Page 1 PROJECT INFORMATION DOCUMENT (PID) CONCEPT STAGE Report No.: AB206 Project Name Jharkhand Participatory Forest Management Region SOUTH ASIA Sector Forestry (75%); Sub-national government administration (15%); Agricultural marketing and trade (10%) Project ID P077192 Borrower(s) MINISTRY OF FINANCE, GOVERNMENT OF INDIA Implementing Agency Village Committees, Tribal Institutions, Panchayat Institutions, Jharkhand Forest Department Borrowers contact information Government of India Department of Economic Affairs Ministry of Finance 110001 Tel: 91-11-23092500 Environment Category [ ] A [X] B [ ] C [ ] FI [ ] TBD (to be determined) Safeguard Classification [X] S 1 [ ] S 2 [ ] S 3 [ ] S F [ ] TBD (to be determined) Date PID Prepared August 6, 2003 Estimated Date of Appraisal Authorization December 1, 2004 Estimated Date of Board Approval March 15, 2005 1. Key development issues and rationale for Bank involvement . Recent assessment of rural poverty in India identifies Jharkhand to be of particular concern because the absolute numbers of poor are high and increasing. Bihar’s rural headcount ratio is 41.1%, second highest after Orrissa (Deaton and Dreze 2002). All India statistics on poverty among tribals indicate disproportionately low levels of literacy, income, and high levels of internal displacement (IFAD 2001). Jharkhand’s forest dependant poor are the explicitly defined target of the proposed operation. Forest fringe communities represent about 60% of the total state population and over 90% of the state’s tribal people. Tribal groups strongly identify with forests for subsistence and cultural/spiritual reasons, as a safety net, and as a primary source of income. Strengthening community control over forest assets has been shown to make significant and culturally appropriate contributions to poverty alleviation, empowerment, transparency, and environmental conservation throughout the world. In this newly formed state, with a significant tribal population, politicians and civil servants are making a concerted effort to identify and address the development needs of isolated and underserved tribal groups. To this end, state leaders are attempting to harness forests (which cover 2.4 million hectares or 30% of the state) to support poverty alleviation efforts. The state’s progressive Joint Forest Management policy (JFM, 2001) demonstrates commitment to reform by expanding benefit shares and control over usufruct rights for participating communities and relying on self-initiated groups. The proposed operation fosters implementation of the new policy while ensuring that access restrictions emerge only from freely taken decisions on the part Page 2 of the communities concerned and that these communities are given full control over usufruct rights ceded to them by the state . The India CAS (2001) recognizes that natural resource management projects attack poverty directly by strengthening local control over productive assets while increasing asset value. As a development partner the Bank is one of very few institutions able to provide the necessary continuity of support and facilitate multi-stakeholder consensus building efforts. Our involvement in multiple state-level projects provides a mechanism for transferring up-to-date practical experience and enables the Bank to engage in a constructive dialogue on sector management issues with both the states and central government. Many valuable lessons have emerged from recent experience in the Indian forestry sector and global analysis of the forests and poverty nexus: 1) tenurial rights and associated responsibilities must be clearly defined and well disseminated; 2) careful assessment of pre-existing patterns of resource use are needed to avoid unintended/unmitigated access restrictions; 3) skills in conflict management and strategic communication are essential; 4) devolving planning and decision- making to local communities and front-line staff generates new ideas and unanticipated solutions; 5) community-managed forests make important contributions to both increased productivity and improved conservation of biodiversity. 2. Proposed objective(s) The primary objective of this project is to improve the livelihoods of poor forest-dependent communities by strengthening their access to and control over natural resources. The expected outcomes include 1) increased capacity of self-initiated community institutions to exercise their rights and responsibilities in forest management and decentralized planning; 2) improved coordination among service providers (state forest department, tribal institutions/local panchayats, NGOs, other line agencies); 3) acquisition by stakeholders of new roles, skills, and incentives to support, regulate, and monitor participatory forest management; 4) increased opportunities to access and market forest and non-forest products; and 5) increasing returns (usufruct to communities and ecosystem services to society) from expanded forest resources over time. 3. Preliminary description This is a livelihood project, but livelihoods of the target population are primarily forest-based and therefore the central focus is forest asset management and associated policies and institutions. The project will use culturally appropriate, community-driven approaches and introduce community procurement methods. The team will explore opportunities to support livelihoods of rural poor that come from sources outside forests and complement funds from other line agencies and donors operating in the project area. Investments will be tailored to individual community needs through a microplanning process and on the basis of a typology of groups (low capacity vs high capacity) and the condition of the forest (low productivity vs high productivity). Level and type of investment in a particular community will depend on the initial community capacity and local forest productivity. Stakeholders, including several line agencies and tribal leaders, have been involved in the evolution of the government’s JFM policy, that the Page 3 present proposal intends to support. Project components will be defined during preparation but are expected to include: Institutional Development at the Community Level : Local, self-initiated groups will be supported with targeted capacity building efforts in community-based planning, financial management, natural resources management, and marketing. The project will support income generation activities, increased agricultural productivity and improved access to micro-finance through inter-sectoral coordination, an expanded role for tribal institutions / local panchayats, and functional links to other rural livelihoods and poverty alleviation initiatives currently under implementation in Jharkhand (International Fund for Agricultural Development, World Food Program, others). Enabling Environment : Support for analytical work and policy dialogue that strengthens legal and policy frameworks for community forest management and disseminates information on community rights and responsibilities. Project-related discussions on tenure and access will be carried out in accordance with circulars issued by the central government in 1990. To ensure that the State Forest Department and other agencies and actors are well equipped to support community forest management and fulfill their designated roles, a number of new skills, incentives and procedures will be developed and piloted during project preparation. Asset Creation: The project will support improvements in the productivity of forest resources through improved silviculture, planting stock, water management, rational grazing, and monitoring. Preparation will explore inclusion of agroforestry /outgrower schemes on private land. The GEF and WWF Alliance could support mainstreaming conservation and improved environmental management in project areas. Detailed implementation arrangements will be developed during preparation. The state forest department (FD) is expected to focus on its areas of core accountability and comparative advantage – technical assistance in forest management and regulatory functions – to ensure that they play a supportive role as communities develop forest management skills. FD and communities will share responsibility for monitoring and evaluation, with social audits carried out periodically by a third party evaluator. Other activities will be implemented directly by communities themselves or through other line agencies or NGOs. Consistent with recent experience in other Bank sponsored poverty alleviation projects in India, a multi-sectoral team will support the process of community-based planning. A discussion of alternative designs centered on the possibility of addressing forestry issues through a component in a broader watershed development or rural poverty reduction project. Given that community livelihoods in the target area are primarily forest-based, it was decided that this project be directed largely toward improving forest policy implementation. Benefits of a broader rural development project will be achieved through effective incorporation in this project of lessons learned from ongoing rural livelihoods projects financed by the Bank and cooperation (parallel or co-finance) with similar programs financed by other donors (eg., IFAD’s ongoing Tribal Development Program). It was also agreed that alternative arrangements for implementation would be considered at pre-appraisal in light of experience with pilots undertaken during preparation and the outcomes of the institutional assessment. Page 4 4. Safeguard policies that might apply Seven safeguard policies are likely to be triggered by the proposed operation - Environmental Assessment, Natural Habitats, Forestry, Pest Management, Cultural Property, Indigenous Peoples, Involuntary Resettlement (due to access restriction not physical displacement). It is important to note that most of the safeguards are triggered because the operation is directly and intentionally addressing related issues (safeguards are triggered proactively not incidentally) and the project is expected to have a strong positive impact in each triggered area. The task team considers the project itself to be an Indigenous Peoples Development Plan. 5. Tentative financing Source: ($m.) BORROWER/RECEPIENT 10 INTERNATIONAL DEVELOPMENT ASSOCIATION 40 FOREIGN MULTILATERAL INSTITUTIONS (UNIDENTIFIED) 10 Total 60 6. Contact point Contact: Peter Jipp Title: Sr. Forestry Specialist Tel: (202) 458-7288 Fax: (202) 522-1770 Email: Pjipp@worldbank.org