Mahaweli Ganga Project which is considered as country’s landmark multi-purpose rural development programme was recently reconfirmed as one of the unsatisfactory projects for both the lender and the borrower in meeting the expected results.

World Bank has revealed this in its report, ‘Project Performance Reassessment Report – Third Mahaweli Ganga Development Project,’ it has been found that reassessing the project previously evaluated by the Operations Evaluation Department (OED) testing the initial findings and ratings remain valid after a significant lapse of time.

According to this, 52 paged report which contains the reassessments based substantially on responses to an OED sponsored survey of 200 households in ‘System C’ (Dehiattakandiya, Giradurukotte, and Mahiyanganaya) carried out in February 2004 outlines three important findings where the water user groups have failed to emerge as financially self-sustaining entities, capable of assuming full responsibility for the operation and maintenance functions that government has assigned to them.

"Rushing technical and economic feasibility studies, or paying insufficient attention to the findings are likely to result in an unsatisfactory project outcome, settlement programmes that do not select candidates with previous farming experience and which do not provide settlers with full title to their land are not likely to prosper, and using repeated interviews with a small number of households, supplemented by interviews with local leaders and community groups are an effective low cost technique for tracking the performance of rural development projects," the report highlights as the three important findings.

The sustainability of the project’s net benefit stream is rated unlikely that given the cutbacks in government spending on operation and maintenance, the failure of water user groups to become financially self-sustaining, the lack of diversification into higher margin crops, land tenure insecurity, and the overall stagnation of incomes.

"The reassessment rates the outcome as highly unsatisfactory, based on the modest relevance of the project’s development objectives, modest progress in achieving those objectives and negligible efficiency. Relevance was limited by the project’s failure to address distortions in the agriculture incentives regime, the lack of consideration given to organizing water users for cost recovery, the failure to provide settlers with secure land rights, and the absence of provisions for sound management of natural resources," the report stated.

The Sri Lanka Third Mahaweli Ganga Development Project based on water resources of Mahaweli and allied six river basins was supported by a credit of US $ 90 million equivalent. The credit was approved in June 1981 and was closed in December 1991, four years later than expected. Between 1970 and 1998 the World Bank has extended six credits to the Mahaweli programme, totaling about US $ 450 million in 2001 dollars. The objective of the project was to improve rural livelihoods through a settlement programme involving irrigated farming and supporting infrastructure, with a view to boosting incomes and boosting rice production to substitute for imports.