PAKISTAN WATER SECTOR STRATEGY

Transcription

1 Ministry of Water and Power Office of the Chief Engineering Advisor/ Chairman Federal Flood Commission PAKISTAN WATER SECTOR STRATEGY EXECUTIVE SUMMARY Volume 1 October 2002

2 PREFACE Pakistan has been blessed with a rich water resource which has driven, mainly through agriculture, the economic development of the country. Pakistan has a long and proud history of the development of water resources and the infrastructure for delivering water to where it is needed, including the vast Indus Plain, constituting the largest contiguous irrigation system in the world. As the population continues to grow the country is approaching the utilisation limits of its water resources and Pakistan is becoming a water scarce country. As never before, there is now a strong and growing need to manage this precious resource more carefully and efficiently to ensure water for all on a sustainable basis. In recognition of this need, the Government of Pakistan, with the support of the Asian Development Bank, instituted the Water Resources Strategy Study. It was undertaken by the Ministry of Water and Power, Office of the Chief Engineering Advisor/Chairman Federal Flood Commission. The Study began in July 2001 with the main objective of preparing a road map for future development of the water sector toward more efficient service delivery and optimum utilisation of resources to meet the competing demands of all water users in the future. The Government has addressed the issue of developing the water sector through several initiatives, including the Ten Year Perspective Plan (Planning Commission, 2001), Vision 2025 (Water and Power Development Authority, 2001) and the National Water Policy (Ministry of Water and Power, Draft, 2002). Now the Pakistan Water Sector Strategy Study provides a road map for the future development of the sector. The end product of the Study comprises three main documents which are referred to in total as the Pakistan Water Sector Strategy. These are: 1. The National Water Sector Profile (NWSP), which summarises and details all aspects of the Water availability and utilisation as they exist today. As such, it will become a standard source document for future water sector work. 2. The National Water Sector Strateqy (NWSS). which identifies the key issues and objectives for the water sector and proposals for planning, development and management of water resources and their use in all water sub-sectors. 3. The Medium Term Investment Plan (MTIP), which identifies the key programmes and projects which should be undertaken up to 2011 which will make the initial contribution to achieve the objectives of the Strategy. i

3 This is a document for the whole of the water sector, in all its sub-sectors of: Water Resources Development, Urban Water Supply and Sanitation, Rural Water Supply and Sanitation, Industrial Water Supply and Pollution Control, Irrigation and Drainage, Hydropower, the Environment and Flood Protection. As 95% of our water resources are used for agricultural purposes, the role of the agriculture sector is also discussed extensively, with recommendations and a proposed strategy for a closer relationship with the water sector. The Strategy and MTIP emphasize institutional, management and financial matters as well as infrastructure. It prioritizes equity in water allocation, improving and maintaining the quality of water, the conservation of the country's water resources and the need for efficiency and financial sustainability in water service delivery. It promotes an integrated approach to water sector development and participation of all stakeholders in decision making. This is a collaborative document. The study adopted a participatory approach to ensure that all stakeholders of water have been consulted and have contributed to this Strategy and MTIP. Working Groups from each province and at the federal level were formed at the start of the Study and have been closely associated with the development of the work throughout. Four National Workshops were held to broaden the scope of stakeholder consultation, bringing people together from all areas to contribute to the Strategy document. The effective implementation of the Pakistan National Water Sector Strategy and its accompanying Medium Term Investment Plan is paramount to the continued development of Pakistan's water sector and economy well into the 21st century. Mirza Hamid Hasan, Secretary, Water and Power 4 October, 2002 Riaz Ahmad Khan, Chief Engineering Advisor, Ministry of Water and Power 4 October, 2002 ii

4 ACKNOWLEDGEMENTS The Ministry of Water and Power, Government of Pakistan, Office of the Chief Engineering Advisor/Chairman Federal Flood Commission led the development of the Water Sector Strategy under the guidance of Mr. Riaz Ahmad Khan. Mr. Asjad Imtiaz Ali, Project Director, also chaired the Federal Working Group. The Provincial Working Groups contributed significantly to the content and quality of the Strategy and Investment Plan for their respective provinces under the guidance of their conveners: Mr. A. Salam Khan / Mr. Munawwar Khan Mandokhel, Secretary, Irrigation and Power Department, Balochistan Mr. Fazal Abbas Maken, Secretary, Irrigation and Power Department, NWFP Mr. Javed Majid, Secretary, Irrigation and Power Department, Punjab Mr. Idrees Rajput / Mr. Hifz ur Rehman / Mr. Meer M. Perhyar, Secretary Irrigation and Power Department, Sindh The Ministry of Water and Power, Office of the Chief Engineering Advisor/Chairman Federal Flood Commission also extends sincere thanks for the contributions of: Dr. Mutawakkil Kazi, Secretary Planning & Development for his support and valuable comments during the study. Mr. Ahmad Khan Bhatti, Member Water, WAPDA for his close involvement and informed recommendations throughout the Study. Ministry of Water and Power also acknowledges and appreciates the tremendous effort provided by the Consultants on the Study, under the Team Leadership of Mr. Tim Hannan and Mr. Muhammad Aslam Rasheed. The Consultant s Consortium was led by Halcrow Group Ltd. of the UK, in association with ARCADIS Euroconsult (AEC) of the Netherlands, Halcrow Pakistan (PVT) Ltd., Euroconsult Pakistan (PVT) Ltd., and Asianics, Pakistan. The Water Resources Strategy Study was funded through the Asian Development Bank (ADB) Technical Assistance programme and the Ministry of Water and Power gratefully acknowledges their assistance. iii

5 The documents which make up the Pakistan Water Sector Strategy are: Volume 1, Executive Summary, which is the summary of the Water Resources Strategy Study, under which the Water Sector Profile, Strategy and MTIP were developed; Volume 2, National Water Sector Strategy, which is a concise presentation of the Water Sector Strategy; Volume 3, Medium Term Investment Plan, which details the projects and costs for the MTIP, in support of the Water Sector Strategy; Volume 4, Detailed Strategy Formulation, which presents the supporting information and considerations for the formulation of the Strategy; Volume 5, National Water Sector Profile, which presents detailed background information on the water sector in Pakistan. Disclaimer: The Water Sector Strategy document presented herein brings out the proposed road map to meet the objectives of the National Water Policy for a sustainable and environmentally and economically sound water sector in Pakistan. This has, however, yet to pass through the formal channels of approval, with possible fine tuning. The adopted country Strategy for the Water Sector will follow this approval. iv

6 EXECUTIVE SUMMARY Contents S.1 Study Background 1 S.2 The Process of the Study 1 S.3 Objectives and Scope of the Study 1 S.4 Chronology of the Study 3 S.5 Brief Summary of the National Water Sector Profile 4 S.6 Brief Outline of the Pakistan Water Sector Strategy 7 S.7 Brief Outline of the Medium Term Investment Plan 13

7 S.1 Study Background This document is the Executive Summary and is part of the final submission for the Water Resources Strategy Study, which began in July Funded by the Asian Development Bank (ADB) under the ADB Technical Assistance (TA) Number 3130-PAK, the Study was executed by the Ministry of Water and Power, Government of Pakistan, through the office of the Chief Engineering Adviser/ Chairman Federal Flood Commission. The Consultant consortium which carried out the study was led by Halcrow Group Ltd. of the UK, in association with ARCADIS Euroconsult (AEC) of the Netherlands, Halcrow Pakistan (PVT) Ltd., Euroconsult Pakistan (PVT) Ltd., and Asianics, Pakistan. S.2 The Process of the Study Given the importance of the outcome of the Study to the future of the Water Sector in Pakistan, a collaborative approach was followed from the outset, when five Working Groups were established, one at the Federal Level and one each for the four Provinces. The Federally Administered areas of FATA, Northern Areas and the State of Azad, Jammu and Kashmir (AJK) were included in the Federal Working Group. The collaborative approach ensured that the resulting Water Sector Strategy and Medium Term Investment Plan (MTIP) were developed by the main agencies which would be ultimately responsible for implementing them. The Government has been engaging in developing the water sector through several initiatives, including the Ten Year Perspective Plan (Planning Commission, 2001), Vision 2025 (Water and Power Development Authority, 2001) and the National Water Policy (Ministry of Water and Power, Draft, 2002). Now the Pakistan Water Sector Strategy Study provides a road map for the future development of the Sector. S.3 Objectives and Scope of the Study The main objective of the Study is to provide an updated, comprehensive strategy and a framework for the water sector within which competing demands for water and scarce financial resources can be assessed and service delivery improved. The Study was to develop an updated, comprehensive Water Sector Strategy (with a planning 1

8 horizon of 2025) to provide guidance on investment planning in, and management of, the water sector. It was also to provide a Medium Term Investment Plan (MTIP) (with a planning horizon of 2011) with specific investment proposals. The Strategy and MTIP are to be responsive to the overall national development programmes, principles of economic efficiency and environmental improvement, and policy decisions on institutional reforms. The Study covered water resource planning, development and management as well as water service delivery. It included all subsectors of water, defined as: Water Resources Development, Urban Water Supply and Sanitation, Rural Water Supply and Sanitation, Industrial Water Supply and Pollution Control, Irrigation and Drainage, Hydropower, the Environment and Flood Protection. Each sub-sector has been assessed as to its current situation, future requirements, objectives for the sub-sector (to 2025), constraints to meeting those objectives, a proposed strategy for the sub-sector, a detailed investment plan with projects aimed at achieving the objectives of the Strategy, with a cost estimate to meet those objectives. The outcome of the Study is comprised of three main documents which are referred to in total as the Pakistan Water Sector Strategy. These are: (a) (b) (c) The National Water Sector Profile, which summarises and details all aspects of the Water Sector as it is today. As such, it will become a reference document for future water sector work. The National Water Sector Strategy, which identifies the key issues and objectives for the water sector and outlines proposals for planning, development and management of water resources and their use in all water sub-sectors. The Medium Term Investment Plan, which identifies the key projects which should be undertaken up to 2011 which will make the initial contribution to achieve the objectives of the Strategy. 2

9 S.4 Chronology of the Study The Study began on 23 July The Inception Report was submitted on 20 August 2001 and was followed up by the Inception Workshop on 28 August 2001 which included participants from across the water sector. The workshop introduced the Study and its objectives but its main outcome was to develop a draft of the selection criteria for projects to be included in the MTIP. The first task was to complete the Water Sector Profile, which provides a detailed description of the current state of the water sector as the basis for developing strategy and investment proposals and proposals. The Draft was completed on 8 November Following the delay caused by the events of September , the first National Workshop was held on 9 February The primary outcome of this workshop was to complete an agreed selection criteria for the MTIP. During this period up to the preliminary draft, several meetings were held with the individual Working Groups, both in Islamabad and in each Province. Because of the extensive nature of the Strategy and MTIP it was felt that the Working Groups and other stakeholders needed more time to digest it than originally laid out in the ToR. A Preliminary Draft Strategy and MTIP was then agreed which would draw out major issues for improvement before the more official presentation of a draft final report. The Preliminary Draft Strategy and MTIP was submitted on April The Second National Workshop was held on 16 May 2002 to discuss the Preliminary Draft Strategy and MTIP. This was a very productive workshop resulting in many good ideas and changes to the preliminary draft. The Draft Final Report was submitted on 28 June 2002, incorporating the changes and additions agreed at the May Workshop. The Final National Water Sector Profile was also submitted at this time. The Final National Workshop was held on 13 September 2002 to finalise the main issues of the Strategy and MTIP. Based on the discussions 3

10 from the Workshop, the Final Report has been completed and submitted on 2 October, The final documents which make up the Water Sector Strategy are: The Executive Summary, Volume 1; the National Water Sector Strategy, Volume 2, which is a concise version of the Water Sector Strategy; the Medium Term Investment Plan, Volume 3, the Detailed Strategy Formulation, Volume 4, which presents supporting information for the Strategy and a detailed discussion of the strategy formulation. The detailed background information on the water sector in Pakistan is given in the National Water Sector Profile, Volume 5. S.5 Brief Summary of the National Water Sector Profile The National Water Sector Profile provides the background information on the current state of the Water Sector in Pakistan, projections of future needs and an agenda for action. The first section, an overview of the sector, is summarised here: Population and Administration Pakistan s current population of 141 million people is expected to grow to about 221 million by the year The most pressing need for the water sector over this time will be the provision of the basic needs of food, power and domestic water requirements. The federal government has the responsibility for coordination and policy formulation at the national level. National distribution of water and management of multipurpose reservoirs on the Indus and its tributaries are also a federal responsibility. Otherwise the provinces administer their own water sectors. Under the new decentralization process, water supply and sanitation have come under District control. Economic Indicators During , Pakistan s GNP amounted to Rs. 3,411 billion while for the same period the GDP amounted to Rs. 3,472 billion. The agricultural sector, with a share of about 25%, was the largest contributor to the GNP. Manufacturing, trade and transport and communication sectors respectively accounted for 17%, 10% and 15% of the GNP. During this 4

11 period, the country s exports amounted to Rs. 444 billion of which the shares of primary, semi manufactured and manufactured goods were respectively 12%, 15% and 73%. During , the per capita GNP was about Rs. 24,528, which in nominal terms was 6.3% larger than Provincial household income levels vary little from the national average (2 to 5 percent) except in NWFP which are 20 percent lower. Income disparities are greater between urban and rural populations, where average income levels for the rural population are 37% lower than the urban population, with 39.8% of the rural and 35.2% of the urban population classified as poor. The Indus River Basin The Indus Plain covers 25% of the total land area, most of the irrigated agriculture takes place here and 80 to 85% of the population is centred here. The Indus Basin Irrigation System commands an area of 36.2 million acres, is the largest contiguous irrigation system in the world and is the agricultural and economic centre of the country. The Indus River and its tributaries on average bring about 152 million acre feet (MAF) of water annually. This includes 143 MAF from the three Western rivers and 8.4 MAF from the Eastern rivers. Most of the inflow, about 104 MAF, is diverted for irrigation, with 38 MAF flowing to the sea and about 10 MAF consumed by system losses. Irrigation System The Indus Basin Irrigation System comprises three major reservoirs, 16 barrages, two head-works, two siphons across major rivers, 12 interriver link canals (all in Punjab), 44 canal systems and more than 107,000 water courses. The aggregate length of the canals is 34,834 miles. The System also utilises an estimated 41.6 MAF of groundwater pumped through more than 600,000 tube wells (mostly private) to supplement the canal supplies. In addition, there are over 200 civil canals in NWFP, which irrigate about 0.82 million acres and are managed by local tribal populations. 5

12 Outside the Indus Basin, there are two smaller river basins in Balochistan. The Makran Coastal Basin includes the Dasht, Hingol and Porali rivers, which discharge individually into the Arabian Sea. The closed Kharan Basin comprises the Kharan Desert and Pishin Basin and includes Pishin, Mashkhel and Baddo rivers which discharge into shallow lakes and ponds that dry out completely in the hot season. The total inflow of the two basins is less than 4 MAF annually. The streams are flashy in nature do not have perennial supply. About 25% of the inflow is used for flood irrigation. Agriculture Agriculture is the single largest sector of Pakistan s economy, contributing 24.7% of GNP ( ) and more than 60% of foreign exchange earnings. Some 68% of the rural population depend on the sector and 46% of the labour force is employed in it. The principal crops include wheat, rice, cotton, sugarcane, oilseeds, fruits, vegetables and pulses. While there have been improvements in productivity of some crops, the overall yield per hectare of most crops is far below their demonstrated potential. Main reasons for this include an uncertain policy environment for pricing and marketing of staples, generation and dissemination of technology to the farmers and inefficient post harvest processing and storage. Waterlogging and salinity pose a major threat to the sustainability of irrigated agriculture in about 30 percent of irrigated lands, which is directly related to the low efficiency of irrigation systems, which in turn is a result of inadequate irrigation management both at the system and at farm level. Domestic and Industrial Water Use and Waste Water Disposal Access to water for domestic purposes in the urban areas is limited to about 83% of the population, with 57% having piped supply to their homes. Present water use in the urban sector is of the order of 4.3 MAF. The demand is expected to increase to about 12.1 MAF by the year Rural domestic water use is currently 0.8 MAF, with only about 6

13 53% of the rural population having access to drinking water from public water supply sources. Water consumed by major industries is about 1.2 MAF per year, mostly from ground water. Environment Water pollution is a main concern in Pakistan. The source is from both municipal and industrial uses, with only about 1% of wastewater treated before disposal. This has become one of the largest environmental problems in Pakistan. Hydropower Generation Total installed power generation capacity in Pakistan is 17,980 MW, which includes hydropower generation capacity of 5,042 MW, thermal power generation capacity of 12,509 MW and nuclear power generation capacity of 462 MW. The thermal capacity includes 6,003 MW supplied by private power plants developed and operated by the private sector. Pakistan presently has surplus power generation capacity but this will change in the near future. Floods Localised and widespread flooding is common in Pakistan, resulting in loss of life, substantial damage to urban and rural property and infrastructure, public utilities and loss of agricultural crops and lands. Despite the construction of reservoirs and major investments in flood protection, there is still a considerable flood hazard. The main causes of floods in Pakistan are the progressive denudation of river catchments and the general deterioration of the river channels from significantly reduced flows during non-flood seasons. It is estimated that between 1950 and 2001 total losses from floods have been of the order of US $10 billion and over 6,000 lives were lost. S.6 Brief Outline of the Pakistan Water Sector Strategy The Water Sector Strategy is intended as a roadmap for the planning, development and management of the Water Sector, with a planning 7

14 horizon of It covers the Water Sector as a whole, with main crosscutting issues and objectives, as well as specific objectives for each subsector. Sub-sectoral objectives and strategies are provided in the Strategy Framework at the end of this section. Major issues for the sector as a whole are summarised as: Institutional and Management Issues Specific institutional and management issues include the following: (i) Inadequate coordination between all water user organisations; (ii) Difficulties in reaching consensus between the provinces on the issue of additional storage, retarding growth in water resources development; (iii) Absence of an inter-ministerial, inter-provincial body to oversee water sector planning, development and management; (iv) Changing administration under the Devolution Plan, and uncertainty in technical ability during the transition, especially in the domestic water supply and sanitation sub-sectors; (v) Insufficient data base and information on water. Social and Financial Issues The main social and financial issues affecting water sector development are: (i) (ii) (iii) (iv) Rapid population growth and changing demographics; High level of poverty, with some potential to be improved through water sector investment; Low level of involvement of women in water sector decision making, with potential for improvement, especially in domestic water supply and sanitation; Inequity in water distribution withinin the irrigation systems; 8

15 (v) Limited availability of funds for the water sector and high financial requirements to meet the needs of the future; (vi) Inadequate financial sustainability in water sector services due to low levels of public sector funds and insufficient cost recovery; (vii) Low crop prices reducing farmers ability to contribute to irrigation and drainage management; (viii) Limited private sector investment or participation; (ix) Limited stakeholder participation in decision making in all sub-sectors; (x) Inadequate public awareness and understanding of water issues; Technical Issues The main technical issues are: (i) (ii) (iii) (iv) (v) (vi) (vii) (viii) (ix) Increasing demand for water, food and power; Insufficient water resources for the demands of the future; Inefficient use of water in all sub-sectors with greatest potential for improvement in the irrigation sub-sector; Low crop yields; Deteriorating water quality; Low coverage and quality of service in domestic water supply and sanitation; Deteriorating infrastructure in the domestic and irrigation and drainage sub-sectors; Overuse of water in many irrigated areas, the main cause of (ix) below; Waterlogging and salinity on irrigated land and disposal of saline drainage effluent. The Water Sector Strategy goes beyond the infrastructural development of the various water sub-sectors and has emphasised the elements which are essential to the sustainable achievement of the objectives of the water sector. Key Strategy Objectives for the sector as a whole are: 9

16 (a) (b) (c) (d) (e) (f) (g) (h) (i) (j) (k) (l) (m) Provision of water for all through water conservation, additional storage, providing improved water allocations; Improvement of institutional and management capacity through establishing an inter-ministerial and inter-provincial National Water Council and a supporting Water Resources Apex Body, whose first task will be to prepare an Integrated Water Resources Master Plan to determine the needs and development priorities for conservation, storage, watershed management and water resources development as a whole. A Coordinating and Support body is also proposed for the domestic water and sanitation sub-sector, which would provide support for strategic planning to all urban areas. Poverty reduction, mainly through the irrigation and drainage and urban and rural water supply and sanitation sub-sectors. Improving the involvement of women in water mainly through the rural water supply and sanitation sub-sector; Increasing equity in water distribution for poverty alleviation, increasing irrigation efficiencies and reducing dependence on groundwater; Increasing stakeholder participation in irrigation and drainage and domestic water supply and sanitation; Improving public awareness and understanding and information to provide the foundation for increased stakeholder participation; Improving agricultural yields and production to meet the food needs the future. Increasing cooperation between irrigation and agriculture to accomplish improvements in irrigation efficiency and increased crop yields. Enacting the National Water Policy; Improving cooperation and resolving conflict in the water sector. Improving financial efficiency through targeting investments to the objectives of the strategy and achieving financial sustainability in water services and involving the private sector. Improving water quality. A Framework for the Water Sector Strategy which outlines the key issues, objectives and responsibilities of each of the sub-sectors, as well as a cost summary is provided in the following table. 10

17 SUMMARY AND FRAMEWORK OF THE PAKISTAN WATER SECTOR STRATEGY Sub Sector Water Resources Urban Water Supply and Sanitation OBJECTIVES Overall Sectoral Overall Rural Water Supply and Sanitation Industrial Water Supply and Pollution Control Irrigation and Drainage Hydropower Environment Flood Protection To achieve the National Water Vision: By 2025, Pakistan should have adequate water available, through proper conservation and development. Water supplies should be of good quality, equitably distributed and meet the needs of all users through an efficient management, institutional and legal system that would ensure the sustainable utilization of the water resources and support economic and social development with due consideration to the environment, quality of life, economic value of resources, ability to pay and participation of all stakeholders. 1. Provide sufficient water for all sub sectors based on Integrated Water Resources Management (IWRM) 2. Promote water conservation. 3. Ensure effective planning and decision making 4. Regulate groundwater abstraction where feasible 5. Improve water quality 6. Develop information base 7. Develop public awareness and understanding of the issues 1. Provide water supply to 96% of urban population 2. Provide functional sewerage to 80% of the urban population 3. Achieve financial sustainability in all urban water developments 4. Achieve full compliance with EPA standards for drinking water and wastewater disposal 5. Develop water quality information management system 1. Increase rural water supply coverage to 75% of the population 2. Increase coverage of rural sanitation to 50% 3. Improve drinking water quality to comply with EPA standards 4. Ensure services are financial self sustaining 5. Develop a comprehensive water quality monitoring and information system 6. Raise public awareness re: hygiene and sanitation 1. Ensure provision of sufficient water to industry to promote industrial and economic development 2. Ensure environmentally sound disposal of industrial waste water through regulation, in order to reduce pollution and improve water quality 1. Increase irrigation efficiency from 40% to 45% to conserve 4.7 MAF 2. Achieve equity in water distribution at all levels 3. Harness unused flood water and runoff from hill torrents 4. Increase irrigated agriculture over 2 million acres of culturable waste for agricultural production and poverty alleviation 5. Achieve sustainability including financial sustainability 6. Promote stakeholder participation, through PIDAs, AWBs and FOs 7. Reduce waterlogging in 7 million acres 8. Provide a long term safe solution for saline drainage effluent 1. Develop the hydropower subsector in parallel with the overall power sector 2. Attract private investment 3. Develop the hydropower potential of any new multipurpose storage projects 4. Develop run-ofriver hydro projects through private sector finance. 1. Improve the quality of surface and ground water to acceptable standards by Rehabilitate coastal and other wetland areas through better management of freshwater flows to them. 3. Reduce soil erosion in the catchments of major storage reservoirs. 1. Place priority for flood protection on areas of major human habitation and economic importance 2. Prepare flood and drought management strategies, especially for major cities, towns and infrastructure 3. Promote the delineation of flood risk planning zones to be adopted by all agencies as part of the planning process Ministry Water and Power to obtain formal adoption, initially from the Economic Coordinating Committee and, subsequently, the Cabinet for the Water Sector Strategy. Establish an inter-ministerial, inter-provincial National Water Council with a supporting Apex Body established within the Ministry of Water and Power to oversee the planning, development and management of the water sector, beginning with the implementation of the Strategy. Determine capacity building needs and begin capacity building process. Extend the charter of Ministry Water and Power to include all sub-sectors of the water sector Undertake an Integrated Water Resources Master Plan, with emphasis on conservation, storage and environmental needs STRATEGY Sectoral Short Term 2003 & 2004 Medium Term Promote and support water sector conservation Commit to develop storage Prepare water resources master plan Undertake feasibility study on public awareness Study and develop a water sector Management Information System (MIS) Develop water quality monitoring programme Promote and support water conservation Implement water resources master plan and begin implementation of storage development Implement public awareness programme Develop MIS Implement Water Quality improvement programme Develop coordinating and support body for the urban water sector Develop long term plans for water and sanitation services Restructure sub-sector financing, tariff mechanisms and regulation Address maintenance backlog Develop water resources to maintain continuity of supply to existing customers Improve revenue recovery Develop water resources to meet projected new demand and consumption Extend networks to increase service coverage Achieve compliance with drinking water quality and effluent discharge standards Possible reorientation of Coordinating and Support body to Regulating Body if private sector investment improves Undertake project preparation Establish Project Management Units (PMUs) in each Province Train PMU staff and Community Based Organisation (CBO) personnel Develop and execute public awareness campaigns. Establish water quality testing laboratories Assist communities to form CBOs Undertake rehabilitation programme for existing schemes Phase 1 development of new schemes Assess the need for financial incentives to industries to comply with EPA effluent disposal regulations Determine legislative needs for regulation of industries and enforcement of standards and water abstraction licensing. Undertake a feasibility study to develop a water quality monitoring programme Develop an awareness campaign to promote the reduction of pollution Prepare a national industrial pollution control plan Enact new legislation for industrial effluent control Develop and implement a water quality monitoring programme Execute public awareness campaign Execute National Industrial Pollution Control Plan, including, public private partnership approach to pollution control Commit to financial sustainability of the irrigation & drainage infrastructure and prepare a plan for this Initiate actions to increase irrigation efficiency to 45% - to include addressing improved water management, farmer participation and cost recovery Assess benefits of lining distributaries in saline areas and develop plan Prepare plan to modernise barrages and the feasibility studies for priority works Restructure NDP Complete pre-feasibility study for spinal drain Prepare plan to harness hill torrent flows Prepare plan for expansion of agricultural area Prepare/upgrade feasibility studies for small schemes Complete regulations for groundwater abstraction Undertake training/capacity building to strengthen PIDAs and AWBs Implement pilot projects for development of stakeholder participation and then expand Initiate pilot projects to evaluate modern irrigation technologies Expand the on farm water management programme (OFWM) Independently monitor and evaluate the OFWM programmes Line distributaries in saline GW areas Implement modernisation of barrages Rehabilitate/improve existing irrigation systems Prepare studies for modernisation of 2 nd priority barrages Complete revised NDP I Prepare NDPs II and III and complete NDP II, inc. the spinal drain Plan increased cropping intensity as new storage comes on line For large storage dams, the hydro strategy follows that for water resources and the nat ional power plan For smaller run of river schemes, develop a private investment enabling environment Plan a comprehensive national water quality management programme Develop a major campaign to raise public awareness of the environment Support the studies to determine the volume of flows required downstream of Kotri Assess the need for incentives to industries to comply with EPA effluent disposal regulations Determine the needs for legislation for regulation of industrial development, enforcement of standards and water abstraction licensing Implement the national water quality monitoring programme Execute the public awareness campaign on the environment Support municipal and industrial waste water control measures Improve urban and rural solid waste management to a coverage of 55% Enact new legislation where required Restart the Second Flood Protection Sector Project, including non physical works and studies, which are important to a holistic approach to flood protection. Following the Second Flood Sector Project, implement the proposed Third Flood Sector Project

18 Sub Sector Water Resources Urban Water Supply and Sanitation Cost US$ Million RESPONSIBLE ORGANISATIONS PRIORITY SECTORAL CONSTRAINTS Long Term Total = Promote and support water conservation Implement storage projects Maintain effective public awareness programme Continue updating MIS Update and improve water quality improvement programme Continuation of development of water resources Continuation of extension of networks Continuation of programme to achieve compliance in drinking water and effluent quality standards Rural Water Supply and Sanitation Phase 2 development of new schemes Industrial Water Supply and Pollution Control Continue to improve monitoring programme Monitor and evaluate the National Industrial Pollution Control Plan Irrigation and Drainage Hydropower Environment Flood Protection Extend implementation of stakeholder participation to entire network Introduce new technologies with the participation of the farmers Expand OFWM programme to all watercourses Continue to monitor saved water Continue lining of distributaries in saline areas Continue rehab/improvement of the existing irrigation system Continue modernisation of second priority barrages Carry out NDP III including completion of the spinal drain Implement crop intensification programme Monitor, evaluate and improve the national water quality management programme Continue a reduced public awareness campaign Continue improvement of urban and rural solid waste management with coverage increasing to 90% 33,622 10,000 5,066 2, ,099 4, Overall responsibility for the implementation of the Strategy will be with the National Water Council, supported by an Apex Body to be established and developed to necessary capacity within the Ministry of Water and Power. Overall Federal OVERALL ISSUES Provincial National Water Council Ministry of Water and Power IRSA Planning and Development Departments To be accorded special priority and funding 1. Time 2. Slow growth in Water Sector Development 3. Project implementation difficulties 4. Finances Proposed Coordination and Support Body for urban water supply. KWSB, WASAs, District Councils, Private Sector Planning Commission Public Health Engineering Departments and District and Tehsil Councils Pakistan Environmental Protection Agency (EPA) Provincial Environmental Protection Departments (Agencies) Top priority Top priority Licensing and pollution control measures to be given priority 1. Lack of institutional arrangements 2. Lack of consistent approach to funding and regulation 3. Low tariffs and collection rates 4. Non commercial approach to service delivery 5. Poor climate to attract private sector 1. Poor and deteriorating water quality at source and within systems 2. Variable history of community involvement 3. Uncertain impact of devolution plan 1. Inadequate monitoring of industrial effluent 2. Inability to enforce existing effluent quality regulations 3. Inability of industries to finance on-site effluent treatment to comply with regulations. Proposed National Drainage Authority PIDAs, AWBs and FOs Priority accorded to conservation, modernisation of existing infrastructure, small schemes for poverty reduction, intensification of cropping 1. Poor project implementation 2. Scarcity of water 3. Lack of consensus and cooperation 4. Poor information availability 5. Overuse of water in some areas and lack of effort in conservation 6. Design of the irrigation systems 7. Inequitable distribution of water 8. Low cost recovery and poor maintenance 9. Weakness of institutions 10. Lack of stakeholder participation Min of Water and Power Water Wing of WAPDA Private Power Investment Board NWFP and AJK Private Power Cells Plus the Private Sector Major schemes with major storage, small schemes through private finance 1. Consensus and government policy 2. Finances 3. Poor private sector investment climate 4. Legal and regulatory issues Pakistan Environmental Protection Agency Provincial Environmental Protection Departments (Agencies) Equal priority to water supply and sanitation, particular emphasis on water quality and pollution control 1. Low priority accorded to water quality 2. Inadequate institutional capacity to implement effective pollution control 3. Insufficient funding 4. Governance problems 5. Existing legislation is punitive rather than cooperative 6. Planning is poor and tends to be over ambitious 7. Poor stakeholder and private sector participation Federal Flood Commission Provincial Irrigation Departments Second priority, as a result of risk to life 1. Stalling of the Second Flood Protection Sector Project 2. Lack of support for a realistic and holistic approach to flood protection Management: (1) Lack of financial sustainability, (2) Inadequate cost recovery, (3) Ineffective public sector management of water sector infrastructure and activities, (4) Limited stakeholder participation, (5) Poor public awareness, (6) Poor water information, (7) No private sector investment or participation, (8) inadequate cost recovery. Technical: (1) Increasing demand for water, (2) Deteriorating water quality, (3) Inadequate domestic water supply and sanitation, coverage and quality of service, (4) Deteriorating irrigation and drainage infrastructure, (5) Waterlogging and salinity on irrigated land and disposal of saline drainage effluent.

19 S.7 Brief Outline of the Medium Term Investment Plan The Medium Term Investment Plan (MTIP) accompanies the overall Water Sector Strategy. Where the Water Sector Strategy is intended as a road map for water sector development for the next quarter century (to 2025), the MTIP contains specific projects for investment as a first stage of Strategy implementation. The MTIP has a further purpose to support investment decision making by the international lending agencies, such as the Asian Development Bank, JBIC and the World Bank, in their considerations of investment in the water sector in Pakistan. The projects presented in the MTIP are based on the agreed selection criteria, developed in collaboration with Working Groups. It is also based on the finances estimated to be available for the water sector during the MTIP period. The MTIP also covers all sub-sectors of water, but they are grouped differently from the Strategy, as follows: Water Resources Development, which is treated somewhat separately due to the high cost of storage development; Irrigation, Drainage & Flood Protection; Water Supply & Sanitation, which covers urban, rural and industrial sub-sectors; Environment; Hydropower, which is treated somewhat separately because of the high cost and the potential for private sector investment. In addition there are projects referred to as Supporting Activities, which are either institutional and management oriented or are studies, and which support the efficient targeting of funding for the water sector. The MTIP contains on-going activities, projects which are either fully underway or have funding committed to them and are likely to start shortly. These were not part of the selection process of the MTIP development but are included due to their budget commitments, especially in the earlier years of the MTIP. 13

20 New MTIP activities are the projects selected during the period of the Study. They are made up of projects that are already under consideration and have been developed to the stage of feasibility studies or similar. These are generally engineering / infrastructure projects, though some studies are included. The new activities also include what are referred to as block financial allocations for certain sub-sectors. The purpose of the block allocations is to ensure that finances are fully considered for urgent activities which have not yet been developed to feasibility stage. MTIP new activities also include projects or studies that specifically target institutional, social, financial and other improvements. Most of these were developed during the course of the MTIP as the need for them was determined. These are referred to as supporting activities and may be considered for funding through government reserves, by bilateral aid donors, or as TAs through the major international lending agencies. Finances for the projects have been streamed over the period of the MTIP and beyond, where larger projects or those which start later overrun the horizon of Storage projects and hydropower projects which are recommended in the Strategy are kept out of the streaming process; storage, because its high cost will require it to be financed as a special project; and hydropower also because of its high cost of development and the good potential for it to be financed by private sector investors. Cost Summaries The total costs of On-going and New projects during the MTIP period is summarised in Table S.6.1, with a total just under US$ 8 billion. A more detailed breakdown of combined ongoing and new projects, including the financial streaming over the MTIP period, is given in Table S.6.2. Selected MTIP projects which have a specific geographical location are shown on Figure S.1. The cost of additional storage of US$ 4.4 billion is included separately in Table S.6.1 as it will require special funding as it is beyond the normal 14

21 funding available for the water sector. Storage is not included in Table S.6.2 as it is not included in the financial streaming. Rs million US$ million Federal % Provincial % Federal 202,975 3, Punjab 146,664 2, Sindh 65,879 1, NWFP 33, Balochistan 12, Total without 461,387 7, storage Storage 262,500 4,375 Total with storage 723,887 12,064 Table S.6.1: Combined Costs of On-going and New Projects Hydropower projects are also not included in Table S.6.1 or S.6.2. Table S.6.3 shows the run-of-river hydropower projects for which there is potential for private sector investment. 15

22 Table S.6.2 Medium Term Investment Plan - Summary On-Going & New Projects (Rs million) SUMMARY MTIP/1 % I & D & F 21,092 38,977 47,312 44,306 47,255 48,408 41,630 35,757 31, , Federal 11,187 28,858 38,077 34,979 34,866 23,764 13,014 9,596 5, ,436 Punjab 4,491 4,670 3,220 5,349 8,622 19,534 22,650 17,182 14,051 99,769 Sindh 4,205 3,937 3,801 1,402 1,363 2,851 4,033 5,034 5,250 31,876 NWFP 1,055 1,324 1,055 1,226 1,289 1,204 1,391 3,284 6,633 18,461 Balochistan ,159 1,350 1,115 1, ,643 WS & S 1,984 2,514 2,723 8,471 9,721 12,287 13,273 10,175 10,651 71, Federal ,121 Punjab ,076 5,077 5,050 5,050 5,050 4,907 31,172 Sindh ,267 2,516 5,109 6,095 3,547 3,216 22,125 NWFP 1,090 1,640 1,550 1,550 1,550 1,550 1,550 1,000 1,000 12,480 Balochistan ,305 3,901 Environment , ,162 11,826 3,026 32, Federal Punjab ,870 2,077 1,111 15,723 Sindh ,543 1,670 11,878 NWFP , ,086 Balochistan , ,298 Supporting Federal Total 23,291 42,238 50,893 55,571 58,101 61,525 67,065 57,758 45, , Federal 11,724 29,311 38,626 35,468 35,332 24,098 13,348 9,930 5, , Punjab 4,827 4,959 3,823 10,558 13,832 24,717 39,570 24,309 20, , Sindh 4,330 4,195 4,059 2,802 4,012 8,093 10,128 18,124 10,136 65, NWFP 2,145 3,097 2,738 3,838 3,135 2,974 3,025 4,328 7,747 33, Balochistan ,647 2,905 1,790 1, ,067 1,855 12, Budget 45,403 47,673 50,057 52,559 55,187 57,947 60,844 63,886 67, , Underspending 22,112 5, ,012-2,914-3,578-6,221 6,128 21,955 39, Note: Not including storage projects /1 Cost during MTIP-period ; this is less than the Total Costs as some projects continue after 2011 Provincial distribution (%)

23 Table S.6.3 Potential Private Sector Hydropower Projects (Rs million) Hydro power projects MW EIRR Code Year Total Jinnah Hydro P12P 2,673 2,673 2,673 2, ,691 Malakand III Hydro power P21P 2,540 2,540 2, ,620 Duber Khwar Hydropower P22F 2,580 2,580 2,580 2, ,320 Allai Khwar Hydropower P23F 2,580 2,580 2,580 2, ,320 Pehur High Level Hydropower (NWFP) P24N Golen Gol Hydropower (NWFP) P25N 1,563 1,563 1,563 1, ,251 Khan Khwar Hydropower (NWFP) P26N 2,025 2,025 2,025 2, ,100 Neelum Jehlum Hydropower P30F 2,841 3,066 5,122 4,911 7,381 8,733 3,427 2,790 38,272 Abbasian Hydropower (AJK) P31F 4,270 4,270 4,270 4, ,082 Total 1, ,418 Note: These projects could not be ranked as there is insufficient information for the ranking process

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