India country partnership strategy 2013-16 draft concept note for discussion

1. India country partnership strategy 2013-16 draft concept note for discussion

2. What is a Country Program Strategy (CPS) ? • The World Bank prepares a CPS to set out the priority areas of its support to the country’s development strategy (eg. India’s Five Year Plan) • It serves as an indicative business plan in support of a country’s development goals. • Oriented toward results, the CPS is developed in consultation with country authorities, civil society organizations, development partners, and other stakeholders. • It identifies the key areas where the Bank's assistance can have the biggest impact on poverty reduction. • From this assessment, the level and composition of Bank Group’s financial, advisory, and technical support to the country is determined.

3. Why your inputs Count • Consultations with civil society are key to identifying the internal and external challenges facing countries in its fight against poverty. • Through consultations, the World Bank Group is able to tap into a broad range of perspectives from those involved or affected by development programs. It aims to integrate comments and new ideas into its operations, policies and final documents. • Consultations help capture the experience and knowledge of multiple audiences―government, NGOs, academia and think tanks, media and the private sector― to enable greater participation of partners and stakeholders in operations supported by the Bank. .

4. The consultation process for CPS 2013-16 • Mid May 2012 – Preparation on draft presentation on CPS • Mid May-End June • Consultations with Ministry of Finance and line ministries at the Centre • Consultations with state government officials across six states including Karnataka, Chhattisgarh, Assam, and Uttar Pradesh • Civil society Consultations in Delhi and five state capitals – Bangalore, Raipur, Guwahati, Lucknow and Mumbai • End July : Preparation of CPS • Sharing of next CAS through website and email updates for further feedback • A separate section on the issues discussed during consultations with civil society will be prepared • End August : Presentation to Board • Dissemination of final CPS document

5. Structure of the Presentation • The main pillars of the previous CPS (CAS 2008-2012) • Highlights of how CPS 2008-2012 was implemented by the World Bank • And the lessons learnt • Current Scenario – Opportunities and Challenges • Developments/trends within India and outside • Direction provided by the XIIth Five Year Plan • Initial thoughts on what the CPS 2012-2016 could focus on • Constraints and opportunities • Six questions where we need your inputs and guidance • Additional points you want to cover

6. Focus areas of support identified for CPS 2008-2012 • Pillar 1: Rapid and Inclusive growth • Infrastructure building • Enhancing agriculture productivity • Increasing access to finance, for the poor • Leveraging private investments • Pillar 2: Sustainable development • Supporting implementation of the GoI’s low carbon strategy • Cleaner Coal • Renewable energy sources - hydel, solar, wind • Integrated coastal zone management and biodiversity conservation • Strengthening disaster management (flood management in Bihar) • Pillar 3: Service delivery improvement • Promoting universalization of primary and secondary education; Strengthening public Health delivery systems (NRHM) • Strengthening implementation and effectiveness to national development programs • Enhancing delivery of public services, such as water • Promoting rural road connectivity, road safety and asset management

7. CPS 2008-2012 : Implementation Highlights • Scaling up of WBG engagement in India • IBRD/IDA and IFC lending doubled: • From US$12 bln under the previous CAS to $25 bln under the present CPS • This includes $11billion provided to India by the WBG during the global economic crisis in 2008-09 • New areas of engagement: • Focus on ‘transformation’ projects – Ganga Clean up, Dedicated Freight Corridor, Coastal Zone Management, e-service delivery, etc. • Moving from projects to country-wide programs: • Primary and secondary education, rural roads, rural livelihood • In terms of actual lending value – specific numbers • Knowledge and Technical Assistance (TA) • Investment climate at state level, social protection, gender, urbanization, low carbon growth, biodiversity, integrated transport strategy, health insurance, etc. • IFC advisory services grew by almost 50 percent between FY09 and FY11

8. CPS 2008-2012 : Implementation Highlights 2a. Aiming for growth with inclusion • Agriculture productivity and sustainability • Record lending to Rural and Agriculture Sector in 2011-12 of nearly $2 billion • Land reclamation, improved watershed and community tank management, support to national dairy program, strengthening of farmer to market linkages in low income states, climate smart agriculture, and roll-out of low-input, low risk farming, etc. • Transport Sector : • Improved asset management of highways ( 7 states) and rural roads (PMGSY) • Promoting rural road connectivity, road safety and asset management • Financial and private sector development • Financing of Small and Medium Enterprises, vocational and technical education (specifics), GoI’s CSR initiative. • Investment climate reforms including in low income states (IFC advisory services in Bihar, Orissa, Uttar Pradesh and Rajasthan; tax and e-governance efforts in Bihar)

9. CPS 2008-2012 : Implementation Highlights 2b. GoI’s Growth with Inclusion agenda • Poverty alleviation and social inclusion • Access to Credit : Micro-finance, Rural livelihood projects (including in NE states), women economic and social empowerment through in self help groups. • Access to health services: accessible and affordable health care facilities; payment platform in Bihar • Natural disaster: National Cyclone Risk Mitigation, Bihar Kosi Flood Recovery, Coastal zone management • Engaging in low income states • 27% of IBRD/IDA commitments under present CPS period (including share of multi-state projects) and 35% IFC total in FY12 • Capacity building and governance reforms: E-service delivery, e-procurement, M&E, performance management • Improving investment climate and enhancing awareness amongst investors about emerging industrial and infra opportunities • Bihar health payments, Bihar tax reforms, micro finance, Rajasthan knowledge partnership, housing micro finance, agribusiness) • Innovations in service delivery: G2Patient health payments and SMMEs e-filling of taxes in Bihar

10. CPS 2008-2012 : Implementation Highlights 3. Sustainable development initiatives: support to the implementation of the GoI’s low carbon strategy • Energy efficiency : Coal-fired generation rehabilitation, Lighting India program, green buildings • Expanding renewable energy use : • Solar power to off-grid telecom towers and India’s first private sector grid tied solar power company, expanding solar roof top project in Gujarat and other states • Medium to large hydro projects demonstrating improved social and environment practices • Integrated coastal zone management and biodiversity conservation • Strengthening disaster management (flood management) • Leveraging climate finance (CTF, carbon funds, etc.)

11. CPS 2008-2012 : Implementation Highlights • Pillar 3: Service delivery improvementinitiatives • Promoting universalization of primary and secondary education • Reforming health delivery system (NRHM), New UP Health Systems Project • Introducing 24/7 water supply in urban areas of Karnataka • Supporting GoI’s efforts for strengtening implementation of national development programs (PMGSY, SSA, NRLM, RMSA, rural WSS, etc) • Capacity building for rural and urban local governments, promoting participatory development – water user associations, self help groups • Promoting e-governance and accountability • NeGP, urban service level benchmarking, corporate governance under NHAI TA, IT-based systems now embedded in 1/3 of projects • Mainstreaming social accountability mechanisms • social audits in PMGSY and R&R processes, participatory development (watershed development, rural WSS, small irrigation)

12. Planning the next CPS: current context • India sustaining growth, though at lower levels • While India’s growth rate in FY11/12 fell under 7%, it still is the second fastest growing economy. • From 1.7% of world GDP in 1980 to 5.5% in 2010 (4th largest) • An increasing contribution to the international agenda - role within G20, ASEAN, BRICS initiative, etc. • Falling corporate investment from 14% of GDP before crisis to 10% • Global economic developments could pose serious challenges, given India’s limited fiscal space • Challenged by unequal benefit distribution –regional, caste, gender, income categories, rural-urban, etc. • Governance in focus: • RTI Act, Women political empowerment, decentralization, E-service delivery and Corporate governance

13. Planning the CPS : India12th Plan highlights • 1st pillar: rapid & inclusive growth; • Investment rate of 38.5%; Jobs; Manufacturing, especially in SMEs; Agri growth, improving Business climate, Domestic market integration • One trillion in Infrastructure; Energy, • Reducing regional disparities; Urban transition • 2nd pillar: sustainable development; • Improving the management of natural resources • Strengthening land acquisition and R&R processes, rationalizing land use in urban areas, promoting land titling/leasing • Towards “ a credible and fair system of exploitation of mineral resources” • Promoting green development: water & energy efficient, low carbon development • Strengthening natural disaster management/resilience • 3rd pillar: enhanced effectiveness of service delivery • Reforming the health system • Improving quality of (universal) primary education • Universalizing access to secondary education by 2017 • Enrolling 10 million additional students in higher education (Increasing present gross enrollment rate of 18% to 25%) • Accommodating 10 more million urban dwellers a year • Focusing on access to basic services in lagging/backward areas across the country

14. Some initial thoughts for CPS 2013-2016

15. CPS 2013-16 : Strategic Objectives under consideration • Catalyzing infrastructure investment and creating bankable projects • Financial engineering, PPP, asset management, • Strengthening risk management • Regional integration (energy, water resources, transport facilitation) • Strengthening project management • Promoting human development • Managing demographic growth • Job creation • Urbanization • Universalizing access to quality health services • Education & skill development • Fighting poverty alleviation & promoting social inclusion: • Livelihood (rural & urban) • Gender, equality of opportunity

16. CPS 2013-16 : Strategic Objectives under consideration • Supporting/informing key structural reforms • Natural resources management (water, land, mineral) • Energy security • Agricultural productivity & food security • Integration & performance of domestic markets • Governance reforms • Scaling up and bringing to fruition • GoI’s urban agenda – service delivery such as transport, water, etc. • Use of country systems for fiduciary controls and safeguards: • Scaling up knowledge • Accompanying India’s transition to a MIC • Infrastructure regulatory framework, investment climate, domestic market integration, governance, social/financial/legal inclusion, public finance management, social and environmental safeguards • Leveraging India’s development experience on behalf of other developing countries: India as a funder and the main provider of knowledge and experience within the South-South experience exchange • Managing Finance Constraints

17. The CPS Instruments • Operationalizing DEA’s Finance plus agenda (transformation/innovation/leveraging) • Optimizing transformational impact • Innovative finance • Promoting innovation • In service delivery, project management, accountability mechanisms, financial engineering, contracting • Focus on low income states • Knowledge and technical assistance • Regional integration, water resources management, land management, etc. • Scaling up knowledge transfers: • from Bank projects, across states (good practices), from overseas (leveraging the experience of policy makers, practitioners) • Strengthening TA to states: • With a focus in low income states (UP, Jharkhand, Chhattisgarh, North East, etc.) • Improving results/outcomes/performance • Strengthening readiness filters, e.g. on land acquisition • Moving on from supervision to support to implementation (e.g. in procurement) • Building IT-based M&E and project management capacity in the road and health sectors

18. Points for Discussion • Do CPS themes capture the development priorities of India/your state • What according to you are the priorities • What are we missing • What role do you see the World Bank Group playing in helping Chhattisgarh meet these challenges? • Which sectors – agriculture, transport, environment, education • What form – finance, knowledge, experience sharing, etc.

19. Points for discussion • What are the concerns you have regarding implementation of development programs in Chhattisgarh? • Governance • Equity – gender, access to services • Voice • Others? • How can the World Bank work with you to help meet the state’s development challenges

20. Other points you may wish to discuss