THE AGA KHAN RURAL SUPPORT PROGRAMME
PROJECT PROPOSAL
FOR THE MINI HYDEL UNIT SHOGORE
Community physical infrastructure, Section
AKRSP Regional Programme Office, Chitral
NOVEMBER 2010
Table of Contents
CONTENTS Page #
PROJECT SUMMARY……………………………………………………………..... 3
Project Location………………………………………………………….. 3
Project Description………………………………………………………. 3
Description of the Area………………………………………………….. 3
Social Organization……………………………………………………… 3
Total Cost of the Project…………………………………………………. 3
Project Justification……………………………………………………… 4
1. INTRODUCTION……………………………………………………………….. 5
1.1 Project Location and Description………………………………………… 5
1.2 Project Identification……………………………………………………... 5
1.3 Objectives of the Project…………………………………………………. 5
1.4 Social Organization………………………………………………………. 6
1.5 Socio-economic set-up…………………………………………………… 6
2. DESIGN AND COST ESTIMATES……………………………………………….. 6
2.1 Design……………………………………………………………………. 6
2.2 Cost Estimation..……………………………………………………….. 7
2.2.1 Construction Cost and Quantities………………………………………... 7
2.2.2 Maintenance Cost……………………………………………………….. 8
3. ENVIRONMENTAL ASSESSMENT………………………………………............ 8
4. PROJECT IMPLEMENTATION…………………………………………………. 8
4.1 The Role of AKRSP……………………………………………………… 8
4.2 The Role of the Community……………………………………………… 9
4.3 Physical Phasing of the Project Work 9
5. PROJECT MANAGEMENT……………………………………………………... 9
5.1 Project Committee………………………………………………………... 9
5.2 Audit Committee…………………………………………………………. 9
5.3 Maintenance Committee…………………………………………………. 9
6. ECONOMIC ANALYSIS…………………………………………………............ 10
6.1 Qualitative Description of Benefits………………………………………. 10
6.2 Quantitative Assessment of Costs and Benefits………………………….. 10
6.3 Assumptions……………………………………………………………… 11
6.4 Measures of Project Worth………………………………………………. 12
APPENDICES
Annex A: Site Location Map ………………………………………………………
Annex B: Man Days Format…………………………………………………….....
Annex C: Details of Costs. …………………………………………………………
Annex D: Environmental Review Forms…………………………………………..
Annex E: Cost Benefit Analysis Table……………………………………………..
Annex F: Location Map…………………………………………………………….
2
PROJECT SUMMARY
Project Location
Village Shogore
Tehsil Chitral
Area office Chitral
District Chitral
Region Chitral
Distance from Chitral 25 km
Project Description
Project type Mini Hydel Unit
Number of units 2 (250 kW)
Total generation 500 kW
Length of power channel 4,250 ft
Length of penstock pipe 279 ft (85 m)
Total working months required 15
Completion period (months) 18
Description of the Area
Valley Karimabad
Cropping zone Single
Social Altitude (ft) 6,480
GPS Coordinates
Site Latitude Longitude
Weir site 36o-01’-45.4” 71o-46’-17.2”
Powerhouse site 36o-01’-18.4” 71o-45’-53.4”
Major crops Potato,wheat, maize, beans
Major source of income Agriculture,livestock,,and off
farm labour
Organization
Village Organization (VO) 25
VOs membership 922
VOs savings (Rs.) 8,420,416
3
Total Cost of the Project
Description Cost (Rs.)
Total construction cost 66,351,351
PPAF contribution 38,192,117
Other Donors 19,021,741
Community contribution 9,137,493
PPAF contribution per household 37,876
PPAF contribution per person 4,208
Annual operation and maintenance cost 1,944,710
Project Justification
Beneficiaries
Number of villages 22
Number of households 922
Population 8,298
Number of VO (s) 25
Benefits
Cooking, lighting and heating facilities to the local villages
Fuel wood security to the population
The pressure on the forest will decrease hence the environment will improve
Reduction of workload on women with use of electric appliances
Improvement in Education and Health hygiene of the population
Income generating facilities, as a result of small enterprises
Measures of Project Worth
Net Present Value - NPV (Rs.) 142,028,892
Benefit/ Cost Ratio (BCR) 1.57
Internal Rate of Return - IRR (%) 29
4
1. INTRODUCTION
1.1 Project Location and Description
The proposed project is located at the end of village Shogore, Karimabad valley, which is
nearly 25 km away from the Chitral town. The inhabitants in this village speak khowar
language. The project will benefit Karimabad LSO having 922 households with a total
population of 8,298. The altitude at power house is 6,230 ft.
The proposed Mini Hydel Unit will generate about 500 kW and will benefit the nearby villages
of Shogore, Bil Droneel, Galeh, Gree, Lorigram, Madasheel, Pasturagh, Shah,Tashqar, Awi,
Hasanabad, Siwakth, Dondolik, Miralandeh, Ughdeer, Argesh, Taligram, and Parsan fulfilling
basic electricity requirements for the local population in the above mentioned villages.
1.2 Project Identification
The Village Shogore and all other above mentioned villages are located in the Karimabad
valley. Though at present the villagers do have access to the electricity facility, however the
system has completed its designed period and do not produce enough electricity to fulfill, even
the basic lighting requirement. Population has increased manifold over the years and electricity
demand for heating and cooking is on the rise. There are meager chances of having additional
electric facility from government or other agencies for these villages in near future. Currently
the population is using forest wood, kerosene oil and natural gas for lighting, cooking and
heating purposes. Due to severe winters and high demand of wood, the communities have
almost deforested their highland forests.
To solve this problem, a meeting of the LSO members was held in February 2010 and it was
decided in the meeting to take up the issue with AKRSP Chitral for financial and technical
assistance. A resolution was later on passed on to AKRSP for the provision of financial help in
this regard. The ID section has conducted Ist Dialogue with the cluster organization for social
viability of this project. After social feasibility, the engineers of AKRSP have conducted survey
and technical feasibility of this project
Objectives of the Project
To provide lighting, heating and cooking facilities
To decrease the deforestation of trees
To improve the education, health and hygiene
To promote small enterprise and cottage industry
1.3 Social Organization
Shogore Cluster consists of 260 households. The villagers as mobilized by the AKRSP formed
VOs in 1985 to 2009. The objective of VO’s formation was not only to access the AKRSP
packages, but also to organize themselves to have access to the facilities available with other
government and non-governmental organizations. Also to resolve the disputes arise with in and
with surrounding villages. The table 1.1 shows the brief detail of the VO.
5
Name of VO Formation Year House holds Membership Saving
Shogore 1986 59 59 25000
Droneel 1992 22 22 12000
Ajrandeh 1985 36 45 511094
Galeh 1996 22 12 174027
Gree 1984 45 42 1250050
Lori Gram 29 36 250788
Madasheel 1 62 62 575568
Madasheel 2 35 33 312677
Oragh 35 40 670055
Pasturagh 35 22 350000
Shah 50 56 350000
Tashqar 1 48 43 589753
Tashqar 2 38 36 291000
Awi 60 60 250000
Hasanabad 27 24 110270
Siwakth 1 33 55 180000
Siwakth 2 46 48 181000
Dondolik 22 12 133035
Bil Bil Parsan 28 40 118770
Miralandeh 34 34 440067
Lashtdeh 50 50 338026
Ughdeer 18 12 268306
Argesh 22 22 675012
Potiek 35 33 15000
Taligram 31 24 81000
Total 922 922 8152498
1.4 Socio-Economic Setup
The project villages are situated in the union council Karimabad, comprising of 922 households
and a population of 8,298. The social facilities in these villages are almost non-existent. The
electricity is short even to fulfill the basic household requirements. The education facilities are
as follows, three primary and two high school (boys and girls), two primary school and higher
secondary for girls, one private college, BHU hospital, Aga Khan Medical Center, FMFB,
Dispensary, Police Station, and three Hostels are located in these villages. However, drinking
water supply facilities are available in these villages.
Due to severe cold, the villages lie in the single cropping zone. Agriculture is the major source
of household economy; however subsistence farming prevails through out these villages.
Average land holding per household is 3 kanals. Major crop includes wheat with an average
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yields of 100 kg per kanal. Average forest trees per household are 10, which include willow.
Livestock is main part of their household income and average livestock per house hold is 20.
2. DESIGN AND COST ESTIMATES
2.1 Design
Shogore main stream will feed the proposed Mini hydropower project, containing a minimum
discharge of 42.38 cusecs in winters, while in summers maximum discharge remains above 250
cusecs. A 4,250 ft long power channel with a cross section of 4 ft x 3 ft has been designed for
46 cusecs flow.
The available gross head is 170 ft, while diameter of the penstock pipe has been designed as 30
inches in a length of 279 ft (85 m). Two imported (Chinese) Francis Turbine units of 250 kW
each having 85% efficiency, will be installed to generate an overall power capacity of 500 kW.
Detailed specifications are in table 2.1.
Table: 2.1 Design Specifications
Power Channel Designed Discharge (cusecs) 42
Gross head (ft) 170
Length of penstock pipe (ft/m) 279 / 85
Penstock pipe diameter (inches) 30
Thickness of penstock pipe(mm) 6
Horizontal Shaft Francis turbines 2 ( 250 kW each)
Length of power channel (ft) 4,250
Cross section of the power channel (b x d)-(ft) 4x3
Length of Tailrace channel (ft) 100
Length of transmission line (km) 35
Hydrological Survey:
The estimated flows for various flow durations at the weir site are listed as below:
Flow Availability Discharge Flow Availability Discharge
(m³/s) (m³/s)
Q100 (100% of the 1.2 Q40 (40% of the 6.1
year) year)
Q95 (95% of the year) 1.3 Q30 (50% of the 8.0
year)
Q90 (90% of the year) 1.5 Q20 (20% of the 11.6
year)
Q80 (80% of the year) 1.6 Q10 (10% of the 15.4
year)
Q70 (70% of the year) 2.0 Q05 (05% of the 17.5
year)
Q60 (60% of the year) 3.2 Q00 (00% of the 20.2
7
year)
Q50 (50% of the year) 5.4 Qav (Mean Annual) 3.7
As a mini hydel sized scheme has been propose for the local area, a design discharge of 1.23
cumecs (42 cusecs) was selected according to a Plant factor of about 95 %. The flood
discharges at the weir site for return periods 10, 100 & 1000 years were estimated to 75, 93 &
155 m³/s respectively. Detailed investigations on sedimentation have been carried out, as a
heavy sedimentation in Shogore Stream is observed specially in summers.
Engineering Geological Aspects:
Big boulders at the proposed MHP location reveal the intensity steepness of the river bed and
speedy water flow / flood. Strong protection works, in heavy stone masonry or gabions for the
river sides are proposed. The intake canal with bed level almost in level with river bed made in
stone masonry with screen for stopping floating debris and water control gate are to be
provided. The permanent weir will require full diversion of the river flow on the left side in low
flow season and then making of cofferdam type structures upstream & downstream of proposed
weir location for construction purpose. Therefore a temporary stone masonry weir type
structure (dry stone damping) across the river for diverting required amount of water toward
intake canal is proposed keeping in view the cost of project.
Detail Technical Description:
Intake Structure:
The intake canal with bed level almost in level with river bed made in stone masonry with
screen for stopping floating debris and water control gate are to be provided. The temporary
weir will require full diversion of the river flow on the right side in low flow season and then
making of cofferdam type structures upstream & downstream of proposed weir location for
construction purpose. Therefore a temporary stone masonry weir type structure (dry stone
damping) across the river for diverting required amount of water toward intake canal is
proposed keeping in view the cost of project
Sand Trap:
De-silting basin (sand trap) and Gravel spill structure in stone masonry having dimension of 55
x 10 x 7 ft will be constructed for silt trap. A small flushing channel with steep slope will
deposit the silt back to the river through a short flushing pipe.
Power Channel:
A lined power channel of about 4,250 ft in length will be constructed to cater 1.23 cumecs (42
cusecs) of water to the forebay structure.
Head Race Tunnel:
From the Power channel to the forebay structure about 710 Ft long head race tunnel is proposed
crossing the left ridges of Shogore village. The net diameter of the tunnel will be 8ft, for a
design discharge of 1.5m³/s and with X-sectional area of 7.0 m² the flow velocity is 1.80 m/s.
The energy slope is assumed to be 0.001, in the tunnel and the total head losses are calculated
as 0.50 m approx... The 710 ft long tunnel is a low pressure tunnel to be lined with shortcrete &
wherever needed it will be concrete lined as per the geological conditions. The maximum rock
cover over the tunnel is about 80 meter.
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Forebay Tank:
The fore bay is a sort of water tank provided at the penstock head for supplying regular water at
a constant head to the twin turbine units. The surface elevation at forebay tank is 6,400 ft
m.a.s.l. As enough land is available on top of the selected site, forebay structure with a size of
25 x 16 x 16 ft is has been proposed. It will be a completely RCC (1:2:4) concrete structure,
and constructed completely in the ground.
Penstock:
A steel penstock of 30 inches diameter will run in a length of about 279 ft (85 m) coming down
to connect the turbines. As the terrain is generally gravelly compacted, however the penstock
will run through rocky formation. It is therefore proposed to bury the penstocks into the ground
for safety point of view and against frost. At point of change direction anchor blocks have been
provided.
Powerhouse:
Design and structural calculations for turbine, generator unit, high pressure valves, governor,
transformers, electrical equipment, switchyard and cranes has been done while designing the
power house. The powerhouse is proposed near Shoghore village with a surface elevation of
6,230 ft m.a.s.l. The proposed dimensions of 45 x 30 ft for the two horizontal shafts Francis
Turbine units, has been proposed to be installed in the powerhouse. An operators room is also
attached with the power house.
Tailrace Canal:
Design and calculations with a view of security against floods has been done. The length of a
covered tailrace canal is about 100 ft. It will cater the tail water of 1.23m³/s, from powerhouse
back to the Shogore Stream.
Topographic Survey:
Detailed topographic survey of the project area has been done to verify the available head,
location for the weir, headrace tunnel axis and power house location etc.
Transmission Lines:
About 35 km independent transmission and distribution lines will be required to transmit 500
kW of electricity to local villages of Karimabad valley fulfilling the basic energy requirements.
Twelve (12) steps down transformers will be installed for supplying electricity to these villages.
Habitation:
There are no houses in alignment of power channel and other project structures, therefore no
environmental damage will occur, including no migration. Similarly there will be no damage
to other nearby residential areas. The inhabitants of the nearby area will get jobs during
construction phase and will use power for lighting heating and cooking purpose. Some 99
households, 2 hospitals, commercial banks, slate and marble cutting plants, School and
colleges, NGO offices, government offices and 100 shops with other business activities will
benefit from the hydel project.
Risk and Pollution:
9
Some noise and air pollution is expected only during the construction activity period due to i,e.
transportation, loading and unloading of materials and during excavation/concreting, which is a
routine construction activity. Risk factors will be further reduced by in-time construction
works completion and observing proper safety and pecautionary standard procedures.
2.2 Cost Estimates
2.2.1 Construction Quantities and Costs
Equipment, Labor and materials are the important components for the construction of the Mini
Hydel Unit. About 26,817 man-days will be required for the construction of the project. Of the
total, 7336 are skilled man-days and 19481 are unskilled man-days. A total of Rs. 6,830,600
will incur on the construction of this project. Out of the total cost, Rs. 66,351,351 will incur on
the labour and Rs. 59,520,751 on the material and other activities.
The PPAF, World Bank upfront and the community will share the cost of construction. PPAF
will extend a grant of Rs. 38,192,117, World Bank put there share Rs. 19,021,741 whereas the
community will contribute Rs. 9,137,493. On average PPAF share will amount to Rs. 37,876
per household and Rs. 4,208 per person. All the details have been summarized in the tables 2.2,
2.3 and 2.4. For more details see Annex C.
Table: 2.2 Labour cost (skilled and unskilled)
Labour Man-Days Rate/Day (Rs) Cost (Rs.)
Skilled 7336 400 2,934,400
Unskilled 19481 200 3,896,200
Total 26,817 - 6,830,600
Table: 2.3 Material and other costs
Material and other activities Cost (Rs.)
Non-local material 51,120,768
Transportation of material 5791650
Drilling 934560
Tools & Implements 134085
Sign Board Cost 12000
Total 57,993,063
Table: 2.4 PPAF and community share in construction cost
Description Cost (Rs.)
Total construction cost 66,351,351
PPAF contribution 38,192,117
World Bank Upfront contribution (Rs.) 19,021,741
Community contribution 9,137,493
PPAF contribution per household 37,876
PPAF contribution per person 4,208
Annual operation and maintenance cost 1,944,710
10
2.2.2 Annual Maintenance Cost
The community will be responsible to ensure that the project is maintained and repaired whenever
there is a need to do so once it is completed. An annual maintenance cost of Rs-1,944,710 has
been estimated for the recurring cost of this Mini Hydel Unit. The maintenance cost has been
estimated @ 3% of the total construction cost of the project as of PPAF standards.
3 ENVIRONMENTAL ASSESSMENT
AKRSP always encourages small-scale community-managed infrastructure projects keeping in
view the environmental protection of the local area. In order to determine the environmental
review of the proposed Mini Hydel Unit, an environment review has been conducted. The
results of the review conclude that there would be positive environmental effects as a result of
the project (for details refer Annex D). The standard format developed for PPAF-financed
projects has been used.
There are potential positive impacts on the environment after construction of this project.
These impacts will be in the shape of improved forests and vegetation and reduced forest
cutting in the area.
4. PROJECT IMPLEMENTATION
4.1 The Role of AKRSP
During the first dialogue, Shogore Cluster presented AKRSP with its demand of the Mini Hydel
Unit. With the help of the cluster members, a technical and social survey of the project was
conducted to evaluate the feasibility of the project. During the third dialogue, terms of partnership
(ToP) will be signed between AKRSP and the beneficiary community. This will be carried out
after the project has received its final approval from the PPAF. The Engineering staff has designed
the project, and will provide the technical assistance and undertake periodic monitoring of the
physical progress of the project during the construction period. AKRSP’s field engineers will
ensure that the construction is as per design specifications. The social sector staff will play their
role to motivate the community members for effective organization and maintenance of the
proposed Mini Hydel Unit.
4.2 Role of the Community
The ownership of the entire project will lie on the community, which may lead to the longevity
of the project. To enhance this process, the community members would establish their own
management structure for the construction and maintenance of the project. The project
committee with technical supervision of AKRSP’s engineering staff will carry out construction
of the project. The community will organize labor and material during construction of the
project. Once the project is completed the community will make the maintenance of the project.
The community will be responsible for resolving the disputes if and when arises during the
implementation of the project.
11
4.3 Physical Phasing of the Project Work
The community will start work on the project soon after the third dialogue and signing of the
ToP with AKRSP. The project is expected to be completed within fourteen months after its
inception. A total of seven working months will be required to complete the project.
5. PROJECT MANAGEMENT
The project VOs will be responsible for the projects management. For better management of
the project, the community will form three committees; a Project Committee, an Audit and a
Maintenance Committee. These committees will have the following roles and responsibilities.
5.1 Project Committee
The VOs will form a Project Committee comprising at least three members and this committee
will be responsible for the overall implementation of the project. They would be responsible to
follow instructions from the site engineer of AKRSP, assign the duties to the members, keep
the record of funds received from the AKRSP and expenditures made on purchase of material
and payments made to the labor etc. The committee will also be responsible for drawing
installments from AKRSP based on the physical progress of the project.
5.2 Audit Committee
The beneficiary VOs will also form an Audit Committee comprising at least one literate
member representing the beneficiary VOs. This committee will be responsible to prepare a
report before requesting the installment from AKRSP. The committee will check the financial
records and accounts of the project maintained by the Project Committee. The installments
from the AKRSP will be released on the provision of satisfactory audit reports and clearance
certificates from the audit committee and on its recommendations.
5.3 Maintenance Committee
The VOs will set up a Maintenance Committee for the maintenance of the project. The
committee will be responsible to supervise the repair & maintenance operations of the project
once it is completed. They will also ensure that all the beneficiaries are equally involved in the
maintenance process. Maintenance Committee will also undertake the responsibility to generate
the funds required for the repair & maintenance of the project. A separate bank account will be
maintained for this purpose.
6 ECONOMIC ANALYSIS
6.1. Qualitative Description of Benefits
Improvement in heath condition: Smoke produced from fuel wood, generators use and
kerosene oil lamp is the common cause of respiratory diseases especially among the women
because they are in more contact with it. Increased cooking time due to poor lighting is also
12
another cause of inhaling more smoke. The facility of electricity would decrease the health
problems considerably. The project will improve the health conditions of the people especially
women in more consistent way.
Improvement in the condition of education and health: During survey it has been observed
that the unavailability of electricity in the village has led the school going children to use the oil
lamps during their study hours at night. Continued studying in oil lamplight, most of the school
going children has eye weakness problems and blemishes on their eyes too. The availability of
electricity will reduce the aforesaid problems of school going children to great extend and make
them do their school works more efficiently. The result of these efficiencies and interests of the
school going children in their home works would bring betterment in their quality of education.
It is most likely probability that in near future, the school going children and some of the
people would be able to have electronic and electric appliances in their homes.
Reduction in workload of women: Generally, women collect fuel wood for cooking and
heating purposes in the village. The availability of electricity would reduce the drudgery of
women outside and inside of their households to great deal. The time saved from the activity of
collection of fuel woods would be used in other productive works.
Improved Environmental Conditions: Currently, the villagers use fuel woods and kerosene
oil for cooking, heating and lighting purposes at their houses. Use of fuel wood and kerosene
oil in profusion at their houses has extremely negative effect not only on the health of the
villagers but also make the environment deteriorated. On having access to the electricity, the
villagers, would use electricity for cooking, heating and lighting purposes to great extent. Use
of electricity at household and to some extent commercial level will bring reduction in
deforestation. Reduction in deforestation will have positive effect on environment. Reduction
in Kerosene oil and diesel consumption on availability of electricity would have better effect
not only on the health of the villagers but also would help in making the environment safe and
it would indirectly contribute to the global environmental problem solving at Mini level.
6.2 Quantitative Assessment of Costs and Benefits
To conduct ‘Cost Benefit Analysis’ of the proposed Mini hydel project, it seems relevant to
identify and quantify the potential ’Costs’ and ‘Benefits’. Therefore, the following mentioned
‘Costs’ and ‘Benefits’ are taken into consideration while assessing the cost benefit analysis of
the proposed Mini hydel project.
Costs
Capital cost of the project
Maintenance cost of the project
Cost of enterprise
Cost of billing
Cost of house hold wiring
Cost of tube lights and energy saving bulbs
Cost of butter churner and washing machines
Benefits
Value of time saved on kerosene oil and fuel wood
Value of time saved on electric butter churner and washing machines
13
Value of time saved on sewing machines
Increased income from enterprise
6.3 Assumptions
Period of analysis is 30 years
Total construction cost Rs 1,57,74,582
Maintenance cost is Rs 4,73,237
Average connection charges per hh Rs. 1,000 and all the households connected in the
2nd year after the completion of the project.
Average electricity bill per hh per month is assumed to be Rs 350 and for 922 hhs the
electricity bill would be(922*350) for one month . And yearly, they would have to pay
Rs .(322,700*12)
Average cost of wiring per b. household is assumed to be Rs. 7,000 and the wiring
would have to be done in the 2rd year.
Each b. household would have an average of 4 tube lights in their houses. And 922 b.hhs are
supposed to have 1400 tube lights . These tube lights are assumed to be replaced after
6th month. Price of one tube light is Rs 150
Each b. hh is assumed to have an average of 2 energy saving bulbs and there are 80 b.hhs
which are supposed to have 160 energy saving bulbs and the cost of one energy saving
bulb is Rs 180
Kerosene oil valued at Rs 70 per litre. Average consumption p.n per hh before project is
432 liter and after the completion of the project it would be 72 liter per annum.
It is assumed that 300 b. hhs would have washing machines after the completion of the project.
Each b.hh is assumed to have one washing machine.
500 b. hhs would have electric butter churners . They currently spend 257142 hrs per annum on
manual butter churner to produce butter and after the completition of the project it will reduce
to to 180,000 hrs per annum. and the saving of time would be in Rs equal to 1,928,571
Fuel wood is valued at Rs 8 per kg .Average consumption p.n per hh before the project is 3600
kg and after the completion of the project it would be 1800 kg per b.hh per annum
Income from Marble factory is assumed to be Rs.
Income from the enterprise (saw mill ) is assumed to be Rs 240000 per annum.
Currently there are 5 hhs which have manual sewing machines . After the completion of the
project , the 5 hhs are supposed
to have 5 electric motor for their sewing machines . Currently, average time 1 b. hh use on
sewing is 77 hrs per month .
and it is assumed that th same b.hh would use 21 hours per month after availability of the
electricity .
The public organization which include a 2 hospitals and a bank use diesel generator to generate
electricity and average daily consumption of dielsel for each organization is 10 liter which will
reduce to 2 liters after completition of this project
It is assumed that atleast 1 marble factory will be established after completion of the project
keeping in view the potential of the area and the total capital cost for a normal sized marble
factory is assumed to be Rs. 6,000,000
It is assumed that atleast 1 slate cutting unit will be established after complition of the project
keeping in view the potential of the area for slate stone and the total capital cost for a normal
14
sized slate stone plant is assumed to be Rs.3,000,000
It is assumed that atleast 1 crash plant will be installed after the complition of the project
keeping in view the availabiliyty of lime stone deposit very near the project and the total
capital cost of a crash plant is assumed to be Rs. 5,000,000
It is assumed that atleast 5 saw mill will be installed and the total capital cost for a saw mill is
assumed to be Rs. 100000
Average annual Income from Marble Factory is assumed to be 6,748,000 and average annual
operational cost including Cost of goods sold is Rs.4,820,000
Average annual Income from Slate stone factory is assumed to be Rs. 4,568,400 and average
annual operational cost including cost of goods sold is Rs. 3,384,000
Average annual Income from Crash plant is assumed to be Rs. 5,684,000 and average
operational cost including cost of goods sold is Rs. 3,920,000
Average annual Income from 5 saw mills is assumed to be Rs. 1,848,000 and average
operational cost is Rs. 1,232,000
It is assumed that atleast 80 water lifting pumps will be installed in the project area with the
passage of time Average purchase cost of water lifting pump is assumed to be Rs. 5000
It is assumed that atleast 150 electric gysers will be installed in the project area with the passage
of time average purchase cost of water lifting pump is assumed to be Rs.6000
It is assumed that atleast 400 electric ovens will be installed in the project area with the passage
of time average purchase cost of water lifting pump is assumed to be Rs.3500
It is assumed that atleast 170 grinding machines will be installed in the project area with the
passage of time average purchase cost of water lifting pump is assumed to be Rs.7000
There are 40 fuelwood trees on 1 kanal of land .
present average yield of fuel wood is 160 kg per tree
Cost of production for fuel wood would be 10% of total value of incremental production of
fuelwood .
The increment in the production of fuelwood is assumped to be 6.25% of total present
production of the fuel wood.
6.4 Measures of the Project Worth
The calculations reveal that the present value of ‘Benefits’ is higher than the present value of
‘Costs’. The high Benefit-Cost Ratio indicates that the investment in the project is not only
worthwhile but also gives a significantly high return per rupee invested. The table 6.1 presents
the summary of ‘Costs’ and ‘Benefits’ of the proposed project. For the economic analysis, a
simple ‘Cost-Benefit Analysis’ has been conducted based on the data collected from the field
and using the expertise of AKRSP economists and engineers.
Table: 6.1 Measures of the Project Worth
Present Value of Costs 248,617,324
Present Value of Benefits 390,646,432
Discount Rate (%) 12%
Net Present Value (NPV) 142,028,892
Benefit Cost Ratio (BCR) 1.57
Internal Rate of Return - IRR (%) 29
15
