ADB's Board of Directors approved a grant of $2 million from the Japan Fund for Poverty Reduction for the Capacity Building and Livelihood Enhancement of Poor Water Users. The project will be carried out in several parts of Orissa, located on the east coast of India, where over 40% of the population lives below the poverty line, most of them in rural areas.

A lack of land and resources and little access to irrigation have left many rural dwellers in Orissa eking out a subsistence living from agriculture. They are poorly represented in water users associations, known as Pani Panchayats, which operate and manage irrigation schemes, the lifeblood of agriculture.

The project will fund capacity building and skills programs that support the development of new sustainable livelihood and income opportunities in areas like agro-processing, animal husbandry, pisciculture (fish farming), and high value crop production. It will also conduct training and awareness activities for water user groups with the aim of increasing the number of women representatives, and others from marginal groups like sharecroppers and tribal people.

“This pilot intervention which focuses on capacity building and livelihood improvement will help increase on- and off-farm income as well as the equal participation of vulnerable groups in the formation and management of water user associations,” said Susanne Nebel, Rural Development Specialist, in ADB's South Asia Department. The target is to increase the incomes of 20% of the extremely poor in project areas and have women make up 30% of the membership of the user groups, by the third year of activity.

The project complements the ADB-financed, Orissa Integrated Irrigated Agriculture and Water Management Investment Project, which is renovating and extending irrigation and associated infrastructure, in four major river basins in the state as part of broader national government efforts to bridge the country's growing urban/rural divide.

The Japan Fund for Poverty Reduction was set up by the Japanese Government and ADB in 2000 to provide assistance to the poorest, most vulnerable groups in the region.#