Socioeconomic Feasiblity Study Report of Bisare Small-Scale Irrigation Project

SOCIOECONOMIC FEASIBLITY STUDY
REPORT OF BISARE SMALL-SCALE

IRRIGATION PROJECT
FINAL REPORT
CLEINT: SOUTHERN REGION IRRIGATION DEVELOPMENT AND

SCHEMES ADMINISTRATION AGENCY
CONSULTANT: SOUTH DESIGN AND CONSTRUCTION SUPERVISION
ENTERPRISE
2017
HAWASSA
TABLE OF CONTENTS
LIST OF TABLES................................................................................................................................3
ACRONYMS........................................................................................................................................4
Executive summary...............................................................................................................................5
PART I SOCIOECONOMIC STUDY..................................................................................................6
1.1. INTRODUCTION.................................................................................................................6
1.2. OBJECTIVES OF THE STUDY.........................................................................................10
1.3. APPROACH AND METHODOLOGY OF THE STUDY..................................................11
1.3.1. Primary and Secondary Data Source...................................................................................11
1.3.2. The Sampling Method.........................................................................................................11
1.3.3. Method of Data Analysis....................................................................................................12
1.4. RATIONALE OF THE PROJECT......................................................................................13
1.5. SOCIOECONOMIC SITUATION ANALYSIS OF THE PROJECT AREA......................14
1.5.1. Location of the project area.................................................................................................14
1.5.2. Climate and Topography.....................................................................................................14
1.5.3. Demographic features.........................................................................................................15
1.5.4. Overview the Socio-cultural set up of the project area.........Error! Bookmark not defined.
1.5.5. Local economic scenario of the project area.......................................................................18
B. Agricultural marketing........................................................................................................21
C. Animal husbandry...............................................................................................................22
1.5.6. Supporting institutions........................................................................................................27
1.5.7. Social services and infrastructures......................................................................................31
1.6. COMMUNITY ATTITUDES TOWARDS THE PROJECT..............................................38
1.6.1. Farmers` Participation.........................................................................................................39
1.7. THE PROJECT...................................................................................................................41
1.7.1. Project description...............................................................................................................41
1.7.2. Goal & Objectives...............................................................................................................41
1.7.3. Detailed Features................................................................................................................42
1.8. POSITIVE AND NEGATIVE IMPACTS OF THE PROJECT..........................................48
1.8.1. Environmental impacts........................................................................................................48
1.8.2. Upstream-Downstream and other water-use Competitions.................................................48
BISARE SMALL-SCALE IRRIGATION PROJECT
1.8.3. Health problem.....................................................................Error! Bookmark not defined.

PART II ORGANIZATION AND MANAGEMENT.........................................................................49
2.1. Project phasing & disbursement..........................................................................................49
2.2. Project implementation in the construction phase................................................................49
2.3. The project operation phase.................................................................................................50
2.3.1. The Condition to set General Assembly..............................................................................51
2.3.2. Proposed Irrigation Management Setups.............................................................................52
2.3.3. Duties and Responsibilities of Proposed Setups..................................................................53
2.4. PROJECT‘S SUSTAINABILITY STRATEGIES...............................................................57
PART III FINANCIAL AND ECONOMIC ANALYSIS...................................................................58
3.1. Financial Analysis...............................................................................................................58
3.1.1. Key assumptions.................................................................................................................58
3.1.2. Project cost..........................................................................................................................59
3.1.3. Project financing.................................................................................................................59
3.1.4. Production cost....................................................................................................................61
3.1.5. Project return.......................................................................................................................61
3.1.6. Pricing and marketing.........................................................................................................61
3.1.7. Production...........................................................................................................................62
3.1.8. Sensitivity Analysis.............................................................................................................62
3.2. Economic analysis...............................................................................................................63
3.3. PROJECT BENEFITS AND JUSTIFICATION.................................................................63
3.3.1. Quantifiable Benefits..........................................................................................................64
3.3.2. Non-quantifiable benefits....................................................................................................64
4. CONCLUSION AND RECOMMENDATION..............................................................................65
5. REFERENCES...............................................................................................................................66
6. ANNEX..........................................................................................................................................67
6.1. Signatures’ of Beneficiaries.................................................................................................67
6.2. Expression of Stakeholders’ Interest....................................Error! Bookmark not defined.
6.3. Financial and Economic Analysis Tables............................................................................68
6.4. Questionnaires.....................................................................................................................89
SOCIOECONOMIC FEASIBILITY STUDY REPORT 2

LIST OF TABLES
Table 1 Population summary of Sodo-zuriya Wereda...................................................................15
Table 2 Population by project kebeles and sex group...................................................................15
Table 3 Sample household population by age-sex group..............................................................15
Table 4 Wereda Population by Age-Sex Group............................................................................16
Table 5 Land use pattern of the Sodo zuriya Wereda in Km2.................................................17
Table 6 Distributions of household annual income, inclusive of home consumptions.................18
Table 7 Crop production in the project kebeles for year 2005/6 (Two seasons)..........................20
Table 8 Oxen distribution by households in Gilo bisare kebele....................................................21
Table 9 Total annual income (ETB) of sample households....................................................24
Table 10 Total annual household expenditure..........................................................................25
Table 11 Agricultural cooperatives in the wereda.........................................................................29
Table 12 Open market places of the project area..........................................................................30
Table 13 Summary of educational statistics of sodo zuriya wereda for 2007EC (Academic Year)
.......................................................................................................................................................31
Table 14 Educational profile of sample households' family members..........................................32
Table 15 Top-ten disease of Bisare wereda, year 2007 EC...........................................................33
Table 16 Training Requirements and Plan of Action.....................................................................44
Table 17 Start-Up Working Capital Loan Requirements in Br.......................................................45
Table 18 Quantity of major agricultural inputs required with the project............................46
Table 19 Physical works’ time schedule.......................................................................................47
Table 20 Estimated Cost Contributions by the Beneficiary Community upon Construction........60
Table 21 Discounted financial measures of the project (‘000ETB).........................................61
Table 22 Financial analysis “without the project”...................................................................62
Table 23 Result of financial sensitivity analysis for the probable changes (‘000ETB).........62
Table 24 Discounted economic analysis (‘000ETB)..................................................................63
Table 25 Crop Budget (Financial in ETB)....................................................................................68
Table 26 Financial Analysis..........................................................................................................74

Table 27 Financial sensitivity analysis for 10% decline in yield..................................................75

Table 28 Financial sensitivity analysis for cost overrun by 10%..................................................76
Table 29 Financial Sensitivity Analysis for one year delay in construction.................................77
Table 30 CROP BUDGET (ECONOMIC)....................................................................................78
Table 31 Economic analysis..........................................................................................................84
Table 32 Economic sensitivity analysis for 10% yield decline.....................................................85
Table 33 Economic sensitivity analysis for cost overrun by 10%.................................................86
Table 34 Economic sensitivity analysis for 1 year project delay..................................................87
Table 35 Prices of Crop Produces and Inputs................................................................................88
ACRONYMS
SNNPRS South Nations, Nationalities and Peoples Regional State
B/C Benefit cost Ratio
BOA Bureau of Agriculture
DA Development Agent
Ha Hectare
IRR Internal Rate of Return
Kg Kilogram
Km Kilometers
NPV Net present value
Qt Quintal
WUA Water Users Association
SSIP Small Scale Irrigation Project

Executive summary
Modern irrigated farming is an untenable development strategy that dwells in an umbrella of
agricultural intensification program to ameliorate agricultural production and productivity.
Attaining market oriented and sustainable livelihood at the household level is the overall goal of
the project. Thus, irrigation development intervention needs to be tailored according to the
physical and natural resource conditions and socioeconomic opportunities. Therefore, the
socioeconomic study of Bisare SSIP is undertaken with the objectives to assess the project with
respect to the socioeconomic profiles, examine its impacts, identify problems and
opportunities, investigate beneficiaries attitude, how to organize the irrigation and analyze the
financial and economic implication of the project.
To fulfill these objectives, the study has employed appropriate methodologies in the collection
of primary and secondary data through household survey of 9 respondents, key informants
interviews, field observation, personal communications, community consultations and FGD for
the former while for the secondary data reports, censuses, previous studies published and
unpublished materials, literatures and web-based information. Similarly, the appropriate data
analysis methods were used in the study which has comprised the quantitative and qualitative
analytical tools.
The project area is found in Southern Nations, Nationalities and Peoples Regional State’s
(SNNPRS), Wolayita Zone and Sodo Zuryia wereda in Gilo Bisare rural kebele. The project is
envisaged to benefit 480 rural households via irrigating 120 ha of land in complementary and
supplementary irrigation, surmounting 200% cropping intensity.
People’s livelihood in the project area has majorly depended on crop production activity to
cater household’s food consumption needs and to raise cash for household demand. However,
there are still much unused natural resource potentials in the project area with enabling
environment for irrigation to increase household’s income.

The project would enable to increase the annual cash flow of 4,608,000ETB in financial value at
the end of fourth year such that improve food security and income levels of beneficiaries.
Animal production also has significant contributions for the annual income of farm households.
The nearest larger open market place to the project area is in the wereda town, W/Sodo at an
average road distance of about 17km. Bisare Small Scale Irrigation Project is proposed by
diverting water from Bisare River.
The project is expected to require an investment cost of 9,732 ,000ETB after tax. And the
financial and economic viability indicators have shown acceptable values in the study.
Ultimately, the project is socially, financially and economically feasible for implementation
while the following issues have significant importance to be considered at all phases of the
project cycle.
1. Integration of wereda level implementing partners and stakeholders of the project at
the implementation phase
2. Efficient and effective irrigation water management to mitigate upstream-downstream
water use conflict incidences
PART I SOCIOECONOMIC STUDY
1.1. INTRODUCTION
Intensification of agricultural practices generates additional employment opportunities in the
rural sector. The irrigation induced benefits are not limited to farming households but also
affect broader sectors of the economy by providing increased opportunities to growing rural
service sectors and other off-farm employment activities (Mellor, 1966). Irrigation also offers a
way to reduce the risk and vulnerability associated with climatic unpredictability. Therefore,
modern irrigated farming is an untenable development strategy that dwells in an umbrella of
agricultural intensification program to ameliorate agricultural production and productivity as an
ultimate socioeconomic objective, especially in the dry land and semi dry land farming. Thus,
irrigation development intervention needs to be tailored according to the physical and natural
resource conditions and socioeconomic opportunities.

In light of this fact, small-scale irrigation development to small holder farmers is a panacea to
impart a reliable and adequate annual food supplies to farm households such that it contributes
for improved food security. Furthermore, income disparity of farmers could be more easily
reduced through meticulous irrigation development intervention propounding the overall socio
economic well-off. However, the strength of the link between irrigation and poverty is
conditioned by a wide range of institutional factors, including efficiency and equity in land and
water distribution.
Intensifying smallholder agriculture by improving the management and productivity of land and
water in a sustainable way offers a solution for both poverty reduction and agricultural growth
in sub-Saharan Africa. According to UNHDR (2006), the per capita threshold level of water
resources was estimated to 1000m 3/year to which below this level the risk of cyclical water
shortages would make irrigation necessary for food self sufficiency. As referred to Ethiopia, the
nation’s renewable water resources is estimated to be of 110km 3/year with the per capita value
of 1758m3/year/inhabitant, timed to 2000. The future projections in 2025 is also estimated to
be 953m3/year/inhabitant and Ethiopia is shown to be not a water stressed country, but the
spatial and temporal variability of water limits the country’s development, management and
equitable distribution.
The incidence of poverty is lower in irrigation than in other farming systems and absolute
number of the poor are small. Up to 2.7 million hectares of land in Ethiopia have irrigation
potential, but only fewer than 300,000 hectares which nearly accounts to 10% of the total
potentials are only developed (MoWR, 2007).
The mechanics of the welfare gains from irrigated farming comes into picture by the backward
and forward linkages and/or direct and indirect outcomes of irrigation development
interventions in the local rural economy. That is, the local goods and services produced,
transacted and demanded would be stimulated in irrigation users’ area due to the various
additional agricultural inputs required in the production process and these situations trickles to
activate the local economy through a backward linkage of modern irrigation production system.
Whereas by the forward linkage, the direct and indirect non preferential benefits derived from
irrigation for the users’ and non-users’ farmer families will improve their productivity of labor

and other complimentary inputs other than the irrigation water, creation of additional
employment opportunities, increased family income, etc are the invincible rationale for
irrigation.
Agricultural production pervades with lower productivity and efficiency due to the farming
system that largely emanates from the traditional farm technologies and recurrent occurrence
of drought resulting from climatic adversaries. This attributes to the prevailing dependence on
food aid, under employment, low income and low standard of living, up-keeping its vicious
circle of poverty. Despite of the observed increases in agricultural production contributing to
the economic growth of the country in the lasting decade there still needs to aggrandize the
production. The rural development policy in general and the agricultural development policy in
particular, of the country emphasize to increase production and productivity of smallholders
agriculture through investing in irrigation infrastructural development to enhance the lower
utilization rate of the surface water irrigation potentials estimated with less than 10% utilized
(MoWR, 2001).
The envisaged project area, in pursuant to the feasibility study of small scale irrigation
intervention is found in South West region of SNNPRs characterized by dense population
settlement. The project area is suitable for crop and livestock production. In spite of this, the
hitherto rain fed agricultural production and productivity in the area is at lower levels.
However, the trend showed that productivity and production is ascending mainly due to the
introduction of extension services on improved farming practices and technologies including
inputs for enhancing agricultural productivity. The agricultural production is largely
characterized with subsistent farming which primarily presupposes securing the annual family
food requirements of the home consumption.
By the wereda agriculture, much effort has been put in place to increase agricultural production
through the provision improved agricultural extension services to farmers with regard to the
transfer of farm technologies and supply the necessary farm inputs by the respective supplier
agencies
The government focuses on developing the agricultural sector. It has a policy of ‘Agricultural
Development led Industrialization towards this end, markets are being liberalized, new system

of extension approach is introduced and government investments are emphasizing on

improving the physical infrastructure. All these show green light for sustainable irrigation
development.
The feasibility study has employed primary and secondary data sources with the respective
data collection methods which comprise the household survey, field observation, Focus Group
Discussions (FGD), key informant’s interviews, reports and study documents. Community
consultation was also held with the potential target group community complemented with the
disclosures upon the proposed Gilo Bisare SSIP and assesses the acceptance of the intended
project by the community and hence ensures the participation of the community from the
study and design to implementation phases of the project. Especially, upon the project
construction work, the community was made to agree to participate with the contribution of
pay-free labor and local construction material collection. Discussion with woreda and kebele
administration has also been held to create awareness and readiness to the future mobilization
work and to give time before hand.
Key informant’s interviews have also been undertaken using semi-structured questionnaire
with knowledgeable and prominent individuals to have insights about the development
potentials, socio-cultural setup, development challenges and other relevant facts about the
project area. Primary data is also been collected through sample household survey to
investigate the various socioeconomic facets regarding the important variables relevant to the
prominent household characteristics of the typical farm household unit such as the family size,
household structure, educational level, farm size and livestock possession, peak & off labor
seasons, working days, experience on irrigation, agricultural inputs used, agricultural marketing
and other socio-economic issues. Secondary data was also been collected from the respective
offices of agricultural development and from other relevant sector offices like education, health
and etc.
The body of the study report is structured with three major study topics comprising the
socioeconomic study in part I followed with the organization and management study in part II
and finally the financial and economic study in part III.

Under the topic of the socioeconomic study, the first sections and subsections would state the
objectives and methodologies of the Gilo Bisare SSIP socioeconomic feasibility study
component with its subsequent parts involved. Then continue the current social and
economical scenarios of the project area and its general bottlenecks to the development of the
area. This is followed by a section outlining the rationale of the project, gender issues, positive
and negative project impacts, inputs required by the project, outputs expected and the
community attitudes. The second main topic follows on the project’s organization and
management, and outstanding issues to be considered for sustainability of the project. Finally,
the financial and economic feasibility of the project comes thirdly showing sensitivity analysis
with the last section will discuss the conclusion and recommendation.
1.2. OBJECTIVES OF THE STUDY

The general objective of the study is to investigate the soundness of the project with respect to
its social and economic implications in increasing the annual farm household’s income and/or
the food security status. Thus, under this purview of increasing agricultural production and
productivity through irrigated farming, the specific objectives of the feasibility study are:
 To assess the socio-economic profiles of the study area mainly comprising of farm
household characteristics, demography, socio cultural setup, social services,
infrastructures, gender issues and etc.
 And hence to identify the social & economical problems and opportunities, in general
and hence in particular with its relevance to the proposed irrigation development
interventions in the study area
 To identify positive and negative socioeconomic impacts of the project and hence to
recommend mitigation measures for those negative impacts and measures that could
enable to further aggrandize those positive ones
 To assess the potential beneficiary communities attitude towards the project and their
willingness to participate
 To develop an appropriate organizational structure to facilitate implementation of the
project and

 To assess the financial and economic feasibility of the irrigation project
1.3. APPROACH AND METHODOLOGY OF THE STUDY

The socio-economic study primarily include assessment of the peoples’ mode of life and
farming system of the area, examining the existing conditions of the communities, assessment
of the potential, constraints and socioeconomic impacts of the proposed project, assessment of
infrastructure and social service, and examining the attitudes of the would be beneficiaries
through the primary and secondary data gathered by the study.
1.3.1. Primary and Secondary Data Source

Primary data were collected through formal and informal techniques. The formal was applied
through household survey, FGD and general community consultations while the informal was
applied via field observations, interviewees and personal communications with key informants
using unstructured and semi structured questionnaires. However, the secondary data was
collected from secondary sources which comprise reports, censuses, previous studies published
and unpublished materials, literatures and web-based information.
1.3.2. The Sampling Method

The study was conducted using sample household surveys by the selection of representative
sample direct beneficiary households in Fincha ‘Got’. In doing so, purposive sampling method
was employed with the help of information obtained from the Gilo-Bisare kebele administration
to select sample households from rich, moderate and poor wealth status. Hence, totally 9
sample households were selected for interview. The sample size has represented about 15% of
the total sub kebele (Got) household number, i.e. 60. The survey was self-managed which was
conducted by the study analyst under concern from March 27 to 29, 2016.
The household survey was undertaken using a structured questionnaire that covers a wide
variety of data including demographic factors, land use pattern, crop production systems,
livestock population, and source of income and food security status, social services and
economic activities, majors common constraints and problems of social and economic of the
area, the key problems of the respondent, willingness &attitude of the farmer towards the

proposed project (See ANNEX 3). The questionnaires for household survey were translated in to
Amharic to ease the perplexity of respondents and the interviewers.
Further, one Focus Group Discussion (FGD) session was conducted which comprised of
community cross sections from the elders, youths and women headed household groups. A
wide variety of information were discussed with the group members related to demographic
factors, land use pattern, crop production systems, livestock population, source of income and
food security status, social services and economic activities, common constraints and social and
economic problems of the area, the key problems of the respondent, and willingness &attitude
of the farmers’ towards the proposed project. In addition 1 key informant discussions was also
made with knowledgeable and well experienced individual about the local socioeconomic
setup.
1.3.3. Method of Data Analysis

Depending on the nature of data collected through the precedent methods, the appropriate
data analysis methods were used in the study which has comprised the quantitative and
qualitative analytical tools. That is, based on the obtained data it was able to describe and
assess the situation through tabular & descriptive statistics, the quantitative analyzed data
were analyzed and tested by using measures of project’s worthiness i.e. financial and economic
analysis and decision techniques I.e. NPV, B/C-ratio and IRR used to compute the financial and
economic soundness of the project. Further, qualitative data were triangulated from different
sources according to its coherence, consistency and logical judgments.
In this regard, the prominent three financial and economic parameters were computed using
the following discounting techniques:
B
∑ (1+dt )t
 Discounted Value of Net-Benefits (DVB) =

Ct
∑ (1+d )t
 Discounted value of costs (DVC) = ; Where, d is discounted rate, t is
number of years from start till the end of the project, Bt is benefit in year t and Ct
is cost in year t
And hence, by definition the Net Present value (NPV) is DVB-DVC with project acceptability if
NPV>0; Benefit-cost ratio (BCR) is DVB/DVC with project acceptability, if BCR>1; Internal rate of
return (IRR) is the rate of discount at which NPV becomes zero with project acceptability if
IRR>0.
1.4. RATIONALE OF THE PROJECT

The Federal Democratic Republic of Ethiopian Government’s policy of Agricultural Development
Led Industrialization has launched two main programs to develop the agricultural sector. This
comprises of the introduction and widespread application of improved seed and fertilizer in
those areas that receives sufficient amount of rain fall and irrigation development interventions
giving priority to those drought prone and food unsecured areas having the water and land
potential for irrigation.
In juxtaposition, the project area has significant amount of water resource that could turn out
to utilize the available irrigable lands. At an optimum production level, the project would
provide annual incremental cash flow of 4608000ETB in financial value at the end of fifth year
and this will have significant contributions upon the target group households’ improved food
security and would impart transformations from the status quo system production to more
reliable and improved forms of subsistent farming and also to market oriented agricultural
system.
Successful implementation of the project needs active participation of stakeholders such as the
community, office of agriculture and rural development, co-operatives promotion office, credit
institution, Woreda & kebele administrators, input suppliers, etc. The community has good
attitude towards the proposed intervention and ensured to participate upon the project
implementation. Since irrigation development interventions direly require synergetic endeavors
as an impetus for the desired socioeconomic change, consultations and discussions was made

with the local stakeholders from the respective sectors. In due course, the potential
development actors for collaboration have shown encouraging commitments for the realization
of the project by the discharge of their supporting duties. Moreover, monitoring & evaluation
would be carried out to ensure project sustainability through taking appropriate corrective
measures.
1.5. SOCIOECONOMIC SITUATION ANALYSIS OF THE PROJECT

AREA
From the ranges of data types and sources employed for this study, the current socioeconomic
condition of the project area is scrutinized in this section. Hence, the analysis primarily would
focus to depict the ground reality about the project area based on the data acquired by the
household survey results, field observation, sector offices, secondary sources, previous studies
and relevant documents and key informant interviews. That is data from all sources are
complimentarily used in a way that could enable triangulation to enhance data reliability and
validity.
1.5.1. Location of the project area

The project area is found in SNNPRS, Wolaiyta Zone and Sodo Zuria wereda administrative
locations. The project kebele administration is located 17km from the zonal and/or wereda
town of Welayita Sodo with all weather gravel road access. The command area is specifically
found in Fincha ‘Got’.
1.5.2. Climate and Topography

Information from the Wereda Agriculture Office shows that the wereda elevation ranges from
1750meters to 2600meters above sea level. The wereda agro ecological classification
information reveals that about 33% of area is categorized as highland (Dega), 55%, mid-
highland (Woinadega) and 12% lowland (Kola). The area receives mean annual rainfall of
950mm and mean monthly temperature of about 19oC.
About 75% of the peasant association has plain, 15% has undulating and 10% is mountainous
topography. The command area has flat topography which has a slop of less than 5%.

1.5.3. Demographic features
1.5.3.1. Population size and characteristics of the wereda

The 2007 population and Housing Census result when project to 2014 shows that the total
population of Wolayta Zone is estimated to 1,886,844 and amongst the Sodo Zuria Woreda
population is 204,497 all being rural residences. As shown in table 1 the total household heads
(HH) of the wereda is 32,831. The average farm family size is estimated to be 6.
Table 1 Population summary of Sodo-zuriya Wereda
No. Description Unit Rural %

1 Total population Person 204,497
Male Person 103,937 50.8
Female Person 100,560 49.2
2 No. of HHs Person 32,831
3 Average household size Person 6.23
4 Population Density P/Ha 398
4 Agriculture Density P/Ha 545
5 Population growth rate Person 2.90%
6 Projected population after 30 years Person 482,112
Source: CSA, 2007 with exponential population projections, wereda agriculture office, GIS data
The total population of the project kebele, Gilo-Bisare is estimated to 6868 persons residing in
the rural kebeles (Table 2). The sample household survey result shows that about 40% of the
family members are found within the age range of 15 to 45 years that represent the active age
population part (Table 3). The mean age of the sample households show that it is 36.6 years.
The average family size of the kebele is estimated to about 6 which is nearly equal to the
wereda average of 6.2.
Table 2 Population by project kebeles and sex group
S/N Kebele Population Household
Total Male Female Total Male Female
1 Gilo-Bisare 6868 3297 3571 1166 1143 23
Source: Kebele Administration and DA, March 2016
Table 3 Sample household population by age-sex group

SN Sex of family members Age group in years
0-15 >15-45 >45 Total
1 Male 11 10 7 28
2 Female 11 9 6 26
3 G/Total 22 19 13 54

Source: Own survey, March 2016
1.5.3.2. Social and cultural setup

In the project kebele, the dominant ethnic group of the population is exclusively Wolayita. And
the majority of the population is followers of the Protestant Christians while the minorities are
members of Orthodox Christians.
1.5.3.3. Dependency Ratio

Age groups found up to 15 years and above 45 years are considered to be dependant age
groups. Thus, the wereda’s active and dependant age population group by gender is given in
Table 4. The average ratio of economically active to non active age population is 1:0.69. The
dependency ratio is 2.44 implying that every economically active aged person is responsible for
his livelihoods and for an additional 2.44 persons.
Table 4 Wereda Population by Age-Sex Group
Population by sex group
S/N Age group in years Percent
Male Female Total
1 <15 43654 42235 85889 42
2 >15 to <45 42614 41229 83844 41
3 >45 17669 17095 34764 17
Total 103,937 100,560 204,497 100
Source: CSA 2007 with projection to current period, 2016
1.5.3.4. Crude population density

Crude population density and agricultural density of the study area is estimated to be 398 and
545 persons per Sq.Km, respectively. It is the distribution of the population over a given area
showing the relative scatter of the settlement. In the Sodo-zuria Wereda 204497 human
population has settled on 514Km2 about of land with the portion of the crop land being 375Km 2.
This indicates that the project area has densely settled population and hence high density.
Thus, the agricultural higher density of the population shows that a shortage of cultivable land
is the limiting factor and agricultural intensification would have paramount importance for
sustainable rural development.

1.5.3.5. Land Tenure and Use

Land tenure could be defined as a complex relationship that exists between categories of
individuals and groups in reference to land, water and their respective products. These
relationships can be analyzed in terms of sets of rights and obligations held by these categories
of people with regard to the acquisition, preservation and transfer of specific portion of terrain
and products. According to Ethiopian constitution (1994) article 40(3) states, “the right of
ownership of land as well as natural resources is exclusively vested in the state. Land is a
common property of nations and nationalities and people of Ethiopia and shall not subject to
sale or other means of transfer”. The owner of the farmland has a right to use, rent and transfer
to their kinship families.
Land is not a limiting factor in agricultural production system which largely depends on
extensive agriculture but moisture. Nevertheless, to promote an intensive farming system
through increasing the productivity of land and other inputs through interventions in irrigated
farming is the panacea for the increasing household income and food security status of the
project area. According to the wereda agriculture office data cultivated land in the wereda is
about 243Km2 which largely includes annual crops and some permanent crops. Table 5
indicates the total land use pattern of the wereda.
Table 5 Land use pattern of the Sodo zuriya Wereda in Km2
Land use type Area %
Cultivable land 14 3%
Cultivated land 243 47%
Grazing land 27 5%
Forest 104 20%
Others 126 25%
Total 514 100%
Source: Wereda Agriculture Development office and GIS output, March 2016.
In addition, the information obtained from the DA working in Gilo Bisare kebele is shown
below, illustrating that about 63% of the total area of the kebele is covered with crops:
 Crop land 16.6Km2
 Grazing land 4.8 Km2
 Forest 2.1 Km2

 Others 2.9 Km2

Total 26.4Km2
1.5.4. Local economic scenario of the project area

This subsection will follow to uncover the prevalent situations in the local economics relevant
to the basic facts of the production process and agricultural marketing functions. Agriculture is
the main stay of the people in the project area composed of crop husbandry and animal in
which the major share of households’ annual income is derived from the former activities.
Additionally, off-farm income from petty trade and remittances from family kins and relatives in
towns shares certain proportion of the household’s annual income. The relative wealth status
of the population in terms of the household’s annual income shows about 58% of the
population to lie within the middle income group interval while 50% and 20% are to be found
within the poorer and richer group, respectively (table 6 and Figure ).
Table 6 Distributions of household annual income, inclusive of home consumptions
Income group Interval of annual income in ETB % of income earners
Poor Below 10000 35
Middle earners 10000-30000 48
Rich Above 30000 17
Source: key informant’s interviews and Kebele D.A.s
Figure 1 Distribution of households’ annual income across the target community
% of income earners
Poor- Below 10000

Middle earners- 10000-
30000
Rich- Above 30000

1.5.5.1. Opportunities and constraints of the project

The proposed project generally has the potential to trigger incremental household annual
income through employing local resources to its optimum level in such a way that would meet
the existing social, economic and environmental development objectives. The development
potentials of the project area is prominently through the trajectory of improving the
agricultural sector performance mainly via intensifying farm productions using irrigation and
application of high yielding agricultural inputs inclusive of technologies. Realizing the project
objectives, however, will require checking other local level enabler factors of production for the
actualized net benefits that deems to fulfill some specified gaps prevalent to output market
demand and/or other derived market demands, supporting the community’s desirable actions,
technical back up and coordinated efforts for multi dimensional project sustainability. That is,
idle local resources of land, water, cheap labor, marketing issues, etc are the potential
opportunities for the project.
The specific area of the project where the command land lies is located bordering with the
neighboring Damot Gale wereda. That is, the River Bisare demarcate the Sodo zuriya and
Damot Gale weredas territory in being located within the same zone, Wolayita. Downstream to
the side of the latter wereda, there is an irrigation project named Bisare SSIP with the size of
commanding 140ha land which was previously constructed by the then CoSEARSAR
(Commission for Sustainable Agriculture and Environmental Rehabilitations in Sothern
Administrative Region). Therefore, upstream-downstream water use conflicts could be
preemptively expected such that designing the project under study now would take the issue
into consideration.
1.5.5.1. Agricultural production
A. Crop production
People’s livelihood in the project area has majorly depended on crop production activity to
cater household’s food consumption needs and to raise cash for household demand. Crop
production contributions have been estimated to be about 80% of the households’ annual
income. Crop farming in the study area is practiced largely in a traditional way which

predominantly depends on the rainfall moisture sources with a bimodal pattern enabling to
perform two crop production seasons. Hence, the major crops grown in the area consists of
maize, haricot bean, teff, coffee, fruits and vegetables (see Table 7). Generally, the area has a
great deal specialty in the production of perennial, root and cereal crops.
According to the Gilo Bisare kebele DA, there is some extent of traditional irrigation system
practiced by about 20 farm households for the production of major crops comprising potato,
onion and cabbage.
From the information obtained from FGD and key informants interview, the critical
agricultural production bottleneck of the existing system is found to be shortage of moisture
due to the erratic and inadequate nature of the rainfall pattern in the project area.
Local key informant’s interview shows that about 20% of the value of crop produces is
estimated to be sold in the local markets in the project kebele. Availing additional moisture
source to the crop farming would enable to significantly augment productions through
intensifying the use of land together with other productive resources in such a way that could
enhance its productivity. From the information obtained from FGD and key informants
interview, the critical agricultural production bottleneck is found to be crop pests of wild
animals of different kinds. In addition, lack of adequate extension service, improved seed and
the post harvest loss of the traditional production system is not the less remarkable influence
in which the poor storage, product handling and processing have also negatively influenced
the traditional crop productions.
Table 7 Crop production in the project kebeles for year 2005/6 (Two seasons)
Crop Area/ha Production/qt Productivity(qt/ha)
Maize 610.3 6347.12 10.4
Harict bean 713 4278 6
Teff 314.4 1257.6 4
Coffee 351.4 2635.5 7.5
Potato 148 3256 22
Perenial crops 37 351.5 9.5
others 203.4
Total 2377.5
Source: - Kebele DA, March 2016

Farm power: the main source of power in crop growing is derived from household labor force
and oxen power. Oxen traction is the main power source to plough and pulverize fields.
Further, oxen are used to thrash the crop harvest and most other activities like sowing,
weeding, hoeing, thinning, harvesting, winnowing, loading-unloading and etc are performed by
human labor force. Despite of the somewhat skewed age structure of the population to the non
active age group category, the work culture of the community is conscientious which could
ensure adequate labor supply for irrigated farming activity. According to the DA data, oxen
power, largely used for traction force is adequately available for the proposed irrigated farming
when referred to the estimated oxen distribution across households (Table 8).
Table 8 Oxen distribution by households in Gilo bisare kebele
Size of oxen holding Number of household % from total hh
No ox 82 15.12
Less than 1 ox 122 17.92
1 ox 320 31.84
2 oxen 88 16.96
3 oxen 37 8.48
>3 68 9.68
Source: Kebele DA, March 2016
B. Agricultural marketing
Accessibility of the target project kebele is through the 17km all weather gravel road from the
wereda/zone town Wolayita Sodo. Subsequently, freight of most commodities, i.e., agricultural
produces and inputs are undertaken via Isuzu Trucks to and fro the kebele. Further, the
geographical location of the project area in reference to the national and regional agricultural
produces consumer concentration centers and plenty of input supplying agencies is a green
light to smallholders’ farm production commercialization intervention plan. By this virtue, the
occurrence of outputs and inputs price risks is relatively lower. That is the market outlets to the
Wolayita sodo town and other nearby towns is one of the indicators amongst the project’s
soundness.
Farmer’s crop produce, either cash or food crops, are mainly marketed through two channels,
consisting the local assemblers purchases of small lots to the nearby wholesale agents and
colliding farmers to form economical lots for truck rental to Addis. The former market channel

being the dominant one involves buying small lots of goods to sale for profits to the nearby
markets and goods are maintained for relatively shorter period of time and these assembling
traders are not largely engaged in a formal way and it is rather practiced in the form of off-farm
income generating activity during the lean labor seasons. In subsequent, local crop traders in
the nearby towns of Wolayita Sodo and Boditi receive produces from the assemblers with
which the volume of goods maintained are relatively bigger and lasts longer since these
activities are carried out as a formal business being licensed from the local Trade and Industry
Offices. Therefore, speculation is taken place as one form of trade in which to certain extent it
contributes for demand smoothening since speculators purchase products when the price is
cheaper and sale when it becomes expensive and in both cases would relief the price tension
for both producers and consumers.
In juxtaposition, the local agricultural input markets catering farmers with input supply services
are operating by formal and informal agents through provision of improved and traditional
farm inputs. Though it seems that farmers have relatively good access to most improved farm
inputs, strengthening cooperatives in the input market business lines like seed multiplication,
fertilizer, chemical, etc distribution is critical to maximize produce’s margin. Most parts of the
project area have access to mobile phone services coverage such that there is relatively market
information transmission with nearby town and metropolitan markets.
Therefore, strengthening cooperatives by enabling them for their appropriate insertions with
value addition along the local agricultural value chain and marketing functions is an
indispensable strategy. Thus, such empowerment for cooperatives needs to involve training,
capital injection, diversification of important business activities and other commensurate
organizational supports.
C. Animal husbandry
Animal production plays important role in securing households annual income to cover
household’s cash needs, at large and home consumption. Animal husbandry in general and
more peculiarly livestock rearing is largely practiced as a means of asset accumulation in being
considered as one form of bank functions in which households use to raise money from sale of

livestock when immediate financial need arises. Livestock and livestock products are also used
for home consumption as a dietary source of animal protein from milk and meat especially
during holidays and cultural ceremonial rituals. Like most similar rural areas in the country,
livestock husbandry also contributes to farm power for crop production through the supply of
traction and freight animals in the project area. Table 10 shows total animal population of the
project area.
The traditional animal production in the study area is at large practiced with the auspices of
natural forage which is derived from natural grazing grasses and crop residues. Local livestock
breeds with genetic characterization of lower productivity and higher disease resistance types
are reared in the area. Nevertheless, the livestock husbandry is highly constrained with
shortage of forage due to the competing demand of land for crop growing than grazing land
and browsing. Further, prevalence of animal diseases also compound in the traditional
livestock Enterprise in project area with the non commensurable delivery of animal health
services to circumvent. Animal disease prevalence prominently consists of Trypanosomiasis,
CBPP, lumpy skin and African horse sickness.
Table 10 Livestock population of the project area
Livestock type Animal Population
Wereda Bisare
Ox 30015 1059
Cow 5941 792
Calf 31376 413
Bull 17158 591
Heifer 37109 300
Sheep 93080 629
Goat 25217 3190
Donkey 1976 576
Horse 11736 12
Mule 4462 82
Chicken 86113 12000
Beehives
 Traditional 17811 182
 Modern 81 -
Source: - Wereda Agriculture Office and kebele DAs, Apr 2015

Figure 2 Livestock population of the project area

100000
90000
80000
70000
60000
50000
40000
Animal Population Wereda
30000 Animal Population Girar
20000 Dibir kebele
10000
0
Ox lf
ife
r at se en ern
Ca e Go Hor hick
H C od
M

·
1.5.5.2. Household economy

A. Total annual household income
As the predominant economic activity of the project area is indicated to be agriculture, the
same holds true in a typical farm household family. By this fact, the household survey result has
Table 9 Total annual income (ETB) of sample households
Sources of income N
Mean Minimum Maximum Mean Percentile
Valid Missing
Crop production 9 0 7463 1540 10235 56.59
Livestock production 9 0 4417 0 7732 33.49
Fire-wood and Char-coal 9 0 152 0 320 1.15
Remittance 9 0 305 0 1450 2.31
Daily labor 9 0 257 0 500 1.95
Petty trade 9 0 189 0 750 1.43
Civil servant 9 0 15 0 600 0.11
Other sources 9 0 390 0 650 2.96
Total 9 0 13188 1540 22237 100.00
Source: Household survey result, conducted from Feb 15 to 24, 2015
indicated that about 90.1% of the annual household income is derived from the traditional
agriculture. Whereas, off farm income is estimated to contribute about 9.9% of the total
household’s annual income. The mean total annual income of the sample households of the
survey is estimated to 13188ETB.

Figure 3 Annual household income of the sample
Mean annual income in br

8000
7000
6000
5000
4000
3000
2000 Mean annual income in br
1000
0
n
on al nc
e r e t es
tio -co bo ad an rc
uc cti r itt
a l a tr r v u
od
u a ily y se so
pr od Ch em Da ett vil er
pr d R P i h
op ck an C Ot
Cr to
oo
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es
Liv e-
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Fir
B. Annual expenditure pattern

As specified in table below, the minimum and maximum total expenditure of a HH ranges from
Birr 5684 to Birr 22307 the mean annual expenditure of a household for different purposes is
Birr 15315.
C. Balance of household account
As specified in the preceding section the net mean annual income and mean annual
expenditure of a household is Birr 13188 and Birr 15315 respectively and this make the
household income-outlay balance to 2126 Birr less to income. Hence, this result indicates that
there is annual deficit of income with which these could have been covered from traditional
loan or social reciprocity or other sources of annual income. Thus, the project in mention could
help to narrow this income deficit through increased production by crop intensification.
Table 10 Total annual household expenditure
Items N Mean Min Max Percentile
Valid Missing
Food 9 0 6279 3449 8671 41
Cloth 9 0 1838 150 1775 12
Processed home consumables 9 0 919 0 1400 6
Farm inputs 9 0 3752 1250 5400 24.5

Education 9 0 306 0 700 2

Health 9 0 689 55 930 4.5
Transport 9 0 153 0 231 1
Rituals and ceremonies 9 0 1378 780 3200 9
Total 9 15314 5684 22307 100
Source: Household survey result, conducted from Feb 15 to 24, 2015
Figure 4 Expenditure pattern of sample respondents
Mean exependiture in br
16000
12000
8000
4000
0 Mean exependiture in br
s t l
o od loth ble puts tion alth por nies ota
F C m a in ca e s o T
u u H an m
ons arm Ed Tr cere
F
ec an
d
om s
h al
sed Ritu
es
oc
Pr
D. Household food security status and agribusiness

The main objectives the traditional agricultural production activity in the project area is to
supply the farm family’s annual food requirement. The household survey result has shown that
about 90% of the annual household income of sample respondents is derived from mixed
agriculture practice. Similarly, the value of annual agricultural own production in comparison to
the annual food expenditure of the sample households would show that the former exceeds
the later by about 53% and hence for a typical farm household in the project area, an estimated
value of about 5601 Birr generated from the own production is sold to the market. Thus,
generally speaking, the sample survey households could be characterized as net agricultural
sellers.
With regard to food crops like Enset, cereals, legumes and etc that are habitually consumed
domestically, key informants’ have reported that their purchases of food crops with the money
proceeds from sale of cash crops would be estimated to about 15% of value of an annual

average total family food demand. Comparatively, the degree of commercialization of the
traditional agriculture could be stipulated better in the project area and hence development
interventions towards increasing crop productions would have propounding effects for annual
household income increases.
1.5.5.3. Off farm income activities

In the project, certain portion of the annual household income is derived from off farm income
activities like petty trade of local food and drinks, farm produce assembling trade, artisanship,
weaver, pottery and daily unskilled labor work activities. Hence, certain portions of the
livelihood basis of most farm families are covered from these economic activities. Nevertheless,
for some households groups whose educational status of family members are more literate, off
farm income activity becomes more important for wealth accumulation and as a source of
annual income. This is due to the fact that individuals’ ability to search and participate in the
local labor market becomes increased with skill and education of an individual. Hence, with the
upcoming of irrigation project intervention, the backward-forward linkages of the input-output
markets would pave for further off farm income generating activities being as an induced
project benefits since this would allow the creation of additional employment opportunities.
1.5.5. Supporting institutions
1.5.6.1. Wereda Office of Agriculture:

The wereda agriculture office is the prominent stakeholder which would have direct and
significant influences upon the project’s success history. In this regard, the office in mention has
actively participated and been consulted in the project study process of the project which
ultimately expressed its commitments for the expected contributions it is supposed to
discharge during the subsequent various phases of the project development (see Annex 2). That
is, to expedite the provision of agricultural extension services in the wereda, wider array of
multidisciplinary professionals trained at different levels are working to discharge their duty by
centering at the wereda office towards outreaching the prospective rural kebeles. Thus, 62
agriculture SMS staffs are currently incumbent for the service with which their academic

backgrounds would reveal that 37 are trained at degree, 1 DVM, and 25 college diploma (TVET)
levels.
In spite of the fact that the wereda office renders extension services to farmers via the wereda
SMS personnel, it also have several terminal para state organs of the Kebele Agricultural
Development Stations with which in most cases 3 to 4 Development Agents (DA) are assigned in
a kebele. And totally in the wereda 38 DA staffs are working being 21 of them are first degree
graduates and 17 are TVTE. Different types of improved farm technologies are delivered to
beneficiary farmers under the respective packages of practices via the mechanics of farmers’
participatory approach. Under this extension realm, pertinent agricultural technologies in crop
production, livestock production, soil and water conservation, agro forestry and irrigation are
provided to beneficiaries in such a way that could enhance production and productivity of
resources in manner of sustainable agriculture and natural resource utilization.
In the project Kebele, Gilo Bisare 3 DA workers are staffed whose academic or training
backgrounds belong to first degree and ATVET diploma being trained and work in the fields of
professions in crop production, animal husbandry and natural resources conservation.
However, there is no extension worker assigned in the project kebele in the field of irrigation
that may assist farmers in managing the various aspects of the modern irrigation schemes.
Thus, before handedly, manning the qualified personnel in the respective field of profession,
i.e. irrigation, would have paramount importance to maximize the project benefits.
1.5.6.2. Input supply organizations:

The agricultural marketing system with respect to the agricultural input supply functions should
perform properly and smoothly for the provision of the required inputs as per its appropriate
types, adequacy, timeliness, affordability and generally at lower transaction cost of acquisition.
In this regard the wereda agriculture office have irrefutable coordination role towards
reconciling the supply-demand paradox of the wereda agricultural input markets. However, in
fewer cases the office in question abridges the input supply functions when existing private
and/or quasi private suppliers could hardly participate in the supply of certain input types like
improved seeds of some crops which have underdeveloped seed systems.

According to the information of the wereda agricultural input coordination unit would
illustrate, in the production year, 2005/06EC, improved seed varieties of teff and maize (BH
140) are disbursed to farmers on cash basis with the quantity of 738 and 474quintals,
respectively.
In pursuant to the agricultural input supply in the wereda, ‘Hulegeb Mahberat’ that is to mean
multi-purpose cooperatives operating in various trades which mostly is centered on supplying
commodities that members have high demand for productive such as inputs and other
consumable goods like sugar. Currently, 13 cooperatives of the preceding type are mainly
incumbent with provision of agricultural inputs to producers even if the extent of these supplies
are much below the demand off the wereda in terms of its type, quantity and timeliness.
Hence, these cooperatives use to distribute inputs usually seeds and fertilizers for the ultimate
user, i.e. the producer generally at a reasonable margins and hence prices. The cooperatives
use to sell inputs to either members or non members except some extent of lower selling price
discrimination towards the former. Most proportion of the inputs sold is made on cash basis.
For the specific project area, Gilo Bisare Farmers’ Cooperatives is working with a greater extent
of the local input market share supplying fertilizer, chemicals and other commodity items.
According to the DA information, the cooperative has 480 members running its businesses with
recurrent capital of 55,000ETB and fixed capital of 21300ETB.
1.5.6.3. Woreda co-operative promotion office:

The woreda co-operative promotion office is delegated to establish co-operatives on the basis
of the new co-operatives policy. It involves training of board of directors, supports water users
association (irrigation) to promote in to cooperatives, audit co-operatives, etc. Accordingly, in
the wereda two types of cooperatives are available organized under multipurpose producers’
cooperatives, and saving and credit associations having totally 238 and 627 member
households, respectively (Table 11).
Table 11 Agricultural cooperatives in the wereda
SN Type of cooperatives No. of No. of Total Capital Types of business
coops members Operating Fixed asset
1 Multipurpose farmers’ 13 238 691314 128000 Agri. Inputs,
cooperatives miscellaneous items

2 Saving and credit 14 627 1,100,670 79682 Loan and domestic

association consumption items
Source: wereda cooperatives office, Feb 2016.
In this regard, the co-operative promotion sub sector would be important stakeholder in
strengthening water users Association (WUA) and promoting managerial capacity of the
association in Bisare Small-Scale Irrigation Project.
1.5.6.4. Access to market

Marketing to agricultural produces’ and inputs’ are being served via 19 traditional open
markets situated with the distance range of 10 to 37km from the wereda metropolis town,
Sodo. Most of the exchange items in these markets are crop produces like different grains,
enset, fruits and vegetables, wood, and next with livestock and its derivatives (Table 12). In the
wereda, 36 and 7 wholesale traders in the purchase of cereals, livestock, hide and skin from
rural assemblers and farmers are licensed to sale to the central market. Generally, access to
market is relatively a good opportunity for the target community due to its nearness to many
urban centers and developed road conditions.
Table 12 Open market places of the project area
Market place Marketing days Distance to the Commodities traded
Main Secondary kebele in km
1. W/Sodo Sat. Thur 20 Crops, livestock, manufactured items, etc
2. Gilo village Mon. Thur. 5 Chat, enset, livestock, etc
Source: Kebele DA
1.5.6.5. Rural financial services
Formal institutions in venue of agri-finance services in the study area are in vain such that
unable to deliver the conventional the rural credit and saving services. Thus, people suffer from
lack of financial sources to cover their immediate cash needs of input purchases such as seed,
hand tools, chemicals and other farm implements. Therefore, rural microfinance services are
the detrimental factors for successful agricultural production through its adjunctive roles for
prolific agricultural extension services for farmers’ higher adoption rate of improved
technologies and practices.

In the project wereda, rural credit and saving services delivery is made through 2 Micro-Finance
Institutes called Omo and Wisdom MFI which have several satellite service centers in rural
kebeles. In addition cooperatives provide credit and saving, 889 household members are
organized in the wereda.
From the project kebele, 65 households have taken loan from Omo MFI in 2007EC for fattening,
petty trade and assembling businesses.
Therefore, the transaction cost of accessing rural finance schemes services for the project
beneficiaries was evidenced to be lower in relative terms.
Office of Health: Kebele health extension workers would be important stakeholders playing an
important role in controlling malaria and primary health care.
1.5.7. Social services and infrastructures
1.5.7.1. Education
Education has an indirect positive influence on agricultural labor productivity in small holder
farmers’ agricultural production process through the link that education fosters the adoption
rate of improved farm technologies by the servitude of agricultural extension service supports.
Thus, it is worthwhile to consider the implication of education services while proposing SSIP
interventions that subsumes to aggrandize the financial and economic benefits from a given
resources commitment. The net education coverage of the Bisare wereda as referred to the
percentage of population at school ages who have got formal and informal education is
estimated to about 92%.
Table 13 Summary of educational statistics of sodo zuriya wereda for 2007EC (Academic Year)
Grad Student Net Enrollment Student-class ratio Student-book ratio Teacher-student ratio
e Rate, NER
1-4 85.8% 1:50 1:1 1:49
5-8 89 1:49 1:2 1:34
9-10 56.3 1:63 1:2 1:42
Source: wereda education office
Some education service indicators of the project wereda, i.e. the teacher to student, student to
class ratio and student to book ratio shows education is relatively better served and some of

educational quality indicators would illustrate encouraging scenario (see table 10). Totally in
the wereda, there are 77 schools among which 21 KG, 38 are first and second cycle schools (1-
8), 3 secondary schools (9-10), 1 preparatory school (10-12) 7 are alternative educational
centers.
In the wereda, the average rate of school dropout for rural schools is estimated to about 15%
indicating the good attitude of the community towards sending their children to schools.
Table 14 Educational profile of sample households' family members
SN Level of education Number of educated Percent
families
1 Illiterate 3 8.6
2 Read and write 11 31.4
3 Primary school (first & second cycle ) 14 40.0
4 Secondary school and above (tertiary &
quaternary cycle) 7 20.0
Total 35 100.0
Source: Own survey
Within the project kebele, one school is serving the people by teaching grade 1 to 8 class levels.
Further, for the next class levels, the project community gets the services up to preparatory
levels from W/Sodo at an average distance of 17km and also in the nearby neighboring rural
kebele there is one high school in 5km distances. The household survey result also shows that
in the project kebele greater proportion of the farm families are literate ones, i.e. about 95% of
in the sample households.
Therefore, education in the study area is better served this in turn would propound success at
the operational phase of the project implementation through the easements in the transfer of
irrigation production technologies for higher adoption rate of improved agronomic practices,
irrigation management techniques and scheme administration that would help to enhance the
productivity of each drop of irrigation water.
1.5.7.2. Health
The other determinant of agricultural farm household’s labor productivity is the health status of
the farm family. Hence, the drudgeries of irrigated farming largely depend on the family labor
supply which inquires to evolve healthy and productive individuals. In this respect, provision of
the necessary heath services could help to alleviate the labor down hour during the annual

agricultural work seasons and hence production decrease, and also could enable to reduce the
adverse effects of irrigation agriculture in wide spreading water born and water related
diseases. In this regard, scrutiny of the preceding relationship deems important in the study and
design of SSIP for sustainable and environment friendly irrigation agriculture.
Table 15 Top-ten disease of Bisare wereda, year 2007 EC
Disease Victim population Percent
1. Malaria 13369 20
2. Unspecified diseases 10456 16
3. UTI 7690 12
4. Helmethiasis 9802 15
5. Typhoid fever 4490 7
6. Pneumonia 2310 4
7. Respiratory infection 5678 9
8. Various types of Infection 1285 2
9. Amoebiasis 7562 11
10. Dyspepsia 3215 5
Total population 65857 100
Source: Wereda health office
The total health institutions in the wereda reach to 78 in number which comprise 51 health
posts, 15 clinics, 8 health centers and 4 drug vendors. Under these health institutions 87 health
professionals are employed within that consist 33 nurses, 7 health officers and 47 heath
extension workers.
Estimations based on the conventional standards of population to be served from the list of
levels of health centers, the heath coverage of the wereda is about 87% disregarding the
service radius. Key informants’ interviews with wereda health professionals have informed that
the demand of the rural community for family planning services is under incline. And from the
yearly wereda health office performance report of 2005 EC, family planning service have
outreached 60% of population from the reproductive age population. The top ten disease
prevalence of the wereda ranks malaria and water born diseases which mostly occur with
irrigation (see table 12).
In general the awareness of the community in the project area to the preventative health
strategic approach is promising in the reduction of the adverse effects of the project. That is the
people traditionally use to clean irrigation canals and drainages so as to deter the widespread

of malaria and other water related diseases. Field observation to the project area justifies that
the sanitation and hygienic practices of households are also the other well developed aspects of
health in the area.
1.5.7.3. Water supply and sanitation

Provision of clean and safe rural drinking water has significant contributions to keep human
health and hence increase labor productivity, and the animal health holds true as well. Further,
it is one eminent sources of the community’s social welfare. According to the information from
the wereda water supply office, the wereda water supply coverage has reached to 25.84% with
which the rural is 15.84% and urban 41.68% for year 2006EC. However, the information in this
regard is limited only in reporting the water supply access coverage, i.e., the proportion of the
population that have access to the purported service, and hence it does not reveal the extent of
the service with respect to its volumetric and radial dimensions of the water supply service.
In the project wereda, source of potable water for home consumption and sanitation purposes
are used from 5 deep well, 24 functional hand dug-well, 3 shallow well, 15 developed springs
with gravity that has got no distribution system. Otherwise, the rest of about 74% of the
population are subjected to use water supply from natural on spot-springs, river water and
other unsafe and unclean sources.
Likewise, the project kebele population has largely depended on the Bisare river and flood
water sources for the domestic uses of water for human and animal during the various seasons
of the year. The household survey result have shown that about 72% of the sample households
have reported that they use river, with 16% uses flood and the rest 12% use from the nearby
village shallow well water supply scheme found 10km away. Similarly, 91.8% of the sample
households have responded to use backyard pits for toileting purposes.
1.5.7.4. Energy
The infrastructural service of the power supply and distribution information of the wereda
economic development and finance office, show that 5 rural villages and three small towns
have got electric energy supply lines from the central grid system. In the project kebele, there is

a 24hr hydroelectric power supply from the central grid system. Otherwise, fire wood is the
major source of energy for cooking for both rural and town communities. The focus group
discussion and key informant household’s interview have shown that 100 percent of the fuel
consumption for cooking and source of light is from wood in the project kebele community.
And hence, most of the households use the traditional open stone stoves which are commonly
used in most rural areas with a biomass-energy conversion efficiency rate of 5-10%, being over
90% the energy released is wasted thereby accentuated biomass demand and hence intensified
deforestation. Further, some households inhabiting near around the towns also use to produce
charcoal for sale to the nearby town residents being as a source off-farm income and impinge
deforestation to be exasperating.
1.5.7.5. Institutions and Organizations
A. Community Based Organizations (CBO)
CBO is an organization that provides social services at the local level. It is non-profit oriented
organization with which most activities are being undertaken on volunteer basis. That is, CBOs
largely depend on voluntary contributions of labor, material and money. CBOs may be
organized for various purposes such as natural resource management, religious and cultural
celebrities, conflict resolutions, social reciprocity, financial purposes etc.
In this regard, people in the project area have the tradition of cultural saving of money in group
locally named ‘Ekub’. The other traditional organization in the project area is ‘Edir’ in which
people voluntarily organize themselves for the purpose of reciprocity at time of sorrow for the
deaths of blood kin relatives for the celebrity of the funeral and other subsequent ceremonies.
At the time of peak labor work demand of individual families the community organize
themselves on the basis of their locality to expedite the work drudgery collectively together in
turn when the situation arise and the host household will prepare food and local dinks.
B. Governmental organizations

The Kebele Administration (KA) is the lowest /grass root/ level of the government structure.
However, traditional elder’s leadership is also equally important in working together with the
government KA. The KA cabinet is comprised of the administrator, public organizer, peace &
security, rural development, information, spoken person, women affair’s, youth & sport affair’s.
There is also a social court to judge and arbitrate local conflicts. The Kebele manager is also
responsible for the coordination of various activities in the Kebele and being accountable to the
KA and to the woreda administrations. Farmers are also organized in to various development
groups like irrigation, conservation, road sectors which recently they are comprised in team of
five households for administrative and developmental propose.
1.5.7.6. GENDER ANALYSIS AND MAINSTREAMING

Ethiopia is a signatory of the UN Convention which provided a strong basis for a policy
framework to integrate gender into the social, political, economic, and legal spheres of the
country. A “Women’s Policy” was formulated in 1993(EC). To facilitate policy implementation at
the Federal and Regional levels the Ministry of Women Affair at Federal Level and Women’s
Affair Bureaus have been organized in many sectoral Ministries and in all Regional
Governments. Moreover, efforts have been made to address women’s issues and the problem
of gender in equality and gender based discrimination in the government’s other key social
sector policies, program documents and legislations.
Despite these all embracing legislatives and policy frameworks, however, the economic and
social status of women remained backward and deprived in the project area as is elsewhere in
rural areas. Thus, women in the project area have faced relatively more constraints with
respect to the multi-dimensional social, economic and political problems. Most of the problems
seem to emanate from the social and cultural setting of the community itself. The following,
among others, are key points of discrimination of women in the area.
 Lack of access and control over resources in the household and community;
 Lack of access to play roles for leadership and decision making in the community based
organizations and other institutions;

 Lack of involvement in development planning, implementation, operating, monitoring

and evaluation,
 Lack of access to education and training
 Cultural barriers that suppress women’s’ right and undermine their role in various social,
economic, political and natural spheres.
A. Division of Labor
Based on the key informants and Focused Group discussion, the gender aspect of cultural set
up of the area shows that there is certain extent of women’s subordination to men, though a
great deal is under progress while disaggregating labor by sex, age and class. Hence, the total
work load would show skewed distribution towards women in which they are laden with
involvement in production works such as digging (disking), weeding, managing and looking after
livestock, poultry, harvesting, and etc. In addition, they are exclusively incumbents of the
reproductive work categories which mainly determines for the flourish of off springs for the
continuity and sustenance of families and societies. With regard to age-work classification
pattern, younger age groups after age of 5 would start to participate in productive works
especially through looking after livestock until the age of the early twenties and would be
candidate for crop production works at their late twenties.
B. Socioeconomic Issues
Women are inferior to men in some spheres of life and traditional practices that violate the
legal and human right in the society. In the project area, discriminatory property and
inheritance rights, early marriage, levirate marriage (wife inheritance), female genital
mutilations are among the harmful traditional practices still prevalent in project area.
As in most rural areas of the country, women of the project area are culturally deprived of in
many important household decision making processes like access to and use of certain type of
resources and its allocation.
C. The Implication of Irrigation Development to gender

Similarly numerous studies evidenced that there will be an increased proactive participation of
women in irrigation whenever the opportunity allows them for involvement. The proposed
irrigation project has to pay special attention to address women’s practical and strategic needs.
Particularly women headed households have to be accessed to irrigation through providing the
following opportunities
 Increase women’s access to resources, income and control
 Provide adequate training and follow up in the socio-cultural environment of the society
 Promoting credit and saving schemes
 Providing potable water supply schemes
 Introduce appropriate technology to alleviate the work load of women
 Improve the health status of women by promoting maternal and child health care
facilities
Numerous studies evidenced that an increased proactive participation of women in irrigation,
whenever the opportunity allows them for involvement. According to Shrestha (2004) most
women irrigators reported increased access to cash which reduces women’s economic
dependence on men and strengthens their bargaining position within the household. On other
hand, many studies on gender and natural resource management have shown women’s
intrinsic virtues in managing scarce natural resources, like irrigation water, in more sustainable
and equitable manner. Therefore, vibrant participation of women headed households and
women family members in general in irrigation development is desirable from the view point of
societal welfare. Further, benefits transfer to women from development intervention programs
means equitable benefits trickling to the whole family through their gender role responsibilities
in the reproductive work.
Like most rural places in the region, women in the study area are culturally deprived of in many
important household decisions making like resource allocation and access to use, participation
in important productive works and social works. Hence, involving more women in WUA
committee would empower women’s inferior position in household decision and would help to

bring sustainable water resource use since women are more innocent, genuine and fair in
managing natural resource than men can do.
1.6. COMMUNITY ATTITUDES TOWARDS THE PROJECT
During the earlier stage of the field expedition to the project area in this study, the target
community groups as a primary potential beneficiaries was identified before the community
rapport is made to investigate their felt attitudes towards the project. Thus, those farm families
who have land holding in the proposed irrigable command area and those households that
could be potentially touched with the induced effects of the project intervention was
meticulously selected with the auspices of the kebele administration and DA assistances.
Thereafter, a meeting was called at their traditional gathering place to make disclosures for the
project and discuss points of matters that may cue up and assess the peoples’ attitude and
interest towards the project. Further, the community attitudes for the project were
investigated through household survey and key informants interview questions in being posed
to respondents.
In doing so, community consultations, focus group discussion, key informants discussion and
the wereda stakeholders’ discussions and analysis shows that generally, there are positive
attitudes towards the proposed irrigation project. By the community meeting 65 households
were met for discussion (see Annex 1). In this instance, women’s participations during the
community consultation was found interesting when they express their keen opinions with
regard to their positions in being potentially benefited by the upcoming of proposed project.
During the focused group discussion communities’ attitude and interests, both male and female
headed households were assessed and they also adequately participated. In this connection
they revealed that they have positive attitude towards the implementation of the project. Most
participants gave positive ideas towards the realization of the planned project by forecasting as
this may help them getting income during construction period and also enable them to
significantly alleviate drudgeries of the traditional labor intensive irrigation practices and hence
increase their production and productivity. Promise of participation has also been obtained by

contributing 10% free unskilled labor and local materials supply during the construction of the
project.
1.6.1. Farmers` Participation

Farmers’ participating in the planning process should enable them to make well-informed
decisions. The field survey was found to be very useful that providing the openness and
informed decision-making needed in participatory development. Farmers then have played a
important role in filed survey study of the scheme planning through different kinds and
approach participations in the following way:
Consultative participation: They provided information based on their traditional experience
that point out areas with potential for flooding, and they suggest to visualize study locations for
irrigation structures such as flood protection.
Functional and contractual participation; for different disciplines of the study, field survey and
study, the selected farmers of the area have provided certain portions of the labor work for
topographic, soil and socio-economic field surveys of the proposed project.
Collateral participation; In addition communities within the area to be developed are
participated in the Environmental Impact Assessment (EIA) for the project, through contributing
vital information, such as current uses of their natural resources, ecology, human health, etc.
Passive participation; The farmers are also participated in selecting the crops to be grown in
the project and during this the irrigation agronomist of the study guided and informed them
only on technical matters related to the suitability of such crops for the climate, soils, the cost
of production and more over that the crops with high and sustainable returns as well as the
well available and realistic marketing potential.
After completing the field survey, the socio economist in collaboration with other study and
design teams, explained the alternative designs to farmers and the implications of each vis-à-vis
water resources potential, total area to be irrigated, cropping program, labor requirements,
capital costs, operation and maintenance costs, environmental aspects, land use patterns, their
expected contributions and roles and responsibilities during and after construction of the
scheme.

Generally farmers of the project area have already been participated through different kinds of
participations during filed survey and planning process of the project. To The next phase, is the
active and contractual participation where beneficiaries of the project play the role of active
partner in the project’s implementation and development and the final is the ownership or the
empowerment phase where, beneficiaries of the project would be willing and able to sustain
and further develop the initiatives begun by the project.
1.7. THE PROJECT

1.7.1. Project description
‘Bisare’ small scale irrigation project proposed under the water abstraction system of river
diversion from the Bisare River. The project is assumed to irrigate 60ha land after its year of
maturity. Hence, with the proposed command area both complimentary and supplementary
irrigation are assumed to be practiced equally, such that by the project’s upcoming the
cropping intensity to have reached to 200%. On average the commend area for a household is
assumed to be distributed with 0.25 hectares in which the project could benefit 480
households.
The project is formulated under the demand driven policy where the community is willing to
actively participate in project implementation. Moreover, project construction would be held
during farmers’ slack labor season so as to avoid overlapping of agricultural activities with the
project construction period.
1.7.2. Goal & Objectives

Attaining market oriented and sustainable livelihood at the household level is the overall goal of
the project. Towards this end, the project has the development objective of raising annual crop
production volume for the beneficiary farmers, raising the value of annual crop production of
the current estimate of 47058 to 3627695ETB. This again would be achieved through fulfilling
the following immediate objectives:
 Ensure reliable irrigation water for crop production

 Improve the farmers input utilization through arranging appropriate credit service and
input supply system
 Improve farmers’ cultural practices through training and provision of adequate
extension service.
1.7.3. Detailed Features
1.7.3.1. Works & general Facilities
The major types of works and general facilities required by the irrigation projects are the
construction of the diversion head work and other structures (main, secondary and tertiary
canals). The construction of the project is assumed to be implemented by, the project
employer, the SNNPRS Irrigation Development and Schemes Administration Agency and the
respective competent construction company, the contractor, with which capable and eligible
contractors that would fulfill the standards and criteria of FDRE’s contract procedure and
requirements relevant to the projects’ scale in which such companies are available in the
current market.
Further, the community needs to be involved by its participations in the construction phase
through labor and local construction material contributions so as to nurture the feeling of
ownership for the project and hence ensure its sustainability. In this regard, this study has
made consultations and discussions with the community and the respective stakeholders to
participate in the planning and preparation phase of the project’s feasibility study. And hence
the community is willing to contribute 10% free labor force of the total unskilled and semi-
skilled labor demand for the construction work. Further, the communities need to be involved
in the monitoring and evaluation activities along the various phases of the project
implementations with which during consultations the community was interested to participate
for the subsumed activities.
Labor power assessment for construction is done by comparing the demand and supply of labor
within the time frame scheduled for construction. Availability of unskilled and semi-skilled labor

force for the construction work for the project is available in the project area rural village or
kebele(s) and nearby towns W/Sodo, Biditi and etc.
1.7.3.2. Crop selection & the proposed cropping pattern

Crop selection has been made using the following major criteria
1) Agronomic criteria,
2) Farmers experience & preference
3) Priority for livelihood improvement
4) Market demand
The profitability of the existing crop selection without the project is shown in table 16 while the
crop selection proposed with the project would increase profitability. Optimization analysis is
not held to select the proposed crops but the selection is made in order to keep crop
diversification and thereby help farmers attain food self-sufficiency, generate cash income and
get better diets. Therefore, cropping pattern proposed by the agronomist is adopted for
estimating incremental production.
1.7.3.3. Supporting Services

Successful implementation of the project needs adequate support services such as extension
service, training, credit support and adequate input supply. Thus, irrigation intervention need to
be proposed and designed in integrated way such that prolific outcomes to could have been
achieved by the synergetic endeavor of the prospective stakeholders and partners. It is the
combined efforts of all these endeavors that can lead to the achievement of the intended
objective.
A. Extension trainings
To ameliorate the project benefits, various components of the irrigation production system
should operate in efficient and effective way. Despite the fact that the existing extension
service in the project area are encouraging, with the upcoming of the project these supports
need to tailored according the required technological packages with respect to irrigated
farming. That is, the provision of improved crop varieties for irrigation with the subsequent

supply of agricultural input requirements and adoption of improved cultural practices should
succinctly be given due attention in the extension service. Hence, it is very important for the
project to use the on-going extension system to put into operation all the intended project
activities. This may avoid duplication of efforts, and it is vital to integrate limited resources to a
common goal. To this end the project need to assign skilled and well trained development
agents, who would assist for the successful implementation of the proposed irrigation
development, under the existing development center. Provision of adequate office equipment
and office supplies to the DA workers is also essential for recording all necessary data and
preparing regular report.
Table 16 Training Requirements and Plan of Action
Thematic training needs Durati Implementers Trainers Costs
on/hr. Employer Client Type No. Per hr. Total
1. Irrigation water management and 40 SIDSAA Qualified  Farmers 240
Scheme administration with legible  DA 3 1378 55120
preliminary simple R&M firms  Wereda SMS 3
2. Irrigation agronomic practices and 40 SIDSAA Qualified  Farmers 240
methods legible  DA 3 1378 55120
firms  Wereda SMS 3
3. Socioeconomic aspects 40 SIDSAA Qualified  Farmers 240
legible  DA 3 1378 55120
4. Environmental issues 30 SIDSAA Qualified  Farmers 240
legible  DA 3 1378 41340
5. Watershed management 35 SIDSAA Qualified  Farmers 240
legible  DA 3 1378 48230
6. Managing IWUA and other 25 SIDSAA Qualified  Farmers 240
outstanding issues legible  DA 3 1378 34450
Total 289380
Even if the traditional farming practices and irrigation experiences of the potential beneficiary
farmers’ are relatively good, modern irrigation technologies and methods of production with
respect to scheme administration and management, agronomic practices, agricultural
marketing and other multifarious skill gaps need to addressed with startup training. Therefore,

training needs to be given to the kebele development agents, and farmers starting just after the
completion of the project construction phase. In subsequent to these trainings, the extension
service support should automatically offshoot its impetus for the projects’ success in a
continuous basis. While the respective start-up training costs are included in the financial and
economic analysis, the details of the training need and plan is suggested for the subsequent
actions to be undertaken before launching the operational phase, with which this is assumed to
be in Nov, 2016 (Table 14).
B. Credit support
Many farmers in the project area earn relatively low income in which they cannot pay ready
cash for the purchase agricultural inputs. Consequently, this would negatively affect the
adoption of improved technologies and hence provision of credit services is vital to trigger
production increase via its role in enhancing the level of utilization of improved agricultural
technologies. Therefore, sufficient credits need to be given to farmers through rural credit and
saving micro finance scheme. Whilst the cost of credits for start-up working capital in the initial
years of the project is included in the project’s crop budget part, the following credit schedule
and facility in monetary terms is estimated to be required with the project.
Table 17 Start-Up Working Capital Loan Requirements in Br
Descriptions Y1 Y2 Y3 Y4 Y5
1. Loan requirements for working capital1 116399 514210 67672.9
2. Repayment of principal (with 1 year grace
116399.9 514210.4 67672.9
period)
3. Payment of interest (@ 10.5%) 12222.0 53992.1 7105.6
4. Total operating cost 387999 554428 676728.6 852000.0 943788.7
C. Input supply
In the project area, the utilization rate of improved agricultural inputs is relatively low due to
the limitations in market supply, awareness and skills of farmers. Hence, provision of adequate,
1
Loan requirements are estimated with the assumption that farmer’s existing fixed productive asset holdings and
financial positions could not cover 30% of the annual total production costs and hence require credits starting Y1
with which this gap to vanish at Y4 due to the project

timely and appropriate type of agricultural inputs with commensurate extension education and
training should be vigorously delivered for the project beneficiaries. For some individuals, the
low level of improved agricultural inputs utilization rate have emanated from the unavailability
of appropriate type and amount of inputs at the required time and place. Empowering farmers’
cooperative is an urgent measure for its consequent roles in involving in the agricultural input
supply systems. Further, the precedent input supplier organizations should supply the required
amount and type of input at the right time to agricultural co-operative and to the irrigators, see
Table 17 below.
Table 18 Quantity of major agricultural inputs required with the project
S/N Input type Units Y1 Y2 Y3 Y4 Y5
1 Seed
Maize Qt 3.3 50.6 59.4 74.8 74.8
Haricot bean Qt 0.45 1.035 1.215 1.53 1.53
Pepper Qt
Onion Qt 4 21 24 31 31
2 Fertilizer 1 1 1 1 1
DAP qt 24 115 135 170 170
UREA 23 92 108 136 136
3 Chemical
Diamezoit 40% EC(lt/ha) lt 3.0 46.0 54.0 68.0 68.0
Endosulfan35% EC lt 21 69 81 102 102
Source: Agronomy report
1.7.3.4. Work schedules for major activities of the project

The study and design phase of the project is expected to be completed until April 30, 2015 and
then appraised until May 30, 2015 to be liable for the subsequent construction phase. The
following Gant Chart will illustrate the development of the project throughout its life cycles
with respect to the major work activities. In this regard, the engineering design shows that the
project would last to benefit the target communities for 20 years period.

Table 19 Physical works’ time schedule
Activities Year
2016 2017 2018-2038
S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A
Study and design
Appraisal
Bidding and site
handover
Construction
Implementation
1.8. POSITIVE AND NEGATIVE IMPACTS OF THE PROJECT
Obviously, any project intervention in pursuant to bring desirable socioeconomic changes in
certain interest of geographic area or target community groups would have direct/indirect
positive and direct/indirect negative impacts. Thus, the issues to weigh these two bundle of
possible project outcomes towards the desired/undesired project objectives and social values.
1.8.1. Environmental impacts
Hence, implementation of irrigation projects would have associated environmental impacts

mostly with the upstream-downstream competitions to water & land for its various uses. In
addition irrigation expansion in the area may aggravate malaria out break letting the area
suitable for the vector reproduction. Thorough investigation of these issues and arranging
appropriate mitigating measures is therefore vital for the success of the intended project.
Modern irrigation production system will involve improved natural resource management and
conservation methods for its sustainable uses with which these would induce improvements on
the natural environment. Thus, the project intervention is expected to minimize the current
level of soil erosion and prove agricultural production on a sustainable manner. Water logging
effect in the specific project area is also highly expected to be exacerbated as a result of the
project intervention and hence meticulous irrigation drainage design and operation is direly
needed.
1.8.2. Upstream-Downstream and other water-use Competitions
The Bisare River has an existing use for livestock’s drinking water and traditional irrigation
production in Gilo bisare kebele through organizing about 30 farmers in groups (association)
and donating water pumps by the wereda agriculture office. Thus, this traditional irrigation plan
is purported to command about 15ha of land under the complementary crop production. At
this juncture, the proposed project in concern is expected to enhance the efficiency and
productivity of the irrigation water use since the traditional proposal before the project would
possibly utilize the river for irrigation in sub efficient manner. With the upcoming project, water
application will enhance through the provision of modern irrigation system including water
abstraction, conveyance, application and generally water management subsystem. Therefore,
the incidence of water use conflicts is less probable.
However, there is an established traditional water resource management system which have
unwritten cultural bylaws being lead by elders with which most terms are orally captured and
arbitrated by traditional water elders and/or leaders. Therefore, the endeavor in designing and
upgrading the water resource management to modern irrigation water management system
need not to subordinate the role of the endogenous traditional system.
PART II ORGANIZATION AND MANAGEMENT
2.1. Project phasing & disbursement

The project has three distinct phases. These are study and design phase, construction phase
and operation phase. Study & design phase covers the period from project identification to
appraisal. Construction phase includes the period from signing agreement with the funding
agency to handing over of the project to the beneficiaries. Operation phase covers the period
from commencement of production to its completion, which is conventionally taken as 20
years. The latter’s phase needs more integrated efforts from various stakeholders on
establishing Water User’s Association, extension service provision, training, credit provision,
input supply, etc.
2.2. Project implementation in the construction phase

The South Irrigation Development and Scheme Administration Agency is the responsible
organization as a client of the project’s construction. Hence, the technical aspects of irrigation
with respect to tendering and construction supervision would be difficult for the employer as
compared to the organizational structure and capacity of the client. To circumvent these
problems outsourcing the work for irrigation specialized private and/or public sectors is an
invincible strategy such that tendering, evaluating and monitoring, etc of the construction work
could be carried out in accordance to the standard rules and procedures. Furthermore,
construction supervision works need to be undertaken by external supervision firms through
Socio-Economy Feasibility Study Report 49

outsourcing the work so that tri-party check and balance system in the construction works
could be attained.
Involvement of the kebele administration bodies and the WUA committee in construction
supervision would have paramount importance. Further, the wereda and zonal agriculture
offices and administrative councils may support the processes of the construction work as
deemed important, especially mobilizing the community participation, local conflict resolution,
etc.
2.3. The project operation phase

After the completion of the construction work, to give start-up trainings in the multidisciplinary
fields of irrigation farming system for the beneficiary farmers’, kebele DA’s and the respective
wereda experts should be mandatory. The training theme needs to be curtailed with theoretic
and field level practical knowledge with which these assignments to could have been better
served if it is outsourced to the concerned external firms. In addition, WUA should be
established immediately at the project commencement phase of operation. Finally, project
handover to the target beneficiary community through WUA would follow for whom it is an
ultimate owner of the scheme. Hence, it is the WUA that would manage the scheme’s
operation and water distribution with certain supports from the kebele administration, as
deemed important. Thus, the WUA committee would have voluntarily elected members by the
general assembly and be accountable for the same. The association would have its operating
bylaws under which the beneficiary members would be governed and administered.
Water Users Association (WUA) will be established by the beneficiary farmers just after the
completion of the construction work for appropriate and sustainable management of the
project. Thus, it would have the following duties and responsibilities.
a. Receive project hand over from the constructing body
b. Undertake easy maintenance and repairs of physical system of the scheme
c. Collect water free from individual beneficiaries, if any
d. Submit regular reports to the office of agriculture in every crop season
e. Involve in conflict resolution between beneficiaries
f. Involve in market bargaining

g. Involve in project monitoring

Water Users Association (WUA) will be managed by supreme organ of its structure, which is the
general assembly. It has different managing bodies such as the general assembly, executive
committee, controlling committee, team leader of each block of the irrigated area and field
leaders. Detailed organizational structure of water users Association (WUA) is illustrated below.
2.3.1. The Condition to set General Assembly

The central objective of the study as regards to organizational and management of the small
scale irrigation is to recommend suitable institutional framework on the ground of irrigation
management and existing water & irrigation laws and legislation where necessary, for the
implementation of the proposed irrigation system structures.
The recommendations in proposing the institutional setups for the planned irrigation scheme
management and administration requires proficient coordination and strong community
scheme management style, whereby each organization that is involved in the development and
operations will have clearly stated and functionally delineated roles and responsibilities. The
key area of concern here is that, the envisaged irrigation project which essentially is farmer-
managed, to fully involve farmers in the planning, design and construction of the scheme, after
which they are to own and manage as well as operate and maintain the systems on a
sustainable manner. With this broad vision in mind, the organizational structure based on water
source, settlement pattern and irrigation system structures, explicitly to the intended user
communities of the project irrigation schemes will be proposed.
It is necessary indeed to set the General Assembly and Water Users Association Board (Central
Management body) from the Kebeles upon the fulfillment of the following conditions.
 The water users residing within the beneficiary kebele need to set their
representatives to administer the election process of Water Users Association in the
General Assembly comprising all the kebele direct beneficiary households. The
number of assignee members can be decided by members of the kebele, sub-kebele
or ‘Gott’ level beneficiaries depending on prevailing conditions.
 The day-to-day activities of the kebele beneficiaries would be managed and led by
their electorate representatives

 If conflict over the use of water is thought to be intensified and the various General
Assemblies are believed to solve these disputes would be seen and resolved by the
central management.
2.3.2. Proposed Irrigation Management Setups

The Water management committee shall be democratically nominated from the beneficiary
kebeles in being the General Assembly, with members proportional to user Kebele Farmers.
Similarly, the dispute resolution and control committees are also democratically elected by
each General Assembly. The number of representation in these committees shall be specified in
the by-laws of the association. However, the proportion of representation must take the total
number of members in each assembly into considerations. This implies that, the general
assembly that has larger number of members shall assign larger number of elected
representative committees into the main management committee and other committees.
Likewise, each Assembly elects and assigns its water management sub-committees (WMSCs)
and Water Distribution Groups (WDGs) including the various water distributors from respective
Assembly and announces their election to the main water management committee. Accordingly
the main Water Management Committee (WMCs) appoints WMSCs to run the day-to-day
operation activities at their respective irrigation schemes.
The arrangements for fair distribution of water, irrigation scheduling and water fees collection
mechanisms and etc are devised by the main management committee and must get the
approval of all assemblies before implementation by the WMCs. The Woreda office of
Agriculture, Kebele Administration, Development Agents and respective sub-Kebele & Village
level community leaders shall actively involved in organizing and establishing irrigation water
users associations as well as in the process of nominating the prescribed committee members.
Figure 8: Proposed Organization Structure of IWUAs for the Project Scheme
General Assembly
Dispute Settling
Control Committee Committee
Water Management
Committees
Accounting and
Finance
Committee
Water Distribution Groups

(WDGs)
Water Distributors Repair and Maintenance

Committee
2.3.3. Duties and Responsibilities of Proposed Setups
2.3.3.1. General Assembly

The General Assembly is a highest governing body of the Association, which includes all the
command area farmers, joined the cooperative membership. The powers & mandates of the
General Assembly should be specified in the association by-laws, however its role and function
includes but not limited to the following.
 Select respective members of the management committee, control committee and
dispute settling committee
 Approves the annual budget and work programs of the cooperative
 Approves the association by-laws and internal regulations
 Decides on the associations members share payment\amount
 Determine the annual profit sharing and reserve amount
 Examines and approve audit reports of the association
 Discuss on related issues regarding scheme development activities
2.3.3.2. Control Committee

The control committee is nominated by and accountable to the General Assembly, which will
comprise at least 3-5members. The main duties of the control committee shall be stated in the
by-laws however, the following are some of major duties.
 Supervise performance of the water management committee

 Ensures for the proper safeguarding of financial and material resources of the
association
 Oversees whether the cooperative activities are done as per the by-laws and internal
regulations
 Perform other activities assigned by the general assembly as required
2.3.3.3. Conflict Resolutions Committee

Having the accountability to the General Assembly, Conflict Resolutions committee will consist
of 3-5 members elected by the General Assembly and at least responsible to:
 Investigate and resolve any disputes and or conflicts arises among the association
members,
 Examine and create smooth and friendly relationships among irrigation user farmers,
 Perform any other related tasks as required by the general assembly.
2.3.3.4. Irrigation Water Management Committee (WUC)

With the direct accountability to the General Assembly, the water management committee is
responsible for the day to day operation & maintenance as well as administration of the
scheme. Though, the mandates, committee members and any related nomination issues shall
be specified in the Association by-laws. However, core duties of the committee include;
 Organizes the General Assembly meetings and implements the decisions of the
General Assembly,
 Prepares the guidelines and standing instructions on the water distributions,
 Control & supervise management of water to ensure equitable distribution among
members,
 Represent the cooperative at any time, at any place,
 Facilitates the supply of agricultural inputs, credits and provide commercial services
as required,
 Prepares annual plans and budget for the Association and insures its
implementations,
 Nominates Water Distribution Committees upon fixing their numbers depending on
the size and lay out of existing canal structures

2.3.3.5. Accounting and Finance Committee

The accounting and Finance Committee is accountable to Water Management Committee and
shall perform the following tasks
 Prepare all the financial and accounting documents for the entire use of
financial and accounting matters in the WUAs
 The accountant is responsible in the proper financial record keeping and
management of accounting related matters under the Association
 The accountant prepares the proper modality of financial matters to be managed
through proper Book keeping system
 Procurement of all goods and services shall be run by finance and accounting
division
 Responsible for cash collection from members through formal financial
documents (Ledgers, journals, payment vouchers, etc) and payments when ever
arise
2.3.3.6. Water Distribution Groups

The Water Distribution Groups will be assigned to perform the day-to-day water distribution
and equitable utilization among a group of irrigation users. Moreover, they ensure distribution
of water to their user groups is equitable and monitors the efficiencies of water utilization by
members. Additionally the group is accountable to;
 Coordinate and facilitate the operation and maintenance of the irrigation water with
relevant members,
 Report the conflicts rouse among members, breakdown of structures etc…to water
Committee,
 Gather farm level data, records and submit to the management committee on the
right time,
 When appropriate, assist the management committee in case of billing and water
charge or collection from individual farmers,
 Keep and or maintain the wellbeing of the canal structures under their specific canal
structures.

Additionally, the Water Distribution Groups will have individual water distributors selected
from farmers along the secondary, territory or field canals in each Group as the distribution
system required.
2.3.3.7. Repair and Maintenance Committee

Will be accountable for the water Users committee and carry out the following major activities
 Prepare operation and maintenance schedules and make approval by the Water
Users Association
 Assign groups and sub groups of the beneficiaries in order to undertake the
required maintenance services of the scheme when ever required
 Identify the status of repair and maintenance and mobilize labour and financial
resources for the operation
 Follow up and implement regular repair and maintenance activities
2.3.3.8. Monitoring and evaluation

In order to implement the intended project activities develop and operation of effective
systems for annual project planning and monitoring of physical progress and base line survey
need to be established.
Monitoring is a continuous function that uses the systematic collection of data on specified
indicators to provide management and the main stakeholders of an ongoing development
intervention with indications of the extent of progress and achievement of objectives and
progress in the use of allocated funds.
Evaluation is the systematic and objective assessment of an ongoing or completed project,
program, or policy, including its design, implementation, and results. The aim is to determine
the relevance and fulfillment of objectives, development efficiency, effectiveness, impact, and
sustainability ( Kusek, J. Z. and R. C. Rist. 2001).
These M&E system need to be designed in detail during the first year of operation. Results and
impact management systems indicators relevant to the project that are generally required
would be incorporated based on the activity and for output and impact level. Data would be
disaggregated according to gender and the system would be designed to effectively measure
the impact of the project and the level of poverty among the beneficiary community. In

addition particular attention would be paid to harmonizing the performance standards by which
progress and impact are measured and reported.
In order to adequately implement therefore it is vital importance conducting frequent M&E
system, training to stake holders located at different phases particularly comprising the wereda
Agriculture office, Water, Mines and Energy Office and Health Office, Development Agents and
the beneficiary community leaders (WUAs). Organizing the intended training activity need to be
managed and organized by the client and its’ SMS.
2.4. PROJECT‘S SUSTAINABILITY STRATEGIES

The project is formulated based on farmers need & priorities through direct participation of the
community, and project implementation need to be carried out with their full participation. The
project would not result in exhaustion of natural resources. Rather it would conserve the
natural environment through keeping the flora of the area in both dry & wet seasons. The
project would largely use local inputs and local skills for its implementation. It would use simple
or easy-to-learn technologies such as farm input utilization, improved irrigation practice, etc.
The project would result in significant incremental production benefits that would exceed
project costs giving rise to generate significant returns. It would also create additional
employment opportunities. The project output would meet basic needs of the beneficiaries to
attain food self-sufficiency and to generate cash income.
The project organization and management should allow that each stakeholder to successfully
accomplish its duties and responsibilities. The project organization includes appropriate
supporting institutions that will ensure continuity of production through provision of credit,
farm input supply, and training and extension service. Moreover, water users’ Association
would be established just after the completion of construction for proper management of
irrigation structures and efficient utilization of irrigation water. Furthermore, monitoring would
be undertaken at each point in time so as to follow–up accomplishments as per the schedule
and take timely corrective measures.

PART III FINANCIAL AND ECONOMIC ANALYSIS

3.1. Financial Analysis
The purpose of financial analysis is to assess the financial viability in terms of its profitability
from the view points of the investment and the farmer. Hence, the project’s financial viability is
scrutinized using the conventional discounted financial return feasibility indictors, i.e. the NPV,
FIRR, and B-C Ratio are computed. Further, sensitivity analysis is also pursued in order to check
the projects vulnerability for adverse changes and shocks in prices, construction delays and
production declines and hence whether the project still remains feasible thereafter. The
financial analysis is undertaken by considering some key assumptions in the computation
process. Accordingly, the computation result of the discounted financial viability measures is
shown below.
Similarly, parameters computed in the financial analysis would be used to derive the economic
value of the project’s costs benefits. To do so, conversion factor which is issued by MoFED,
2008 is employed while undertaking the economic analysis.
3.1.1. Key assumptions
 Based on the engineering estimate, the project is assumed to have 20 years

service of irrigation infrastructures and there is no residual value considered.
 Market interest rate for financial analysis is used according to the bank
banks’ lending interest of 11% through which it is averaged from the min-
max allowable rate of 9 and 13%, respectively. However, the opportunity
cost of capital for the economic analysis is taken with 10% according to the
national parameter issued by MoFED.
 In the discounting processes of the financial values, 11% annual interest rate
is considered by being conservative enough to the maximum permissible
lending interest rate of the country’s financial market
 Inflation is assumed to equally affect costs and benefits. Hence, the analysis
is made at constant prices of the project costs and benefits for the entire
project life.

 Water charge fee is assumed 600 birr/annum and total fee collection
increases across the project years since it is assumed that number of project
beneficiaries would increase at latter years. Considering the supplementary
irrigation use, at year one 138 households will participate in the production
while at maturity year i.e. year five beneficiaries would reach to 340.
 Distribution of irrigation land is assumed to be 0.25 ha per household.
 Repair and maintenance of damaged irrigation scheme parts are considered
as recommended by the design engineer that is in year 5 and 9.
 Crop byproducts are estimated 5% of the total value of production based on
the recommendation by FAO (FAOSTAT, 2010).
3.1.2. Project cost

The project’s financial cost estimations comprises of two main components, the investment
cost and the operational costs. Further, costs are subdivided under the preceding category, i.e.
for investment cost: intake civil works, earth work in irrigation system, irrigation system
structures and general items while the operational cost constitutes the production costs,
training and supervision, land use tax and water charge fees. The investment cost totally
amounts to 11155000Br, comprising 9732000 for construction, 973 for construction supervision
and 450000 for study and design consultancy services. The details of financial cost estimation
for each item of the project are shown in annex1.
3.1.3. Project financing

The financial requirements of the project could be classified in to two categories according to
the costs attached to project’s phase of development. That is there would be investment cost at
the construction phase and operational costs at the implementation phase. Accordingly, the
project financing would be derived from different sources such that the investment cost is to be
covered by the client, the South Irrigation Development and Schemes Administration Agency
sponsored through the AGP source fund as per the modality of agreement between the two
parties involved in the water sector developed. In addition, the farmers training cost at the
beginning of the implementation years is also assumed from this same source. However, 10% of

the value of the unskilled labor force and local construction materials requirement of the
project is envisaged to be contributed from the beneficiary community’s pay free work
participations.
During the project construction phase, 10% of the value of the unskilled labor force and local
construction materials requirement of the project is envisaged to be covered from the
beneficiary community’s pay free work participations. And hence, about 106348ETB is
estimated to be contributed from the beneficiary community through participations in unskilled
labor works (Table 20).
Table 20 Estimated Cost Contributions by the Beneficiary Community upon Construction
Cost Items Unit Quantity Unit cost ETB Total cost
Total excavation and earth M3 26435 40.23 1063480
works, labor base
Community share, 10% M3 2643.5 40.23 106348
Source: Engineering report, BoQ, 2016
On the other hand, during the implementation phase of the initial years of the project, start
up loan is indispensable with which the aforementioned credit service need to be provided by
the GO or NGO credit and saving institutions working in the area by being specially liaised by
implementing stakeholders more specifically the South Agriculture Bureau and/or IDSAA and
the Wereda Agriculture Office. In this regard, loan supply with fair charges of cost of financing
(interest rate) need to be availed for beneficiary farmers for the smoother expedition of farm
operations and hence project implementation processes with at least one year grace period of
repayment of the principal and interest. This would allow enhancing the borrower’s capacity for
debt repayment from the cash proceeds of the farm productions by the project. Otherwise, all
other expenses and costs related with irrigation scheme and water management and the
production process, users bear the financing activity.
With the onset of the project to reality, there is no need of special allowances with regard to
the demand for foreign currency to imported specific items from foreign suppliers at the
project’s scale operation levels. That is, all goods and services required by the project are
available in the domestic markets.

3.1.4. Production cost

The proposed irrigation project is supposed to bring production and productivity increase in the
area under concern through the introduction of improved technologies and practices. The most
common inputs are seed, fertilizer, chemicals, labor, oxen and hand tools.
Table 21 Discounted financial measures of the project (‘000ETB)
Discounted measures Discounting factor Values
1. Net Present Worth 11% 6,023
2. Financial Internal Rate of Return 11% 22%
3. Benefit-Cost Ratio 11% 1.23
4. Sensitivity test:
 10% decline in production/IRR 11% 19%
 10% investment cost overrun/IRR 11% 16%
 One year delay in the construction/IRR 11% 17%
Source: own computation
3.1.5. Project return

The project return is derived by aggregating all quantifiable costs and benefit streams and
hence comparison of ‘with’ and ‘without’ the project situations would be analyzed in order to
obtain the incremental value of production.
3.1.6. Pricing and marketing

Three years prices of inputs and crop produces are averaged in the analysis. Hence, three years
price records for the wereda main market, ‘W/Sodo’ market is taken and farm gate prices are
adjusted accordingly, considering transportation costs to the specific project area.
Meanwhile, with the ongoing high capital investment to utilize the existing natural resources
and the development interventions in the vicinity of the project area, there would be expected
creation of huge market demand for agricultural products. Hence, by the increasing consumer
markets, there would not be problem of market to absorb crop produces of the project.
Marketing middlemen such as retailers and wholesalers involve in the marketing channel hence
facilitating produce marketing activities through carrying out time and place market functions.
Moreover, it is highly anticipated promotion of producers to the marketing service co-
operative.

3.1.7. Production
Production would be practiced on 80ha of net command area with 195% cropping intensity for
the production of crops including maize, onion, pepper and haricot bean. The optimum
achievable yields of the project are obtained with the optimum utilization of the recommended
inputs through time. The time of maximum yields per hectare is determined by the previous
experience of farmers, agronomic and relevant socioeconomic factors. So it will depends on the
use of improved inputs, soil and water conservation and appropriate management practices,
agricultural practices and management adopting improved technologies and innovations with
farmers’ indigenous irrigation knowledge. Based on these and other relevant factors, the crop
yield projection of Bisare irrigation project is indicated in the following table.
Table 22 Financial analysis “without the project”
Descriptions Year one Remark
1. Gross value of production 263025
2. Operating expenses 210467
4. Net benefit 52558
3.1.8. Sensitivity Analysis

The probable effects of the result of uncertainties and risks associated to the project are
assessed by identifying the key variable that most likely influences incremental net return.
Sensitivity analysis tests the soundness of the project financial results after changes by sensitive
variables like output price, yield, investment cost and delay in the accrual of benefits.
Table 23 Result of financial sensitivity analysis for the probable changes (‘000ETB)
Financial Analysis Results
Changing variables
NPV IRR B-C Ratio
Yield decrease by 10% 5,022 19 1.2
Delay in accrual of benefits (1 years) 2,474 16% 1.11
Cost overrun by 10% and yield decline by 10% 1,991 14% 1.08
The analysis is being carried out on the following variables in which Table 23 shows the results
of the analysis
 Yield fall by 10% other things being constant

 One year delay in the accrual of benefits other things being constant
 Investment cost overrun by 10% & yield reduction by 10% simultaneously.
3.2. Economic analysis

After financial prices for costs and benefits is determined and entered to the project accounts,
the next step is estimation of economic value of the project to the nation as a whole. As
financial prices being starting point for economic analysis, it is necessary adjusting both the
inputs and outputs of the project to reflect the true value to the society as a whole.
Table 24 Discounted economic analysis (‘000ETB)
Discounted measures Discounting factor Values
1. Net Present Worth 10.23% 3,674
2. Economic Internal Rate of Return 10.23% 17.2%
3. Benefit-Cost Ratio 10.23% 1.2
4. Sensitivity test:
 10% decline in production/IRR 10.23% 12.6%
 10% investment cost overrun/IRR 10.23% 10.6%
 One year delay in the construction/IRR 10.23% 11.3%
The economic project analysis here judges the capacity of the proposed project to generate the
national income and the analysis moves beyond financial accounting. In this connection the
market price of good or service is changed to make it more closely represent the opportunity
cost (the value in its next alternative use) to the society.
3.3. PROJECT BENEFITS AND JUSTIFICATION

There are benefits beyond those that are simply financial. In this section, those quantifiable and
mainly the non-quantifiable benefits of the project will be explained. Incremental crop
production increases farm income, creates employment opportunity as a result of the project
execution, sustainability of the environment, technological dissemination with regard to new
varieties of crops and fodder aftermath of the project and improvement in health and nutrition
are briefly described.

3.3.1. Quantifiable Benefits
3.3.1.1. Incremental crop production
Higher crop production is expected as a result of development of the project. First and
foremost, higher crop yield per hectare as well as total production would be obtained relative
to the “without” situation of the project. Reliable crop production twice in a year would be
obtained from the project through the use of efficient irrigation, improved seed &fertilizer and
provision of adequate advisory services. Increase in production will not only increase the
available food per capita for consumption but also marketable products that would ensure food
security in the area. And this is the main factor for increasing farm income.
3.3.1.2. Incremental Farm Income

Crop production is the main economic activity in the area from which the maximum share of
the family income is derived. Such increase in income would result in improvement of the living
standard of farmers.
3.3.2. Non-quantifiable benefits
3.3.2.1. Increased off-farm income

Majority of the population is expected to participate in the project as a target beneficiary group
as irrigation farm producers, directly or indirectly being casual laborer during input distribution
and output delivery and bartenders, etc during project construction. They will have a better
income and as a result of which their social well being is generally expected to improve. Those
direct project beneficiary farmers need to be those model farmers.
3.3.2.2. Health & Nutrition

Increment in production has an impact on improvement of health. Better food grains supply
and increased food intake will contribute in improving the health status of the people inducing
greater labor productivity for better production.
3.3.2.3. Improvement of the Environment

The project intervention is expected to minimize the current level of soil erosion and prove
agricultural production on a sustainable manner. Water logging effect in the area is also highly

expected to be exacerbated as a result of the project intervention and hence meticulous

irrigation drainage design and operation is direly needed.
3.3.2.4. Technology Transfer

Improved technology and improvement of farming practices will be obtained as a result of
encouraging support services associated with the project. This benefits not only those directly
involving farmers (project beneficiaries) but also serve as a demonstration to other neighboring
farmers around the project area.
3.3.2.5. Risk Minimization

Farmers risks will be considerably reduced through irrigation and the higher cropping intensity
will protect them against short falls in food production. Reliable water supply will encourage
farmers to readjust their cropping patterns to take the advantage of market conditions.
4. CONCLUSION AND RECOMMENDATION
With the hitherto study analysis and critical discussions in the preceding parts of this report,
concluding remarks would be given in light the way forward for the subsequent phases of the
future project implementations.
The primary and direct target beneficiaries of the project is supposed to be 480 households
through irrigating 120ha of land.
Therefore, the soundness of the projects’ decision criteria shows that it is an indomitable
project to be viable with respect to its social and economic implications. However, the following
issues are critical for consideration in all phases of the project cycle, for which the successful
ends of the project and its sustainability to could have been easily realized.
1. The supply of agronomical recommended seeds, fertilizer and chemical inputs of the
right type, at the right time and the required quantity should be succinctly ensured by
analyzing the agricultural input supply value chain and measures to strengthen through
lobbying the synergies of different GO’s and NGO’s roles in this regard. Despite, this
would not be preemptive to call to emphasize the coordinated and integrated

development endeavors and roles of the sector offices’ that successful and sustainable
irrigation intervention would require.
2. The Bilate river proposed under this irrigation project is the boundary demarcating two
weredas of Damot Woyide and Sodo zuryia weredas. Furthermore, in the downstream of
the former wereda alongside direction to the proposed command area there is one
functional irrigation project that commands about 140ha of land such that coordinated
and inclusive irrigation water demand management need to be put in place during the
project operation stage for the desirable project outcome with a non-zero-sum game.
5. REFERENCES
1. Awoke Amzaye (2007), Mosaic cultures and Peoples of South Nations, Nationalities and
People’s Regional State, Department of culture, Bureau of Information and Culture,
2007, Awassa.
2. CSA (2007), Population and Housing Census of Ethiopia, Statistical Report of the Amhara
Region.
3. CTA (2003) Small-scale irrigation and food security in sub-Saharan Africa. Organised by
CTA with the support of Tigray Water Resources Development Bureau, Ethiopia
4. FAO (1994).Ethiopia: Small Scale Irrigation Consolidation project, Preparation report:

FAO/DDCReport59/94ADB-ETH48
5. FAO(2008)Marketing problems and improvement programs in Ethiopia Federal

Democratic Republic of Ethiopia (FDRE)(2005) Plan for Accelerated and Sustained
Development to End Poverty, Addis Ababa.
6. FDRE(2005).Rural Development Policies, Strategies and Institutions. Economic

Association policy Research.P.P.121
www.dfid.gov.uk/R4D/PDF/Outputs/.../FAC_Research_Paper_No4.p.
Hussain, I. and Hanjra, M. A. (2004) Irrigation and poverty alleviation: review of the
empirical evidence, Irrigation and Drainage, 53(1), pp. 1–15
7. Mellor, J.W. (1966). The Economics of agricultural development. Cornell University

press, Ithaca, New York.

8. Ministry of Water Resource (MoWR) (2001). Water resources strategy of Ethiopia, Addis
Abeba, Ethiopia. 154p.
9. WeldeabTeshome(2003) Irrigation Practices ,State intervention and farmers` Life-words

in Drought- Prone Tigray, Ethiopia. www.elsevier.com/locate/foodpol
10. United Nations Human Development Report (UNHDR) (2006). Water competition in
agriculture. URL, Date of access, 04/06/2008.
http://www.pppue.undp.org/index.cfm?module

6. ANNEX
6.1. Signatures’ of Beneficiaries

6.2. Financial and Economic Analysis Tables

Table 25 Crop Budget (Financial in ETB)
S/N Description Y1 Y2 Y3 Y4 Y5
1 Maize
1.1. Area (ha) 46 32 70 70 70
1.2. Seed Rate (kg/ha) 0.3 0.3 0.3 0.3 0.3
Total Seed (Qt) 13 9 19 19 19
Unit cost(Birr) 1720 1720 1720 1720 1720
Total seed cost 21522 14900 33110 33110 33110
1.3. Labour(md/ha) 106 106 106 106 106
Total Md 4841 3352 7448 7448 7448
unit cost(Birr) 30 30 30 30 30
Total labor cost 145236 100548 223440 223440 223440
1.4. Oxen day/ha 44 44 44 44 44
Total oxen days 2007 1389 3087 3087 3087
Oxen Unit cost(Birr) 55 55 55 55 55
Total oxen power cost 110360 76403 169785 169785 169785
1.5. Fertilizer
Rate of DAP/ha(Quintal) 1.5 1.5 1.5 1.5 1.5
Total DAP 68 47 105 105 105
Unit cost(Birr) 1770 1770 1770 1770 1770
Total cost of DAP 120803 83633 185850 185850 185850
UREA/ha(Quintals) 1 1 1 1 1
Total UREA 57 39 88 88 88
Unit cost(Birr) 1650 1650 1650 1650 1650
Total cost of UREA 93844 64969 144375 144375 144375
Total Fertilizer cost 214646 148601 330225 330225 330225
1.6. Chemicals
Sivene (carbaril), kg/ha 2 2 2 2 2
Quantitiy (kg) 68 47 105 105 105
Unit cost (br/lt) 120 120 120 120 120
s/total cost 180 180 180 180 180
Total chemical 180 180 180 180 180
1.7. Farm tools (cost/ha) 258 258 258 258 258
Total farm tools cost 11739 8127 18060 18060 18060
1.8. Packing materials (Pcs) 717 1323 4043 4043 4043
Unit cost (Br/PcsNo.) 10 10 10 10 10
Total cost of packing mat. 7166 13230 40425 40425 40425
1.9. Grand Total cost 510849 354120 797423 797423 797423
Cost of production per ha 11227 11242 11392 11392 11392
1.10. Yield/ha 15 40 55 55 55
Total production 683 1260 3850 3850 3850

Unit price 470 470 470 470 470
Value of by products (5%) 15263 52749 72531 72531 72531
Total Value of production 305263 1054989 1450611 1450611 1450611
Production Value per ha 15263 24421 33579 33579 33579
1.11. Net benefit before Tax 124023 667595 1056412 1056412 1056412
Net benefit per ha before Tax 6201 15454 24454 24454 24454
2 H.bean
2.1. Area (ha) 26 18 40 40 40
2.2. Seed Rate (kg/ha) 27 27 27 27 27
Total Seed (Qt) 7 5 11 11 11
Unit cost(Birr) 1850 1850 1850 1850 1850
Total seed cost 12747 8825 19610 19610 19610
2.3. Labour(md/ha) 49 49 49 49 49
Total Md 1274 882 1960 1960 1960
Total labor cost 38220 26460 58800 58800 58800
2.4. Oxen day/ha 7 7 7 7 7
Total oxen days 182 126 280 280 280
2.5. Fertilizer
DAP (qt)/ha 1 1 1 1 1
Total DAP 26 18 40 40 40
Unit cost(Birr) 1770 1770 1770 1770 1770
Total cost of DAP 46020 31860 70800 70800 70800
Total UREA 26 18 40 40 40
Unit cost(Birr) 1650 1650 1650 1650 1650
2.6. Chemicals
Endosalfan 35%, L/ha 2 2 2 2 2
Quantitiy (lt) 52 36 80 80 80
Unit cost 110 110 110 110 110
S/total cost 5720 3960 8800 8800 8800
Total Chemical cost 5720 4050 8890 8890 8890
Production cost per ha 6408 6435 6455 6466 6488
2.9. Grand Total cost 166615 115835 258180 258620 259500

2.10. Yield/ha 15 17 19 20 22
Unit price 1850 1850 1850 1850 1850
2.11. Net benefits before Tax 125851 304933 433516 562100 690684
Net benefits per ha before Tax 6454 11764 16725 21686 26647
3 Pepper
3.1. Area (ha) 13 9 20 20 20
3.2. Seed Rate (kg/ha) 0.28 0.28 0.28 0.28 0.28
Total Seed (Qt) 4 2 6 6 6
Unit cost(Birr) 6510 6510 6510 6510 6510
Total seed cost 23273 16112 35805 35805 35805
3.3. Labour(md/ha) 91 91 91 91 91
Total Md 1183 819 1820 1820 1820
Total labor cost 35490 24570 54600 54600 54600
3.4. Oxen day/ha 8 8 8 8 8
Total oxen days 104 72 160 160 160
3.5. Fertilizer
DAP (qt)/ha 2 2 2 2 2
Total DAP 26 18 40 40 40
Unit cost(Birr) 1770 1770 1770 1770 1770
Total cost of DAP 46020 31860 70800 70800 70800
Total UREA 13 9 20 20 20
Unit cost(Birr) 1650 1650 1650 1650 1650
3.6. Chemicals
Endosalfan 35%, L/ha 2 2 2 2 2
Quantity 26 18 40 40 40
unit cost (Br/lt) 110 110 110 110 110
S/total 2860 1980 4400 4400 4400
Total chemical cost 2860 1980 4400 4400 4400

3.9. Grand Total cost 140026 97040 215865 216085 216305
3.10. Yield/ha 13 14 15 16 17
Unit price 5500 5500 5500 5500 5500
3.11. Net benefits before Tax 798139 1410365 1613943 1715733 1919312
4 Onion
4.1 Area (ha) 20 14 30 30 30
4.2 Seed Rate (kg/ha) 4 4 4 4 4
Total Seed (Qt) 68 47 105 105 105
Unit cost(Birr) 700 700 700 700 700
Total seed cost 47775 33075 73500 73500 73500
4.3 Labour(md/ha) 92 92 92 92 92
Total Md 1794 1242 2760 2760 2760
Total labor cost 53820 37260 82800 82800 82800
4.4 Oxen day/ha 13 13 13 13 13
Total oxen days 254 176 390 390 390
4.5 Fertilizer
DAP (qt)/ha 1 1 1 1 1
Total DAP 20 14 30 30 30
Unit cost(Birr) 1770 1770 1770 1770 1770
Total cost of DAP 34515 23895 53100 53100 53100
Total UREA 20 14 30 30 30
Unit cost(Birr) 1650 1650 1650 1650 1650
4.6 Chemicals
Mancozeb or Zeneb and Ridomil, 3 3 3 3 3
kg/ha
Quantity 59 41 90 90 90
unit cost (Br/lt) 110 110 110 110 110
sub total 6435 4455 9900 9900 9900
Total chemical cost 6435 4455 9900 9900 9900
4.7 Farm tools (cost/ha) 258 258 258 258 258

4.8 Packing materials (Pcs) 2681 2228 6600 7425 8250
Grand Total cost 220506 156371 363990 372240 380490
4.9 Yield/ha 125 150 200 225 250
Unit price 630 630 630 630 630
Net benefits before Tax 832192 1143886 1143886 1143886 57388
11Other Overhead Costs
11.1. Start-up training & extension 289380 289380 289380 289380 289380
11.2. Water charge 77760 133440 133440 133440 133440
11.3Costs of water pumping 297960 297960 297960 297960
11.3. Land tax 2160 2160 2160 2160
Environmental cost 50878
11.3. Transportation, loading and 20351 32739 33629 34927 33159
unloading costs
11.4. Loan for working capital 305266 881607 168144
Repayment of principal (with 1 305266 881607 168144
year grace period)
Payment of interest (10.5%) 32053 92569 17655
Total overhead cost 438369 755679 788622 850436 773754
12 Total operating cost 1017553 1636938 1681437 1746340 1657944
13 Total Value of production 2459389 4408037 5140573 5374035 4607985
14 Net benefits before the project 1441836 2771099 3459136 3627695 2950040

Table 26 Financial Analysis
" Without" Project cost " With" Project Invest Cost " With" Project Operating Base Incrementa Gross value of Incrementa Net
Years
costs l Project Production l Benefit Incrementa

Other Prod Total Study Supervisio Constructio Total Productio Oper., Total costs "without "with" l Benefit
Inv & costs Cost & n n Inv. n costs Repair Operatin " Project Projec
Overhea s Desig Costs &Maint g costs t
d cost n .
cost
1 1115 1194
6 194 200 450 973 9,732 5 1018 438 1456 7 11883 263 2459 2381 -9566
2 6 194 200 1637 756 2393 2393 2329 276 4408 4326 1934
3 6 194 200 1681 789 2470 2470 2406 290 5141 5055 2585
4 6 194 200 1746 850 2597 2597 2533 304 5374 5284 2687
5 6 194 200 1658 774 2432 2432 2368 320 4608 4513 2082
6 6 194 200 1658 774 2432 2432 2368 336 4608 4508 2077
7 6 194 200 1658 774 2432 2432 2368 352 4608 4504 2072
8 6 194 200 1658 774 2432 2432 2368 370 4608 4498 2067
9 6 194 200 1658 774 2432 2432 2368 389 4608 4493 2061
10 6 194 200 1658 2347 4005 4005 3941 408 4608 4487 482
11 6 194 200 1658 774 2432 2432 2368 428 4608 4481 2049
12 6 194 200 1658 774 2432 2432 2368 450 4608 4475 2043
13 6 194 200 1658 774 2432 2432 2368 472 4608 4468 2036
14 6 194 200 1658 774 2432 2432 2368 496 4608 4461 2029
15 6 194 200 1658 774 2432 2432 2368 521 4608 4454 2022
16 6 194 200 1658 774 2432 2432 2368 547 4608 4446 2014
17 6 194 200 1658 774 2432 2432 2368 574 4608 4438 2006
18 6 194 200 1658 774 2432 2432 2368 603 4608 4429 1998
19 6 194 200 1658 774 2432 2432 2368 633 4608 4420 1989
20 6 194 200 1658 774 2432 2432 2368 665 4608 4411 1979
Financial analysis results
 Financial NPV @ 11% 6,023
 Financial IRR @ 11% 22%
 Financial B-C Ratio 1.23
74
Table 27 Financial sensitivity analysis for 10% decline in yield
" Without" Project cost " With" Project Invest Cost " With" Project Operating Base Incrementa Gross value of Incre. Net
Years
costs l Project Production Benefit Increm.

Other Inv Prod Total Study supervisio construction Total Production Oper., Total costs "without" "with" Benefit
& costs Costs & n Inv.Costs costs Repair Operating Project Project
Overhead Design &Maint. costs
cost cost
1 6 194 200 450 973 9732 11155 1018 438 1456 11947 11883 263 2213 2135 -9812
2 6 194 200 1637 756 2393 2393 2329 276 3967 3885 1493
3 6 194 200 1681 789 2470 2470 2406 290 4627 4541 2071
4 6 194 200 1746 850 2597 2597 2533 304 4837 4746 2150
5 6 194 200 1658 774 2432 2432 2368 320 4147 4052 1621
6 6 194 200 1658 774 2432 2432 2368 336 4147 4048 1616
7 6 194 200 1658 774 2432 2432 2368 352 4147 4043 1611
8 6 194 200 1658 774 2432 2432 2368 370 4147 4037 1606
9 6 194 200 1658 774 2432 2432 2368 389 4147 4032 1600
10 6 194 200 1658 2347 4005 4005 3941 408 4147 4026 21
11 6 194 200 1658 774 2432 2432 2368 428 4147 4020 1588
12 6 194 200 1658 774 2432 2432 2368 450 4147 4014 1582
13 6 194 200 1658 774 2432 2432 2368 472 4147 4007 1575
14 6 194 200 1658 774 2432 2432 2368 496 4147 4000 1568
15 6 194 200 1658 774 2432 2432 2368 521 4147 3993 1561
16 6 194 200 1658 774 2432 2432 2368 547 4147 3985 1553
17 6 194 200 1658 774 2432 2432 2368 574 4147 3977 1545
18 6 194 200 1658 774 2432 2432 2368 603 4147 3968 1537
19 6 194 200 1658 774 2432 2432 2368 633 4147 3960 1528
20 6 194 200 1658 774 2432 2432 2368 665 4147 3950 1518
Financial sensitivity analysis results-10% yield decline
 Financial IRR @ 11 16%
75
Table 28 Financial sensitivity analysis for cost overrun by 10%
" Without" Project cost " With" Project Invest Cost " With" Project Operating Base Incremental Gross value of Incremental Net
Years
costs Project Production Benefit Incremental

Other Inv Prod Total Study supervision construction Total Prod Oper., Total costs "without" "with" Benefit
& costs Costs & Inv. costs Repair Operating Project Project
Overhead Design Costs & costs
cost cost Maint
1 1299
6 194 200 450 973 9732 12271 1018 438 1456 6 12932 263 2459 2381 -10615
2 6 194 200 1637 756 2393 2393 2329 276 4408 4326 1934
3 6 194 200 1681 789 2470 2470 2406 290 5141 5055 2585
4 6 194 200 1746 850 2597 2597 2533 304 5374 5284 2687
5 6 194 200 1658 774 2432 2432 2368 320 4608 4513 2082
6 6 194 200 1658 774 2432 2432 2368 336 4608 4508 2077
7 6 194 200 1658 774 2432 2432 2368 352 4608 4504 2072
8 6 194 200 1658 774 2432 2432 2368 370 4608 4498 2067
9 6 194 200 1658 774 2432 2432 2368 389 4608 4493 2061
10 6 194 200 1658 2505 4163 4163 4099 408 4608 4487 324
11 6 194 200 1658 774 2432 2432 2368 428 4608 4481 2049
12 6 194 200 1658 774 2432 2432 2368 450 4608 4475 2043
13 6 194 200 1658 774 2432 2432 2368 472 4608 4468 2036
14 6 194 200 1658 774 2432 2432 2368 496 4608 4461 2029
15 6 194 200 1658 774 2432 2432 2368 521 4608 4454 2022
16 6 194 200 1658 774 2432 2432 2368 547 4608 4446 2014
17 6 194 200 1658 774 2432 2432 2368 574 4608 4438 2006
18 6 194 200 1658 774 2432 2432 2368 603 4608 4429 1998
19 6 194 200 1658 774 2432 2432 2368 633 4608 4420 1989
20 6 194 200 1658 774 2432 2432 2368 665 4608 4411 1979
Financial sensitivity analysis results for cost overrun by 10%
 Financial NPV @11% 5,022
76
Table 29 Financial Sensitivity Analysis for one year delay in construction
Years

Other Inv Prod Total Study supervision construction Total Prod Oper., Total costs "without" "with" Benefit
& cost & Inv. cost Repair Operating Project Project
Overhead Design Costs &Main costs
cost
1 6 194 200 450 973 9732.0 11155 1018 438 1456 11947 11883 263 -263 -12025
2 6 194 200 1637 756 2393 2393 2329 276 2459 2378 -15
3 6 194 200 1681 789 2470 2470 2406 290 4408 4322 1852
4 6 194 200 1746 850 2597 2597 2533 304 5141 5050 2454
5 6 194 200 1658 774 2432 2432 2368 320 5374 5279 2848
6 6 194 200 1658 774 2432 2432 2368 336 4608 4508 2077
7 6 194 200 1658 774 2432 2432 2368 352 4608 4504 2072
8 6 194 200 1658 774 2432 2432 2368 370 4608 4498 2067
9 6 194 200 1658 774 2432 2432 2368 389 4608 4493 2061
10 6 194 200 1658 2347 4005 4005 3941 408 4608 4487 482
11 6 194 200 1658 774 2432 2432 2368 428 4608 4481 2049
12 6 194 200 1658 774 2432 2432 2368 450 4608 4475 2043
13 6 194 200 1658 774 2432 2432 2368 472 4608 4468 2036
14 6 194 200 1658 774 2432 2432 2368 496 4608 4461 2029
15 6 194 200 1658 774 2432 2432 2368 521 4608 4454 2022
16 6 194 200 1658 774 2432 2432 2368 547 4608 4446 2014
17 6 194 200 1658 774 2432 2432 2368 574 4608 4438 2006
18 6 194 200 1658 774 2432 2432 2368 603 4608 4429 1998
19 6 194 200 1658 774 2432 2432 2368 633 4608 4420 1989
20 6 194 200 1658 774 2432 2432 2368 665 4608 4411 1979
Financial sensitivity analysis results for 1 year delay
77
Table 30 CROP BUDGET (ECONOMIC)

S/N Description Y1 Y2 Y3 Y4 Y5
1 Maize
1.1. Area (ha) 45.5 31.5 70.0 70.0 70.0
1.2. Seed Rate (kg/ha) 0.3 0.3 0.3 0.3 0.3
Total Seed (Qt) 12.5 8.7 19.3 19.3 19.3
Unit cost(Birr) 1720.0 1720.0 1720.0 1720.0 1720.0
Total seed cost 21521.5 14899.5 33110.0 33110.0 33110.0
1.3. Labour(md/ha) 106.4 106.4 106.4 106.4 106.4
Total Md 4841.2 3351.6 7448.0 7448.0 7448.0
unit cost(Birr) 36.2 36.2 36.2 36.2 36.2
Total labor cost 175009.4 121160.3 269245.2 269245.2 269245.2
1.4. Oxen day/ha 44.1 44.1 44.1 44.1 44.1
Total oxen days 2006.6 1389.2 3087.0 3087.0 3087.0
Oxen Unit cost(Birr) 55.0 55.0 55.0 55.0 55.0
Total oxen power cost 110360.3 76403.3 169785.0 169785.0 169785.0
1.5. Fertilizer
Rate of DAP/ha(Quintal) 1.5 1.5 1.5 1.5 1.5
Total DAP 68.3 47.3 105.0 105.0 105.0
Unit cost(Birr) 1938.2 1938.2 1938.2 1938.2 1938.2
Total cost of DAP 132278.7 91577.6 203505.8 203505.8 203505.8
UREA/ha(Quintals) 1.3 1.3 1.3 1.3 1.3
Total UREA 56.9 39.4 87.5 87.5 87.5
Unit cost(Birr) 1806.8 1806.8 1806.8 1806.8 1806.8
Total cost of UREA 102758.9 71140.8 158090.6 158090.6 158090.6
Total Fertilizer cost 235037.6 162718.4 361596.4 361596.4 361596.4
1.6. Chemicals
Sivene (carbaril), kg/ha 1.5 1.5 1.5 1.5 1.5
Quantitiy (kg) 68.3 47.3 105.0 105.0 105.0
Unit cost (br/lt) 105.6 105.6 105.6 105.6 105.6
s/total cost 7207.2 4989.6 11088.0 11088.0 11088.0
0 1.5 1.5 1.5 1.5 1.5
Quantitiy (kg) 68.3 47.3 105.0 105.0 105.0
Unit cost (br/lt) 96.8 96.8 96.8 96.8 96.8
s/total cost 6606.6 4573.8 10164.0 10164.0 10164.0
0 3.0 3.0 3.0 3.0 3.0
Quantitiy (kg) 136.5 94.5 210.0 210.0 210.0
Unit cost (br/lt) 79.2 79.2 79.2 79.2 79.2
s/total cost 10810.8 7484.4 16632.0 16632.0 16632.0
Total chemical 24624.6 17047.8 37884.0 37884.0 37884.0
1.7. Farm tools (cost/ha) 258.0 258.0 258.0 258.0 258.0
Total farm tools cost 11739.0 8127.0 18060.0 18060.0 18060.0
78
1.8. Packing materials (Pcs) 716.6 1323.0 4042.5 4042.5 4042.5

Unit cost (Br/PcsNo.) 10.0 10.0 10.0 10.0 10.0
Total cost of packing mat. 7166.3 13230.0 40425.0 40425.0 40425.0
1.9. Grand Total cost 585458.6 405717.3 912303.6 912303.6 912303.6
Cost of production per ha 12867.2 12879.9 13032.9 13032.9 13032.9
1.10
. Yield/ha 15.0 40.0 55.0 55.0 55.0
Total production 682.5 1260.0 3850.0 3850.0 3850.0
Unit price 566.4 566.4 566.4 566.4 566.4
Value of by products (5%) 18392.1 47672.3 55617.7 63563.1 71508.5
1112354. 1271262. 1430170.
Total Value of production 367842.1 953446.7 5 3 1
Production Value per ha 18392.1 22070.5 25748.9 29427.4 33105.8
1.11
. Net benefit before Tax 135632.6 460493.8 617133.6 773773.4 930413.2
Net benefit per ha before Tax 6781.6 10659.6 14285.5 17911.4 21537.3
2 H.bean
2.1. Area (ha) 26.0 18.0 40.0 40.0 40.0
2.2. Seed Rate (kg/ha) 26.5 26.5 26.5 26.5 26.5
Total Seed (Qt) 689.0 477.0 1060.0 1060.0 1060.0
Unit cost(Birr) 2150.0 2150.0 2150.0 2150.0 2150.0
1481350. 1025550. 2279000. 2279000. 2279000.
Total seed cost 0 0 0 0 0
2.3. Labour(md/ha) 49.0 49.0 49.0 49.0 49.0
Total Md 1274.0 882.0 1960.0 1960.0 1960.0
unit cost(Birr) 36.2 36.2 36.2 36.2 36.2
Total labor cost 46055.1 31884.3 70854.0 70854.0 70854.0
2.4. Oxen day/ha 7.0 7.0 7.0 7.0 7.0
Total oxen days 182.0 126.0 280.0 280.0 280.0
2.5. Fertilizer
DAP (qt)/ha 1.0 1.0 1.0 1.0 1.0
Total DAP 26.0 18.0 40.0 40.0 40.0
Unit cost(Birr) 1938.2 1938.2 1938.2 1938.2 1938.2
Total cost of DAP 50391.9 34886.7 77526.0 77526.0 77526.0
UREA/ha(Quintals) 1.0 1.0 1.0 1.0 1.0
Total UREA 26.0 18.0 40.0 40.0 40.0
Unit cost(Birr) 1806.8 1806.8 1806.8 1806.8 1806.8
2.6. Chemicals
Endosalfan 35%, L/ha 2.0 2.0 2.0 2.0 2.0
79
Quantitiy (lt) 52.0 36.0 80.0 80.0 80.0

Unit cost 96.8 96.8 96.8 96.8 96.8
S/total cost 5033.6 3484.8 7744.0 7744.0 7744.0
0 0.0 0.0 0.0 0.0 0.0
Quantity 0 0 0 0 0
Unit cost (br/gm) 0 0 0 0 0
S/total cost 0 0 0 0 0

Total Chemical cost 5033.6 3484.8 7744.0 7744.0 7744.0
Production cost per ha 63492.9 63514.9 63536.9 63547.9 63569.9
1650814. 1143267. 2541474. 2541914. 2542794.
2.9. Grand Total cost 1 3 0 0 0
2.10
. Yield/ha 15.0 17.0 19.0 20.0 22.0
Unit price 1850.0 1850.0 1850.0 1850.0 1850.0
Total Value of production 332546.8 520037.1 650046.3 780055.6 910064.8
2.11
. Net benefits before Tax 56078.5 132873.6 230094.0 327314.5 424535.0
Net benefits per ha before Tax 2875.8 5126.3 8877.1 12627.9 16378.7
3 Pepper
3.1. Area (ha) 13.0 9.0 20.0 20.0 20.0
3.2. Seed Rate (kg/ha) 0.3 0.3 0.3 0.3 0.3
Total Seed (Qt) 3.6 2.5 5.5 5.5 5.5
Unit cost(Birr) 6510.0 6510.0 6510.0 6510.0 6510.0
Total seed cost 23273.3 16112.3 35805.0 35805.0 35805.0
3.3. Labour(md/ha) 91.0 91.0 91.0 91.0 91.0
Total Md 1183.0 819.0 1820.0 1820.0 1820.0
unit cost(Birr) 36.2 36.2 36.2 36.2 36.2
Total labor cost 42765.5 29606.9 65793.0 65793.0 65793.0
3.4. Oxen day/ha 8.0 8.0 8.0 8.0 8.0
Total oxen days 104.0 72.0 160.0 160.0 160.0
3.5. Fertilizer
80
DAP (qt)/ha 2.0 2.0 2.0 2.0 2.0

Total DAP 26.0 18.0 40.0 40.0 40.0
Unit cost(Birr) 1938.2 1938.2 1938.2 1938.2 1938.2
Total cost of DAP 50391.9 34886.7 77526.0 77526.0 77526.0
UREA/ha(Quintals) 1.0 1.0 1.0 1.0 1.0
Total UREA 13.0 9.0 20.0 20.0 20.0
Unit cost(Birr) 1806.8 1806.8 1806.8 1806.8 1806.8
3.6. Chemicals
Endosalfan 35%, L/ha 2.0 2.0 2.0 2.0 2.0
Quantity 26.0 18.0 40.0 40.0 40.0
unit cost (Br/lt) 79.2 79.2 79.2 79.2 79.2
S/total 2059.2 1425.6 3168.0 3168.0 3168.0
Total chemical cost 2059.2 1425.6 3168.0 3168.0 3168.0
3.9. Grand Total cost 152910.6 105960.2 235687.0 235907.0 236127.0
3.10
. Yield/ha 13.0 14.0 15.0 16.0 17.0
Unit price 6627.5 6627.5 6627.5 6627.5 6627.5
1551789. 1758694. 1862147. 2069052.
Total Value of production 889473.7 5 7 4 6
3.11 1395937. 1599515. 1701305. 1904884.
. Net benefits before Tax 788596.7 0 9 3 2
4 Onion
4.1 Area (ha) 19.5 13.5 30.0 30.0 30.0
4.2 Seed Rate (kg/ha) 3.5 3.5 3.5 3.5 3.5
Total Seed (Qt) 68.3 47.3 105.0 105.0 105.0
Unit cost(Birr) 700.0 700.0 700.0 700.0 700.0
Total seed cost 47775.0 33075.0 73500.0 73500.0 73500.0
4.3 Labour(md/ha) 92.0 92.0 92.0 92.0 92.0
Total Md 1794.0 1242.0 2760.0 2760.0 2760.0
unit cost(Birr) 36.2 36.2 36.2 36.2 36.2
Total labor cost 64853.1 44898.3 99774.0 99774.0 99774.0
81
4.4 Oxen day/ha 13.0 13.0 13.0 13.0 13.0

Total oxen days 253.5 175.5 390.0 390.0 390.0
4.5 Fertilizer
DAP (qt)/ha 1.0 1.0 1.0 1.0 1.0
Total DAP 19.5 13.5 30.0 30.0 30.0
Unit cost(Birr) 1938.2 1938.2 1938.2 1938.2 1938.2
Total cost of DAP 37793.9 26165.0 58144.5 58144.5 58144.5
UREA/ha(Quintals) 1.0 1.0 1.0 1.0 1.0
Total UREA 19.5 13.5 30.0 30.0 30.0
Unit cost(Birr) 1806.8 1806.8 1806.8 1806.8 1806.8
4.6 Chemicals
Mancozeb or Zeneb and
Ridomil, kg/ha 3.0 3.0 3.0 3.0 3.0
Quantity 58.5 40.5 90.0 90.0 90.0
unit cost (Br/lt) 79.2 79.2 79.2 79.2 79.2
sub total 4633.2 3207.6 7128.0 7128.0 7128.0
Total chemical cost 4633.2 3207.6 7128.0 7128.0 7128.0
4.7 Farm tools (cost/ha) 258.0 258.0 258.0 258.0 258.0
4.8 Packing materials (Pcs) 2681.3 2227.5 6600.0 7425.0 8250.0
Grand Total cost 236072.9 167147.6 387939.0 396189.0 404439.0
4.9 Yield/ha 125.0 150.0 200.0 225.0 250.0
Unit price 630.0 630.0 630.0 630.0 630.0
1281221. 1281221. 1281221.
Total Value of production 932105.3 1 1 1 178256.8
1136362. 1136362. 1136362.
Net benefits before Tax 826718.7 4 4 4 49863.9
11 Other Overhead Costs
11.1
. Start-up training & extension 289380 289380 289380 289380 289380
11.2
. Water charge 77760.0 133440.0 133440.0 133440.0 133440.0
11.3 Costs of water pumping 0.0 258033.5 258033.5 258033.5 258033.5
82
.
Environmental cost 58176.4
11.3 Transportation, loading and
. unloading costs 23270.6 37993.5 38776.8 39526.2 39973.5
Total overhead cost 448587 718847 719630 720380 720827
12 Total operating cost 1163528 1899674 1938841 1976310 1998675
13 Total Value of production 2521968 4306494 4802317 5194686 4587544
14 Net benefits before the project 1358439 2406820 2863476 3218376 2588869
83
Table 31 Economic analysis

Years

Other Inv Prod Total Study supervision constructio Total Prod Oper., Total costs "without "with" l Benefit
& costs & n Inv. Repair Operatin " Project Project
Overhead Design Costs costs &Maint. g costs
cost cost
1 6 215 222 378 817 8175 9748 1164 449 1612 10803 10749 317 2522 2444 -8359
2 6 215 222 1900 719 2619 2619 2565 320 4306 4228 1609
3 6 215 222 1939 720 2658 2658 2605 323 4802 4723 2064
4 6 215 222 1976 720 2697 2697 2643 326 1976 1896 -801
5 6 215 222 1999 721 2720 2720 2666 330 4588 4506 1787
6 6 215 222 1999 721 2720 2720 2666 333 4588 4506 1786
7 6 215 222 1999 721 2720 2720 2666 336 4588 4505 1785
8 6 215 222 1999 721 2720 2720 2666 340 4588 4504 1784
9 6 215 222 1999 2099 4098 4098 4044 343 4588 4503 405
10 6 215 222 1999 721 2720 2720 2666 346 4588 4502 1783
11 6 215 222 1999 721 2720 2720 2666 350 4588 4501 1782
12 6 215 222 1999 721 2720 2720 2666 353 4588 4501 1781
13 6 215 222 1999 721 2720 2720 2666 357 4588 4500 1780
14 6 215 222 1999 721 2720 2720 2666 361 4588 4499 1779
15 6 215 222 1999 721 2720 2720 2666 364 4588 4498 1778
16 6 215 222 1999 721 2720 2720 2666 368 4588 4497 1778
17 6 215 222 1999 721 2720 2720 2666 371 4588 4496 1777
18 6 215 222 1999 721 2720 2720 2666 375 4588 4495 1776
19 6 215 222 1999 721 2720 2720 2666 379 4588 4494 1775
20 6 215 222 1999 721 2720 2720 2666 383 4588 4493 1774
Economic analysis results
 Economic NPV @ 10% 3,674
 Economic IRR @ 10% 16.2%
 Economic B-C Ratio 1.2
84
Table 32 Economic sensitivity analysis for 10% yield decline

" Without" Project cost " With" Project Invest Cost " With" Project Operating Base Incremental Gross value of Incrementa Net
Years
costs Project Production l Benefit Incremental

Other Inv Prod Total Study supervision constructio Total Prod Oper., Total costs "without "with" Benefit
& costs & n Inv. costs Repair Operating " Project Project
Overhead Design Costs &Maint. costs
cost cost
1 6 215 222 378 817 8175 9748 1164 449 1612 10803 10749 317 2270 2192 -8611
2 6 215 222 1900 719 2619 2619 2565 320 3876 3797 1179
3 6 215 222 1939 720 2658 2658 2605 323 4322 4243 1584
4 6 215 222 1976 720 2697 2697 2643 326 1779 1698 -998
5 6 215 222 1999 721 2720 2720 2666 330 4129 4048 1328
6 6 215 222 1999 721 2720 2720 2666 333 4129 4047 1327
7 6 215 222 1999 721 2720 2720 2666 336 4129 4046 1327
8 6 215 222 1999 721 2720 2720 2666 340 4129 4045 1326
9 6 215 222 1999 1640 3639 3639 3585 343 4129 4044 406
10 6 215 222 1999 721 2720 2720 2666 346 4129 4044 1324
11 6 215 222 1999 721 2720 2720 2666 350 4129 4043 1323
12 6 215 222 1999 721 2720 2720 2666 353 4129 4042 1322
13 6 215 222 1999 721 2720 2720 2666 357 4129 4041 1321
14 6 215 222 1999 721 2720 2720 2666 361 4129 4040 1321
15 6 215 222 1999 721 2720 2720 2666 364 4129 4039 1320
16 6 215 222 1999 721 2720 2720 2666 368 4129 4038 1319
17 6 215 222 1999 721 2720 2720 2666 371 4129 4037 1318
18 6 215 222 1999 721 2720 2720 2666 375 4129 4036 1317
19 6 215 222 1999 721 2720 2720 2666 379 4129 4036 1316
20 6 215 222 1999 721 2720 2720 2666 383 4129 4035 1315
Economic sensitivity analysis results for 10% yield decline
 Economic NPV @ 10% 337
85
Table 33 Economic sensitivity analysis for cost overrun by 10%
Years

Other Productio Total Study supervisio Constru Total Productio Oper., Total costs "without" "with" l Benefit
Inv & n costs Cost & n Inv. n costs Repair Operatin Project Projec
Overhea s Design Costs &Maint g costs t
d cost cost .
1 1021 1182
6 215 222 378 817 8175 2 1164 449 1612 4 11770 317 2522 2444 -9380
2 6 215 222 1900 719 2619 2619 2565 320 4306 4228 1609
3 6 215 222 1939 720 2658 2658 2605 323 4802 4723 2064
4 6 215 222 1976 720 2697 2697 2643 326 5195 5114 2418
5 6 215 222 1999 721 2720 2720 2666 330 4588 4506 1787
6 6 215 222 1999 721 2720 2720 2666 333 4588 4506 1786
7 6 215 222 1999 721 2720 2720 2666 336 4588 4505 1785
8 6 215 222 1999 721 2720 2720 2666 340 4588 4504 1784
9 6 215 222 1999 1742 3741 3741 3687 343 4588 4503 762
10 6 215 222 1999 721 2720 2720 2666 346 4588 4502 1783
11 6 215 222 1999 721 2720 2720 2666 350 4588 4501 1782
12 6 215 222 1999 721 2720 2720 2666 353 4588 4501 1781
13 6 215 222 1999 721 2720 2720 2666 357 4588 4500 1780
14 6 215 222 1999 721 2720 2720 2666 361 4588 4499 1779
15 6 215 222 1999 721 2720 2720 2666 364 4588 4498 1778
16 6 215 222 1999 721 2720 2720 2666 368 4588 4497 1778
17 6 215 222 1999 721 2720 2720 2666 371 4588 4496 1777
18 6 215 222 1999 721 2720 2720 2666 375 4588 4495 1776
19 6 215 222 1999 721 2720 2720 2666 379 4588 4494 1775
20 6 215 222 1999 721 2720 2720 2666 383 4588 4493 1774
Economic sensitivity analysis results for 10% cost overrun
 Economic NPV @ 10% 5,096
86
Table 34 Economic sensitivity analysis for 1 year project delay

Years

Other Inv Production Total Study supervision constructio Total Productio Oper., Total costs "without" "with" Benefit
& costs Costs & n Inv.Costs n costs Repair Operating Project Projec
Overhead Desig &Maint. costs t
cost n cost
1 1080
6 215 222 378 817 8175 9748 1164 449 1612 3 10749 317 -317 -10881
2 6 215 222 1900 719 2619 2619 2565 320 2522 2443 -175
3 6 215 222 1939 720 2658 2658 2605 323 4306 4227 1568
4 6 215 222 1976 720 2697 2697 2643 326 4802 4722 2025
5 6 215 222 1999 721 2720 2720 2666 330 1976 1895 -824
6 6 215 222 1999 721 2720 2720 2666 333 4588 4506 1786
7 6 215 222 1999 721 2720 2720 2666 336 4588 4505 1785
8 6 215 222 1999 721 2720 2720 2666 340 4588 4504 1784
9 6 215 222 1999 2099 4098 4098 4044 343 4588 4503 405
10 6 215 222 1999 721 2720 2720 2666 346 4588 4502 1783
11 6 215 222 1999 721 2720 2720 2666 350 4588 4501 1782
12 6 215 222 1999 721 2720 2720 2666 353 4588 4501 1781
13 6 215 222 1999 721 2720 2720 2666 357 4588 4500 1780
14 6 215 222 1999 721 2720 2720 2666 361 4588 4499 1779
15 6 215 222 1999 721 2720 2720 2666 364 4588 4498 1778
16 6 215 222 1999 721 2720 2720 2666 368 4588 4497 1778
17 6 215 222 1999 721 2720 2720 2666 371 4588 4496 1777
18 6 215 222 1999 721 2720 2720 2666 375 4588 4495 1776
19 6 215 222 1999 721 2720 2720 2666 379 4588 4494 1775
20 6 215 222 1999 721 2720 2720 2666 383 4588 4493 1774
Economic sensitivity analysis results for 1 year delay in construction
 Economic NPV @ 10% 157
87
Table 35 Prices of Crop Produces and Inputs

S/N Items Unit Unit price (Br)
Financial Economic Conversion factor
1 Produces
Maize Qt 470 566.35 1.205
Haricot B Qt 1850 2229.25 1.205
Pepper Qt 5500 6627.5 1.205
Onion 630 630 1
2 Seed 0
Maize Qt 1720 1720 1
Haricot B Qt 2150 2150 1
Pepper Qt 6510 6510 1
Onion kg 700 700 1
3 Fertilizer 0
DAP Qt 1770 1938.15 1.095
UREA Qt 1650 1806.75 1.095
4 Chemical 0
Sivene
(carbaril), kg/ha lt 120 105.6 0.88
Endosalfan 35%,
L/ha kg 110 96.8 0.88
Mancozeb or
Zeneb and
Ridomil, kg/ha lt 90 79.2 0.88
5 Labor MD 30 36.15 1.205
6 Oxen OD 55 55 1
7 Environmental
costs 50877.65 52353.1 1.03
Source: wereda marketing process, MEDAC
88
6.3. Questionnaires
AGRICULTURE SECTOR
1. Physical Features of the Wereda
1.1. Location
 Average distance of the wereda town from the zonal capital in km_____________________
 Average distance of the wereda town from the regional capital (Hawassa) in
km___________
 Neighboring boundaries of the wereda:
___________________________________________________________________________
1.2. Number of rural administrative kebeles comprised in the wereda _________________
1.3. Number of towns in the wereda with total population above 1000 dwellers _____________
1.4 Land Use Pattern of the Wereda
S/No Land Use Unit Area
1 Cultivable
2 Cultivated land
 Annual crops
 Perennial crops
3 Grazing
 Communal
 Private
4 Forest
5 Wood land (Shrub and Bush land)
6 Water Body
7 Infrastructure and Settlement
8 Bare land
Total
1.5. Wereda agriculture land holding size per household in hactare:
Land use type Min. Mid. Max. Average
Crop cultivation land
Private grazing land
1.6. Topographic feature of the wereda in %
Land Features % from the total area coverage Remark
1. Plain
2. Hilly land
3. Rugged
3. Mountainous
1.7. Agro climatic zonal distribution of the wereda in %
Agro climatic zone % from the total area coverage Remark
89
1. High land
2. Mid high land
3. Low land
4. Desert
1.7. Wereda elevation in meter above sea level:
Max __________________ Medium ___________________ Minimum _____________
1.8. Annual rainfall distribution of the wereda:
Max ________________Meduim ____________________ Minimum _______________
1.9. Day temperature records of the wereda in a typical year:
Maximum _____________Meduim ________________ Minimum _________________
2. Demographic features of the wereda
2.1. Total population
Age group Population Urban Total
in years
Male Female Total Male Female Total Male Female Total
<15
>15 to 55
>55
Total
2.2. Total household number

Residential area Male Female Total
Rural
Urban
2.3. Ethnic composition of the wereda

Name of the ethnic group Proportion from the total population in %
3. Economic bases of the wereda

3.1. Agriculture production
3.1.1. Crop production
A. Major crops currently grown in the wereda
S/No Crop Type Area in ha Yield in Qt Price per
Quintal
1
90
2
3
B. The top-ten crop grower kebeles of the wereda
Kebeles Major crops grown
C. Percentage of the traditional agricultural production system of the wereda rural population
Livelihood system In %
1. Sedentary crop producers
2. Agro pastoralism
3. Pastoralism
D. Input distribution and/or utilization records of the wereda for the recent crop year
Inputs Unit Quantity Remark
1. Seed by crop and variety
2. Fertilizer
 DAP
UREA
3. Chemicals
4. List others, if any
E. Average number of total plough oxen in the wereda, if any ______________

F. Smallholders irrigation schemes’ data in the wereda, if any
Name of irrigation schemes Irrigated Number Status
Traditional Modern area beneficiaries Functional Non Functional
G. Proportion of the wereda crop production activity by moisture sources

Sources Proportion in %
1. Rainfall
2. River flood retreat
3. River diversion
 traditional
Modern
4. List others, if any
91
H. What are the major crop production problems in the wereda?

______________________________________________________________________________
______________________________________________________________________________
I. Major off farm income activities and its contribution to annual hh income, if any
Proportion in
Off farm activities % Remark
1. petty trade
2. black smith
3. pottery
4. crop produces assembling trade
5. livestock and its products assembling trade
6. fishery
7. apiculture
3.1.2. Animal husbandry
A. Animal population of the wereda
Types Ox Cow Heif Bull Calf She Goat Donke Horse Mule Chicken Beehives
er ep y Modern Tradi
Number
B. Animal health facilities in the wereda

Type of a/health Kebeles served Veterinary staffs
institute under
Technician Nurses Doctor Other, if any
C. List of Top-Prevalent animal diseases in the Wereda

Diseases Types of animals in victim Rank
D. Animal vaccination service records of the wereda for the recent year
Vaccinations type Animal types Number of vaccinated animals Remark
E. Illegal livestock and other commodities border trade to abroad from the wereda, if any
Destination country of the trade Type of livestock/ Average number of animals traded Remark
goods traded annually
92
G. what are the major problems of animal husbandry in the wereda?

______________________________________________________________________________
2. Agricultural Extension
2.1. Agricultural extension service delivery in the wereda for the recent year
Type of extension services Number of beneficiaries
2.2. Agriculture experts working in the wereda office

Field of Expertise Number of experts by educational level
High school Trained in College Degree VDM Others

complete certificate diploma
2.3. Kebele extension agents (D.A.) in the wereda by education, recently

Field of extension Personnel Number by training/qualification
TVET College Diploma Others
1. animal husbandry
2. animal health
3. crop production
4. natural resource conservation
5. others
3. Agricultural marketing
3.1. Open market places of the wereda with an increasing size of transactions
Market places Marketing days Distance in km from the Types of commodities traded
Primary Secondary wereda main market
3.2. Licensed market middle men traders of agricultural products for the wereda market
Trade commodity Number of traders Type of distribution Wholesalers with Remark
items store by cty. item
Retailers Wholesalers Buying Selling
93
3.3. Agricultural cooperatives in the wereda

Name of the No. of members Capital in birr Types of the running Year of
cooperative business establishment
Operating Fixed asset
3.4. Private and public agricultural input supply organizations for the producers in the wereda
Name of the Types of input in Terms of sale Organization type
organization supply
On cash On credit NGO GO Private
4. Rural finance
4.1. Rural microfinance institutions working in the wereda for the recent year
Name of the Number of Loan given Saving Collateral
institutions beneficiary hhs. needed for loan
Principal Interest Principal Interest
rate rate
4.2. Local usurers in the wereda, if any

 Type of loan __________________ (in kind /crop, livestock etc./, in cash, others)
S/No List of NGO Year of Commencement Number of kebeles served Focus of Intervention area
 Annual Interest rates in birr ____________________________
6. Infrastructural Development
6.1. Total road length of the wereda
Grade of the road Length Condition in %
94
in km Good Partially good Bad Inaccessible
1. Asphalted (high way)
2. Gravel RR-100
3. Gravel RR-50
4. Dry weather community road
6.2. Tele communication facilities
Type of telephone Estimated coverage in % from Remark
the total population
1. Mobile phone
2. Cable fixed phone
3. Wireless phone
6.3. Electricity
List of electrified areas Estimated wereda population served Diesel generator
From the national grid From locally generated Private Public

hydro electric power
EDUCATION SECTOR
1. Number of education institutions found in the Woreda:
School Type Urban Rural Total
Kindergarten
Primary/1-4
Primary/5-8
Primary/1-8
Secondary/9-10
Preparatory/11-12
Technical
Colleges
University
Other Institutions
2. Gross Enrollment Ratio (GER) of Students in Primary School Level of the Woreda:
95
Urban + Rural
Period Male Female Total
3. Net Enrollment Ratio (NER) of students in the first and second cycles of Primary School
Level
Urban + Rural
4. Gross and Net Enrollment Ratio of Students in Secondary (9-10) School Level of the Woreda
Gross Enrollment Ratio Net Enrollment Ratio
Period Male Female Total Male Female Total
5. Students drop out rate in the first and second cycles of Primary Schools of the Woreda
Urban + Rural
6. Pupil per class ratio in primary and secondary schools

School Level Pupil Per Class Ratio Remark
Primary (1-4)
Primary (5-8)
Primary (1-8)
Secondary (9-10)
Preparatory (11-12)
7. Other education quality development indicators in the Woreda

Education Devt. School Levels
96
Indicators in the Woreda 1-4 5-8 1-8 econdary 9-10 &11-12

Teacher pupil ratio
Book pupil ratio
97
HEALTH SECTOR
1. Number of health institutes in the Woreda
Type of health Urban Rural Total
organizations Private Govt. NGO Public Total Private Govt. NGO Public Total Private Govt. NGO Public Total
Health Post

Clinic
Health Center

Hospital
R. Drug Shop
Laboratory
Other
98
2. Number of health professionals in the Woreda

Health Professional Urban Rural Total
Male Female Total Male Female Total Male Female Total
M/Doctor (all type)
Nurse (All type)
Health Officer
Sanitarian
Pharmacist
Health assistant
Health Extension
Worker
Lab technician
3. Average distance in km from the wereda to get the next best health service facility
Type of institute Average distance in km
Health Post
Clinic
Health Center
Hospital
R. Drug Shop
Laboratory
Other
4. Recent health service coverage (%) of the wereda population __________________________

5. Recent family planning service coverage (%) of the wereda population __________________
6. Ten top diseases prevalence of the Woreda of the recent year
99
S/No Types of Diseases Number of victims

1
2
3
4
5
6
7
8
9
10
100

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SOCIOECONOMIC FEASIBLITY STUDY

REPORT OF BISARE SMALL-SCALE

CLEINT: SOUTHERN REGION IRRIGATION DEVELOPMENT AND

1.8.3. Health problem.....................................................................Error! Bookmark not defined.

SOCIOECONOMIC FEASIBILITY STUDY REPORT 2

SOCIOECONOMIC FEASIBILITY STUDY REPORT 3

Table 27 Financial sensitivity analysis for 10% decline in yield..................................................75

SOCIOECONOMIC FEASIBILITY STUDY REPORT 4

SOCIOECONOMIC FEASIBILITY STUDY REPORT 5

PART I SOCIOECONOMIC STUDY

SOCIOECONOMIC FEASIBILITY STUDY REPORT 6

SOCIOECONOMIC FEASIBILITY STUDY REPORT 7

SOCIOECONOMIC FEASIBILITY STUDY REPORT 8

of extension approach is introduced and government investments are emphasizing on

SOCIOECONOMIC FEASIBILITY STUDY REPORT 9

1.2. OBJECTIVES OF THE STUDY

SOCIOECONOMIC FEASIBILITY STUDY REPORT 10

 To assess the financial and economic feasibility of the irrigation project

1.3. APPROACH AND METHODOLOGY OF THE STUDY

1.3.1. Primary and Secondary Data Source

1.3.2. The Sampling Method

SOCIOECONOMIC FEASIBILITY STUDY REPORT 11

1.3.3. Method of Data Analysis

SOCIOECONOMIC FEASIBILITY STUDY REPORT 12

1.4. RATIONALE OF THE PROJECT

SOCIOECONOMIC FEASIBILITY STUDY REPORT 13

1.5. SOCIOECONOMIC SITUATION ANALYSIS OF THE PROJECT

1.5.1. Location of the project area

1.5.2. Climate and Topography

SOCIOECONOMIC FEASIBILITY STUDY REPORT 14

1.5.3. Demographic features

1.5.3.1. Population size and characteristics of the wereda

No. Description Unit Rural %

Table 3 Sample household population by age-sex group

SOCIOECONOMIC FEASIBILITY STUDY REPORT 15

Source: Own survey, March 2016

1.5.3.2. Social and cultural setup

1.5.3.3. Dependency Ratio

1.5.3.4. Crude population density

SOCIOECONOMIC FEASIBILITY STUDY REPORT 16

1.5.3.5. Land Tenure and Use

 Grazing land 4.8 Km2

 Forest 2.1 Km2

SOCIOECONOMIC FEASIBILITY STUDY REPORT 17

 Others 2.9 Km2

1.5.4. Local economic scenario of the project area

Poor- Below 10000

SOCIOECONOMIC FEASIBILITY STUDY REPORT 18

1.5.5.1. Opportunities and constraints of the project

1.5.5.1. Agricultural production

SOCIOECONOMIC FEASIBILITY STUDY REPORT 19

SOCIOECONOMIC FEASIBILITY STUDY REPORT 20

SOCIOECONOMIC FEASIBILITY STUDY REPORT 21

SOCIOECONOMIC FEASIBILITY STUDY REPORT 22

SOCIOECONOMIC FEASIBILITY STUDY REPORT 23

Figure 2 Livestock population of the project area

1.5.5.2. Household economy

SOCIOECONOMIC FEASIBILITY STUDY REPORT 24