STAGE II DEVELOPMENT OF NEW
LANDS
UNDER KALAWEWA AND KANDALAMA
SUMMARY
OF
FEASIBILITY REPORT
SUMMARY AND CONCLUSION
1. 5. 1 The project
consists of the development under irrigation with water diverted from the Mahaweli
of 71.000 acres of potential farm area in the dry zone, close to the historic
city of
I. 5. 2 The project will create
a large foreign exchange savings and provide direct employment to 32,200
persons. Considering the present adverse balance of payments and the increasing
number of unemployed persons, the implementation of the project has a high
priority in the development plans of the country.
1. 5. 3 The irrigation supply
will he regulated through two existing reservoirs situated at the upper
extremity of the of the project area. These reservoirs will provide the storage
necessary to cater for the seasonal variations of flow required. Two main
canals commencing from each reservoir will teed the project area through a
system of distributaries and held channels. Drainage will be provided by the
existing streams supplemented by a network of surface and sub-surface drainage
channels. The main construction works are the irrigation, drainage and road
networks and the land preparation.
1. 5. 4 The project involves the
settlement of about 15,500 individual farms besides the integration of
some 8,000 families presently living in the area. Selection procedures will
provide for improved criteria for the recruitment of settlers to ensure
efficient agricultural production, social harmony and self management of farmer
organisation. The training of farmers is also given due consideration.
1. 5. 5 Cropping pattern will
include non - traditional crops such as onions, chilies,
Soya beans. Pulses and cotton. besides
paddy. A certain amount of farm machinery is envisaged.
1.5.6 Water from the Mahaweli Ganga
will be available in the project area by end 1975. Channel construction will commence
in 1973 and is scheduled to keep pace with the settlement of the farmers from
1975. It is proposed to settle the area fully by 1979 to reach full Production
levels in 1987.
I. 5. 7 The project administration
will be organised around a Resident Project Manager assisted by Water
Management eat, Agricultural Production. Community
Development. and Marketing and Credit
Divisions. This organisation will be the local extension of the Mahaweli
Development Board (M.D.B.) which has been entrusted with the promotion,
operation mad monitoring of development schemes under the Mahaweli Project. The
Board is composed of representatives of Ministries concerned with agricultural
development, public works and rural development. Fully autonomous farmer
organisations will he created at all levels of the project administration in an
area covering 10,000 acres and to try out new form of management. In the rest
of the area the pattern will he the same as for the rest of the country.
1. 5. 8 farmers will he charged annual rates to cover the cost of
maintenance, Operation and management of the project. The undiscounted benefit,
cost ratio on the Government budget is equal to 1.4 indicating, that the
investment on the project is not to the detriment of public finances.
1. 5. 9 Individual farm budgets
show a balance of about Rs. 4,500 per year in
a 3-acre paddy farm and Rs. 6,400 per year in a 3-acre
upland farm. These high incomes will enable farmers to save fin the purchase of
their land while having a relatively high standard or life. The social
impact of the project will be amplified by the measures recommended to increase
the farmers’ participation in the project’s organisation and to establish more
equal relations between the farmers and the administration.
1.5.10 The financial cost of the initial investments is Rs. 765.9 million including a foreign exchange component of U.S. $ 35.8 million (Rs. 214.5 million). At full operation the gross annual agricultural output will be worth Rs. 236.5 million at farm gate value. The net income from agricultural produce is Rs. 163 million at farm gate values.
.5.11 The internal rate of economic return of the project computed on the basis of the opportunity value of foreign exchange, labour inputs and agricultural outputs is equal to 13.4 percent.
1 5.12 Stage II of Project