Türkiye: Water Efficiency and Climate Resilience for Results Program (Results-Based Financing)

Türkiye: Water Efficiency and Climate Resilience for Results Program (Results-Based Financing)

SUMMARY

STATUS: Proposed
MEMBER: Türkiye
SECTOR: Water
E&S CATEGORY: Category B
PROJECT NUMBER: 001015

FINANCING

PROPOSED FUNDING AMOUNT: USD500 million
FINANCING TYPE: Sovereign

TIMELINE

CONCEPT REVIEW: November 6, 2025

OBJECTIVE

To improve water use efficiency and enhance flood resilience in the target regions of Türkiye by sustainably expanding climate-resilient irrigation systems and implementing flood protection infrastructure through investments that safeguard livelihoods and agricultural area and enhance the long-term climate-resilience of local communities.

DESCRIPTION

While contributing to approximately 5% of GDP, the agriculture sector in Türkiye remains a vital component of the economy that sustains food security, rural livelihoods and exports. This sector is heavily dependent on irrigation, which triples productivity compared with rain-fed agriculture. The sector faces significant challenges: climate variability increasingly causes droughts and floods that disrupt production, and aging irrigation infrastructure limits efficient water use and delivery. Over the past 40 years, successive national governments have tried to mitigate the uneven distribution of water resources and rainfall by increasing access to irrigation, because of which the gross irrigated area has grown from 2.3 million hectares in the 1970s to about 6 million hectares today. Expansion and modernization of irrigation, along with other investments for increasing agricultural productivity, remain a priority agenda for Türkiye.

To address these challenges Türkiye had put in place a comprehensive water efficiency and climate adaptation program supported by the World Bank and a few other key development partners through interventions in various sub-sectors, but the needs of the country for sustainable water infrastructure are rapidly increasing. Above all, Türkiye plans to rehabilitate its irrigation system, prevent climate induced floods, minimize non-revenue water, enhance its water storage capacity, increase the very low water reuse levels, and reduce water pollution especially in the industrial sector.

Türkiye’s 12th Development Plan (2024-2028) and DSI Strategic Plan (2024-2028) outlay six priority areas: (a) drinking, utility and industrial water; (b) flood management; (c) effective and efficient use of water; (d) research, improvement and monitoring of water resources; (e) hydroelectric energy; and (f) institutional capacity for the next five years. The proposed RBP is designed to finance a slice of the overall Strategic Plan and will include two major components in support of the DSI Strategic Plan: (a) upgrading irrigation services for optimized water use efficiency and (b) strengthening climate resilience of the flood protection and management infrastructure, people and land in the flood-prone areas.

Climate change also intensifies droughts and floods, causing a general decrease in total precipitation, mostly in the Aegean and Mediterranean regions, and an increase in dry days in the Central Anatolia to Aegean regions. Several regions of Türkiye remain highly susceptible to seasonal floods, often resulting in widespread damage to agricultural fields, infrastructure and residential areas. High rainfall is anticipated in the region of the Black Sea coast which is surrounded by steep mountains. Flood damage in these areas has worsened impacts by intense rainfall events, urban expansion, soil degradation and inadequate flood-management infrastructure.

Consequently, the Government of Türkiye plans to (a) modernize irrigation infrastructure to promote climate-resilient, water-efficient irrigation systems and (b) enhance flood protection capacity through the development and rehabilitation of flood protection infrastructure. These objectives are aligned with the Government’s 12th Development Plan (2024-2028) and DSI Strategic Plan (2024-2028) and are based on the Climate Change Adaptation Strategy and Action plan (2024-2030) and Water Efficiency Strategy (2023-2030).

By expanding modern irrigation systems and strengthening flood protection capacity, the proposed Results-Based Program (RBP) will make Türkiye’s water management systems more efficient, resilient and sustainable. The RBP will be implemented in five years. The financing for the RBP will link disbursements to measurable outcomes such as land areas with climate-resilient irrigation services, climate-resilient infrastructure erected, and enhanced flood protection for safeguarding livelihoods, land and people.

ENVIRONMENTAL AND SOCIAL INFORMATION

Applicable Policy and Categorization. AIIB’s Environmental and Social Policy (ESP), including the Environmental and Social Exclusion List (ESEL), will be applicable to this Results Based Program (RBP). As per AIIB’s ESP, this RBP has been categorized as Category B because the potential environmental and social (ES) risks and impacts of the RBP are low and limited. Category A activities and other activities that are likely to have significant adverse impacts that are sensitive, diverse or unprecedented on the environment and/or Project-affected people, are not eligible for financing under the RBF and are excluded from the RBP.

Environmental and Social Risks and Impacts. Potential environmental risks and impacts include temporary and localized air, noise and dust pollution; generation of construction waste; soil erosion and water pollution during construction. Occupational health and safety risks would result from construction activities and increased traffic. Operation phase risks may involve water depletion, waterlogging, salinization, increased agrochemical runoff, biodiversity impacts and changes to natural flood regimes. Potential social adverse impacts of irrigation and flood control sub-projects under the RBP may include economic and physical displacements of local farmer households due to land acquisition, labor and working condition concerns and community health and safety risks such as dust, noise, pollution, traffic and waste discharges during construction by the contractors. In addition, the sub-projects under the RBP would have adverse gender impacts if not carefully designed. The sub-projects under the RBP would reduce women’s economic opportunities, especially when their agricultural lands are acquired for the construction of schemes under the RBP or when women are excluded from decision-making bodies and Water User Associations.

Environmental and Social Systems Assessment (ESSA) and Institutional Capacity. ESSA is a prerequisite under RBP financing and is being conducted for the proposed RBP to (a) assess the potential ES risks and impacts of the proposed RBP; (b) assess the adequacy of the systems proposed to be applied to the RBP for managing potential ES risks and impacts; (c) assess the institutional capacity of DSI and involved agencies in managing of ES risks and impacts of the RBP, and (d) recommend actions to strengthen specific aspects of the capacity of involved agencies and these systems for mitigating ES risks and impacts during the preparation and implementation of the RBP. DSI has sufficient technical capacity in ES domains, supported by a team of well-qualified experts. The agency is implementing some projects financed by international agencies while ensuring that ES assessment and management adhere to international standards and good practices. Further assessment will be conducted during the ESSA on the institutional arrangements and ES management capacity of DSI and involved agencies.   

Stakeholder Engagement, Information Disclosure, and Project Grievance Redress Mechanism. The Project team and ES consultants have conducted initial consultations with DSI (Headquarters and Regional Directorates) and relevant agencies as well as local communities during the concept stage of the RBP. Further consultations will be carried out by the Project team and ES consultants during the ESSA. The required actions to strengthen the ES systems applicable to the RBP, if any, will also be discussed with DSI and relevant agencies as appropriate. The draft assessment and the executive summary of the ESSA in English and local languages will be publicly disclosed in an appropriate and timely manner before appraisal of the RBP. The Grievance Redress Mechanism (GRM) of DSI comprises multiple channels, including a central telephone line, an online GRM portal for public and employee use, the Presidential Communication Center and the Foreigners Communication Center. The ESSA will further evaluate the effectiveness and suitability of the existing GRM of DSI to recommend a functional GRM system applicable to the RBP. Information on the established GRM and AIIB’s Project-affected People’s Mechanism (PPM) will be disclosed in a timely manner to Project-affected people in the RBP area.

Monitoring and Reporting Arrangement. Required ES actions, if any, will be included in the RBP Action Plan. Implementation of the ES actions will be monitored and reported based on an agreed format during Program implementation. AIIB will conduct monitoring and supervision during the Program implementation and providing implementation support to the DSI as appropriate. More details will be discussed and determined with the client during Project appraisal.