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Addressing groundwater depletion: Lessons from India, the world’s largest user of groundwater

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pictured above: Women draw water from a well in the drylands of Jaisalmer, Rajasthan, India. By Yavuz Sariyildiz via Shutterstock (November 9, 2014).
India is home to 16% of the world’s population, but only holds 4% of the world’s freshwater resources. Not only is water scarce in India, but the extraction of groundwater has been on the rise for decades. Since the 1960s, the government’s support for the “green revolution” to ensure food security has increased the demand for groundwater for agriculture. Rapid rural electrification combined Show MoreIndia is home to 16% of the world’s population, but only holds 4% of the world’s freshwater resources. Not only is water scarce in India, but the extraction of groundwater has been on the rise for decades. Since the 1960s, the government’s support for the “green revolution” to ensure food security has increased the demand for groundwater for agriculture. Rapid rural electrification combined with the availability of modern pump technologies has led to an increase in the number of borewells to meet that demand. Over the last 50 years, the number of borewells has grown from 1 million to 20 million, making India the world’s largest user of groundwater. The Central Groundwater Board of India estimates that about 17% of groundwater blocks are overexploited (meaning the rate at which water is extracted exceeds the rate at which the aquifer is able to recharge) while 5% and 14% , respectively, are at critical and semi-critical stages. The situation is particularly alarming in three major regions – north-western, western, and southern peninsular. Groundwater pollution and the effects of climate change, including erratic rainfall in the drier areas, put additional stress on groundwater resources which serve about 85% of domestic water supply in rural areas, 45% in urban areas, and over 60% of irrigated agriculture. Current overexploitation rates pose threats to livelihoods, food security, climate-driven migration, sustainable poverty reduction and urban development. The World Bank has been working with the Government of India to enhance groundwater management in affected areas. The lessons below stem from the experience of World Bank groundwater management projects in India, and are part of a broader IEG evaluation of the World Bank’s support for sustainable and inclusive natural resource management.   Integrated demand and supply side solutions offer the best option for sustainable use. IEG case studies in Rajasthan, Telangana and Andhra Pradesh showed that the success of supply-side measures, such as watershed management programs, aquifer recharging and tank rehabilitation activities, did not lead to sustainable use in the absence of demand-side action. Measures such as surface water harvesting through farm ponds and check-dams, the installation of water-efficient irrigation systems (e.g. more efficient drips and sprinklers) and growing less water intensive crops, need to be integrated on the demand side for improved management and reduced depletion. Weak regulatory action to limit demand for groundwater can hinder the success of programs in reversing groundwater depletion. Weak regulations result in the expansion of groundwater irrigated areas and drilling of additional wells. This can more than offset water savings created by demand-side measures, or the water increases created by supply-side measures, leading to further depletion. The government of India regulates groundwater exploitation in water-stressed states through “notification” of highly overexploited blocks that restrict development of new groundwater structures (except those for drinking water). However, only about 14% of the overexploited blocks in the country are currently notified. Local level regulatory action in all threatened blocks before they reach the “overexploited” stage is vital to avert depletion. Strengthening community participation and rights in groundwater governance can improve groundwater management. World Bank projects in peninsular India, where more spread out and specifically defined hydrological sites prevail, were successful on several fronts by implementing the Participatory Groundwater Management approach (PGM). The PGM approach empowers communities in a defined aquifer area by providing governance rights, community awareness, capacity development, and knowledge and motivation for social regulation and the implementation of coordinated actions. However, there are limits to the success of the PGM approach. It did not work when local institutions were weak, supply-side interventions failed to replenish groundwater or when tanks failed to store water due to recurrent droughts, leading to increased overexploitation. The approach is also unlikely to work in areas with extensive alluvial aquifers that require coordination among large numbers of users. World Bank interventions support local institutional capacity for groundwater governance, but such institutions are often not viable after the end of the project. Two local institutions are mainly involved in groundwater management in India: Water User Associations (WUA) and groundwater management committees (GWMC). WUAs are formal institutions with a wider mandate to manage irrigation systems (surface and groundwater) and have budget allocations for maintaining the systems and collecting user charges. In contrast, GWMCs are informal groups created through World Bank–supported projects to facilitate PGM. These committees become dormant and dysfunctional once projects close. The key institutional challenge for groundwater governance is strengthening local institutions and helping the informal groups to remain viable during the post-project phase. Power subsidies for pumping groundwater accelerate the depletion of aquifers in stressed areas. Several states affected by depletion of groundwater provide free or heavily subsidized power (including solar pumps) for pumping groundwater for irrigated agriculture. This creates perverse incentives that enable overexploitation and depletion of scarce groundwater resources. In the long-run, sustainable groundwater management will depend on cross-sectoral reforms to address the water-energy-agriculture nexus and providing the right incentives to resource users. This requires better coordination of policy, market and regulatory measures as well as repurposing current distortive public support to more climate-smart solutions. Strengthening World Bank analytical support and investments in these directions would be useful for future. Groundwater extraction has allowed rural families to reduce short-term vulnerability but may incur trade-offs and increase the risk of depletion and ultimately increase vulnerability in the long term. Increased access to groundwater resources and extraction allows households to boost agricultural production in the short term. Many farm households owning wells indicated that their vulnerability is lower partly because of income growth and diversification and buffers provided by social safety nets. However, without sufficient regulation or replenishment of aquifers, the increased access to and use of groundwater for irrigation could lead to declining water tables and increasing water scarcity, which risks escalating long-term vulnerability. pictured above: Women draw water from a well in the drylands of Jaisalmer, Rajasthan, India. By Yavuz Sariyildiz via Shutterstock (November 9, 2014).

Towards Productive, Inclusive, and Sustainable Farms and Agribusiness Firms: An Evaluation of the World Bank Group’s Support for Development of Agri-Food Economies (2010-2020) – Approach Paper

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Sustainable development of the agricultural sector and the associated agrifood industry is key to ending hunger and poverty and meeting other global goals, such as those related to climate change. Fostering broad-based agricultural development requires transforming agrifood systems because of their critical role in economic growth, employment, and sustainable agricultural development. The World Show MoreSustainable development of the agricultural sector and the associated agrifood industry is key to ending hunger and poverty and meeting other global goals, such as those related to climate change. Fostering broad-based agricultural development requires transforming agrifood systems because of their critical role in economic growth, employment, and sustainable agricultural development. The World Bank Group has been a major supporter of previous efforts to develop agriculture and the broader agrifood system economies. The objective of the evaluation is to assess how well the World Bank Group identifies the needs, addresses the constraints, and achieves results in supporting agrifood system development, defined as the development of more productive, inclusive, and sustainable farms and agribusiness firms. More specifically, the evaluation aims to (i) assess the relevance of the World Bank Group in identifying and addressing the key AFS development challenges of raising productivity, improving inclusion and reducing environmental sustainability threats especially from climate change; (ii) assess the effectiveness of World Bank Group support in making AFS more productive, inclusive, and sustainable; and (iii) identify lessons of experience, success factors, and constraints on effectiveness.

Indonesia CLR Review FY16-20

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This review of the World Bank Group (WBG) Completion and Learning Review (CLR) covers the period of the Country Partnership Framework (CPF) FY16-20, as updated in the Performance and Learning Review (PLR). The review covers WBG activities since July 1, 2015 through June 30, 2020 and not since July 1, 2016 as stated in the CLR. Indonesia is the world’s fourth most populous nation, with a Show MoreThis review of the World Bank Group (WBG) Completion and Learning Review (CLR) covers the period of the Country Partnership Framework (CPF) FY16-20, as updated in the Performance and Learning Review (PLR). The review covers WBG activities since July 1, 2015 through June 30, 2020 and not since July 1, 2016 as stated in the CLR. Indonesia is the world’s fourth most populous nation, with a population of 271 million (2019) across over 6000 inhabited islands. During the CPF period (and up to the COVID pandemic) the economy grew steadily, underpinned by solid macro-economic fundamentals, with an annual GDP growth rate (2016-19) of 5.1 percent. The 2020 SCD Update notes that the poverty rate declined to an all-time low of 9.4 percent in early 2019 and that incomes for the lower 40 percent have climbed, but that the pace of poverty reduction has been only 0.3 percentage points per year post 2010, against 0.6 percentage points per year in 2003-2010. Indonesia’s Gini coefficient declined from 38.6 in 2016 to 37.8 in 2018. The 2015 SCD identified three key pathways to shared prosperity: strong economic and jobs growth, improved access to key services, and better natural resource management.

Malawi CLR Review FY13-17

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This review of the World Bank Group’s (WBG) Completion and Learning Review (CLR) covers the period of the Country Assistance Strategy (CAS), FY13-FY17. Malawi is one of the poorest countries in the world. It is an agrarian landlocked country, with a population of 18.6 million (2019) growing at 3 percent per year. Between 2013 and 2017 real GDP and real per capita GDP grew at 4.0 and 1.2 percent Show MoreThis review of the World Bank Group’s (WBG) Completion and Learning Review (CLR) covers the period of the Country Assistance Strategy (CAS), FY13-FY17. Malawi is one of the poorest countries in the world. It is an agrarian landlocked country, with a population of 18.6 million (2019) growing at 3 percent per year. Between 2013 and 2017 real GDP and real per capita GDP grew at 4.0 and 1.2 percent per year, respectively. The poverty headcount ratio at the national poverty line was 51.5 percent in 2016, slightly above the 50.7 percent in 2010. The Gini index (World Bank estimate) stood at 44.7 in 2016, below its 2010 level of 45.5. The Human Development Index improved from 0.441 in 2010 to 0.47 in 2015 and to 0.477 in 2017. During the review period, Malawi faced several challenges including the governance and public financial management crisis in September 2013 and two natural disasters- the flooding in 2015 which affected half of the country and the drought in 2016. The “cashgate” led to temporary suspension of donor budget support and sharp reduction in disbursement of aid funds through government systems with the consequent impact on the fiscal deficit.

Jamaica: Rural Economic Development Initiative (PPAR)

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The national poverty rate in Jamaica declined over the two decades prior to appraisal, but rural poverty remained stubbornly high. The Government of Jamaica recognized that if the country was to achieve its goal of “Developed World” status, as indicated in the Government’s Vision 2030 plan, economic development in rural areas needed to keep pace with that experienced in urban areas. In 2008, the Show MoreThe national poverty rate in Jamaica declined over the two decades prior to appraisal, but rural poverty remained stubbornly high. The Government of Jamaica recognized that if the country was to achieve its goal of “Developed World” status, as indicated in the Government’s Vision 2030 plan, economic development in rural areas needed to keep pace with that experienced in urban areas. In 2008, the Government requested World Bank support for a project that would promote rural economic development and income generation by improving access to markets for small-holder farmers and by encouraging rural tourism development. Unusual among the Bank’s productive alliance projects, the present project sought to combine both agriculture and tourism, reflecting the unique circumstances of Jamaica’s rural landscape and the potential for agriculture to engage more with the tourism sector, a major contributor to foreign currency receipts. The Bank also determined that the rural agriculture and tourism sectors offered the most significant potential for rural growth and development. The resulting Bank project, the Rural Economic Development Initiative (REDI), was designed to stimulate rural economic growth and increase rural incomes. Ratings for the Rural Economic Development Initiative are as follows: Outcome was satisfactory, Overall efficacy was substantial, Bank performance was moderately satisfactory, and Quality of monitoring and evaluation was negligible. This assessment offers the following issues: (i) For complex productive alliance projects involving the selection of multiple rural subprojects and the introduction of new private-sector market concepts to rural communities, substantial investment to ensure project implementation readiness during project preparation can contribute to a faster and more effective project start. (ii) For productive alliance projects introducing modern technologies and new business management practices into rural populations, ensuring adequate skills and capacity in the implementing agencies will enhance the achievement of results. (iii) Technical assistance supporting private sector market approaches can be critical for linking rural agricultural and tourism operations to new and evolving markets.

What works in public utility reform: Lessons from evaluations in the energy and water sectors

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What works in public utility reform:  Lessons from evaluations in the energy and water sectors
Utility reform has never been more important. The COVID-19 pandemic has badly impacted utilities across the world. Many utilities are now under intensified financial stress due to budget reductions and a loss of revenue, resulting from a sudden drop in collection rates, suspension of billing, and tariff adjustment in some countries. This, in turn, has made it more challenging to ensure continued Show MoreUtility reform has never been more important. The COVID-19 pandemic has badly impacted utilities across the world. Many utilities are now under intensified financial stress due to budget reductions and a loss of revenue, resulting from a sudden drop in collection rates, suspension of billing, and tariff adjustment in some countries. This, in turn, has made it more challenging to ensure continued service delivery. IEG recently published the synthesis Public Utility Reform: What lessons can we learn from IEG evaluations in the energy and water sectors?, a compilation of evidence of what worked and what did not work, and why, in World Bank support of public utility reforms in the energy and water sectors in its client countries. Its findings are even more relevant in the context of uncertainty about medium-to long-term outlook for recovery from the challenges imposed by COVID-19. Well before COVID-19, financial viability and institutional accountability were the two main challenges faced by public utilities in improving service outcomes in the energy and water sectors. Now, the effectiveness of utilities in these two fundamental areas remain critical for ensuring the quality and sustainability of these vital basic services during a post-pandemic recovery. Financial Viability IEG analysis reveals a range of World Bank interventions geared to support financial viability in both the energy and water sectors.   Recovering the cost of service is at the core of sector reform. Across both water and energy sectors, inadequate cost recovery is a key driver of financial underperformance. Poor bill collection and operational inefficiencies (including excessive network losses) also have a significant role. IEG finds that, while tariff reform is fundamental, improving operational efficiency of service providers is crucial for financial sustainability. The cumulative evidence indicates that when inefficiencies result in high-cost service provision, improving utilities’ operational efficiency should precede or go hand-in-hand with tariff increases. Additionally, the gains from reductions in technical and commercial losses, improvements in payment collection, financial management, and demand side management proved easier to sustain once implemented. Evidence points to the importance of strengthening utilities’ commercial orientation, which is vital for the provision of adequate and reliable services, regardless of whether the service delivery agents are under public or private ownership. Utilities that emphasize cost control, customer orientation, and responsiveness to incentives are more likely to make meaningful progress. For example, World Bank operations in Vietnam and Turkey helped improve financial sustainability of electric power utilities through technical support and policy reforms, incrementally implementing tariff and market regulations in the electricity sector. Utilities may need more financial support as they weather the economic crisis triggered by the pandemic. However, as the recently published IEG evaluation State your Business! An evaluation of World Bank Group support to the Reform of State-Owned Enterprises cautions, temporary subsidies introduced at the time of COVID-19 can pose “policy traps” supported by powerful vested interests, which can be hard to reverse once the crisis is over.   Institutional Accountability Creating the right accountability and incentives is essential for effective service delivery. In both energy and water sectors, institutional accountability is critically tied to performance.  Sustaining reforms requires competent institutions and strong administrative capacity.  Improved performance can be a first step towards attracting private sector investment.  Strengthening sector planning, utility management, capacity and skills, can improve sector outcomes. A solid sectoral fiscal, financial, and regulatory framework also defines and sets the context for leveraging markets and the private sector to support service delivery. There are multiple institutional pathways that could lay the foundation for improved and sustained service delivery. There is no single model but there are certain principles that work. In energy, improved accountability and regulatory performance drive sector outcomes. Good practices on corporate governance and regulation enable the sector environment to leverage markets and the private sector. In Rwanda, for example, the World Bank (through budget support operations), the International Finance Corporation  (through advisory services), and Public-Private Infrastructure Advisory Facility (PPIAF) helped the government develop sector regulatory structures and separate water and electricity utilities to improve governance, accountability and transparency. Institutional and policy reforms transformed the Rwanda Energy Group into a commercially operated state-owned enterprise and helped attract private finance. In water, improved capacity, incentives, and transparent rules on accessing funds can ensure good sector outcomes. Good financial and operational data systems are also important. In Peru, the utility Sedapal radically changed its corporate management approach and work culture, including adopting a new performance-based compensation and incentive system driven by reaching results targets. IEG’s field-based assessment confirmed a steady improvement in access coverage, basic service parameters, and operational and financial performance. Political and social challenges In both sectors, utilities' operations and management are closely linked to the political economy in which they operate. Political economy considerations can inform specific design elements, including choices of programmatic instruments vs. standalone operations, or front-loading vs. back-loading of important reform actions in a programmatic series. Experience shows that support to operations needs to match the time frame in which effective government action can reasonably take place. The World Bank’s experience shows that complementary interventions and sustained support contribute positively to favorable and enduring results. Regarding tariff reform, the institutional, political, and social challenges are considerable. Public opposition to tariff reforms reflects a lack of confidence in public service improvements and that vulnerable groups will be protected. At the same time, it is important to address potentially negative distributional consequences of reforms through such measures as differentiated tariffs and targeted assistance programs. Their success depends on the government’s ability to reach vulnerable households through fiscally sustainable programs. Read the report | Public Utility Reform: What lessons can we learn from IEG evaluations in the energy and water sectors? Pictured at top, clockwise from left: The main drinking water pipeline for 750 households in Alapars and Karenis communities (Kotayk region) being fully rehabilitated. Armenia. Photo credit: Armine Grigoryan / World Bank The control room at the thermal power station at Takoradi, Ghana, June 21, 2006. Photo credit: Jonathan Ernst/World Bank Electrical Substation in Kenya. Photo credit: Andrew Stone Windmill, Nicaragua photo credit: Ihsan Kaler Hurcan Wegala Community Water Supply and Sanitation Project. Sri Lanka. Photo credit: Simone D. McCourtie / World Bank Girl gathers drinking water from a community water pipe. Photo credit: Dominic Sansoni / World Bank

Malawi: Irrigation, Rural Livelihoods and Agricultural Development Project, and Agricultural Development Program Support Project (PPAR)

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The World Bank has been supporting the government of Malawi in its effort to promote sustainable growth in agricultural productivity. The Irrigation, Rural Livelihoods and Agricultural Development Project (IRLADP) supported irrigation farming through the integrated provision of hardware, mainly irrigation infrastructure, and software, mainly local and institutional capacity building. The Show MoreThe World Bank has been supporting the government of Malawi in its effort to promote sustainable growth in agricultural productivity. The Irrigation, Rural Livelihoods and Agricultural Development Project (IRLADP) supported irrigation farming through the integrated provision of hardware, mainly irrigation infrastructure, and software, mainly local and institutional capacity building. The Agricultural Development Program Support Project (ADPSP) addressed the efficiency of decision-making at the institutional agricultural policy and farm input–productivity level. The objective of the Project Performance Assessment Report is to assess how the farm-level support of both projects contributed to sustainable increases in agricultural productivity among smallholder farmers (SHFs). Both projects fostered an integrated approach to increases in agricultural productivity by promoting the uptake of traditional measures to support supply (irrigation, modern inputs, and agronomic knowledge) together with complementary practices of improved land and water management. Ratings for the Irrigation, Rural Livelihoods and Agricultural Development Project are as follows: Outcome was moderately satisfactory, Overall efficacy was substantial, Bank performance was moderately satisfactory, and Quality of monitoring and evaluation was substantial. Ratings for the Agricultural Development Program Support Project are as follows: Outcome was moderately unsatisfactory, Overall efficacy was modest, Bank performance was moderately satisfactory, and Quality of monitoring and evaluation is modest. This assessment offers the following lessons: (i) An integrated and participatory approach to agricultural development can initiate sustainable productivity growth among SHFs. In the context of a SHF-dominated agricultural sector and low productivity, traditional support measures of input supply are needed to close agronomic yield gaps. (ii) Agricultural projects with a supply-side focus on productivity growth that ignore market linkages are unlikely to provide the right agribusiness mind-set or incentives for farmers to sustainably invest in longer-term agricultural productivity. (iii) A government’s insufficient capacity and resources for agricultural sector development make it difficult to maintain an innovative but intensive demand-driven approach to service delivery in agriculture. (iv) Sustainable land and water management practices require a comprehensive approach that goes beyond irrigation or demonstration plots. (v) For projects preparing an Agriculture Sector-Wide Approach, monitoring production outcomes without a counterfactual does not allow an understanding of what is driving the anticipated productivity increases.

An Evaluation of the World Bank Group’s Support to Municipal Solid Waste Management, 2010–20 (Approach Paper)

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Municipal solid waste (MSW) has emerged as one of the most pressing challenges for urban areas across the world. This evaluation is the Independent Evaluation Group’s (IEG) first major study of the Bank Group’s support for MSWM. It is timely given the rapidly increasing scale of MSW in most MICs and LICs and considering the spectacle of massive open garbage dumps in cities as diverse as Manila, Show MoreMunicipal solid waste (MSW) has emerged as one of the most pressing challenges for urban areas across the world. This evaluation is the Independent Evaluation Group’s (IEG) first major study of the Bank Group’s support for MSWM. It is timely given the rapidly increasing scale of MSW in most MICs and LICs and considering the spectacle of massive open garbage dumps in cities as diverse as Manila, Lagos, and New Delhi. The evaluation will highlight the linkages of MSWM with other sectors and themes such as water supply and sanitation, environment, climate change, health, jobs, and social protection. This can point to how the Bank Group can better support the development of synergistic policy frameworks and regulations for MSWM in client countries. This has implications for developing systematic collaboration between various sectors within the Bank Group and among client government ministries and for leveraging opportunities for climate finance.

Evaluation of the World Bank’s Support to Improving Child Undernutrition and Its Determinants (Approach Paper)

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Global reports on indicators of child undernutrition show mixed progress in reducing the stunting (impaired growth and development) of children under five, with Africa and South Asia most severely affected. There are many determinants of child undernutrition, which makes the challenge of improving outcomes multidimensional, requiring interventions in areas of health; agriculture; water, Show MoreGlobal reports on indicators of child undernutrition show mixed progress in reducing the stunting (impaired growth and development) of children under five, with Africa and South Asia most severely affected. There are many determinants of child undernutrition, which makes the challenge of improving outcomes multidimensional, requiring interventions in areas of health; agriculture; water, sanitation, and hygiene; social protection; education; and governance, depending on the country context. The objectives of this evaluation are to assess the contribution of the World Bank to improving outcomes related to child undernutrition and its determinants in countries affected by undernutrition, and to provide lessons and recommendations to inform the design of the World Bank’s future multidimensional nutrition support.

India: Andhra Pradesh and Telangana State Community-Based Tank Management Project (PPAR)

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This Project Performance Assessment Report assesses the development effectiveness of India’s Andhra Pradesh and Telangana State Community-Based Tank Management Project, which was approved in 2007 and closed in 2016. The development objectives of the project were to (i) improve agricultural productivity with the assistance of selected tank-based producers; and (ii) improve the management of tank Show MoreThis Project Performance Assessment Report assesses the development effectiveness of India’s Andhra Pradesh and Telangana State Community-Based Tank Management Project, which was approved in 2007 and closed in 2016. The development objectives of the project were to (i) improve agricultural productivity with the assistance of selected tank-based producers; and (ii) improve the management of tank systems with the assistance of selected water user associations. Ratings for this review are as follows: Outcome was satisfactory, Risk to development outcome was substantial, Bank performance was moderately satisfactory, and Borrower performance was moderately satisfactory. Lessons from this review include: (i) The potential economic benefits from improved irrigation infrastructure cannot be adequately realized by beneficiaries without the coordinated and ongoing support of multiple government agencies and research extension services in agriculture. (ii) Continued support to WUAs in terms of resources and social intermediation, such as through nongovernmental organizations, is key to enhancing their capacity for improved water management in drought-prone areas. (iii) Benefits from increased water availability can be further increased if cropping decisions by smallholder farmers in drought-prone areas are informed by water budgeting and collective governance principles for sustainable use.