TNAG-0592-FCO40-725-Inspection-of-Hong-Kong-and-Indian-Ocean-Department-1976 — Page 37

that the review of the pilot scheme would take place too late in the overall scheme to have its full effect but felt this was a risk to be taken.

5. The Chairman commented that recovering charges by taxation rather than by a direct charge for water gave no incentive for the economic use of the water itself but it seemed relatively few irrigation schemes did in fact charge economic rates for water. Mr Davie said IBRD experience in Thailand on the same question had showed that they too could do little about it. Mr Rae commented that recurrent costs would be recovered. The Chairman regretted that that was all and said that SEADD might note the Committee's views; meantime we should bow to the inevitable in this case.

6. Other points arising in discussion were:

i. The Thai Government had not asked for a revaluation of the 1971 capital aid offer but a request to provide more aid by way of TC (which might have been an attempt to increase its monetary value) had not been considered acceptable.

RECOMMENDATION

ii. Although the Thai Government had taken on an open ended commitment in guaranteeing to provide funds in excess of £2.5m for the project, they were not really short of development aid and there was probably no call to put the project before possible Arab donors.

iii. Some concern was expressed at the seasonal very high offtake of water (22 hours pumping daily) and how the recharging of the aquifer could be measured to ensure no overall imbalance, this having emerged as a primary requirement in the appraisal. The technical measurement could be quite simply done but the management of water by farmers would need to be carefully monitored, as well as ensuring that laws barring private exploitation were effective. It was suggested that SEADD would need to monitor these points particularly.

7. The Committee, recognising that some risks existed but could be minimised by effective action and monitoring, agreed to recommend the provision of £2.5 million of capital aid as a contribution to the offshore costs of the Sukhothai Groundwater project.

GAMBIA: RURAL DEVELOPMENT PROJECT

8.

Mr Whitelegg introduced Mr Lowe, who would be taking up the post of Project Coordinator shortly, and said the project was more strictly agricultural production than rural development, with several inputs eg feeder roads coming from smaller independent projects in the area.

9. Mr Rae asked for a description of the "LRD package" which had been mentioned. Mr Lowe replied that two years' survey work had been done on resource identification and intermediate technology methods of improvement and in the second year a pilot project was started to utilise the preliminary analysis of the first year and the ongoing collection of data. All results were available locally to the project.

He

10. The Committee generally were satisfied with the scope and aims of the project but Mr Burr said he was sceptical of the results forecast by IBRD in their project appraisal and wondered if ODM were correct in "resting on our oars" when a Bank analysis was available for a project in which we were involved. Mr Porter described certain parts of the economic analysis as "inadequate" and pointed out that the 23% economic rate of return depended upon a high livestock component rate (45%) which, in the same section of the appraisal, was stated to be "difficult to evaluate". did not doubt that the project was the right sort of thing to do but suspected that Bank staff were looking for rural development projects in the light of current strategy and doing overglossy appraisals. Mr Burr agreed that the Bank took a much stricter interpretation than ODM on new policies when decided it was now unlikely to approve money for trunk roads but passed feeder road projects quite easily and might be more lenient in their assessments in order to be seen to be following the new guidelines

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