In addition, TNAU carries out research including research into horticultural crops, farm machinery, food processing and livestock. Research is undertaken on farms located at the two main campuses at Coimbatore and Madurai and at 10 outreach stations and subcenters. Government has decided that full responsibility for agricultural research will be transferred to TNAU (including the transfer of the research stations), once agreement can be veached on terms and conditions of services for DOA staff working in research who wo_ld also be transferred. DOA is also represented on TNAU's research advisory committee. These formal relationships are supplemented by numerous informal contacts. The working relationships between DOA and TNAU are good and productive Credit. The cooperative apex institution for short and medium-term agricultural credit is the Tamil Nadu State Cooperative Bank which works through 16 District Cooperative Central Banks and about 4,800 village agricultural credit societies located at the District and Village levels, respectively. Long-term credit is provided by the Tamil Nadu Central Land Mortgage Bank through Primary Land Mortgage Banks. Commercial Banks also provide Et growing volume of credit to agriculture. Due to a reluctance in farmers to repay past loans, seasonal advances, over the past two years have declined substantially. However, the amounts of fertilizers and pesticides sold have not declined as farmers have resorted to cash purchase of their needs Input Supplies. Tamil Nadu, one of the more highly developed states in India and with a good transportation network, is well served by its input supply system. For fertilizer, there are over 13,700 selling points, about evenly divided between public sector cooperatives and private dealers. Few farmers have to travel more than 3 km for their fertilizer supplies. Plant protection chemicals are sold from about 8,000 outlets. DOA is directly involved in the production of seeds and the production and distribution of planting material of tree crops. HYV paddy foundation seed is multiplied on DOA farms; nucleus seed being supplied by TNAU. Registered growers multiply foundation seed to produce certified seed. DOA staff carry out field inspections and quality control tests while distribution to farmers is from DOA depot and seed stores located at Panchayat Unions. Marketing 1.29 Under the Tamil Nadu Agricultural Produce Market Act (1959), regulated markets have been established throughout the state for the sale of most agricultural produce. At each of the 230 markets, farmers' produce is auctioned, officially weighed and immediate cash payment made for produce bought. Daily information is given to growers on prevailing prices, demand and amounts of individual crops being delivered. In addition to private buyers, the Tamil Nadu Civil Supplies Corporation purchases paddy at prices established by Government.

14 II. THE PROJECT A. General Description 2.01 The five year project seeks to achieve early and sustained increases in agricultural production throughout Tamil Nadu's 15 districts through the reorganization and strengthening of the extension services of DOA and the Directorate of Horticulture (Nilgiris District only). The project would support this reorganization by - establishing a single line of command between full-time village extension workers (VEW) and extension headquarters; - consolidating staff from the special crop schemes of DOA into a single unified service; - incorporating regular in-service training as an integral part of extension activities; - improving the working linkages between extension operations and agricultural research activities; - developing regular monitoring and evaluation procedures; and - providing the additional staff, operating expenses, equipment, vehicles, training facilities, and rural housing required to implement these reforms. introduction of the reorganized extension service would be phased over a two year period, with eight districts (including Nilgiris District) being covered in the first year and seven in the second year. B. Detailed Features The Extension Methodology 2.02 Under the project, Tamil Nadu's agricultural extension service would be reorganized and intensified throughout the state, following the T&V pattern adopted in other Indian states over the past three to four years. The project would systematically and regularly provide farmers with up-to-date advice on farming practices best suited to their specific conditions and emphasizing proven practices. This would be brought about by organizing extension field staff so that they visit farmers regularly and receive systematic training and technical support from DOA and from research institutions. Each Village Extension Worker (VEW) drawn from the cadres of Assistant Agricultural Officers and Demonstration Assistants, would be assigned to work with a number of farm families. The number would vary depending on local conditions, population density, cropping intensity and accessibility. In most parts of Tamil Nadu, road communications are good, and this would permit an average farm family: VEW ratio of 800:1. However, available statistics probably understate the number of farm families in Tamil Nadu as the current estimate of 3.81 M effective farm families is

15 based on figures derived from the 1971 population census. In any event, the actual number of effective operating families will vary from around 600 in sparsely-populated areas to about 1,500 in a few densely-settled coastal areas where coconut is virtually the only crop and communications are good. Contingency provision is made in project costs to provide for 300 additional VEW, if in the course of project implementation, GOTN and IDA determine that more intensive coverage by VEW is warranted. As assurance was obtained during negotiations that GOTN and IDA would review progress of project implementation by March 31, 1983 to determine if the number of field staff (VEW) should be increased To reach his farmers systematically, the VEW would divide them into eight smaller groups each of about He would visit each group regularly on a fixed day of the week in a two-week cycle. During his visit, the VEW concentrates his efforts on about 10 contact farmers selected from each group, involving as many other farmers as possible. By the concrete results he achieves with contact farmers, the VEW can spread his recommendations more effectively to all farmers. During each visit the VEW would concentrate his efforts on only a few strategically-selected recommendations relevant for that particular phase in the crop cycle. Initially, the emphasis would be on low cost improvements which the majority of farmers can afford. The VEW would be supervised and helped in his work by an Agricultural Officer/Deputy Agricultural Officer (DYAO), the former would usually hold a B.Sc. degree in agriculture. One DYAO would normally be responsible for about six to eight VEW and would spend at least four days a week visiting them in the field. Once in each two-week period VEW would receive a full day of intensive training in recommendations for that period. Thus, every two weeks VEW would spend eight days in visiting each of his eight groups and one day in training. One day might be spent by the DYAO meeting together with all his VEW in the field or at headquarters to review progress and identify topics to be raised at the next training session. The remaining working days in the two-week cycle would be devoted to trials on farmers' fields, making up missed visits and occasional, but limited office work To provide regular training, continuous technical guidance and supervision of field work, between six and eleven agricultural subdivisions would be established in each district under the charge of a Divisional Agricultural Officer (DVAO), who would have full time responsibility for supervising 6-10 DYAO in his areas and ensuring effective extension operations. A subdivision would comprise one or a number of taluks. The DVAO would have a technical staff of three Subject Matter Specialists (SMS) (one each in agronomy of field crops, plant protection, and training/communications). SMS would spend one-third of their time in training groups of VEW once each fortnight (para 2.06), one-third of their time in field visits providing technical support and guidance to VEW, and one-third of their time in building their own stock of knowledge through a regular dialogue with research workers, carrying out simple field trials in farmers' fields, and attending short training courses. At the district level, a team of three SMS (generally in the same specialities as at the subdivisional level) would be established to provide greater depth of support to SMS teams at the subdivisional level and/or to cover specializations not covered by those at the subdivision. They would also divide their work between teaching, field visits and gathering knowledge. The Joint Director (JD) in charge of the District will have direct responsibility for extension operations throughout his District. To free the JD for

16 frequent field visits so necessary to review extension operations effectively, one Deputy Director of Agriculture would take over responsibility for reporting on scheme implementation, attending coordination meetings at district level, regulatory functions, and input supply arrangements. Staff at DOA headquarters would also be strengthened to provide more effective support to field operations (para 4.02). Incremental Staff Requirements 2.05 Staff required to implement this reform would be met by redeploying staff already with DOA and DOH, transferring staff from Directorate of Rural Development and hiring new staff. Detailed breakdown of staff requirement and availability by year, district and subdivision are given in Annex 1, Tables 8 and 9. The table below summarizes staff available and required by category. Assurances were obtained that GOTN would fill incremental staff positions according to or earlier than the schedule shown in Annex 1, Tables 2, 7 and 9. As the tables indicate, some 4,777 VEW are required. This requirement would be met by redeploying about 1,090 Assistant Agricultural Officers (AAOs) and 1,214 Demonstration Assistants already with the DOA and now utilized for special crop and area schemes, merging them with 1,122 VLW, to be transferred from the Directorate of Rural Development (DRD) and hiring about 1,351 new recruits. As a condition of invitation to negotiations, GOTN has issued a government order transferring 513 VLW positions from the DRD to DOA. Extension Staff Requirements - DOA Total Number Incremental Required Available Requirement VEW 4,777 3,426 1,351 DYAO SMS (SUBDIV) DVAO SMS (DIST) DYAO (TECH) JD SMS (HQ) DYAO (HQ) Asst. DA (HQ) ADA (EXTN) New posts would have to be created and filled by GOTN for 1,351 VEW, 178 DYAO, 96 subdivisional SMS, 39 SDAO, 44 District SMS and 12 JD. New VEW posts would be filled by promoting Demonstration Assistants or by direct hiring of those passing out from the state training institutions (para 2.07). The outturn from TNAU is sufficient to meet the need for graduates. Additional staff (1 DDA, 4 SMS, 5 DYAO and 40 VEW together with the necessary support staff) would also be recruited for the Horticultural Directorate (Annex 1, Table 7). The extension service would be directed in its day-to-day operations by a full-time Additional Director of Agriculture who would work exclusively on this job. Assurances were 1/ In Tamil Nadu VEW are known as AAO and the AEO as AO/DYAO. DVAO is generally of the rank of Asst. Director of Agriculture.

17 obtained that the VEW would be used exclusively for agricultural extension and that their emolument would not be adversely affected as a result of the reorganization. Training 2.06 The project would support a variety of in-service training programs for extension staff. The most important of these are outlined in Annex 2. Central to the entire extension support and an integral part of it is the fortnightly training session during which VEW would be trained in groups of about 30 by subdivisional SMS, assisted by the DYAO and drawing on the district SMS as well as specialists from nearby research stations. The entire training effort would be focused on making these fortnightly sessions as effective as possible. Training would be practical and concentrate only on the few specific recommendations relevant to farming operations in the coming fortnight. Ample time would be provided for VEWs, to carry out the recommendations and to practice how they would convince farmers to adopt them. They would also have an opportunity to raise and discuss problems encountered in the past two weeks. On alternate weeks VEWs would meet with their DYAOs to review progress. Other inservice training courses for VEW include a pre-season workshop/training session for each major season and about one special short course per year on a particular technical topic Newly recruited VEW would have generally received two years training at one of two institutions located in Madurai and Coimbatore districts. The average intake at each institution is from and with a total output of annually. Currently, there are more than 800 persons from these institutes registered at employment exchanges throughout Tamil Nadu. These, together with promotions from the Demonstration Assistant cadres and the anticipated number qualifying from Sri Ramakrishna Vidyalaya and Ghandigram Rural Institute would be sufficient to fill new posts created during the first three years_of the project and fill vacancies arising from retirement, transfer, etc. In addition, in-service training (three month period) and refresher training (two month period) would be given at the State Agricultural Institute to those Demonstration Assistants promoted to VEW and who had received their training some while before their promotion Higher level staff would require a range of training programs as well. Each month DVAO would meet with SMS and DYAO for a one day training and planning session during which the main points of emphasis and schedule of activities for the coming two fortnights would be determined. Before each season, training sessions would be held at the district level for DVAOs. Also, before each season there would be a workshop at the zonal research station attended by JD, DVAO and SMS. During this session research workers at the zonal station together with DOA staff would review the previous season's research results, specify recommendations and plan the coming season's research and field trials programs (paras ). While the fortnightly, monthly and orientation training of VEW and DYAO by SMS would be a major feature of the project, additional and more specialized training would be imparted to various categories of extension staff. This more specialized training (details are in Annex 2) would be conducted at the State Agricultural Institute, located at Kudumiamalai and which would be enlarged and improved under the project.

18 Improving the training of SMS is crucial to the success of the project. One primary vehicle for this would be a monthly workshop held at the research station designated in each main agro-climatic zone for this purpose. The workshop would be attended by all SMS in the zone together with TNAU, DOA and DOH staff and headquarters SMS. The main objective is to review results achieved, modify recommendations as necessary to suit prevailing field conditions, review findings and progress of field trials and develop suggestions for future research topics and field trials. In addition, special short-term practical courses in production technology and extension methods would be organized for SMS both at TNAU and at all-india institutions. A limited number of scholarships at TNAU would be provided for DOA staff who perform well. Before the introduction of the extension system in a given district, an orientation course of about three to four days duration would be organized by senior DOA staff. This would explain the new system and its procedures in detail, assist district staff in designating geographic areas of responsibility for VEWs, demonstrate by example how contact farmers should be selected, and outline major initial impact points. Further details are given in Annex 1, Table 6. Housing 2.10 Under the reorganized extension service, extension workers would be required to make regular and frequent visits to their farmers' groups. Consequently, it is necessary for them to live in or near their areas of work. At negotiation GOTN provided assurances that VEW and DYAO would live in or near the areas assigned to them. Since housing is difficult to find in some areas of Tamil Nadu and as a result of a preliminary survey, the project would provide housing for about 20% of VEW and DYAO (1,750 houses). An assurance was obtained that GOTN would furnish to IDA, at regular intervals (through DOE), information on progress in locating sites for housing to be financed under the credit. Details are given in Annex 1, Table 3. Transport 2.11 Effective extension requires a high degree of mobility both to enable field level staff to meet farmers regularly and to enable technical and supervisory staff to make frequent personal visits in order to provide the direct guidance needed. The entire system thus depends on a high degree of personal contact between all levels of the extension hierarchy. To facilitate this, the project would provide various modes of transport for different levels of staff, one car for each JD and one 4 wheel drive vehicle or van for each district level SMS and DVAO. VEW would be provided loans on attractive terms to purchase bicycles. Similar loans would be provided to DYAO and SMS to purchase scooters or motorcycles. Assurances were obtained from GOTN that loan terms and conditions and travel all mileage allowances would be sufficient to ensure the purchase and use of these vehicles. The project would also provide four-wheel drive vehicles at subdivisional and district levels, and a limited number of sedans at district and headquarters levels. Details are given in Annex 1, Table 4.

19 Equipment 2.12 The project would provide simple dependable audio-visual equipment to support the training sessions and to enhance field operations. Emphasis would be on low-cost, simple aids such as charts and flipcharts which extension staff can design themselves and modify to fit local conditions. The Information wing of DOA would assist the extension service by using its existing printing and photographic equipment supplemented by equipment provided under the project. Furniture and office quipment would also provided as necessary. Details are given in Annex 1, Table 4. Operating Expenses 2.13 DOA's operating expenses would increase with the implementation of this project. Of particular importance would be the availability of funds and materials for printing diaries, field note books, charts and instructional materials, materials for practical demonstrations at training sessions, seeds and other inputs for field trials and materials for preparing simple visual aids. Adequate funds would also be provided for incremental vehicle operating costs and travel allowances. Further details are given in Annex 1, Table 5. Monitoring and Evaluation 2.14 The project would provide for the establishment and operation of a monitoring and evaluation system specifically designed to provide project management with current information on the effectiveness of the extension system. The methodology used would be similar to that described in World Bank Staff Working Paper No. 272 "A System of Monitoring and Evaluation Agricultural Extension Projects." This system would supplement direct personal supervision by each level of project management (paras 4.01 and 4.02). Details of staffing are given in Annex 1, Tables 2, and Assurances were obtained that GOTN would undertake monitoring and evaluation in a form acceptable to IDA and that results would be forwarded (through DOE) to the Association at least once a year. III. COST ESTIMATES AND FINANCING A. Cost Estimates 3.01 Detailed cost estimates inclusive of taxes and duties and based on incremental costs for carrying out the project over a five year period are given in Annex 1, Tables 1 to 8. The following table summarizes the costs:

20 Category Rs M US$ M/a % Foreign Local Foreign Total Local Foreign Total Exchange Incremental Staff Costs Civil Works Equipment & Vehicles Training Incremental Operating Costs Total Base Cost Physical Contingencies Price Contingencies TOTAL PROJECT COST /a Converted at the rate of Rs 8.0 = US$1.0. These costs include about US$5.9 M in duties and taxes and an estimated US$ 4.OM in foreign costs. Physical contingencies of 5% have been applied to civil works, equipment, training, and operating costs and to meet the possible need of 300 VEW (para 2.02) to readjust the farm families:vew ratio. Price contingencies have been applied in accordance with current Bank estimates of expected inflation rates in India (1980: 10%, : 7% per annum; 1984 and onwards: 5%) and compounded accordingly. B. Proposed Financing 3.02 Finance to cover project costs of Rs 318 M (US$39.7 M), including contingencies, but net of taxes and duties would be provided as follows: Amount Source US$ Million Percentage IDA GOTN/GOI Total The proposed IDA Credit of US$28.0 M would be to GOI on standard terms and conditions and would finance about 70% of project costs, net of taxes and duties, but including estimated foreign exchange costs of US$4.0 M. IDA funds would be channeled through GOI to GOTN in accordance with GOI standard arrangements for IDA assisted state development projects. The balance of project financing, beyond IDA financing, would come from state government sources and GOI. GOTN has made adequate budgetary provision for the operation of the first project year.

21 C. Procurement 3.03 The main items to be financed are: vehicles including cycles and motorcycles; equipment; houses for VEW and DYAO; training; project monitoring; incremental staff; and incremental operating costs. Civil work contracts (US$9.6 M), for 1,750 houses, would be small and dispersed, both geographically and over time; therefore, they would not be satisfactory for international competitive bidding. Contracts would be awarded on the basis of competitive bidding following local advertisement. There are numerous qualified local contractors to carry out such work. Arrangements for preparing tenders and overseeing construction were discussed during negotiations. All contracts for civil works, equipment and furniture estimated to cost $100,000 or more would be reviewed by IDA both before bids are invited and contracts awarded motor vehicles (US$1.3 M) of various types would be required under the project. They would be purchased in small quantities overtwo years and would be widely dispersed in rural areas. As adequate maintenance and availability of spare parts would be of paramount importance, thi would necessitate purchase of locally made vehicles of types already used by government departments. Thus, procurement would be according to existing government procedures, which are satisfactory to IDA. Motorcycles and bicycles (US$0.8 M) would be purchased by individual staff from loans provided by the state government and refinanced under the project Orders for purchase of minor equipment and furniture (US$1.8 N) would be bulked wherever possible and purchased according to established local bidding procedures, except where valued at less than US$50,000 when they would be purchased by prudent shopping through normal trade channels. Assurances on procurement procedures mentioned in paras were obtained at negotiations. D. Disbursement and Audit 3.07 Disbursement under the Credit would extend over six years and would be made against: (a) 100% of cost of training; (b) 80% of the cost of civil works, equipment and vehicles; and '4 (c) 25% of the total eligible staff costs. 1/ The percentage is calculated to bring total IDA disbursements to about 70% of the project cost Disbursement against expenditures for staff costs, training, locally procured vehicles and equipment costing Rs 150,000 or less, and payments under 1! Total extension staff costs eligible for partial disbursement would be the following agricultural and horticultural staff: yew, DVAO, DYAO, SMS, JD & ADA at village, subdivision, district and state levels and staff of the monitoring and evaluation unit.

22 civil works contracts for one or more progress payment(s) not exceeding Rs 300,000 under Item (b) above would be against certified statements of expenditures, the documentation for which would not be submitted to IDA for review but would be retained by GOTN and DOA. These documents would be available for inspection by IDA during the course of project review missions. Disbursement against all other items would be fully documented. Certificates of expenditures would be audited by GOTN independent auditors once every year and a report submitted to IDA promptly thereafter. All disbursement applications would be forwarded and processed through the Department of Economic Affairs. Schedules of implementation and project disbursement are presented in Annex 3, Tablesll and Assurances were obtained that separate accounts would be kept of expenditures made under the project. These would be audited annually for each fiscal year, in accordance with sound auditing principles consistently applied and the audit report submitted to IDA as soon as available. In addition, certified accounts would be submitted to IDA within nine months of the end of the fiscal year. Such reports and audits would show, intet alia, that the funds withdrawn were used for the purpose intended that goods have been received or or work performed, and that payments have been made. All reports would be submitted by GOTN to the Department of Economic Affairs for onward transmission to IDA. IV. ORGANIZATION AND MANAGEMENT Extension Service 4.01 The project would introduce fundamental improvements in the organization and management of extension operations in Tamil Nadu. By establishing a single line of control from extension headquarters to VEW (see chart for the organizational pattern), field level staff become directly accountable to their supervisors both technically and administratively. Each would follow a fixed schedule of visits to specific groups of farmers, which is known to farmers. Each DYAO would supervise about 5-8 VEWs, spending at least four days a week in the field assisting and guiding them. The DVAOs provided under the project would each be responsible for ensuring that DYAO in their respective subdivisions are working effectively. To do this, DVAO would need to spend about five days a week in the field, including attending fortnightly training sessions. SMS at the subdivision provide essential technical support as described in para DVAO is directly responsible to the District JD. Normally a JD would have six DVAO in his charge. The Horticultural Directorate in Nilgiris District, would establish a similar organization The DOA headquarters organization would be streamlined to provide effective management and technical support to the extension service as a whole. While overall responsibility for general agricultural development in the state rests with the Secretary for Agricultural and the Directors of Agriculture and Horticulture, the ADA (Extension) would be responsible for the day-to-day operations and management of the extension service both technically and administratively. Subject to the policy directions of the Secretary and Director of

23 Agriculture, the Additional Director of Agriculture (Extension) would be responsible for training and management of extension personnel. He would visit the field frequently to check on the effectiveness of extension operations. ADA (Extension) would have a technical support staff of seven SMS at headquareters (one each for main crops grown throughout the state, plant protection, adaptive research and training, and water management). These SMS would be responsible for improving the technical quality of the extension service in their areas of specialization. They would help promote linkages between extension SMS and research work being carried out in Tamil Nadu and elsewhere, develop and interpret field trials in their areas of specialization, organize training programs and serve as a clearing house of technical information. ADA (Extension) would also be assisted by a small administrative and accounting staff to help keep records of project expenditures and prepare progress reports, etc. The Director of Horticulture would also be assisted by SMS and who would promote linkages between extension and research. Input Supplies 4.03 Since extension staff at the lower levels will not be responsible for the distribution of fertilizers and plant protection chemicals, it is proposed to keep these activities outside the purview of the extension service but within that of DOA. At district level JD will continue to coordinate requirements but at taluk and subdivisional levels, this activity will be catered for by separate input staff (Divisional Agricultural Officer (Inputs) and Deputy Agricultural Officer (Inputs), respectively). As a separate seeds organization is to be established responsible for all aspects of seed production and distribution, the above staff will liaise with their counterparts in that organization. The public sector network would supplement the already substantial network of private and cooperative input supply points. State Level Coordination 4.04 Coordination at State Level between extension, research and allied agencies would be ensured through establishment of a Project Coordination Committee. The Committee would be chaired by the Secretary for Agriculture and would include the Vice Chancellor of TNAU, Directors of Agriculture and Horticulture,representatives of concerned government departments and other agencies (Finance, Irrigation, Cooperation and input agencies). The Additional Director of Agriculture (Extension) would act as Secretary to this Committee. The Committee would meet at least twice a year to review progress in project implementation and to resolve any problems that may arise. An assurance was obtained that such a committee would be established and hold its first meeting before September 30, 1981 Linkages between Extension and Research 4.05 As neither research nor extension can function without close cooperation it would be necessary to formalize their responsibilities. A clear definition of responsibilities is emerging wherein the Tamil Nadu Agricultural University would be made fully responsible for the development of suitable new technology, while the Directorate of Agriculture would assume responsibility for transfer of technology to farmers, including widerspread testing of research recommendations on farmers' fields. This transfer of responsibility will take place once agreement is reached on the terms and conditions of staff transferred from DOA to TNAU and as a result it may be necessary to revise the formal linkages between the extension service and research. The commodity research programs