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Document of
The World Bank
FOR OFFICIAL USE ONLY
Report No: 48235-IN
PROJECT APPRAISAL DOCUMENT
ON A
PROPOSED LOAN
IN THE AMOUNT OF US$320 MILLION
TO THE
REPUBLIC OF INDIA
FOR AN
ANDHRA PRADESH ROAD SECTOR PROJECT
September 19, 2009
Sustainable Development Unit India Country Management Unit South Asia Region
This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.
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CURRENCY EQUIVALENTS (Exchange Rate Effective September 04, 2009)
Currency Unit = Indian Rupees Rs. 49 = US$1.0
US$1.56 = SDR 1.0
FINANCIAL (FISCAL) YEAR April 1 – March 31
ABBREVIATIONS AND ACRONYMS
CAG Comptroller and Auditor General LTPBMC Long-term Performance-based Contract APRDC Andhra Pradesh Road Development
Corporation MDR Major District Roads
BOT Build Operate and Transfer NABARD National Bank for Agriculture and Rural Development
CAS Country Assistance Strategy NH National Highway CRN Core Road Network OPRC Output and Performance Based Road
Contracts EA Environmental Assessment PIO Public Information Officer EMP Environmental Management Plan PWD Public Works Department ESMF Environmental and Social Management
Framework RBD Roads and Buildings Department
FMR Financial Management Report R&R Resettlement and Rehabilitation FRBM Fiscal Responsibility and Budget
Management RDC Road Development Corporation
GAAP Governance and Accountability Action Plan
RTI Right to Information Act
GOAP Government of Andhra Pradesh SA Social Assessment GOI Government of India SH State Highway HUDCO Housing and Urban Development
Corporation Limited SOS Strategic Options Studies
ISAP Institutional Strengthening Action Plan
VGF Viability Gap Funding
Vice President: Isabel M. Guerrero Country Director: N. Roberto Zagha Sector Manager: Michel Audigé
Task Team Leader: Binyam Reja
FOR OFFICIAL USE ONLY
This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not be otherwise disclosed without World Bank authorization.
INDIA Andhra Pradesh Road Sector Project
CONTENTS
Page
I. STRATEGIC CONTEXT AND RATIONALE ................................................................. 1
A. Country and Sector Issues ................................................................................................... 1
B. Rationale for World Bank involvement .............................................................................. 3
C. Higher Level Objectives to which the Project Contributes ................................................ 5
II. PROJECT DESCRIPTION ................................................................................................. 5
A. Lending Instrument ............................................................................................................. 5
B. Program Objective and Phases ............................................................................................ 5
C. Project Development Objective and Key Indicators ........................................................... 5
D. Project Components ............................................................................................................ 6
E. Lessons Learned and Reflected in the Project Design ........................................................ 8
F. Alternatives Considered And Reasons For Rejection ......................................................... 9
III. IMPLEMENTATION .................................................................................................... 10
A. Partnership Arrangements ................................................................................................. 10
B. Institutional and Implementation Arrangements .............................................................. 10
C. Monitoring and Evaluation of Outcomes/Results ............................................................. 11
D. Sustainability..................................................................................................................... 11
E. Critical Risks and Mitigating Measures ............................................................................ 11
F. Loan/Credit Conditions and Covenants ............................................................................ 12
IV. APPRAISAL SUMMARY ............................................................................................. 14
A. Economic and Financial Analyses .................................................................................... 14
B. Technical ........................................................................................................................... 15
C. Fiduciary ........................................................................................................................... 15
D. Social................................................................................................................................. 16
E. Environment ...................................................................................................................... 16
F. Safeguard Policies ............................................................................................................. 17
G. Policy Exceptions and Readiness...................................................................................... 17
Annex 1: Country and Sector or Program Background ......................................................... 19
Annex 2: Major Related Projects Financed by the Bank and/or other Agencies ................. 29
Annex 3: Results Framework and Monitoring ........................................................................ 31
Annex 4: Detailed Project Description ...................................................................................... 35
Annex 4A: Institutional Strengthening Action Planning 2009 – 2015 ................................... 39
Annex 5: Project Costs ............................................................................................................... 42
Annex 6: Implementation Arrangements ................................................................................. 43
Annex 6A: Governance and Accountability Action Plan (GAAP) ......................................... 51
Annex 6B: Supervision Strategy Matrix ................................................................................... 64
Annex 7: Financial Management and Disbursement Arrangements ..................................... 69
Annex 8: Procurement Arrangements ...................................................................................... 77
Annex 9: Economic and Financial Analysis ............................................................................. 97
Annex 10: Safeguard Policy Issues .......................................................................................... 110
Annex 11: Project Preparation and Supervision ................................................................... 121
Annex 12: Documents in the Project File ............................................................................... 123
Annex 13: Statement of Loans and Credits ............................................................................ 124
Annex 14: Country at a Glance ............................................................................................... 128
Annex 15: Map IBRD 37131 .................................................................................................... 130
FIGURES Figure 1: Fiscal Performance of Andhra Pradesh ......................................................................... 21 Figure 2: Capacity of AP’s Road Network Under RBD ............................................................... 22 Figure 3: Total Vehicle Population, Thousands ........................................................................... 23 Figure 4: Andhra Pradesh Road Development Corporation – Organization Structure at HQ ...... 50 Figure 5: Andhra Pradesh Road Development Corporation – Organization Structure –Field Level....................................................................................................................................................... 50
INDIA
ANDHRA PRADESH ROAD SECTOR PROJECT
PROJECT APPRAISAL DOCUMENT
SOUTH ASIA
SASDT
Date: September 19, 2009 Team Leader: Binyam Reja Country Director: N. Roberto Zagha Sector Manager: Michel Audigé
Sectors: Roads and highways (95%); General transportation sector (5%) Themes: Infrastructure services for private sector development (P); Trade facilitation and market access (S); Public expenditure, financial management and procurement (S)
Project ID: P096021 Environmental screening category: A- Full Assessment
Lending Instrument: Specific Investment Loan
Project Financing Data [X] Loan [ ] Credit [ ] Grant [ ] Guarantee [ ] Other: For Loans/Credits/Others: Total Bank financing (US$m.): 320.00 Proposed terms: IBRD Flexible Loan with variable spread option, level repayments, total maturity of 30 years including a grace period of 5.5 years
Financing Plan (US$m) Source Local Foreign Total
Borrower 325.86 0.00 325.86 International Bank for Reconstruction and Development
101.13 218.87 320.00
Total: 426.99 218.87 645.86 Borrower: India Responsible Agency: Andhra Pradesh Through the Government of Andhra Pradesh, Road & Building Department 507, 5th Floor, J Block Secretariat Hyderabad - 500 022 Andhra Pradesh, India Fax: +91-40-23450104 http://www.aproads.com
and through the Andhra Pradesh Roads Development Corporation AC Guards, Mahavir Marg R&B Office Complex, 5th Floor Hyderabad - 500 004 Andhra Pradesh India Ph: 040-23300462 http://www.aprdc.in
Estimated disbursements (Bank FY/US$m)FY 2010 2011 2012 2013 2014 2015 Annual 30 32 64 64 64 66 Cumulative 30 62 126 190 254 320 Project implementation period: Start November 1, 2009 End: June 30, 2015 Expected effectiveness date: November 1, 2009 Expected closing date: June 30, 2015
Does the project depart from the CAS in content or other significant respects? Ref. PAD I.C.
[ ]Yes [X] No
Does the project require any exceptions from Bank policies? Ref. PAD IV.G. Have these been approved by Bank management? Is approval for any policy exception sought from the Board?
[ ]Yes [X] No [ ]Yes [ ] No [ ]Yes [ ] No
Does the project include any critical risks rated “substantial” or “high”? Ref. PAD III.E.
[ ]Yes [X] No
Does the project meet the Regional criteria for readiness for implementation? Ref. PAD IV.G.
[X]Yes [ ] No
Project development objective Ref. PAD II.C., Technical Annex 3 The development objective of the project is to provide better quality, capacity and safe roads to users in a sustainable manner through enhanced institutional capacity of the Andhra Pradesh government in the road sector. Project description Ref. PAD II.D., Technical Annex 4 The Project comprises four components: Road Improvement Component. This component comprises two activities designed to upgrade and maintain the Core Road Network (CRN): (a) upgrading about 429 km of priority state highways (284 km in Phase I and 145 km in Phase II) under public sector financing; and (b) maintenance of 6,241 km of the CRN under Long-term Performance-based Maintenance Contracts (LTPBMC).
Public Private Partnership (PPP) Facilitation Component: This component will strengthen the capacity of the Government of Andhra Pradesh (GOAP) to attract, on PPP basis, private sector participation in financing, development, and management of selected high traffic density corridors. Specifically, through technical assistance, the loan will finance the costs of (a)
transaction advisers to assist APRDC to carry out feasibility studies and to develop and transact selected PPP roads; and (b) capacity building of APRDC to be able to better identify, structure, award and monitor PPP projects.
Institutional Strengthening Component. This component will provide targeted technical assistance, training and advisory services for (a) operationalization of the APRDC, with requisite capacity for its responsibilities in managing the CRN and new PPP projects; and (b) various aspects of project implementation including the Asset Management Program, the Governance and Accountability Action Plan (GAAP) and the Institutional Strengthening Action Plan (ISAP), plus associated monitoring and coordination (see Annexes 4A and 4B).
Road Safety Component. This component will help GOAP to provide safer road corridors by initiating measures to reduce road accidents on major corridors, in particular by assisting the concerned GOAP agencies to (a) undertake ‘demonstration projects’ on selected CRN corridors, (b) carry out black-spot improvement program, and (c) implement institutional and policy action plans for improving the state’s road safety responsibility framework and capacities.
Which safeguard policies are triggered, if any? Ref. PAD IV.F., Technical Annex 10 • Environmental Assessment (OP/BP 4.01) • Natural Habitats (OP/BP 4.04) • Physical Cultural Resources (OP/BP 4.11) • Involuntary Resettlement (OP/BP 4.12) • Indigenous Peoples (OP/BP 4.10) • Forests (OP/BP 4.36)
Significant, non-standard conditions, if any, for: Ref. PAD III.F. Board presentation: The standard Board Presentation conditions will apply. Loan/credit effectiveness: The standard loan effectiveness conditions will apply.
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I. STRATEGIC CONTEXT AND RATIONALE
A. Country and Sector Issues
1. Andhra Pradesh (AP) is one of the progressive states of India – its economic, social, health and education indicators are better than the national average and on par with its neighboring states of Karnataka, Kerala and Tamil Nadu.1 As per the latest census information2 the population of AP is about 76 million with about 75 percent living in rural areas. Only about 15 percent of the population is below the official poverty line when compared with the country average of about 26 percent. The per capita income of the State is more or less at par with the National average. Though the contribution of primary sector to the State’s GDP is about 25 percent, a majority of the population relies on agriculture for its livelihood. The secondary sector contributes about 25 percent and the tertiary sector, which comprises services, contributes about 50 percent. The contribution of tertiary sector, which also includes the transport services, has been on the rise over the past decade.
2. Government of AP (GOAP) has undertaken steps towards better fiscal and economic management and reducing revenue and fiscal deficits, and accelerating economic growth. Some of the important steps taken include the passing of the Fiscal Responsibility and Budget Management (FRBM) Act 2005 and adopting the Fiscal Correction Path. The state government has rationalized Stamps, Registration and Motor Vehicles taxes by bringing down the rates which have resulted in better compliance and collections. Computerization and e-governance initiatives of the State are also increasing transparency and streamlining record keeping and other procedures, consistent with the Right to Information Act passed by the GOI in 2005. AP is the first state to initiate the process of e-procurement and about 90 percent of the state’s public procurement is done electronically.
3. Road transport accounts for more than 80 percent of the state’s freight and passenger traffic. GOAP Vision 2020 strategy recognizes that an efficient transport system is a necessary foundation for agricultural and industrial growth, and consequently in achieving its economic growth and poverty reduction goals. Accordingly, GOAP has been investing in improving its transport infrastructure.3 It has developed high density corridors with its own funding, as well as financing from the Central Road Fund, and the now-closed World Bank-supported AP Economic Restructuring Project (APERP) and AP State Highway Project (APSHP).
4. The capacity and quality of the state core road network has improved considerably in recent years. The total road network in the state is 188,568 km long and the road network managed by the Roads and Buildings Department (RBD) in AP is about 68,510 km long and this includes national highways, state highways (SH), major district roads (MDR) and some rural roads. Of these, SH and MDR account for roughly 60 percent of the network. In 1997, from among the SH and MDR, GOAP selected about 10,000 km of roads with high traffic and strategic importance and declared them as the Core Road Network (CRN), and established the Road Development Corporation (RDC) to manage the CRN. About 7,500 km of the CRN have been improved in recent years, either through the first AP State Highway Project (APSHP),
1 The South Special, Outlook, July 16, 2007 2 Census of India, 2001 3 Budget 2006-07, GOAP
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which helped improve 3,100 km of state roads, or GOAP’s own funding. In the SH network, double lane roads have increased from 52 percent to 68 percent over the past six years.
5. While maintenance spending has increased, it is still not adequate. GOAP spent about Rs.3.7 billion for maintaining existing road assets in the year 2004-05 as against the Rs.5.68 billion estimated requirement per the Finance Commission’s norms for road maintenance. The total provision for State’s road sector in the budget for 2006-07 is Rs.12.1 billion of which the provision for road maintenance is about Rs 4.6 billion (as against a Finance Commission norm of Rs.7.1 billion for the State). This has increased to Rs. 8.3 billion by 2007-08. There is still a gap between the actual needs and the resources provided for capital and maintenance interventions. A recently concluded Road Financing Assessment study suggests that the present road financingrequirements for the state, maintenance and upgrading will continue to grow and the present and planned GOAP level of funding will not be adequate, resulting in a growing funding gap. In addition, the RBD and RDC lack expertise in the latest techniques for planning network improvements and maintenance contracting. It is therefore critical for the road agency to focus on developing more effective capacities for road asset management, ensure suitable funding and optimal leverage and efficient utilization of available funds.
6. The state has a serious and deteriorating road safety problem which has become a significant public health issue. According to data complied by the Andhra Pradesh Road Safety Authority (APRSA), in 2006 on average there were 117 accidents per day, with 34 people dead and 164 people injured, while in 2007 the corresponding figures were 131 accidents, with 36 persons dead and 179 injured4. The combination of rapidly growing motorization levels and higher speeds, as a result of better quality of highways, has lead to a growing incidence of accidents, and unless strict measures are taken by the relevant agencies the situation is likely to deteriorate further. The lack of coordination between the multiple agencies involved in road safety is a major constraint for develeoping and enforcing road safety regulations. .
7. Public Private Partnership in the State and the Road Sector: GOAP is keen to use PPPs to develop the state’s infrastructure and high-traffic roads. GOAP passed an Infrastructure Act 2001, and established state-level agencies, including Infrastructure and Investment Department, Infrastructure Corporation of Andhra Pradesh (INCAP), and a PPP Cell in the Department of Finance. GOAP has so far implemented 43 projects, the majority of which have been in the tourism and roads sectors. In order to facilitate development of more road projects on PPP basis, GOAP issued a Toll Policy, which sets out the rules for collection fees from users of State roads and bridges. The Toll Policy is essentially similar to the toll policy applicable to National Highway toll roads, with a few exceptions to comply with local requirements.
8. At the national level, India has a large PPP program which has accelerated rapidly since 2004. India’s transport PPP program, with investment commitments of over $10.5 billion during 2006 and 2007, is now one of the largest programs in emerging economies. However, in the context of the current global financial crisis, the adverse impact of reduction in availability of debt and risk capital has reportedly slowed down India’s PPP program. The Government of India (GOI) and Reserve Bank of India (RBI) have taken several measures to increase
4 Accidents, More Accidents Every day. The Hindu. May 03, 2007. http://www.hinduonnet.com/2007/05/03/stories/2007050309610400.htm
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availability of funds for PPP infrastructure projects. RBI has reduced the repo rate and credit reserve ratio and relaxed norms for external commercial borrowings, and the central government has allowed India Infrastructure Finance Company Limited (IIFCL) to raise long-term funds through issues government-guaranteed, tax-free bonds, and channelizing them through a re-financing window. In addition, the GOI has recently negotiated with the World Bank a line of credit to the IIFCL of about US$1.2 billion. In the meantime, debt and equity investors have adopted a cautious approach, resulting in higher thresholds for financial attractiveness. Therefore, to be able to attract private partners and achieve financial closures in the future, the structuring of PPP transactions needs to be more financially robust, with adequate cushion to withstand large revenue variations.
B. Rationale for World Bank involvement 9. The World Bank Group’s Country Strategy for India (CAS 2009-12) emphasizes rapid and inclusive growth, sustainable development, and improving government’s effectiveness for service delivery. Given India’s size and diversity, the Country Strategy also calls for differentiated approaches for providing Bank assistance to lagging and advanced states, and to take into account the state’s level of development and capacity in determining the level and type of engagement. The proposed project is well aligned with the CAS. The road improvement program supported under the project will help to remove the infrastructure bottlenecks in the state, which is considered a major constraint to sustain the state’s impressive economic growth in recent years. The project’s support for PPP and institutional and policy development will help the state government to modernize its road sector institutions, provide sustainable financing, and leverage government resources with private sector financing for the provision of road infrastructure services.
10. At the state level, the proposed project complements the Bank’s broader engagement with Andhra Pradesh where Bank support is aimed at removing infrastructure bottlenecks in both rural and urban areas5. The Bank’s support in the road sector together with other Bank-supported projects are designed to improve the performance of existing institutions and systems and build strong performance and result culture in AP. The Bank has an active dialogue with GOAP to create synergies among the different sector projects, move towards more integrated lending program with mutually reinforcing instruments, and strengthening fiscal and fiduciary oversight of projects.
11. At the sector level, the proposed AP Road Sector Project builds on the successful Bank engagement in APSHP6. The APSHP had a significant impact on the state highway sector and the capacity available to the GOAP for roads management and development. It was successful in not only improving the highway capacity and quality, but also in helping establish widely-supported strategic directions for sector reform and in developing the basis for ongoing action towards improved capacities within the RBD and RDC for procurement and contract management, quality control, financial management and cost accounting, as well as providing
5 There are currently five projects in Andhra Pradesh totaling US$1.3 billion under preparation for Bank financing -- State Roads (US$320 m), Urban Development (US$274 million), Irrigation (US$435 million), Rural Water Supply (US$150 million), and Rural Roads (US$150 million). 6 The project ICR dated November 29, 2004 rated the project outcome as Satisfactory, its sustainability Likely and its Institutional Development Impact Modest. Both the Bank and Borrower performance was rated Satisfactory.
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an exposure to modern road engineering practices, construction techniques, and design standards.
12. At a broader sector-wide level, some of the notable achievements during and following from the first APSHP include:
(i) A Road Policy for the period 2005-15 was developed, endorsed and issued by the GOAP in July 2005. This policy broadly highlights the sector’s importance in AP and the Government’s thinking on the way forward for improving connectivity through sustainable development, maintenance/operating and financing of roads. A preliminary Road Bill was prepared by the RBD, designed to address ribbon development, roadway encroachment, road safety and road financing.
(ii) The State was the first in India to pilot performance-based road maintenance contracts and developed some new specifications for pavement construction and maintenance.
(iii) GOAP issued a policy framework for private participation in roads sector through government orders in 1997/98 and then enacted an “Infrastructure Enabling Act, 2001”.
(iv) GOAP passed legislation in 1998 to create the AP Road Development Corporation (APRDC) to improve the state’s capacity for the development of the CRN with new forms of financing.
(v) In 2009, GOAP issued orders for implementation of the toll policy, which sets out the rules for collection of fees from users of State Roads and bridges.
(vi) Procurement reforms have been spearheaded by the GOAP use of electronic procurement for all works contracts estimated to cost more than Rs.1 Million (about US$22,000).
(vii) To increase the capacity of road construction and maintenance contractors and to improve the quality of works, GOAP has set up the National Academy of Construction which imparts training to contractors and to RBD and RDC staff.
(viii)The RBD has established a modern GIS-based road network information system capable of supporting RBD and RDC road maintenance monitoring and planning, though still awaiting the new data collection / analysis / management processes and functions planned to be implemented under the Asset Management thrust in the new project.
(ix) A state-level R&R policy, covering all sectors, has also been developed. This R&R policy, once harmonized with OP/BP 4.12, will enable the World Bank to work with GOAP on a sector-wide approach to road investment initiatives by the public and private sectors.
13. World Bank involvement in the project is in line with the importance accorded by GOAP and nationally to transport infrastructure in boosting economic development. This second road sector project in the state will deepen the Bank’s engagement in the sector and create conditions for sustainability by focusing on issues of road sector financing, private sector participation, preservation of road assets, road safety and HIV/AIDS. More specifically the project aims at: (i) creating a sustainable framework for road infrastructure development and asset preservation to reduce transport costs and ensure reduction in fuel consumption and emissions through better quality roads; (ii) creating ‘safe’ roads and an institutional and policy framework conducive to the achievement of this agenda; and (iii) developing public sector capacity for improved service delivery in line with the Transport Sector Strategy of the Bank. The Bank can also contribute significantly through sharing of global best practices and innovations in road sector management.
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C. Higher Level Objectives to which the Project Contributes 14. The project supports the India CAS 2009-12 outcomes for sustained and inclusive growth by removing road infrastructure bottlenecks for private sector activities and government service delivery. Improvements in road transport will catalyze agricultural and industrial development and improve access to markets, jobs and services to the people of AP, including the poor. In line with the CAS focus, the project aims at supporting the development of institutional arrangements to secure sustainable development results in the road sector. This project also supports the state’s vision for Andhra Pradesh to improve the investment climate and agricultural, mining and IT potentials of the state. In addition, the project supports GOAP’s Road Policy 2005- 2015 for providing efficient, safe and environmentally sustainable road network in support of economic development and poverty reduction in the state.
15. The project also contributes to enhancing country systems by supporting the implementation of the Governance and Accountability Action Plan (GAAP) and Institutional Strengthening Action Plan (ISAP), which have been prepared by RDC and endorsed by GOAP during project preparation. The GAAP is deisgned to help RDC to improve, among other things, information disclosure and transparency in project implementation through improved implementation of existing government laws, including the the Right to Information Act. The GAAP also provides for better quality control measures and third party monitoring system for project implementation by local engineering schools. The GAAP incorporates citizen inputs through actions to address citizen complaints and through mandatory user satisfaction surveys. As such, these actions would contribute to enhancing systems, procedures and processes before, during and after project implementation, which will ensure effective implementation of the project and RDC’s overall management of the sector. As part of the Institutional Strengthening Component, the project also provides resources for improving the state’s procurement and Financial Management systems. The aim is to increase competition and transparency in procurement, and to upgrade the implementing agency’s financial management systems through better delegation of financial powers and use of new tools.
II. PROJECT DESCRIPTION
A. Lending Instrument 16. The lending instrument to be used for this project is a Specific Investment Loan (SIL). The project will be financed under an IBRD Flexible Loan with variable-spread option and level repayments and has a final maturity of 30 years including a grace period of 5.5 years.
B. Program Objective and Phases Not Applicable. C. Project Development Objective and Key Indicators 17. The development objective of the project is to provide better quality, capacity and safe roads to users in a sustainable manner through enhanced institutional capacity of the Andhra Pradesh government in the road sector.
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18. Outcome Indicators: The achievement of the project will be monitored through the following indicators: (i) improvement in the share of the Core Road Network (CRN) in good condition; (ii) full operationalization of the RDC with adequate financial and human resources to manage the CRN; and (iii) reduction in vehicle operating cost, travel time, and fatality rates per vehicle miles travelled in project roads. The baseline and target values for the outcome indicators are provided in Annex 3 of the PAD. The intermediate/output indicators for the various project components are also provided in Annex 3.
D. Project Components 19. The project has four components: (a) Road Improvement; (b) PPP Facilitation Support; (c) Institutional Strengthening; and (d) Road Safety. These are described briefly below and details are provided in Annex 4.
20. Road Improvement Component: This component comprises two activities designed to upgrade and maintain the CRN: (a) upgrading about 429 km of priority state highways in two phases (284 km in Phase I and 145 km in Phase II) under public sector financing; and (b) maintenance of 6,241 km of the CRN under Long-term Performance-based Maintenance Contracts (LTPBMC).
21. PPP Facilitation Component: This component will support strengthening the capacity of the Government of Andhra Pradesh to develop selected high density traffic corridors under Public Private Partnership (PPP) arrangement, via toll revenues and viability gap support from the central and state governments. The loan will finance the costs of (a) transaction advisers to assist APRDC to carry out feasibility studies and to develop and transact selected road projects as PPPs; and (b) capacity building of APRDC to be able to better identify, structure, award and monitor PPP projects. APRDC engaged a transaction adviser to develop eight roads on PPP basis and, based on the latter’s techno-economic feasibility assessessment, decided to develop five roads with a total length of 863 kms as PPPs. These roads are being developed as BOT-Toll concessions following the Government of India guidance documents, including the Model Request for Qualifications and Model Concession Agreement. APRDC has initiated the procurement process for three PPP roads, and has obtained in-principle approval for Viability Gap Funding support from the Government of India, and received bids. In addition to financing the costs of the transaction adviser already engaged by APRDC, this component makes provision for engaging services of additional transaction advisory consultants for helping APRDC in developing more roads that are likely to be identified during the course of the project as PPPs. The capacity building part of this component will finance the costs of engaging experts on PPP related issues and of training and exposure visits for staff at various levels of APRDC and GOAP.
22. Institutional Strengthening Component. This component will provide targeted technical assistance, training and advisory services for (a) operationalization of the APRDC, with requisite capacity for its responsibilities in managing the CRN and new PPP projects; and (b) various aspects of project implementation includingthe Asset Management Program, the Governance and Accountability Action Plan (GAAP) and the Institutional Strengthening Action Plan (ISAP), plus associated monitoring and coordination (see Annexes 4A and 4B).
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23. Road Safety Component: This component will help GOAP provide safer road corridors by initiating measures to reduce road accidents on major corridors by assisting the concerned GOAP agencies to: (a) undertake ‘demonstration projects’ on selected CRN corridors; (b) carry out an extended black-spot improvement program; and (c) implement institutional and policy action plans for improving the state’s road safety responsibility framework and capacities.
24. Table 1 provides the cost and financing arrangement for the project. The size of the project will be around US$646 million and the IBRD loan amount will be US$320 million.
Table 1: Summary of Project Components, Costs and Financing Arrangement (US$ millions, including contingencies)
Component
Costs Including
Contingency % of Total
Bank Financing
%Bank Financing
GOAP Financing
%GOAP Financing
A - Road Improvement Component 1 606.79 94.0% 290.55 90.8% 316.24 97.1%
Upgrading of Civil Works 276.79 42.9% 221.43 69.2% 55.36 17.0%
OPRC & Other Works 290.07 44.9% 57.35 17.9% 232.72 71.4%
Supervision Costs 11.32 1.8% 9.06 2.8% 2.26 0.7%
LA, Utility Shifting 25.22 3.9% 0.00 0.0% 25.22 7.7%
R&R 2.90 0.4% 2.32 0.7% 0.58 0.2%
B - PPP Facilitation Support 3.07 0.5% 2.46 0.8% 0.61 0.2%
Transaction Adviser 2.45 0.4% 1.96 0.6% 0.49 0.2%
Capacity Building 0.62 0.1% 0.50 0.2% 0.12 0.0%
C - Sector, Institution and Policy Development Component 16.54 2.56% 11.27 3.5% 5.27 1.6%
Asset Management Program 1.80 0.28% 1.44 0.4% 0.36 0.1%
Institutional Strengthening Action Plan 4.20 0.65% 3.36 1.0% 0.84 0.3%
Training 1.80 0.28% 1.44 0.4% 0.36 0.1%
Monitoring & Facilitation (ISAP & GAAP) 3.36 0.52% 2.69 0.8% 0.67 0.2%
Incremental Operating Costs 2.45 0.00% 1.96 0.01% 0.49 0.2%
D - Road Safety Component 18.65 2.89% 14.92 4.7% 3.73 1.1%
Black Spot Improvement 5.45 0.84% 4.36 1.4% 1.09 0.3%
Safe Roads Program 13.20 2.04% 10.56 3.3% 2.64 0.8%
E - Incremental Operating Costs 2.45 0.4% 1.96 0.6% 0.49 0.2%
Total Project Cost 645.06 100% 319.20 100.4% 325.86 100.2%
Front-end Fee 0.80 0.80 0
Total Financing Required 645.86 100% 320.00 100% 325.86 100% ^ This consists of R&R Assistance & R&R related services; * Safe Roads Program includes development of demonstration corridors and a state level Road Safety Policy and Action Plan
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E. Lessons Learned and Reflected in the Project Design 25. Implementation of a second AP road project relatively shortly after the first one should provide continuity in key sector reform thrusts and thus help to establish a sustainable platform for improved performance in the road sector in the State. In the context of a (then) quite large, ambitious and complex first project, the borrower/implementing agency performance was rated satisfactory, though the extent of hard political decisions and actions then required on reforms and their institutional aspects was underestimated, and there were problems due to decision making being too centralized, insufficient ownership, and already stretched capacity among road agency staff. 26. Some of the key lessons learned from previous and ongoing World Bank operations in highway projects in India as well as from the APSHP project include (i) need for upfront action, sustained effort and substantive client ownership to advance the institutional development initiatives; (ii) wider and active involvement and ‘buy in’ of the road agency staff in the reform process; (iii) building capacity of the road agency staff on an ongoing basis to improve the final delivery; (iv) avoid delays for land acquisition, shifting of utilities, and in obtaining clearances from various government departments by undertaking these activities before work commencement; (v) ensuring an adequate and assured flow of maintenance funding and developing capacities for systemic network planning and management for sector sustainability; (vi) increasing transparency in public procurement by establishing a centralized database system and publicizing contract award and procurement information, and performance of consultants and contractors; and (vii) ensuring sustained government attention to institutional development activities. 27. Operationalization of the RDC, creation of sustainable and adequate road maintenance funding, and strengthening of RBD and RDC planning and asset management functions were not achieved under the previous project owing to the reasons (i) to (iii) identified above. This project accordingly focuses on a smaller, closely integrated set of institutional development activities designed primarily for a major sustainable improvement in asset management by both the RBD and RDC, and for full operationalization of the RDC, to match the responsibility now vested there for the Core Road Network and to enable the RDC to discharge those responsibilities in a manner more flexible than a government department. 28. Given the experience in highway projects of significant delays owing to preconstruction activities such as land acquisition and utility shifting, this project is striving for 50 percent of the land acquisition to be completed for the Phase 1 projects prior to contract award.
29. Several studies7 by the World Bank in recent times have raised concerns regarding the quality of designs being prepared and the quality of works being implemented under highway projects in India and their implication on the time and cost overruns being experienced by these projects. In order to mitigate these risks the project provides for third party monitoring of works
7 India - Design and Construction Review of NHAI Projects – Lessons Learned, Draft, The World Bank, June 2007; Indian Road Construction Industry – Capacity Issues, Constraints and Recommendations, The World Bank, June 2008
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during project implementation through senior students and faculty of local engineering colleges. A contractor/consultant performance monitoring system is also included to report contractor’s and consultant’s performance in terms of completing work to quality design and within time and cost.
30. The deteriorating road safety situation has also been a concern in Indian highways. As such, the project includes a road safety component to develop institutional mechanisms for proper integration of efforts among multiple agencies and give priority attention to the issue, including the establishment of a lead road safety agency and multi-sector coordination body, consistent with international practices for ‘second’ generation road safety projects.
31. The RBD has successfully implemented pilot performance-based road maintenance contracts for about 1,200 km of roads under APSHP. These contracts contained both lump-sum and BOQ payments, respectively, for the routine and periodic maintenance works. In the proposed project, the performance-based maintenance contract is being scaled up under the LTPBMC component based on the Bank bidding document for Output-and-Performance-based Road Contracts (OPRC).
32. An INT investigation was carried on the AP State Highway Project, which closed in 2004, following a complaint about a contractor overbilling the client for earthworks. The contractor was alleged to have fraudulently billed and received payment for excessive earthworks. The state government also carried out a parallel vigilance investigation of this allegation, following which the government recovered the overpaid amount from the contractor. The World Bank took no further action against the contractor. In the proposed project, the Governance and Accountability Action Plan (GAAP) includes a third-party monitoring by reputable engineering university professors and their post-graduate students to minimize the risk of such an incident occurring again and to ensure that the contractor, supervision consultant, and the client are following the agreed engineering design in the construction of the proposed project roads. In addition, the GAAP for the proposed project includes support to the Road Development Corporation to comply with India's Right to Information Act disclosure requirements and improve its documentation and computerization of records.
F. Alternatives Considered And Reasons For Rejection 33. Target Roads: The project will primarily finance improvement and maintenance of the CRN, which are managed by RDC. During project preparation, there was also discussion whether RBD roads should be included. However, given that the project’s focus is on making RDC fully operational and on ensuring adequate financial and human resources are dedicated to maintenance of the CRN, it was decided that the primary focus would remain in RDC. However, some of the institutional support, especially the asset management capacity building activity, will be directed at RBD.
34. Type of World Bank Financing: The project will be financed under Specific Investment Loan (SIL) to finance the identified civil works and consultancy services. While there are some elements of a programmatic support in the project (such as the LTPBMC component covering a large share of the CRN, and application of environment and social management framework in the non-Bank financed PPP components), moving towards a full
10
programmatic and sector wide engagement in AP will require improvements in the state’s institutions and systems, especially those related to procurement and financial management practices. The project is providing support to operationalize the Road Development Corporation and improve its institutional capacity, safeguard management and fiduciary oversight capability. In particularly, the adequate empowerment of RDC in financial and administrative matters, should enable a more programmatic and sector wide engagement with RDC in future Bank road sector loans to the state.
III. IMPLEMENTATION
A. Partnership Arrangements
Not Applicable. B. Institutional and Implementation Arrangements 35. The GOAP’s Roads and Building Department (RBD) will have the overall responsibility for the implementation of the project. The RBD is headed by a Principal Secretary and has several units, headed by chief engineers. One of these units, the Road Development Corporation (RDC) was established to manage the Core Road Network, under the leadership of a managing director and Chief Engineer (Core Road Network). The RDC has been designated as the Project Management Unit (PMU) to assist RBD in carrying out the day-to-day management of the project, including procurement, contract management, financial management, safeguard management, and implementation oversight. The RDC, also serving as the PMU, has successfully implemented the previous Bank-financed APSHP and the roads component of the APERP, and since 2005 the RDC has been preparing the proposed project. The RDC staff is familiar with World Bank procedures for fiduciary and safeguard requirements, and FIDIC contract conditions. The Chief Engineer (CRN)/MD RDC has about 60 engineers and professional staff at its headquarters and supported by nine field divisions.
36. The Road Safety component shall be implemented by the Transport Department and Transport Commissioner’s Office. The RDC will support the Transport Department/Transport Commission with managing the with for procurement of works, goods and services for the road safety component.
37. Financial Management: The financial management and fund flow arrangement, as well as other operational procedures, will follow the regular GOAP and RBD procedures, as agreed with the World Bank. However, GOAP’s long-term plan is for RDC to have its own financial, administrative and operational procedures, and thus make RDC a fully empowered entity. As part of the institutional development component, the project is providing resources for making RDC to be fully operational. Once RDC is fully operational, completes its outstanding audits, and becomes a fully operationalised entity, the GOAP may decide to transfer project implementation responsibility fully to RDC, rather the current designation of RDC as the PMU only.
11
38. Disbursement: Report Based disbursement will be used for actual expenditures as reported in the quarterly Financial Management Report.
39. Safeguard Management: All civil works component (upgrading and LTPBMC, will follow the Bank’s safeguard policies as described in Annex 10. The preparation consultants (for upgrading and LTPBMC components) and transaction advisers (for PPP components) will assist in the preparation of the various environment and social safeguard documents. Supervision consultants and RDC staff will ensure the contractors will implement the provisions in the safeguard documents.
40. Procurement Arrangement: Procurement for the project will be carried out in accordance with the World Bank's "Guidelines: Procurement under IBRD Loans and IDA Credits" dated May 2004, revised October, 2006 (Procurement Guidelines); and "Guidelines: Selection and Employment of Consultants by World Bank Borrowers" dated May 2004, revised October, 2006 (Consultancy Guidelines) and provisions stipulated in the Legal Agreement.
C. Monitoring and Evaluation of Outcomes/Results 41. The Results Framework, shown in Annex 3, is the main instrument for monitoring and evaluation of the achievement of the PDO and outcome indicators. The project’s primary outcome indicators (vehicle operation cost, travel time, and safety) will be generated by routine monitoring by the RDC. This will help in prioritizing and optimizing annual maintenance plans for roadway sections. Road Users Satisfaction survey will be carried out to assess RDC’s ability to provide effective road services to users. The road user satisfaction surveys will be conducted at the start, mid-term and near-closure of the project and the results will be made publicly available. Third-party monitoring will be carried out by a reputable engineering university and panel of experts. Professors and post-graduate engineering students will be used to assess quality and outputs of road improvement components.
D. Sustainability 42. The GOAP’s initiatives in the road sector coupled with the success of the first Bank project in AP, demonstrate its commitment to developing a robust highway network and infrastructure in the state. By opting for LTPBMC and PPP mechanisms in road development, maintenance and management, which implicitly incorporate sustainability, the state demonstrates a forward-looking agenda. In addition, the establishment of a RMS-based Asset Management Program, proposed creation of sustainable CRN funding, full operationalization of the RDC and other institutional strengthening and governance improvement measures to be undertaken as part of the project also address sector sustainability issues in the state.
E. Critical Risks and Mitigating Measures
Description of Risk Mitigation Measures Ratinga of Residual
RiskOvert public discontent with increased use of tolling and the consequent weakening of
Effective disclosure of road strategy/policy per RTI principles and periodic dissemination of information on benefits of PPP to the public through targeted
M
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Description of Risk Mitigation Measures Ratinga of Residual
RiskGOAP’s commitment to tolling. campaigns. Weak implementation capacity in RBD/RDC may strain available resources, resulting in delays.
RBD/RDC capacity will be strengthened by mobilization of carefully-targeted project-financed technical assistance and consultancy services to support the civil works, institutional strengthening and PPP elements of the project. GOAP has issued a Policy Letter expressing its commitment (interalia) to implementation of the agreed institutional strengthening program.
M
Limited experience in implementing PPP roads.
RBD/RDC will be assisted by transaction advisor on contract management of PPP roads, and an independent engineer to monitor the contract. A Financial Adviser and a legal counsel engaged by APRDC will assist the PPP team Specific PPP preparation and management skills training will be provided to RDC during the project.
M
Lack of familiarity with Bank procurement policies
Addition of dedicated procurement staff at PMU and oversight by new Procurement Committee; implementation of continuous training program for the PMU.
L
Weak capacity of contractors and consultants during execution.
Procurement methods will be packaged to bring in the most qualified contractors and consultants for the works/services.
M
Project delays due to slow land acquisition (LA) process, delays in implementation of Resettlement Action Plan and slow removal of encumbrances.
The award of civil works contracts will be linked to completion of all land acquisition and resettlement impacts in the first milestone stretches and a well coordinated timetable will be established for the timely handing over of the remaining milestone stretches.
M
Corruption, specifically collusion of contractors and unexplained cost overruns of works.
GOAP has endorsed a Governance and Accountability Action Plan (GAAP) which includes implementation of RTI, an effective complaints handling mechanism and third-party field-based physical verification of quality.
M
Political and bureaucratic resistance to making RDC fully operational and autonomous
GOAP has already issued a Policy Letter expressing its commitment to making RDC fully operational and providing financial, administrative and operational flexibility in managing the CRN. Scaling up the issue with the new government post elections. In addition, providing legal covenants to ensure compliance.
M
Overall Risk (including Reputation Risks) M H – High; S – Substantial; M – Moderate; L – Low; N – Negligible.
F. Loan/Credit Conditions and Covenants 43. Effectiveness: The standard loan effectiveness conditions will apply.
44. Implementation Stage: In addition to the standard covenants for financial management, report and auditing, the following loan covenants related to policy reforms and implementation
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arrangement are incorporated into the legal agreements. Throughout the project implementation period, the project implementing entity shall:
A. ensure that the RBD shall have the overall responsibility for Project implementation, direction and governance, and ensure that the RBD is assisted in Project implementation by the RDC, including in the areas of procurement, contract management, financial management, safeguards, environment and social management, monitoring and evaluation, oversight, and reporting;
B. maintain the RBD and the RDC with management, staff, powers and resources
necessary and appropriate to fulfill their functions under the Project, including: (i) constituting and maintaining two subcommittees of the RDC Board, one committee being responsible for the implementation of the ISAP, and the second committee being responsible for monitoring Project implementation; and (ii) ensuring that by the date of the Loan Agreement effectiveness, the RBD shall appoint a finance manager/controller with responsibilities, qualifications, and experience necessary for the Project, and shall employ such a person or a successor for the duration of the Project;
C. by March 31, 2010, operationalize and thereafter maintain a lead agency for road safety
and a multi-sector/multi-disciplinary coordination team, both under Component 4 of the Project;
D. ensure that the EMPs and the RAPs for Phase II Roads under Component 1 (a) of the
Project are prepared and adopted in a timely manner, and comply with the R&R Policy Framework;
E. ensure that the Project is carried out in accordance with the terms, conditions and
procedures set forth in the ESMF, R&R Policy Framework, EMPs, RAPs, ISAP, HIV/AIDS Action Plan, TDP, Anti-Corruption Guidelines, and GAAP, and that the ESMF, R&R Policy Framework, EMPs, RAPs, ISAP, HIV/AIDS Action Plan, TDP, and GAAP are not revised, amended, or abrogated without the prior concurrence of the Bank;
F. with respect to Component 3 of the Project, develop a sustainable financing
arrangement for the Core Road Network; G. ensure that the RDC is fully operationalized by mid-term of the Project, including (a)
completion of RDC’s outstanding audits, and (b) providing the RDC the necessary financial, administrative, and operational powers to effectively manage the Core Road Network; and
H. carry out, under Component 4 of the Project, multi-sector road safety measures for at
least two demonstration corridors, and taking into account the results of the demonstration projects, develop and adopt by December 31, 2013, a policy and strategy for improving road safety in Andhra Pradesh.
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IV. APPRAISAL SUMMARY
A. Economic and Financial Analyses 45. Economic feasibility study has been undertaken on the project roads, which were first screened through the Strategic Options Study carried out by the RDC. The evaluation assessed whether upgrading and maintenance under long-term output-based contracts, of the proposed project roads are justifiable based on current traffic counts and projections, and road condition survey. The economic analysis of these sub-components was done using the Highway Development and Management Model (HDM-4), a globally accepted key analytical tool for economic analysis of highways investment alternatives, which simulates life cycle conditions and costs and provides economic decision criteria for multiple road design and maintenance alternatives. The main project economic benefits are savings in vehicle operating costs, travel time costs, distance savings and maintenance costs arising from the road works. Annex 9 provides a detailed economic analysis. Table 2 presents the economic analysis summary.
Table 2: Economic Analysis Summary
Sub-Components Benefits,
US$ million Costs,
US$ million Net Benefits, US$ Million
ERR, %
Upgrading Sub-Component 611 199 412 21.4%
LTPBMC sub-Component 335 58 277 58.5%
Total 946 257 689 29.6%
46. The total NPV of the activities under the road improvement component is US$689 million and the EIRR is 29.6 percent. The sensitivity of the EIRR to changes in the underlying costs and benefits show that assuming a 20 percent increase in project costs would decrease the EIRR to 26.5 percent. If benefits are reduced by 20 percent of the original estimates, the EIRR would decrease to 25.9 percent. In a more adverse scenario of a simultaneous 20 percent project cost increase and 20 percent reduction of benefits, the overall EIRR will be 23.0 percent. The switching value analysis shows that the percentage increase in costs for the NPV to become zero is 245 percent and the percentage decrease in benefits is 71 percent.
47. For PPP roads, a high-level pre-feasibility analysis was carried out to select road improvements on a PPP basis. Based on this analysis, in consultation with the World Bank, APRDC identified eight roads with a total length of 1226 km to examine their amenability for development as PPPs. Subsequently APRDC engaged a Transaction Advisor to prepare Preliminary Project Reports for these projects and also assist them in structuring and awarding concessions for roads that are found to be amenable for development as PPPs, with or without viability gap support. Based on the information available at the time of appraisal, a total of five road projects with a total length of 836 km have been identified as amenable for development as PPP projects. According to these reports, the base case EIRR of these roads range from 15 percent to 44 percent.
48. Fiscal Analysis. Over the past few years, the fiscal situation of the GOAP has shown steady improvement. Responsible fiscal management has allowed the state to recover from the debt trap, opening space for greater capital investment. The State has enacted and followed the
15
AP Fiscal Responsibility and Budget Management Act 2005, and started generating Revenue surplus from 2005-06 after more than a decade of deficits. The revenue surplus for 2006-07 reached Rs.2800 crores. The report of RBI on state finances for the year 2008-09 ranked AP first in the country on fiscal allocation for plan, development expenditure, social sector, and capital expenditures. AP state government capital expenditures rose by 140 percent between 2003-04 and 2006-07, contributing to a rapid economic growth. GOAP is likely to have little difficulty to provide the counterpart funding for this project, even though the fiscal room is likely to contract due to the latest central mandate to increase the public sector wages and the global recession.
B. Technical 49. The roads to be taken-up for improvement are existing traffic plying core network roads with intermediate or double lane width. However, most of these roads have poor horizontal and vertical alignments, weak pavements, inadequate capacity, poor riding quality, narrow or weak cross-drainage structures, inadequate shoulders, and accident black-spots. The roads will be improved by adopting uniform standards for a given section and removing all deficiencies and inadequacies in pavements, shoulders, road infrastructure, geometrics, capacity, drainage including bridges, and road safety. The roads will be mostly improved to two lanes with gravel/paved shoulders or four lanes if the traffic level warrants it. The total width of the carriageway plus the shoulders on either side is maintained at 12 m as per the Indian standards. In built up areas the road section would be kept to 10 m, if required, to minimize land acquisition and adverse impact to the roadside inhabitants. Specification and design standards adopted for the road improvement are those prescribed by the Indian Roads Congress for state highways. The standards ensure the level of service expected from the primary road network. The roads are designed to cater for traffic flows over the next 20 years. Engineering designs of the roads under the LTPBM contracts have also been prepared using the standards prescribed by the Indian Roads Congress. Most of the roads under these contracts require pavement strengthening or renewals to bring them to a stage after which routine maintenance could suffice.
C. Fiduciary 50. An assessment of procurement capacity and financial management risks has been carried out and appropriate risk mitigation measures have been proposed for the same (details are provided in Annexes 7 and 8). On behalf of RBD (and Transport Department in case of the Road Safety Component), the RDC will manage all aspects of the procurement of the civil works, goods and consultants. The RDC will rely on (a) cooperation from other GOAP departments to undertake land acquisition, fulfill regulatory obligations and relocate utilities; and (b) independent supervision consultants, to control time and quality and certify payments on completed works. At the State level, the Project’s financial requirement will be budgeted in the GOAP’s annual budget under the RBD, out of which project funds will then be provided to Chief Engineer (CRN) for implementation. The Comptroller and Auditor General (CAG) of India will undertake audit of the project in accordance with the agreed scope of work.
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D. Social 51. Social Impact Assessment (SIA): A comprehensive SIA was undertaken for upgrading and PPP components, including identifying the type and extent of impacts resulting from the planned interventions; marking properties within the Corridor of Impact (CoI); undertaking a census survey of affected families; and holding extensive stakeholder consultations. Contract-specific assessment included the extent of acquisition/appropriation of land and structures and enumeration of properties coming within the CoI. A resettlement and rehabilitation (R&R) entitlement framework has been prepared based on the findings of the SIA and the provisions of the National R&R Policy, 2007 and AP R&R Policy, 2005, as amended. The policy framework is in conformity with the requirements of the Bank’s OP 4.12. Where tribal people are affected on individual basis, specific measures have been included in the Social Management Plan (SMP) as per the Bank Policy on Indigenous People OP 4.10. A road safety awareness program and an action plan to prevent HIV/AIDS incidence resulting from improved road network has also been included in the SMP. For LTPBMC component, an Environmental and Social Management Framework (ESMF) has been prepared for integrating appropriate measures into maintenance of roads. The SIA consultations with the project stakeholders including the local (including affected) communities, NGOs, civil societies, elected representatives, project staff, local administration and functionaries of the concerned government agencies, at the community, village, mandal, district/project corridor levels. Feedback from these consultations provided input into the project design/alignment, R&R framework, and strategies to help vulnerable groups (tribal, women) to access project benefits, measures to contain HIV/AIDS and improve road safety awarness.
E. Environment 52. Environmental Impacts: The EA conducted for the project components complying with OP 4.01 and country systems has identified that the project may result in potential environmental impacts, including: (a) forest diversions and unavoidable felling of roadside trees; (b) impact on local and regional drainage and flood situations, and possible impact on water resources during construction stage; (c) impacts on existing physical, community and cultural properties; (d) construction related temporary Environment, Health, and Safety (EHS) impacts; (e) construction and operation phase air/noise pollution impacts on sensitive receptors like schools, hospitals, religious congregation areas; and (f) road safety issues during construction and operational phases.
53. Environmental Management: The project interventions for environmental management includes: (i) corridor specific EMPs for Upgrading to mitigate and minimize impacts, measures to protect environmental and community and cultural properties, and relevant environmental enhancement measures. These plans, which address construction-stage and operation-stage impacts as well as monitoring, reporting and supervision protocols, have been integrated into the corridor specific designs and bid documents. While EMPs are completed for first year upgrading, the EMPs for rest of the roads are in advanced stage of preparation; (ii) Environmental and Social Management Framework for integrating Environmental and Social
17
Management Measures into maintenance of roads8 (6,241 km in five years). The framework defines a specific screening protocol for identifying the environmental impacts and specifies the environmental management measures that need to be integrated in the bidding documents, as well as specifies the measures during road resurfacing and subsequent maintenance. Integration of environmental management measures for first year road contracts (about 2,141 km) has been completed; and (iii) Institutional Arrangements with one forest officer and Environmental Engineer working full time in APRDC supported by field engineers in various divisions, Construction Supervision Consultants for Road Upgrading component, and Technical Audit and Quality Assessment consultants for maintenance of roads. Annex 10 provides further details.
F. Safeguard Policies
Safeguard Policies Triggered by the Project Yes No
Environmental Assessment (OP/BP 4.01) [X] [ ] Natural Habitats (OP/BP 4.04) [X] [ ] Pest Management (OP 4.09) [ ] [X] Physical Cultural Resources (OP/BP 4.11) [X] [ ] Involuntary Resettlement (OP/BP 4.12) [X] [ ] Indigenous Peoples (OP/BP 4.10) [X] [ ] Forests (OP/BP 4.36) [X] [ ] Safety of Dams (OP/BP 4.37) [ ] [X] Projects in Disputed Areas (OP/BP 7.60) [ ] [X] Projects on International Waterways (OP/BP 7.50) [ ] [X]
54. Safeguard Policies Triggered: The Project is Category A for Environment Assessment (OP/BP 4.01). The project has triggered six safeguards policies as indicated above. The physical interventions proposed under the project could result in environmental and social impacts including tree cutting, forest land diversions, impact on community and cultural resources, land acquisition and involuntary resettlement of local population, and impacts on local communities, particularly tribal people (OP/BP 4.10) in certain stretches. As part of the project preparation, social and environmental assessments were undertaken to identify and assess the impacts associated with the proposed project activities, and develop mitigation measures and plans. Although the Natural Habitats (OP/BP 4.01) has been triggered, the project will not finance any road maintenance or improvement passing through wildlife sanctuaries, including designated Tiger Reserves within Andhra Pradesh. Details of the safeguard policies triggered are provided in Annex 10.
G. Policy Exceptions and Readiness 55. No policy exceptions are required. The Project complies with the readiness filter for India transport sector projects. Bids for Phase 1 upgrading and LTPBMC components have
8 The project activities on maintenance roads are limited to resurfacing without either widening the paved part of the road or widening the ROW
18
been invited, and in the case of the latter, already awarded. PPP transaction advisers have been hired, and have prepared draft techno-economic feasibility reports for seven projects. APRDC have invited expressions of interest for pre-qualification of potential bidders for three PPP project packages. Consultancy services are in advanced stages of procurement.
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Annex 1: Country and Sector or Program Background
INDIA: Andhra Pradesh Road Sector Project
Andhra Pradesh 1. Andhra Pradesh (AP) is one of the progressive states in India. Formed in 1956, it is the 5th largest state with an area of about 277,000 sq km (i.e. about 8.4 percent of Indian territorial area). According to the latest census, the population of AP has reached 76 million, with about 75 percent living in rural areas. A predominantly agricultural state, Andhra Pradesh has been developing from a relatively poor state to middle income state in the past decade. The state economy has grown at an annual rate of about 7 percent over the past five years9, comparing with that of 7.7 percent for all-India. Per capita income has grown at around 5.8 percent per annum10 during the same period and has reached to US$570, catching up with the national average. Poverty level is relatively low. Population living below poverty line is about 15 percent, only after Punjab, Himachal Pradesh and Haryana and significantly lower than the national average of 26 percent.
2. AP’s mining sector is a major driver for the economy. Standing second in the value of production in India, Andhra Pradesh’s mining sector has been growing at around 11 percent per annum11, producing in large scale key inputs such as coal and limestone for power generation and construction. The state still has rich mineral reserves to tap such as barites, coal, lime stone, and diamond.
3. The development of the communications industry has accelerated in recent years with over 20 percent annual rate of growth. In particular, IT exports become the fourth largest revenue source for Andhra Pradesh, accounting for about 15 percent of the total IT/software exports from India.12 Hyderabad, the capital of Andhra Pradesh, has become a well-known center for IT and IT enabling services, referred to as the Silicon Valley of India next to Bangalore.
4. Despite the current growth momentum, the performance of AP’s agriculture sector is lagging behind. The former “rice bowl” of south India, providing livelihood for a majority of population and generating 60 percent of employment for the workforce, is now growing at an annual rate of less than 1 percent13. Its contribution to GDP has been declining from 20 percent in 2000-01 to about 15 percent in 2004-0514. Although structural change in the economy explains part of the changing pattern, poor infrastructure, old-fashioned land and water management practices, heavy indebtedness and underdeveloped market facilities are key issues hindering agricultural growth. AP’s rich water resources, long coastline and large irrigated
9 Net Domestic Product at 1999-00 constant prices. Directories of Economics and Statistics, AP 10 Per capita Net Domestic Product at 1999-00 prices. Directories of Economics and Statistics, AP 11 During 1997-98 to 2004-05. Feasibility Study Report. Andhra Pradesh Road Sector Project. The Louis Berger Group, Inc. 12 “Andhra Pradesh emerges as the Preferred IT Hub in India”, the Financial Express, Mar. 26, 2008. 13 Chapter 2 State Profile and Economic Setting. Feasibility Study Report, Andhra Pradesh Road Sector Project, The Louis Berger Group, Inc. 14 Feasibility Study Report, Andhra Pradesh Road Sector Project, The Louis Berger Group, Inc.
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areas15 provide large growth potential to its agriculture, which in turn provides a strong base for the economy of the state as well as the nation. The investment and productivity growth in the agricultural sector can release additional workforce to keep up with the new development in the second and tertiary sector.
5. As in other states in India, there are wide variations in the economic performance across districts in AP. Among the three regions, Rayalaseema has the smallest share of Net State Domestic Product (NSDP) and its per capita income is the lowest compared with Coastal Andhra and Telangana. District wise, despite lagging regions such as Srikakulam experiencing growth rates higher than the national average, many districts remain in the lower fourth tier of the state, such as Mahbubnagar, Warangal, Nizamabad and Vizianagaram. The income gap between the poorest and the richest regions has widened over the years. Urbanization levels reach as high as 100 percent in Hyderabad and as low as 10.57 percent in Mahabubnagar. Regional disparity is likely to exacerbate as the economy moves toward existing industrial agglomerations and districts with high productivity and better investment climate.
6. In order to improve its economic and social standing, the government of AP has taken a series of fiscal and governance reforms, including passing the Fiscal Responsibility and Budget Management (FRBM) Measures Act of 2005 and adoption of the Fiscal Correction Path. The government of AP, as required in the FRBM Act, is to set annual deficit reduction targets, eliminate its revenue deficit by the end of fiscal year 2008/09, and remain with an overall fiscal deficit of 3 percent by the end of March, 2010. The state government has rationalized Stamps, Registration and Motor Vehicles taxes by bringing down the rates, resulting in better compliance and collections. Initial improvement has been evident in the fiscal health of the state as a result of these reforms. Fiscal deficit is estimated to be around 3.25 percent in 2006/07, declining from the 4.74 percent fiscal deficit in 2002/03. Revenue deficit has also shown signs of significant improvement and is estimated to decline to 0.5 percent in 2005/06 compared with 1.9 percent in 2002/03 (Table 3).
Table 3: Fiscal Deficit and Revenue Deficit of Government of Andhra Pradesh Rs. Crores
Item 2001-02 2002-03 2003-04 2004-05 2005-06
(RE) 2006-07
(BE) Nominal GSDP at factor cost
151,459 160,768 177,883 202,576 225,892 229,461
Fiscal Deficit -6723 -7625 -7450 -8192 -8190 -7457 Fiscal Defict as % of GSDP
-4.44% -4.74% -4.19% -4.04% -3.63% -3.25%
Revenue Deficit -2881 -3054 -2962 -2558 -1118 N/A Revenue Deficit as % of GSDP
-1.9% -1.9% -1.66% -1.3% -0.5% N/A
Note: BE- Budget estimate
15 About 47% of the gross sown area in the state. Andhra Pradesh Economy in Brief 2008. http://www.apdes.ap.gov.in/
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7. The state of Andhra Pradesh is one of leading states in reforms for more transparency and efficiency in governance. Well before Government of India enacted Right to Information Act in 2005, Government of Andhra Pradesh established in 2001, the Center for Good Governance, with the State Chief Minister as Chairman, to achieve the goal of “Transforming Governance”. The Center provides technical support in implementing governance reforms in varioious GOAP deparements and agencies. AP is the first state to initiate the process of e-procurement, and currently about 90 percent of procurement is done electronically. The computerization and e-governance initiatives of the state have increased transparency and streamlined record keeping and government procedures.
Figure 1: Fiscal Performance of Andhra Pradesh
8.
Road Sector in Andhra Pradesh 9. Andhra Pradesh has a total road network of about 188,568 km in length, comprising of National Highways (NHs), State Highways (SHs), Major District Roads (MDR) and rural roads (Table 4). The road density is 72 km per 100 sq. km and about 2.68 km per 1,000 persons, lower than the all-India average of 100km per 100 sq. km and 3.89 km per 1,000 population and modest according to international benchmarks. The majority of the road network is still single and intermediate lane. Figure 2 shows the lane configuration under Roads and Buildings Department (RBD). About 78 percent of the roads under RBD, mostly MDR and rural roads, are still single and intermediate lane (Figure 2).
Table 4: Road Network in Andhra Pradesh as of October 2007
Type of Network Length (km) % State Highways 10,412 15% Major District Roads 32,201 47%
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
3.50%
4.00%
4.50%
5.00%
2001-02 2002-03 2003-04 2004-05 2005-06 (RE)
% o
f GSD
P
Fiscal deficit Revenue deficit
22
Rural Roads 21,250 31% National Highways 4,647 7% Total Roads under RBD 68,510 100% Other roads (rural, under local bodies & project roads) 120,058 Total length of roads in AP 188,568
Source: RBD
Figure 2: Capacity of AP’s Road Network Under RBD
Source: APRDC Final Assessment Report (2008)
10. A number of GOAP entities share responsibility for developing and managing the AP road network. The Roads and Buildings Department (RBD) is the major organization in the sector and plays an important role in road expansion and quality maintenance in the state. RBD currently has under its jurisdiction some national highways, state highways, major district roads and some rural roads with a total length of about 68,510 km. Over 60 percent of its road network is SH and MDR. In 1997, the GOAP selected from among these SH and MDR about 10,000 km of roads with high traffic and strategic importance as the Core Road Network (CRN). These CRN roads are managed and maintained by the Andhra Pradesh Road Development Corporation (APRDC). The remaining roads totaling 120,000 km are managed by panchayats, local bodies and designated authorities.
11. The state of AP has made significant efforts in expanding and improving its road network. Over 7,500 km of the CRN have been improved. In the SH network, double lane roads have increased from 52 percent to 68 percent over the past six years. The proportion of four-lane roads in the National Highway network has increased from 7 percent to 25 percent from 2003 to 2005.
12. Despite these efforts, the current road capacity is still limited to meet the growing transport demand of the economy. The number of registered vehicles in Andhra Pradesh has been increasing rapidly (Figure 3). The annual growth rate is estimated to be around 9.5 percent, one of the highest in the country. Coupled with the common overloading problem, this has resulted in significant road congestion and accidents on the road network. According to the
73%
5%
20%2%
single lane intermediate lane double lane four lane and above
23
road safety assessment, in 2007, 13,450 people died in road crashes, a more than 50 percent increase compared with 2001 levels16.
Figure 3: Total Vehicle Population, Thousands
Source: APRDC Final Assessment Report (2008)
13. The limited road capacity and growing demand for road traffic show the need for maintenance and capital investment to enhance the road network. Strengthening the road network not only improves the immediate inadequacies for road traffic but also helps industrial and economic development at large. Consistent with AP’s Vision 2020, revitalizing agriculture and tapping the rich mining industry requires a road network that ensures logistical efficiency. A better investment climate with an enhanced and improved road network also facilitates urbanization and helps attract high-end sectors such as IT industry in competition with neighboring cities. To this end, AP needs to continue its efforts to improve the road network.
14. The first AP road sector project has laid a good foundation for future development in the sector. The average condition of the core road network and overall maintenance funding for the state roads have been improved substantially under this project. AP was the first state in India to pilot performance based maintenance contracts. Its successful implementation has motivated GOAP to scale up the pilot project to all districts in the state. Other states such as Uttar Pradesh and Kerala17 have also benefited from the experience in the first AP road sector project.
15. The previous project initiated several reforms in policy planning, financing and implementation for the road sector. A Road Policy for 2005-2015 developed during and following the first project, was issued by the GOAP in July 2005. This policy broadly
16 Assessment of Road Safety Management Capacity in the State of Andhra Pradesh, India. 2008 17 ICR of the Andhra Pradesh State Highway Project (APSHP)
3951.9
4601.84940.6
5408.9
6662.86432.1
6814.7
0
1000
2000
3000
4000
5000
6000
7000
8000
2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07
24
highlights the importance of connectivity improvement and addresses on the way forward issues of sustainable development, maintenance/operation and road financing in the state. RBD has subsequently prepared a preliminary Road Bill to address ribbon development, encroachment, safety and road financing.
16. Road financing remains a major bottleneck for the sector development. To ensure priority of maintenance funding, the GOI’s Twelfth Finance Commission (TFC) has set aside US$245 million grants to maintain and improve the AP road network during 2006-201018. Of this amount US$190 million will be allocated to RBD to finance non-wage expenditure of maintenance and improvement of about 6,000 km, which covers about 10 percent of its road network.
17. While the TFC allocation has separate grants for road maintenance, a road financing study shows existing financing sources are not sufficient to fund for road maintenance requirement and road capacity improvement for future traffic demand. In particular, funds for SH and MDR network are particularly low compared with requirements for future maintenance and upgrading. Andhra Pradesh needs to develop a long-term policy strategy to ensure adequate resources.
18. A potential revenue source for road development comes from usage charge for road users. With the number of registered vehicles growing comparably to the economic growth rate, the amount of revenues collected from road users are expected to increase. Generated revenues from road users in the past few years have shown a compounded growth rate of over 20 percent under heads such as sales tax on petrol and diesel. These revenues, as projected by the road financing study, are going to be the major source to fill the funding gap. The uncertainties and upredictable nature of budgetary allocation for maitenancne, , however, suggests the need for a revenue transfer policy and legal freamework to channel adequate portion of the revenues from road users back to the road sector (the current portion transferred to the road sector is only around 11 percent). GOAP is currently considering the establishement a dedicated road fund for road maintenance, as one of the options for ensuring sustainable road maintenance financing arrangement.
Public Private Partnership in the State and the Road Sector 19. GOAP is keen to use PPPs to address the infrastructure deficits in a wide variety of sectors ranging from power and transport to urban amenities and tourism. An Infrastructure Act was put in place in 2001 defining areas for PPP, establishing the Infrastructure Authority, outlining the competitive bidding procedures, step-in rights for lenders, and establishment of a standing conciliation board for disputes and its modus operandi. GOAP has established an Infrastructure and Investment Department and Infrastructure Corporation of Andhra Pradesh (INCAP) in 2005 and, more recently, a PPP Cell in the Department of Finance.
20. Development of PPP projects usually takes place at Line ministry level in sectors where there is a project pipeline or with project specific agencies (e.g. Hyderabad Metro) or at municipal level or by INCAP. In some cases, where the size of the project is such, e.g. the
18 Chapter 10 Grants-in-aid to the states, Twelfth Finance Commission, p182.
25
$560m Hyderabad Metro Rail, a project specific steering committee reporting to the Chief Secretary and thence to the Chief Minister has been established to fast track approvals and monitor progress. INCAP’s mandate, on the other hand, includes identification, conceptualization, promoting, developing, advising and providing support to GOAP on infrastructure projects acting both as a project development agency or project developer.
21. GOAP has so far implemented 43 projects, the majority of which have been in the tourism and roads sectors (for a department/agency-wise listing of these projects, see Table 5 below). PPP initiatives at municipality and district level largely consist of outsourcing projects in areas like solid waste management, water supply operations and maintenance (O&M), street lighting and township development. In the road sector, PPP projects are developed by the Roads and Buildings Department and APRDC. Twelve road and toll bridges have been completed to date of which five have already run the term of their (short) concession periods. APRDC is currently managing the procurement of 23 schemes. The Roads Department has established a technical committee to clear RFQ/RFP documents and evaluate technical proposals and a financial committee to evaluate financial proposals.
Table 5: PPP Projects in Andhra Pradesh Department/authority Preparation Awarded/Operational Total
Infrastructure Authority 4 - 4 Transport, Roads and Buildings 1 1 AP Roads Development Corporation 23 12 35 Hyderabad Urban Dev Authority (a) 5 5 Municipal & Urban Development (b) 1 1 Tourism 11 29 40 Others 1 7 8
Notes: (a) Sections of Outer Ring Road; and (b) Hyderabad Metro. Source: Draft Action Plan Report to support Public Sector Agencies engaged in development of PPPs, prepared for DEA, by Partnerships UK, with support from PPIAF and the World Bank.
22. In order to facilitate development of more road projects on PPP basis in 2009, GOAP issued orders for implementation of the toll policy which sets out the rules for collection fees from users of State Roads and bridges. The toll policy is essentially similar to the toll policy applicable to National Highway projects, with three notable exceptions. First, the base toll rates are slightly lower than the toll rates applicable for comparable four-lane National Highways. Second, while the toll policy for National Highways allows for an annual increase in toll rates by 3 percent (fixed) + 40 percent of WPI (variable), the AP Toll Rules provide for a bi-annual increase linked solely to WPI. Third, local private cars within a 20 km radius of the project road are exempt from paying tolls.
23. Other relevant issues for PPP development: India has a fairly large PPP program which has accelerated rapidly since 2004. India’s transport PPP program, with investment commitments of over $10.5 billion during 2006 and 2007, is now one of the largest in middle and low-income countries. The momentum generated by the PPP program led to an increase in the number of states using this approach for service delivery, as well as plans by the GoI to both ramp up PPPs in infrastructure as well as expand their use to the social sectors. In the aftermath of the global financial crisis, India’s PPP program has reportedly lost some momentum. The
26
adverse impacts of increase in cost of debt and reduced availability of risk capital as well as debt are reflected in the lower participation levels in bids for PPP projects being awarded under various flagship programs of the central government such as, for example, the National Highways Development Project. The Government of India and RBI have already taken several measures to increase availability of funds for infrastructure projects, including those to be implemented through PPP. While RBI has slashed repo rate and credit reserve ratio (CRR) and relaxed norms for external commercial borrowings (ECBs), the central government has allowed IIFCL to raise long-term funds through issues government-guaranteed, tax-free bonds, and channelizing them through a re-financing window. In addition, GOI has requested the Bank to consider increasing the proposed $600 million line of credit to IIFCL by an additional US$600 million. From a series of informal interactions that the Bank team had with a few lenders and developers actively associated with PPP projects, it appears that the private investor interest in infrastructure PPP projects is expected to be revived in tandem with the successful implementation of the aforementioned measures aimed at increasing the availability of funds for these projects. In the meantime, as debt and equity investors are adopting a very cautious approach, the threshold of commercial attractiveness of a project to be successfully awarded and financed as PPP is likely to be higher than in the past. In order to be able to attract private partners and achieve financial closures in the near future, structuring of PPP projects need to be very robust, i.e., with adequate cushion to be able to withstand sizeable variations in the projected revenues.
Road Sector Institutional Framework 24. The AP Road and Buildings Department (RBD) is the main agency managing the major road network in the state. There are nine wings under RBD, as shown in Table 6. The AP Road Development Corporation (RDC) was formed in 1998 under an Act of the government. It gradually took over the development and maintenance of the core road network (CRN) in the state and now manages about 12,408 km of high traffic CRN.
25. The roads under RBD are maintained mainly through allocations from the consolidated fund of the government of Andhra Pradesh. Capital investments of road network are funded through sources from the Central Road Fund of the Government of India, domestic borrowing from national agencies (NABARD and HUDCO) and external assistance from international organizations (World Bank, ADB etc.)
26. With little customer and service delivery focus, the current organizational structure has the effect of spreading limited human and financial resources too thinly among various subdivisions, thus preventing the concentration and development of resources required for effective and efficient road asset management. The Road Development Corporation (RDC) has not been fully operationalized as a corporate body. The road sector Institutional Development Action Plan implemented in the first AP road project began the improvement of the state’s capabilities for the planning and management of road programs and assets. For example, e-procurement has been introduced for all civil works contracts estimated to cost more than Rs.100,000 (US$2,200). A draft Procurement bill is under review and the state has also embarked upon creating a computerized public database of contractors. GOAP has also set up the National Academy of Construction to impart training to staff of the contractors and improve the quality of works, increasing the capacity of contractors, other construction agencies and
27
RBD/RDC staff. Despite these efforts, there is still a long way to go in institutional strengthening in the sector to achieve effective and sustainable roads management functions, capacity and funding. While the state’s Infrastructure Enabling Act 2001 has been enacted to invite private sector involvement for road projects in Andhra Pradesh on the BOT basis, RDC still lacks the internal capabilities and skill-sets to develop and manage PPP transactions in an effective manner. Although action was taken over 1998-2004 to establish a GIS-base Road Information System (RIS) and prepare for a Pavement Management System (PMS), budget/resource constraints have hampered the intended finalization and operation of these tools in RBD/RDC activities.
Table 6: RBD Organizational Framework
Wing Designation Functions Administration Engineer-in Chief(R&B),
Administration. In charge of all administrative matters pertaining to Roads & Buildings Department.
State Roads Chief Engineer, (R&B), Roads In charge of construction and maintenance of State Roads including under Plan, Non-plan, CRF, APRDC, ROBs and RUBs.
Buildings Chief Engineer(R&B), Buildings
In charge of construction and maintenance of Government Buildings
National Highways Engineer-in Chief(R&B), Administration.
In charge of construction and maintenance of National Highways in the State, except the Externally Aided Projects which are being looked after by the National Highways Authority of India
HUDCO Chief Engineer(R&B), NABARD.
In charge of works sanctioned under the NABARD Schemes
Quality Control Chief Engineer(R&B, CRN) and Managing Director, APRDC
Inspection and quality control for road network
Andhra Pradesh Road Development Corporation (APRDC) and Externally Aided Projects
Chief Engineer(R&B, CRN) and Managing Director, APRDC
Funds raising, management, policies, Works sanction etc for the APRDC except execution; in charge of externally aided projects, PPP Projects
NABARD Chief Engineer(R&B), NABARD.
In charge of works sanctioned under the NABARD Schemes
Commissionerate of Tenders
Chief Engineer(Commissionerate of Tenders)
Member, Commissionerate of Tenders
Source: APRDC Road Safety 27. Andhra Pradesh has a serious and deteriorating road safety and public health problem. It is reported that the number of road accidents have increased about 50 percent since 2001 and it is projected to increase further as motor vehicle traffic grows19. The data comp lied by the Andhra Pradesh Road Safety Authority (APRSA) in 2007 shows that the accident rate involving all types of vehicles was on the rise in the State. In 2006, everyday on average, there
19 Final report: Assessment of road safety management capacity in the State of Andhra Pradesh, India. Jeanne Breen Consulting.
28
were 117 accidents, with 34 people dead and 164 people injured in January and February that year, while in 2007 the corresponding figures were 131 accidents, with 36 persons dead and 179 injured20. The rising accident rate is mainly attributed to speeding, drunken or rash driving and lack of staff to enforce safety measures and the total absence of coordination among the connected departments/agencies concerned — police, transport, health, roads and buildings, the Panchayat Raj and civic bodies.
28. The huge socio-economic costs of these accidents exacerbate poverty reduction efforts. A study by the GOI Planning Commission in 2002 estimated the social cost of road accidents in India at Rs.55,000 Crore annually (in 2000 prices), which constitutes about 3 percent of the (then) national GDP21
.
29. The GOAP has made the APRSA a powerful body, headed by the Chief Minister to ensure better coordination among the concerned departments. In line with a U.N. resolution to avoid accidents, many critical actions need to be undertaken. Taking safety precautions and institutionalizing transport safety issues and responses will be more useful than ad hoc measures. The GOAP lacks an up-to-date and cohesive road safety strategy and action plan to effectively reform and conduct road safety management in a new multi-sectoral approach.
20 Accidents, More Accidents Every day. The Hindu. May 03, 2007. http://www.hinduonnet.com/2007/05/03/stories/2007050309610400.htm 21 Sundar Committee Report on Road Safety and Traffic Management. Ministry of Shipping, Road Transport and Highways Department of Road Transport and Highways. http://morth.nic.in/writereaddata/sublinkimages/Road_Safety_sundar_report4006852610.pdf
29
Annex 2: Major Related Projects Financed by the Bank and/or other Agencies
INDIA: Andhra Pradesh Road Sector Project
Issue Project Latest Supervision Ratings
World Bank-financed, completed or on-Going Implementation Progress
Development
Objective
Capacity expansion of national highways and institutional strengthening of MOSRTH and NHAI
Second National Highways Project (Ln.3470, Cr.2365-IN),
Completed S
Third National Highways Project (Ln.4559-IN),
Completed MS
Grand Trunk Road Improvement Project (Ln.4622-IN)
MS MS
Allahabad Bypass Project (Ln.4719-IN) S S Lucknow Muzaffarpur National Highway Project (Ln. 4764-IN)
MS S
Enhancement of institutional capacity to prepare projects at the state-level
State Roads Infrastructure Development Technical Assistance (Ln.4114-IN)
Completed S
Capacity expansion, maintenance and institutional development of state road agencies
Andhra Pradesh State Highway Project (Ln. 2490-IN)
Completed S
Gujarat State Highway Project (Ln.4577-IN) Completed S Karnataka State Highways Improvement Project (Ln.4606-IN)
Completed S
Kerala State Transport Project (Ln.4563-IN) MU MU Mizoram State Roads Project (Ln.3618-IN) MS MS Uttar Pradesh State Roads Project (Ln.4685-IN)
S MS
Tamil Nadu Road Sector Project (Ln.4706-IN) S S Himachal Pradesh State Roads Project (Ln.4860-IN)
MS S
Orissa State Roads Project (Ln. 7577-IN) Approved Approved
Widening and strengthening of two state roads in Gujarat in a commercial format: Vadodara – Halol SH and Ahmedabad – Mahesana SH, Delhi Noida Toll Bridge
Infrastructure Leasing & Financial Services (Ln.3992-IN; Cr.2838-IN)
S S
Other development agencies, completed, ongoing and plannedADB- Capacity expansion of national highways and IS of NHAI/MOSRTH
First Highway Project, Second Highway Project, National Highway Project
Completed
JBIC - Capacity expansion of NHs and IS of NHAI/MOSRTH
Yamuna Bridge Project, National Highway Project
Completed
ADB - Capacity expansion of NH and SH and institutional strengthening of agencies
National Highway Corridor I, Surat-Manor Tollway Project, Chattisgarh State Roads Project, National Highway Corridor II, MP State Roads Project
Ongoing
30
Table 7: Status of India Road Projects Financed by the Bank
Projects Loan amount, USD million
Length of NHs or SHs, km
Project Status Date of approvalwidening/ upgrading
Other improvement
(PM)
NHAI Projects
Second National Highways Project 153 290 Completed 12-May-1992
Third National Highways Project 516 475 Completed 08-Jun-2000
Grand Trunk Road Improvement Project 589 620 Under implementation 21-Jun-2001
Allahabad Bypass Project 240 84.7 Under implementation 14-Oct-2003
Lucknow Muzaffarpur National Highway Project 620 483 Under implementation 21-Dec-2004
Sub-total for NH projects 2,118 1,952.7
State Projects
Karnataka 360 1,000 1,300 Completed 24-May-2001
Kerala 255 624 1,000 Under implementation 14-Mar-2002
Tamil Nadu 348 750 2,000 Under implementation 17-Jun-2003
Mizoram 60 184 520 Under implementation 14-Mar-2002
Gujarat 381 900 1,000 Completed 5-Sep-2000
Uttar Pradesh 488 1,000 2,500 Under implementation 19-Dec-2002
Punjab 250 360 590 Under implementation 5-Dec-2006
Andhra Pradesh 350 1,400 1,750 Completed 17-Jun-1997
Himachal Pradesh 220 447 2,000 Under implementation 5-Jun-2007 Orissa 250 461 229 Under implementation 30-Sept-2008
Sub-total for SH projects 2,962 7,126 12,889
TOTAL 5,080 9,079 12,889
31
Annex 3: Results Framework and Monitoring
INDIA: Andhra Pradesh Road Sector Project
Table 8: Results Framework PDO Project Outcome Indicators Use of Project Outcome
Information 1. The development objective of the project is to provide better quality, capacity and safe roads to users in a sustainable manner, through enhanced institutional capacity of the Andhra Pradesh government in the road sector.
1.1. Share of the CRN in good condition increased;
1.2. Full opertationalization of the RDC with adequate financial and human resources to manage the CRN;
1.3. Vehicle operating costs declines relative to without project situation in upgraded roads;
1.4. Travel time for bus passengers declines relative to without project situation in upgraded roads;
1.5. Number of road accident fatalities per vehicle km travelled reduced on Demonstration Corridors.
To assess the project’s contribution to improve (i) the state’s investment climate; and (ii) the performance of the state’s road sector agencies in delivering better quality and safer CRN roadways.
Intermediate Outcomes Intermediate Outcome Indicators Use of Intermediate Outcome Monitoring
1. Priority road corridors improved in a sustainable way
1.1. 429 km upgraded efficiently and environmental and socially sustainable way;
1.2. 6241 km of roads under Long-term performance based maintenance contract;
To assess the performance of the project and to redirect it, if necessary, to achieve the PDO.
2. PPP Facilitation Support
2.1. RDC is able to concession three roads of those selected for PPP transactions.
To assess the performance of the project and to redirect it, if necessary, to achieve the PDO.
3. Institutional Strengthening
3.1. ISAP milestones met; 3.2 GAAP milestones met; 3.3. Annual maintenance plans developed through the RMS system.
To assess the performance of the project and to redirect it, if necessary, to achieve the PDO.
4. Road Safety
4.1. Demonstration projects carried out in at least two road corridors; 4.2 Comprehensive GOAP road safety functions, capacity and action plan(s) put in place; 4.3 Black-spot improvements initiated.
To assess the performance of the project and to redirect it, if necessary, to achieve the PDO.
32
Ta
ble
9:
Arr
an
gem
ents
fo
r R
esu
lts
Mo
nit
ori
ng
Act
ual
Val
ue
Tar
get
Val
ues
D
ata
Co
llec
tio
n a
nd
Rep
ort
ing
O
utc
om
e In
dic
ator
s
Ba
seli
ne
(20
09
) Y
R1
Y
R2
Y
R3
Y
R4
Y
R5
F
req
uen
cy
an
d R
epo
rts
Dat
a C
oll
ecti
on
In
stru
men
ts
Res
po
nsi
bil
ity
fo
r D
ata
C
oll
ecti
on
1.
1 F
ull
op
erta
tio
nal
izat
ion
o
f th
e R
DC
wit
h ad
equ
ate
fin
anci
al
and
hum
an
reso
urc
es t
o m
anag
e th
e C
RN
RD
C s
till
no
t fu
lly
o
per
atio
nal
; ou
tsta
ndin
g au
dit
s; A
ct t
o
be r
evie
wed
; no
ind
epen
dent
fi
nan
cial
an
d o
per
atio
nal
p
roce
du
res;
m
any
sta
ff
dep
ute
d fr
om
R
BD
Out
stan
ding
A
ud
its
Co
mp
lete
d
Nec
essa
ry
amen
dmen
ts
carr
ied
out
in
RD
C A
ct
GO
AP
pr
ovid
es R
DC
w
ith
fina
ncia
l,
adm
inis
trat
ive
and
oper
atio
nal
pow
ers;
Rul
es
& p
roce
du
res
adop
ted
RD
C h
as o
wn
staf
fin
g a
nd
ad
equ
ate
sou
rces
o
f re
ven
ue f
or
CR
N
1.2.
Veh
icle
o
per
atin
g c
ost
d
ecli
nes
rel
ativ
e to
w
ith
ou
t p
roje
ct
situ
atio
n in
u
pg
rad
ed r
oad
s
C
ars:
Rs.
5.4
1 p
er v
ehic
le k
m
(wit
ho
ut
pro
ject
)
Tru
cks:
Rs.
11
.85
per
vehi
cle
km
(wit
ho
ut
pro
ject
12
%
red
uct
ion
w
ith
pro
ject
8%
red
uct
ion
wit
h p
roje
ct
Ann
ual
Hig
h P
rio
rity
N
etw
ork
C
ondi
tion
R
epor
ts
RA
MS
R
BD
/PM
U
1.3
. T
rav
el t
ime
for
bus
pass
enge
rs
decl
ines
re
lati
ve
to
wit
hout
pr
ojec
t si
tuat
ion
in
up
gra
ded
roa
ds
10
.6 h
rs t
o tr
avel
all
422
k
m o
f up
grad
ing
com
pone
nt
7.8
hrs
(2
6%
re
du
ctio
n)
to
trav
el a
ll 4
22
km
of
upgr
adin
g co
mpo
nent
Bi-
Ann
ual
Hig
h P
rio
rity
N
etw
ork
T
raff
ic
Rep
orts
RA
MS
R
BD
/PM
U
1.4.
Num
ber
of r
oad
acci
den
t fa
tali
ties
p
er
veh
icle
k
m
red
uce
d o
n
Dem
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rati
on
To
be
un
der
take
n
YR
1
To
be
un
der
take
n
To
be
un
der
take
n A
nnua
l R
epor
t
P
MU
/Tra
nsp
ort
D
epar
tmen
t
33
A
ctu
al V
alu
e T
arge
t V
alu
es
Da
ta C
oll
ecti
on
an
d R
epo
rtin
g
Ou
tco
me
Ind
icat
ors
B
ase
lin
e (2
00
9)
YR
1
YR
2
YR
3
YR
4
YR
5
Fre
qu
ency
a
nd
Rep
ort
s D
ata
Co
llec
tio
n
Inst
rum
ents
Res
po
nsi
bil
ity
fo
r D
ata
C
oll
ecti
on
C
orr
ido
rs
1.5.
Sha
re o
f C
RN
in
goo
d co
ndit
ion
incr
ease
d
40
%
60
%
8
0%
A
sset
M
anag
emen
t S
urve
y
Su
rvey
In
dep
end
ent
Con
sult
ant
Res
ult
s In
dic
ato
rs
for
Eac
h
Com
pon
ent
Com
pon
ent
1 (R
oad
I C
orri
dor
im
pro
vem
ent)
1.1
429
km
up
gra
ded
eff
icie
ntl
y
and
envi
ronm
enta
l an
d so
cial
ly
sust
aina
ble
way
1.
2 62
41 k
m o
f ro
ads
un
der
Lo
ng-
term
per
form
ance
ba
sed
mai
nten
ance
co
ntr
act
Nil
27
4 k
m
20
00 k
m
42
9 k
m
62
41
km
Sem
i-an
nu
al
pro
gre
ss
rep
ort
, M
onth
ly
rep
ort
s,
qu
arte
rly
F
MR
s
In-h
ou
se
rep
ort
ing,
ce
rtif
icat
ion
of q
uant
itie
s by
CS
C
RB
D/P
MU
/CS
C
Co
mp
on
ent
2 (
PP
P F
aci
lita
tion
)
2.1
RD
C i
s ab
le t
o co
nce
ssio
n t
hre
e o
f th
e ro
ads
sele
cted
fo
r P
PP
tra
nsa
ctio
ns
Nil
1
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35
Annex 4: Detailed Project Description
INDIA: Andhra Pradesh Road Sector Project
1. The proposed project comprises four components: (a) Road Improvement Works, (b) PPP Facilitation Support (c) Institutional Strengthening, and (d) Road Safety
Component 1: Road Improvement Works Component 2. This component comprises two activities designed to upgrade and maintain the Core Road Network (CRN) under the Road Development Corporation (RDC) management: (a) upgrading about 429 km of priority state highways in two phases (284 km in Phase I and 145 km in Phase II) under public sector financing, (b) maintenance of 6,241 km under Long-term Performance-Based Maintenance Contracts (LTPBMC).
3. Upgrading Works: The project will support widening and strengthening of about 429 kms state highways. The civil work contracts will be let out into two phases in order to ease the preparation and implementation capacity of RDC and the construction industry. The loan shall finance civil works, supervision costs, R&R assistance, including implementation support through NGOs. In addition, the componenet will provide technical assistance and NGO support for HIV/AIDS awareness measures to GOAP agencies and/or community bodies for (i) addressing the needs of the immediate populations working on the project, and (ii) complement the activities implemented by the AP State AIDS Control Society (APSACS) on the project roads.
Table 10: Project Roads Upgrading under Public Sector Financing Sl. No. Name of the Road Length in Kms
I. Phase I Roads
1. Chittoor-Puttur Road 60.8
2. Kurnool-Devanakonda Road 60.6
3. Kandi-Shadnagar Road 69.9
4. Mydukur – Jammalamadugu Road 35.0
5. Jagityal – Peddapalli Road 57.8
Total Phase I Roads 284.1
II. Phase II Roads
1. Kakinada – Rajahmundry Road 61.6
2. Pedana – Vissannapeta Road 82.9
Total Phase II Roads 144.5
Total All Phases Roads 428.6
36
4. Long Term-Performance Based Maintenance Contracts (LTPBMC): Under this sub-component, the project will support the maintenance of the 6,241 km of the CRN currently under the management of RDC. Most of the roads are state highways, which are already widened to two lane standard and the maintenance will be carried out under a five-year contract using the Bank’s OPRC document suitably modified to fit into local conditions. The Bank will finance up to 20 percent of the expenditure, while the reaming 80 percent will come from GOAP is own funding. The APRDC has invited tender for the first phase of the OPRC contracts (11 contracts, totaling about 2,141 km). The RDC has succeeded in receiving bids for nine contracts and is in the process of finalizing the award of these contracts. The other four contracts would be re-tendered. The second phase of OPRC contracts will involve a total of 25 contacts, covering 4,100 km of roads. These contracts are under various stages of preparation. This component shall also support contract preparation assistance and monitoring consultants.
Component 2: Public-Private Partnership Facilitation Support 5. The project will assist in strengthening the capacity of GOAP to attract private financing and leverage viability gap grant funds available from GOI for upgrading (widening from existing two-lane roads to four-lane) and maintenance of selected high traffic density corridors. Specifically, the loan will finance the costs of: (a) transaction advisers to assist APRDC to carry out feasibility studies and to develop and transact selected road projects as PPPs; and (b) capacity building of APRDC to be able to better identify, structure, award and monitor PPP projects. APRDC, in consultation with the Bank and based on a high-level feasibility analysis, identified eight existing state highway corridors for development as potential PPP roads. Subsequently, APRDC engaged a transaction adviser to assist in developing and awarding these roads as PPPs and, based on the techno-economic feasibility reports prepared by the advisers, decided to develop five roads with a total length of 863 kms for development as PPPs. These roads are being developed as BOT-Toll concessions following the Government of India guidance documents such as, for example, Request for Qualifications and Model Concession Agreement. In case of three roads, APRDC initiated the procurement process, obtained in-principle approval for Viability Gap Funding support from the Government of India, and received bids. Besides part-financing the costs of the transaction adviser already engaged by APRDC, this component makes provision for engaging services of transaction advisory consultants for helping APRDC in developing more roads that are likely to be identified during project implementation as PPPs. The capacity building part of this component will finance the costs of engaging experts on PPP related issues and training and exposure visits for staff at various levels of APRDC.
6. The five roads selected for development under PPP format are described below:
(i) Hyderabad – Karimnagar – Ramagundam Road (207 km) starts on SH-1 at km 28.2 near Hyderabad and ends at Manchiryal, a joining point on NH-16. The highway passes through four districts and has a two-lane undivided carriageway (with paved shoulder and soft shoulders), except for a length of 6.1 km, which is four-laned (with hard shoulders).
37
(ii) Narketpalli – Addanki – Medaramitla Road (213 km) is SH-2 connecting NH-9 from Narketpalli to NH-5 at Medaramitla. Except for a small 2 km four-lane stretch, the highway is presently a two-lane undivided carriageway.
(iii) Puthalapattu – Naidupet Road (100 km) is SH-61 starting on NH-18 near Puthalapttu in Chittor district and ending on NH-5 in Nellore district, connecting on its way historically significant places such as Chandragiri, Tirupati and Kalahasti. The project stretch consists of the entire length of this corridor except a 17 km stretch (Tirupati Bypass) which is presently under the control of the National Highways Authority of India (NHAI).
(iv) Kadapa-Renigunta Road (138 km) is SH-31 starting from junction point of SH-61 near Renigunta and ending at the end of Kadpa bypass on NH-18.
(v) Khammam- Tallada – Devarapalli Road (177 km) is a part of SH-08 with an existing intermediate and two-lane carriageway starting from Khammam town and ending in West Godavari district.
7. During the course of the project preparation, the Government of Andhra Pradesh and the Bank have extensively discussed the possibility of utilizing the bank financing to meet the state government’s share of the viability gap funding for the roads sought to be developed as PPPs. This form of support, however, has not been included at the time of appraisal due to differences between the Bank’s procurement and safeguards requirements and the provisions under the GOI’s guidance documents being followed by the APRDC for developing the selected roads as PPPs. In view of this, GOAP and Bank have agreed to limit the scope of this component to Technical Assistance for meeting the costs of Transaction Advisors and PPP Capacity Building and continue to explore the possibility for extending loan assistance to meet the state’s share of the viability gap support for PPP transactions in future. Component 3: Institutional Strengthening Component 8. This component will fund technical assistance (TA), consultant services, training and procurement of IT assets required for the operationalization of the RDC, and for effective planning and asset management in both the RBD and the RDC, in accordance with their respective targets and responsibilities under the client-developed, GOAP-endorsed Institutional Strengthening Action Plan (ISAP). In particular, the project will fund the costs of: (a) engaging external legal, financial management, IT-ICT-MIS and organizational development expertise to comprehensively prepare the basis for GOAP decision-making and implementation of full RDC technical, operational and business powers; (b) technical assistance to strengthen management capacity for PPP and contract/concession management in the road sector; (c) strengthening core processes and capacities, particularly for roads master planning, ISO-based quality management, financial management and road maintenance monitoring, funding and management; (d) associated human resource development and staff training based on an upfront training needs assessment (TNA); and (e) appropriate contemporary IT-ICT equipment, facilities and services to support important technical applications, management systems, business
38
communications and e-governance functions. The project funded services will also wherever appropriate include support for the ‘roll-out’, user-training and ‘embedding’ stages of new processes and systems. The project will also provide funding for an Institutional Strengthening (IS) Cell during the Project to provide support on ISAP implementation, coordination and progress monitoring
9. The main ISAP interventions and measures being supported by these project-funded services and TA have been determined by the GOAP Core Group on AP road sector institutional development. The key thrust areas of the ISAP are directly compatible with the Governance and Accountability aims and measures expressed in the GAAP also being implemented under the project, and hence the ‘ISAP implementation’ services and TA will in many areas also help achieve GAAP targets and outcomes. A matrix-style summary of the major elements of the ISAP is provided in Annex 4B.
Component 4: Safe Roads Component
10. The Road Safety component attempts to address the deteriorating road safety situation in the state in a sustainable manner. The actions expected to be supported under this component include: (i) establishing a lead unit for road safety in the Transport Department with about 20 people; (ii) strengthening the road safety engineering capacity in the RBD; (iii) enhancing the capacity and effectiveness of the state’s road safety agency; and (iv) establishing a range of Technical Working Groups, such as: (a) Result Management; (b) Road Infrastructure Safety Planning and Engineering; (c) Pre-hospital and Trauma Centre; (d) User Legislation and Police Enforcement; (e) Safety Promotion; and (f) Vehicle Safety.
11. Project funds will be provided under this component for:
(a) Safe Roads Program: Works, goods and technical assistance and consultancy services to implement a Road Safety Demonstration Project in two or three identified corridors which could be the focus of a range of multi-sectoral activity and provide a basis for the development of a comprehensive evidence-based and effectively resourced road safety policy and strategy in Andhra Pradesh;
(b) Safe Roads Program: Technical assistance and consultancy services to develop a road safety policy and action plan for Andhra Pradesh; and
(c) Technical Assistance to RDC/RBD to: (i) conduct road safety audits of the CRN; and (ii) undertake a blackspot improvement program of the CRN.
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Annex 4A: Institutional Strengthening Action Planning 2009 – 2015
Major Objectives & Key Result Areas
India: Andhra Pradesh Road Sector Project
1. The GOAP has given its endorsement to all key elements of the Institutional Strengthening Action Plan (ISAP) that will be implemented with Project support over the period 2009 – 2015, involving commitment to various early milestones for catalytic actions on new legislation, sector policy, road funding and organizational development of the RDC as well as more medium-term targets. The major ISAP elements are summarized below. This will provide the framework for implementation and monitoring of an agreed IS program for both the RDC and the RBD in carefully targeted fields.
2. Based on this summary-level matrix, the RDC and the RDB will develop a more detailed ‘working level’ ISAP which provides specific details of individual IS targets and sub-targets, the range of required outputs, the actions to be taken, the assigned milestones and the respective accountabilities across GOAP, the RDC and the RBD. This ‘working level’ ISAP shall be available by Project launch and will be made publicly accessible during the Project via the APRDC website. The summary-level ISAP matrix will be a “living document”, to be updated by the concerned GOAP agencies (in consultation with development partners such as the Bank) at major intervals during the project period to respond as required to any significant changes and/or new issues in the implementation environment.
Table 11: Key Results Expected
Objective Key Results Expected
Strategic & Regulatory Framework
Effective road sector policy, planning, responsibilities and powers
New AP Road Act enacted by GOAP and implemented, sector-wide
Updated D-Code approved by GOAP and implemented, sector-wide Outputs of rational road (asset) management system (RMS) being applied by GOAP in road maintenance budget planning and allocation decisions Efficient ‘activity / project monitoring’ / performance reporting and MIS / decision-support systems implemented and in use in R&BD and RDC Policies and capacity for Environment and Social (E&S) factors and issues in roads development / management, in place State-level ‘road network master plan’ established for GOAP decision-making on roads development
Adequate and sustained CRN funding
New road fund or comparable mechanism(s) selected by GOAP to ensure adequate and sustainable resources for CRN funding requirements, implemented and fully operational
Increased private sector participation
New PPP projects and new performance-based CRN maintenance contracts initiated by RDC and performing satisfactorily
New state-level Road Safety (RS)
Comprehensive GOAP endorsed state RS action program implemented by multi-agency body led by Transport Department
40
strategy, capacity and action
Current-phase R&BD ‘black-spot rectification’ program completed
Organization, Management & Systems
Effective roads sector RTI, governance and accountability mechanisms
GOAP-endorsed, RTI-compliant Governance and Accountability Action Plan (GAAP) for roads sector under implementation and on target Periodic road user satisfaction surveys completed and results publicized
Effective RDC powers, policies, structure and capacity for its major responsibilities.
New PPP projects roles and capacity implemented in RDC New Rules and Policies for RDC business processes endorsed by GOAP Necessary staffing powers and flexibility fully implemented (with specific MD powers for RDC staffing management) New RDC-specific financial powers and FMS in place and being utilized RDC-specific IT Strategy, ‘cell’ and capacity in place and operational New RDC-dedicated HRM and HRD functions and capacity in place
Updated R&BD structure, processes and capacity
Strengthening of R&BD staffing and functions (in line with new D-Code effects) in Planning and Asset Management, completed Updated D-Code in place and being applied throughout R&BD
Updated R&BD-specific financial powers and FM tools in place New R&BD IT-ICT-MIS Strategy and “IT cell” / resources in place
Rational road asset management and funding
IT-based road management system (RMS) in place and regular road data collection / analysis / reporting processes underway, managed by R&BD
Sound QM / QA in key functions and activities
Completion and application of ISO-certification QM enhancement program and its results
Efficient project management, MIS and data security / management
Networked IT-based project / activity monitoring, performance reporting and MIS tools implemented including ‘data security’ measures
Human Resources (HR) Development [Training & Capacity Building]
Sound staff skills mix and competencies for the respective main functions and responsibilities of RDC and R&BD
Specific PPP training programs implemented for RDC staff Training Needs Assessment (TNA) completed and Training Strategy / plans established for respective RDC and R&BD priorities
Multi-year TNA-based staff training program in place
Regular staff training in main IT applications in place New staff performance appraisal policy and processes implemented
41
3. The ISAP implementation process will be supported internally in two ways. An Institutional Strengthening (IS) Cell will be initiated early in the Project, to “anchor” the ISAP agenda and implementation process visibly in the organizational environment, to be responsible throughout the Project for coordinating and facilitating ISAP implementation activities and processes, and to undertake ISAP progress monitoring and reporting for both GOAP and Bank purposes. In parallel, the RDC and the RBD will jointly initiate a part-time ongoing “ISAP Working Group” (ISAP-WG), comprising middle-level officers of both organisations and with occasional participation by a representative from the Centre for Good Governance. The high level GOAP ‘Core Group’ on the Institutional Development of the Road Sector shall continue on an ‘empowered’ basis as the RDC Board Sub Committee to steer and expedite critical decisions regarding policy, sectoral and ISAP matters.
42
Annex 5: Project Costs INDIA: Andhra Pradesh Road Sector Project
Local Foreign Total
Project Cost By Component and/or Activity
US $million
US $million
US $million
1 Road Improvement 335.46 170.20 505.66
Upgrading Works 149.93 80.73 230.66
LTPBMC & Other Works 156.97 84.75 241.72
Supervision Costs 4.72 4.72 9.44
LA, R&R, Utility Shiifting 23.84 - 23.84
2 PPP Facilitation Component 1.36 1.20 2.56
Transaction Adviser 1.02 1.02 2.04
Capacity Building 0.34 0.18 0.52
Bank's financing for State's VGF - - -
LA, R&R, Utility Shifting - - -
3 Sector Institution and Policy Development
9.96 4.64 14.60
Asset Management
0.75 0.75 1.50
Institutional Strengthening 1.90 1.60 3.50
Training 0.75 0.75 1.50
Monitoring 1.40 1.40 2.80
Incremental Operating Costs 2.45 0.00 2.45
4 Road Safety Component 9.87 5.68 15.55
Total Baseline Cost 356.64 181.72 538.36
Physical Contingencies 17.59 9.09 26.67
Price Contingencies 52.76 27.26 80.02
Total Project Costs1 426.99 218.07 645.06
Front-end Fee 0.00 0.80 0.80
Total Financing Required 426.99 218.87 645.86
1Identifiable taxes and duties are US$77.5 million and the total project cost, net of taxes, is US$568.3 million. Therefore, the share of project cost net of taxes is 88 percent.
43
Annex 6: Implementation Arrangements
INDIA: Andhra Pradesh Road Sector Project 1. Main Implementing Agencies: The GOAP’s Roads and Building Department (RBD) will have the overall responsibility for the implementation of the project. The RBD is headed by a Principal Secretary and has several units, headed by chief engineers. One of these units, the Road Development Corporation (RDC), has been designated as the Project Management Unit (PMU) to assist RBD in carrying out the day-to-day management of the project, including procurement, contract management, financial management, safeguard management, and implementation oversight. The RDC was established to manage the Core Road Network in 1998 under an Act of the State Assembly. RDC is headed by Chief Engineer (Core Road Network), who also serves as the Managing Director of RDC.
2. The RBD, represented by the Principal Secretary, will provide overall policy direction and ensure effective project implementation. The RBD will also coordinate with various departments of the GOAP including finance, revenue, electricity, water supply, police, audits, transport, legal, and others to facilitate project implementation. As a unit in RBD, RDC will use the financial management procedures of RBD and GOAP to draw funds from the loan.
3. Organizational Structure of the PMU: The organizational structure for the RDC headquarters and field divisions is given in Figures 4 and 5. The MD (APRDC)/CE (CRN) is the head of the PMU and responsible for all the activities of the RDC including the externally aided projects, BOT projects and maintenance of the CRN, currently 12,048 km. He will be the designated Project Director and have overall responsibility for implementing the project. He is assisted by three General Managers and several other staff at various levels, including the following:
• Three Deputy Chief Engineers (one of whom has additional responsibility as Public Information Officer)
• 13 Deputy Executive Engineers and 24 Assistant Executive Engineers • One Accounts Officer • One Environmental Officer • One Forest Officer • One Deputy Collector (Land Acquisition) • One Sociologist (Consultant) • One Financial Advisor
4. PMU Field Divisions: In the districts, the RDC is in the process of establishing nine field divisions each consisting of one Executive Engineer and a minimum of two Deputy Executive Engineers (DEEs) and four Assistant Engineers (AEs). Thus far, four field divisions established for the implementation of APSH are functioning. Once established, each RDC division will cover two or three districts on an average. These divisions will act as employer’s representatives for the ICB contracts for road upgrading works and also
44
process the Interim Payments Certificates (IPCs) for these contracts. All the OPMC contracts will be directly supervised by these divisions.
5. Arrangements to Hire the Required Expertise: The RDC will hire any required expertise not available within the government, such as PPP experts and financial analysts, under the prevailing market-based incentives, with the approval of the governing body.
6. Support from Other Departments: The RDC will rely on support from many other Government Departments to implement the project. These include finance, legal, audits and accounts, forest, land revenue, water supply, electricity, railways, local municipalities, transport, AP State AIDS Control Society, and district administrations. This support will be facilitated by the Principal Secretary (Transport and Roads and Buildings) and other senior RBD officials.
Implementation Arrangements by Project Components:
7. Road Improvement Component: This component will be managed centrally by the PMU in RDC’s headquarters with the help of two construction supervision consultants (CSC). The Headquarters team will be headed by a General Manager and work under the overall guidance of the MD RDC/CE(CRN). The RDC will engage qualified contractors through international competitive bidding process for these works. The Technical Evaluation Committee and Financial Evaluation Committee will review and approve all the awards. The CSC will serve as FIDIC Engineer for these works and provide day-to-day supervision of the contracts. The consultants will be responsible for construction quality and reliability of various measurements including the quantities recommended for payments, compliance to the contract conditions, safety during construction, management of social and environmental issues, pre-construction levels to be taken jointly with the contractors, issuing variations orders and time extensions, and recommending various payments to the contractors.
8. The RDC field divisions will: (i) monitor the work of the consultants and contractors as client’s representatives in the field; (ii) scrutinize the IPCs received from the CSC and recommend them for payment to the PD; and (iii) facilitate effective environmental and social management in coordination with CSC and contractor. After the completion of the works the RDC field engineers will take over the roads for regular maintenance. The CSC will also train the contractor’s and RDC staff in project and construction management, quality assurance, resource planning, construction operations, and safety during construction operations of both the construction workers and the road users.
9. LTPBMC Component: The RDC is in the process of establishing field divisions to supervise these contracts. Consultants will be engaged to regularly monitor the quality of these works as a third party and to assist the RDC to implement these contracts. If required, consultants will be engaged to train the RDC staff to undertake field surveys and investigations to prepare the engineering designs and bid documents for these contracts, evaluate bids and award the contracts, execute these contracts and to resolve any contractual issues arising while implementing these contracts. Some training would also be provided to the contractors’ staff in surveys and investigations, maintenance
45
operations to be undertaken to keep the road to the prescribed service standards, preparation of bills and various responsibilities of the contractors. The RDC will procure these contracts centrally in two phases, using the National Competitive Bidding (NCB) procedures. The Technical Evaluation Committee and Financial Evaluation Committee will review and approve all the awards. The RDC has developed a bid document for these contracts based on the Bank’s Output-and-Performance based Road Contracts (OPRC).
10. The MD, RDC and his team including the three GMs, Environmental Officers, Deputy Collector, Social Specialists, and other officers from the RDC head-quarters will visit the road improvement works regularly to monitor progress of works including: (i) land acquisition, shifting of utilities, and tree cutting; (ii) quality of construction; (iii) implementation of the RAP, EMPs, and GAAP; (iv) design changes and variations during construction; (v) implementation of contractors work plan, quality assurance plan, and safety plan including safety during construction; and (vi) any issues arising during construction. A ‘pool’ of university professors and students drawn from engineering colleges and institutes will also monitor the quality of construction, under the oversight of the CGG and as per the GAAP. Where required, the State Vigilance and Enforcement Unit may be drawn on to give support in matters requiring more serious quality investigations. The RDC will set-up a dedicated team to effectively monitor the progress of works and effectively resolve any contractual disputes. The RDC will also maintain an active liaison with various government departments including revenue, forest, electricity, railways, water supply, legal, finance and Auditor General.
11. PPP Facilitation Activities: PPPs are complex transactions involving: (a) policy changes that require time to build consensus and effect statutory changes; (b) substantive risks that need to be identified early on and addressed appropriately; and (c) multiple players with differing perceptions and interests. In view of this, APRDC, in consultation with GOAP, has identified and made provisions for the costs and risks they are likely to bear for the proposed PPP transactions, including the cost of land acquisition and the liabilities that are likely to devolve on APRDC/GOAP under various events of defaults.
12. To be able to structure, award and monitor the PPP projects in an effective manner, APRDC would have to internally build or outsource capacities in critical areas, such as financial and risk analysis, legal due diligence and concession management, and suitably ramp-up APRDC capacity in these areas in tune with the actual increase in the number of PPP transactions in future. Accordingly, APRDC has established a PPP cell to be headed by a General Manager at the level Superintendent Engineer, and supported by two Executive Engineers and two Assistant Engineers. In addition, APRDC would engage financial and legal advisors recruited from the market to assist them in financial and legal matters during the PPP transaction development and award process. Concomitantly, availing assistance envisaged under the PPP facilitation component of the project, APRDC will take steps to enhance the capacity of its staff at various levels to better identify, structure, award and monitor PPP projects, through training and exposure visits.
13. Safe Roads Component: The Transport Department (TD) will be the lead implementing agency for this component with active involvement of various other government agencies including Transport Commissionerate, State Road Safety Council,
46
and departments of Police, Health, and the RBD. Consultants and NGOs will assist to conduct road safety audits for the core network, identify accident black spots, develop the road safety policy and action plan, and to implement road safety and HIV/AIDS awareness programs. The AP State AIDS Control Society will assist in implementing the HIV/AIDS prevention and awareness activities under the project targeted on the population by the side of the roads, construction workers involved under the project, and some identified road users such as truck operators.
14. Institutional Strengthening Component: The GOAP has established an Institutional Strengthening (IS) Core Group with the overall responsibility to oversee the implementation of this component by the RDC and the RBD, in accordance with an Institutional Strengthening Action Plan (ISAP) endorsed by the GOAP prior to the launch of the project. The IS Core Group has senior officers of the RBD and the RDC as well as the Advisor to the GOAP on Quality Control (R&B). A full-time IS Cell will be initiated by GOAP before the launch of the project, for ongoing coordination and monitoring of the ISAP implementation process and to closely work with the ISAP implementation support consultants. Various major elements of the ISAP will be implemented through technical assistance (TA) and consultancy services, drawn from domestic and international sources. The respective TA and consultant’s inputs will be selected and delivered in accordance with specific Terms of Reference (TOR) and procurement processes, vetted in advance by the Bank. The responsibility for essential administrative, coordination, procurement and contract-management functions for activities under this component (particularly for the TA and consultancy services) will primarily remain with the RDC.
15. Asset Management System (AMS): Both the RBD and the RDC will set-up dedicated units to establish the road inventory data-base and to implement the AMS. These units will work in close coordination with the TA consultants selected to help develop the AMS. The RDC and RBD field divisions will be responsible to collect data for the road inventory database including regular road condition and traffic surveys.
16. Fund Flow: The GOAP will make an appropriate budget allocation for the project in line with the overall financial plan agreed during the project preparation and release funds through the mechanism of the budget. The state government will make an annual budgetary allocation for the project as a “Plan - Capital” item, under a separate budget line item “APRSP- World Bank Project”. The RBD will reallocate these funds (through Letter of Credit, LOC) to the PMU and to the field divisions for implementation of project works. The PIU will pass the bills and the concerned PAO will issue cheques.
17. Procurement: The RDC HQ will manage the procurement of the civil works contracts (including bid invitation, their evaluation, and awards). All contracts will be reviewed and approved by the Technical Evaluation Committee and Financial Evaluation Committee for the RDC. Procurement on behalf of the Transport Department regarding the Road Safety Component shall also be undertaken by RDC.
18. Social: The institutional arrangements to implement the Social Management Plan (including RAP) consist of a Social Management Unit (comprising a Deputy Collector
47
for LA and a Social Specialist) at the Project level in PMU and a Social cell (with a dedicated Assistant Engineer) at the Package level. Additionally, a project level monitoring committee was established (vide reference GO Rt. No. 1615 of Transport, Roads and Buidling Department dated 3.11.2008) based on the provisions given in the AP R&R Policy, 2005 (Chapters IV and VIII), so as to facilitate and monitor LA and R&R activities as part of the implementation of the APRSP. Accordingly, the Principle Secretary (T, R&B) will head the committee as Commissioner. The Joint Collector of the district concerned will be ‘Administrator’ and the Superindenting Engineer of the district concerned will act as the ‘Convenor’. Several other important district officials from allied departments along with three project affected persons (PAFs), with at least one woman member and local NGO will be members of the committee. These units will be supported by a Nodal NGO at the project level and facilitating NGOs at the Package level. While RAP and tribal development activities will be implemented in close coordination with the District Administration, the State AIDS Control Society will be the main implementing partner for HIV/AIDS activities. The District R&R Committee will redress grievances of local people.
19. GAAP, ISAP, Social and Environment, Procurement and Financial Management: The implementation arrangements for GAAP, RAP, EMP, ISAP, procurement and financial management are outlined in the respective Annexes.
20. Quarterly Progress Reports (QPRs): The RDC will prepare quarterly progress reports highlighting progress made on various project components including physical and financial progress of civil works; implementation of GAAP; status of various procurements and audits; progress made on land acquisition and shifting of utilities; status of various statuary clearances from various departments such as forest and railways, and management of the social and environmental issues; key issues being faced during implementation of the project; and status of compliance to various actions agreed during supervision missions and reviews, and other actions as emerged from the reports of construction supervision and other consultants including the Bank-hired consultants.
21. Monitoring of Results: The RDC (with the assistance of consultants and third-party resources) will undertake road user satisfaction/feed-back surveys for the road improvement works to identify the perceived benefits of the project by the road users. This includes roads under the OPMC contracts and safe roads component. The RDC will also regularly collect data on the monitoring indicators. Beyond the conventional ‘ISAP implementation progress’ monitoring, the impacts of the ISAP will be mainly approached at a more strategic and aggregated level. This will include measuring performance improvements in RBD/RDC in terms of various elements of road services delivery (e.g., construction time completion, reduced ‘planning to funds allocation’ elapsed time, containment/reduction of construction unit-cost factors, road serviceability/maintenance performance, etc.). Additional ad hoc assessment of ISAP implementation status and results against the documented measures and targets will be undertaken during project implementation. The RDC will provide an impact assessment report to the project’s Mid-Term Review and as an input to the Implementation Completion Report (ICR).
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22. Main Stake-Holders involved in the Project: Table 12 shows the main stake-holder’s involved in the project.
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Ta
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50
Figure 4: Andhra Pradesh Road Development Corporation – Organization Structure at HQ
Figure 5: Andhra Pradesh Road Development Corporation – Organization Structure –Field Level
Managing Director
General Manager
General Manager
EE Warangal
EE Rajahmundry
EE Guntur
EE Kadapa
EE Kurnool
EE Jagityala
EE Hyderabad
Dy. EE– 3 AEr/AE - 6
Dy. EE– 3 AEr/AE - 6
Dy. EE– 3 AEr/AE - 6
Dy. EE– 3 AEr/AE - 6
Dy. EE – 3 AEr/AE - 6
Dy. EE– 5 AEr/AE - 10
Dy. EE– 4 AEr/AE - 8
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Annex 6A: Governance and Accountability Action Plan (GAAP)
INDIA: Andhra Pradesh Road Sector Project Context 1. The context for the preparation of the proposed Governance and Accountability Action Plan (GAAP) is the recognition by the state government and the Bank that there is a need to improve accountability arrangements with a view to prevent chances of corruption and strengthen transparency in the State’s road sector. The Government of Andhra Pradesh (GOAP) is among the foremost states in India in promoting major initiatives for transforming governance by making the government citizen-friendly, transparent and caring, built on the foundations of commitment, accountability, responsiveness and inclusiveness. Two notable achievements of GOAP in improving governance are its pioneering efforts in e-Governance and establishment of the Centre for Good Governance (CGG) to assist the government in identifying governance weaknesses and remedies for improving government accountability and transparency. This GAAP seeks to build on these GOAP initiatives and on-going governance reforms, India’s Right to Information (RTI) Act of 2005, and lessons learned in the implementation of the first Bank-financed road project in the state in contract management and supervision. The GAAP is accompanied by a supervision strategy (described in Annex 6B).
2. Center for Good Governance (CGG): The CGG was established in 2001 with DFID support as part of a strategy to foster good governance, in particular to guide, coordinate and manage the design and implementation of a comprehensive Governance Reform Program (GRP). The CGG is an autonomous society with the Chief Minister and Finance Minister as the Chairman and Vice –Chairman respectively. The CGG comprises staff with specialized domain knowledge in various fields with a sound knowledge of the functioning of departments of Government. The Centre has also developed an e-Development cell with good infrastructure and qualified staff to develop appropriate solutions. It provides technical support in implementing governance reforms in Andhra Pradesh, in particular in those departments that have high citizen interaction and involve public procurement. It has been particularly successful in understanding the Government processes, carrying out process reengineering with appropriate software support.
3. The CGG has also been implementing a “Delivery of Improved Services in Administration” (DISA) focused on Strategy, Performance and Innovation Units (SPIUs) in select 11 departments as the drivers of systemic reform and change for pro-poor service delivery outcomes. Under DISA, CGG has developed some innovative governance mechanisms such as Online Grievance Redressal Tracking System (OGRTS) and social accountability mechanism (third-party monitoring) for select departments. 4. E-Procurement: Andhra Pradesh has been the first state in India to initiate the process of e-procurement and about 90% of public sector procurement is executed electronically. The computerization and e-governance initiatives of the State have been set up to increase transparency and streamline record keeping and other procedures. The GOAP has implemented many statewide e-Government applications since 2000, when
52
the Central Government of India enacted the IT Act of 2000 to provide legal recognition to electronic transactions. As a part of these initiatives, GOAP has also set up an E-Procurement Marketplace, linking government departments, agencies and local bodies with their vendors to ensure better value for public money, prevent collusion, corruption, and ensure transparency. The e-procurement system, as applicable in RBD, has been modified to enable item rate contracts.
5. India’s Right to Information Act: India passed the landmark legislation in 2005 which became effective from October 2005. The Act mandates the disclosure of and universal access to information wherever in the public interest. Compliance to the Act is required for all public entities. Implementation of RTI requires systems for on demand and suo moto disclosure of information, and for each government department to develop a disclosure policy, automated systems for record and document management, and information handling, and appointment of trained staff, programs for citizens’ awareness, and annual progress reporting. GOAP acting on the directions given in the RTI Act has promulgated the Andhra Pradesh State RTI Rules 2005. Under sub-section (3) of Section 15 of the RTI Act 2005, Government of Andhra Pradesh constituted a State Information Commission in November 2005 (www.apic.gov.in) 6. Key Governance Issues: Some of the key governance issues are:
incentive structure for staff of APRDC affecting performance and fiduciary risk
irregular updation of contractor database with facility for tracking contractor performance including debarment.
limited familiarity of contractors/consultants with relatively newer contracting formats such as OPRC resulting in reduced competition in procurement
limited staff capacity for quality monitoring of works, resulting in overdependence on external Engineerand sub-optimal project outcomes.
limited access to information on road sector policies, programs and project related documents resulting in limited public scrutiny.
Inadequate complaint handling mechanisms for appropriate action on complaints on procurement, construction quality or allegations of fraud and corruption.
Limited use of independent, third-party monitoring of works quality, to ensure value for public money
Key Features of GAAP 7. Taking into account the enabling environment in the state and the country, the GAAP has been developed to strengthen transparency and accountability arrangements with the proposed APRSP with a view to prevent chances of corruption. The main objective of this GAAP is to ensure that project resources – both financial and expert advice – are available to GOAP to comply with the RTI provisions and contribute to GOAP’s efforts in implementing governance initiatives in the sector. Thus, this GAAP has been prepared in consultation with the RBD/RDC, CGG and within the framework of
53
GOAP’s ongoing governance initiatives and RTI implementation in the state. While the GAAP has evolved as a part of APSRP, it has positive implications and benefits for RDC, RBD and the sector at large. A. Implementation of Right to Information Act, 2005 8. For the APSRP, complying with the RTI will involve several activities as listed below, many of which will be supported by ISAP measures and activities:
• Disclosure Policy: As per sections 4(1)(b), (c), and (d) of the RTI Act, RBD/RDC is to disclose information related to the APSRP on its website. For this, it has prepared a disclosure policy with the intention of allowing greater access to information, including disclosure of mid-term review reports, safeguard information, audit reports, relevant information on the procurement process, and others as agreed. The expectation is for the AP RBD/RDC, besides complying with on-demand access to information, to fully comply with provisions on suo moto disclosure under section 4 of the RTI Act. Appendix 1 provides the proposed draft disclosure policy and strategy, which details documents to be disclosed with their frequency, medium and responsible party. The main media for information disclosure will be the APRDC website and citizen boards at project sites. The draft disclosure policy has been agreed upon with GOAP.
• Systems and Procedures: AP RBD/RDC needs to set up systems and procedures to implement disclosure policy, for both on-demand requests and suo moto disclosure. Under the previous bank-funded project, the APRDC has already set up a website (http://www.aprdc.in) which discloses information on the organization, projects, and tender information for APSRP and BOT works. The APSRP will provide ISAP related resources to enhance the existing systems and procedures, including IT-ICT-MIS and complaints handling mechanism, and introduce new systems and procedures, including a road asset management system (RAMS). IT-ICT-MIS will be enhanced through formulation of and implementation of the strategy in both APRDC and RBD to achieve effective planning and decision-support tools, networking of technical applications and information-sharing capacity using modern IT and ICT resources. RAMS will be built on existing RBD road inventory/condition data and will help determine road maintenance budget planning.
• Organizational Arrangements and Capacity Building: The organizational arrangements include provisions for operationalizing the disclosure policy and the maintenance of the automated systems of disclosure. APRDC has designated a Deputy Chief Engineer, RBD, as the Public Information Officer (PIO) and a Deputy Executive Engineer, RBD, as Assistant to PIO (APIO). The CGG held a training workshop on the RTI Act for all officers of APRDC in June 2008. However, GOAP agrees that there is a need to provide a continuous capacity building for all the officers for enhanced disclosure to become effective.
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• Monitoring and Reporting: As per sections 25(1), (2), and (3) of the RTI Act, APRDC/RBD is to set up reporting and monitoring systems for monitoring and evaluation of the implementation of the disclosure policy. Reporting requirements include an annual report on implementation of the RTI Act and recommendations for the future, including disaggregated indicators on various aspects of the RTI Act compliance.
B. Improving Accountability and Transparency Through Process Improvements 9. Simplification, rationalization and standardization of core business processes and operations are important for improving governance and strengthening accountability in the government department. The Institutional Strengthening Action Plan (ISAP) places an emphasis on several actions to reform some processes and systems in APRDC and RBD. These relate to development of new corporate rules and core policies, strengthening of functions, staffing and policies for HR, IT and Planning/Asset Management, revision and use of the updated Departmental Code throughout APRDC, RBD and concerned industry areas, launching of ISO-certification of QM program, and use of network IT- and ICT-based systems for project monitoring and performance reporting. C. Improving Procurement Practices through e-Governance 10. GOAP has been pioneering implementation of Electronic Government Procurement (e-GP) and has been successfully carrying out procurement of good using e-GP. The e-GP system has been strengthened to carry out procurement of civil works using item rate contracts. For this project, e-procurement is planned to be used as and when the same is agreed with the World Bank. D. Strengthening Complaint Handling and Preventive Vigilance 11. An effective grievance redressal mechanism will be set up in the APRDC, which will include maintaining a log and record-keeping to monitor status of follow up of each complaint or grievance. For the mechanism to be effective, a complaint-handling officer will be appointed both at the APRDC and at each of its divisions. At the headquarters, the Chief Vigilance Officer (CVO) shall be designated as the complaint-handling officer, whereas at the divisional level, the respective Executive Engineer shall handle this function. The complaint handling mechanism would be widely disseminated (through citizen information boards at the project sites, at divisional offices, through Internet, newspaper advertisements, citizen information boards at highly visible locations, project brochures etc.) and will at a minimum include contact information of complaint handling officers, dedicated email address and physical mailbox locations, and procedures to handle various complaints (see sample given under Appendix 2). In addition, the Construction Supervision Consultants would also be required by the GOAP to set up similar complaint handling mechanisms to enable the public to register complaints directly with them about accessibility, safety, construction debris, construction deficiencies and poor quality. Tracking of the status of investigations and measures taken
55
will be reported in monthly reports to the Employer. Action taken on such complaints would also be monitored by the divisional engineers on a random basis. E. Improving Social Accountability 12. Third-party monitoring by beneficiaries and stakeholders is one of the social accountability mechanisms that provides for better monitoring of works and services provided with public funds. However, in the highway sector, such beneficiaries and stakeholders are not easily identifiable, as they are widely dispersed throughout the highway corridor. As such, community or civil society based party monitoring is not practical for this project. Instead, the APRDC has agreed to engage resources from civil engineering departments of local universities, who would be independent and credible third parties serving the Project as works quality monitors. This will be supplemented with other feedback mechanisms such as road user satisfaction surveys and stakeholder workshops. 13. These third parties will report any serious issues of quality to the RDC, who will be authorized to undertake further suitable action and necessary investigation. 14. The CGG has extensive experience in arranging third-party monitoring, and APRDC/RBD has decided to seek CGG’s expertise and support for a two-year pilot phase of such third-party monitoring under APRSP. G. Identification and Monitoring of Indicators for Compliance and Outcomes 15. APRDC/RBD have agreed on the following key indicators to monitor and evaluate the progress of implementation of the above arrangements:
• Implementation of the RTI Act: (i) Quarterly reports on the format of annual reports; (ii) monitoring the index for disclosure of information like the duty to publish index (DTP); and (iii) an appropriate summary in the quarterly project reports (QPR)
• The system of sanctions and remedies will be supervised mainly through (i) periodic review of statistics based on records kept on the APRDC website, and (ii) field level checks to ensure that problems are being reported, tracked and acted upon;
• Results of road user satisfaction surveys as publicized on the APRDC website; • Operation of complaint handling mechanism: QPR section on number of
complaints received and resolved
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Table 13: Governance and Accountability Action Plan Matrix
Action to be taken Timeline Responsibility Remarks A. Implementation of Right to Information Act, 2005
1. Agree on the Disclosure Policy. Done APRDC/RBD Implementation monitored through quarterly reports and the duty to publish index.
2. Enhance the existing systems and procedures to implement RTI Act.
Ongoing APRDC/RBD
3. Develop organizational arrangements.
Done. APRDC/RBD PIO and APIO appointed.
4. Conduct training on the RTI Act. Done in 2008, and to be conducted at least annually during the project.
APRDC/RBD & CGG
Training for APRDC officers held in June 2008 by CGG.
5. Organize workshops to discuss draft road sector policies with all stakeholders.
As necessary. APRDC/RBD
B. ISAP-based measures to enhance accountability and transparency 1. Develop new APRDC corporate Rules and core policies.
December 2010 APRDC
2. Strengthen functions, staffing and policies for HR, IT and Planning/Asset Management.
September 2011 APRDC
3. Revise and start use of the updated Departmental Code throughout APRDC, RBD and concerned industry areas.
June 2010 APRDC/RBD Clearance of the revised Departmental Code by GOAP is expected in 2009.
4. Strengthen core processes by using computerized road management system (RMS) in maintenance budget planning and allocation decisions, launching ISO-certification QM program and using network IT and ICT resources for core business and operations management.
December 2011 APRDC/RBD
5. Improve staff performance appraisal and performance management processes.
December 2011 APRDC/RBD
C. Improving procurement practices in the APRDC/RBD 1. Use e-procurement system covering electronic publication of invitation for bids, availability of bid documents and publication of evaluation results/ contract awards.
Start with the first bidding document in Phase II
APRDC/RBD Bid invitation for Project works published on RDC website. Online bid opening/ evaluation under consideration.
2. Develop databases of contractors, contracts, unit prices, specifications, etc. and document management and management information system.
March 2010 CoT
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3. Finalize contract sizes and qualification criteria based on market information.
Start with the first project contract.
APRDC
4. Conduct business briefings for bidders to familiarize them with new type of contracts proposed in the project.
Start for Phase II works.
APRDC
5. Start benchmarking of performance against procurement indicators.
March 2010 APRDC Start with the project roads.
6. Disseminate details of the process for disqualification of bidders.
As required APRDC
D. Strengthening preventive vigilance 1. Designate a Complaints Officer at APRDC and at each division.
April 2009 APRDC Done.
2. Establishment of CSC complaint handling mechanisms.
When CSC is appointed
CSC/APRDC Monitored through periodic review of statistics from records maintained on the APRDC website and quarterly progress reports, and field-level checks.
E. Social accountability mechanism 1. Implement CGG coordinated third party monitoring of works quality and impacts.
March 2010 APRDC/RBD GOAP has endorsed this idea.
2. Conduct user satisfaction surveys. Annual APRDC/RBD either by themselves or through NGOs/local university students.
Results to be disseminated in stakeholder workshops mentioned under Action (1) of the Implementation of RTI Act above.
H. Financial management 1. Prepare project financing plans Quarterly APRDC 2. Prepare budgetary allocation reports.
Yearly APRDC
3. Prepare expenditure statements Quarterly APRDC 4. Conduct review of the central payment system for work related bills.
March 2010 APRDC
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Appendix 1: Disclosure Policy and Strategy 1. The APSRP disclosure strategy is based on the RTI Act, 2005, both for on-demand disclosure and proactive or suo moto disclosure of information making maximum use of the APSRP website. The intent is to enhance the transparency of the decision making processes inside the project during the implementation phase, including those for procurement, financial management, and social and environmental safeguards and to comply with all the legal requirements under the RTI Act, 2005. This enhanced disclosure of information to the citizens is also expected to facilitate civil society oversight, to achieve greater adherence to transparency norms and quality of work during project implementation. To this end, the information will be maintained and provided in a user friendly manner that will maximize the utility of the information. The detailed disclosure requirements are based on the letter and spirit of Sections 4 and 26 of the Right to Information Act 2005. 2. The APRDC has established a website where it publishes information relating to the project in compliance with the Right to Information Act 2005 as per Section 4 of the Act for Suo Moto Disclosure. Information published on the website should remain available online through out the project implementation period and for at least one year after the project has been completed. APRDC also considers disclosing information with details of project works on citizen boards at project sites. 3. The responsibility for implementation of this policy, including all the above four components, will rest with the APRDC Public Information Officer (PIO) and APSRP Project Director with approval o f the APRDC Managing Director. This draft disclosure policy will be presented to and endorsed by the Chief Information Commissioner of the State of Andhra Pradesh. Monitoring and Reporting for RTI Compliance 4. Robust monitoring requires disaggregated indicators to capture the different aspects of disclosure. Monitoring implementation of suo moto disclosure is critical since the level and quality of this disclosure will directly influence the effectiveness of the disclosure policy. There are three complementary indicators that are currently under consideration in India for measuring the effectiveness of RTI disclosure that can be used to monitor progress of RTI for APSRP: (a) Duty to Publish Index measures the basic contents of the information that need to be disclosed under Section 4 of the RTI Act, and is a weighted percentage of the heads of information that have been disclosed, (b) Affected Citizen Index is a qualitative index based on the relevance and usefulness of the information disclosed to citizens affected by the activities of the government, (c) Dissemination Index measures the efforts taken to disseminate information to the public and familiarize the public with its availability. 5. Based on the experience to be gained, this draft disclosure policy will be jointly reviewed by the APRDC and the Chief Information Commissioner annually, and be further updated and/or improved. The APRDC/RBD may invite an external agency which
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has experience in advising government agencies on implementation of the RTI Act to assess the compliance of this policy with the RTI Act and its contribution to GOAP’s on-going governance reforms in the state and provide recommendations for further improvements. 6. In compliance with the RTI Act, the draft disclosure policy consists of the following four parts: (i) a list of documents to be provided suo moto as specified in the sections 4 (1) (b),
(c), and (d) of the RTIA; (ii) organizational arrangements and procedures for implementing the disclosure
policy as per sections 5( l)5,(2 ), and sections 4( l)a, 4(2), 4(3) and 4(4); (iii) reporting and monitoring systems for monitoring and evaluation of the
implementation of the disclosure policy as per sections 25(1), 25(2), and 25(3); and
(iv) a capacity building plan (including public awareness campaigns) as per section 26(1).
7. The table below specifies types of information for disclosure, time and frequency, media, and responsibility for disclosure, covering all APRDC/RBD projects irrespective of sources of funding. However, disclosure at the World Bank Infoshop will be required exclusively for Bank-supported projects.
Table 14: Draft Disclosure Policy Topic Documents to be disclosed Time &
Frequency Media Responsibility
APRDC/ RBD’s Policy Related Information
All relevant facts and draft documents while formulating important policies or announcing the decisions which affect public.
Immediately upon their availability.
APRDC/RBD website
PIO/APIO
Reasons for APRDC/RBD’s administrative or quasi-judicial decisions to affected persons.
Immediately upon their availability.
APRDC/RBD website
PIO/APIO
AP Road Act Upon being cleared by GOAP: March 2010.
APRDC/RBD website
PIO/APIO
AP Toll Road Policy Once and to remain on website.
APRDC/RBD Website
PIO/APIO
Road Network master Plan and State-level Transport Master Plan.
Upon being cleared by GOAP: December 2010 and September 2012, respectively.
APRDC/RBD website
PIO/APIO
Core Network Maintenance Plan.
Annually by April 1st.
APRDC/RBD website
PIO/APIO
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Topic Documents to be disclosed Time & Frequency
Media Responsibility
State-level Road Action Program and RBD’s ‘black-spot rectification’ Program and reports on their progress.
Upon being cleared by GOAP.
APRDC/RBD website
PIO/APIO
APRSP General Documents
Project Appraisal Document; mid-term review and completion reports; and quarterly project monitoring reports.
Immediately upon their availability.
APRDC/RBD website
PIO/APIO
Resettle-ment, Rehabili-tation and Land Acquisition
Resettlement Action Plan (RAP).
Once in the entire project cycle. But to remain on the website and other disclosure locations throughout the project period.
WB’s InfoShop; APRDC/RBD’s website; Deputy Commissioner’s Office; State and District Libraries; Tehsil and Panchayat offices.
PIO/APIO, Social Consultant, World Bank
Resettlement and Rehabilitation Policy translated in local languages.
Once in the entire project cycle.
Distributed among Project Affected Persons (PAP).
PIO/APIO, Social Consultant
Information regarding impacts and their entitlements.
Once at the start of the Project and as and when demanded by the PAP.
Through one-to-one contact with PAPs; Group Discussion; List of PAPs with impacts and entitlements to be posted in the Village Panchayat office and website of APRDC/RBD.
PIO/APIO
R&R and Land Acquisition monthly progress report.
10th day of every month.
APRDC/RBD website.
PIO/APIO
RAP Impact Assessment Report.
After substantial completion of each phase.
APRDC/RBD website.
PIO/APIO, Social Consultant
Land Acquisition notifications.
As required under the Land Acquisition Act.
AP Government Gazette; APRDC/RBD website.
PIO/APIO, Social Consultant
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Topic Documents to be disclosed Time & Frequency
Media Responsibility
Grievance redressal process Continuous process throughout the project cycle
APRDC/RBD website; Deputy Commissioner’s Office; Tehsil and Panchayat offices; One to one contact with PAPs.
PIO/APIO
HIV/AIDS Action Plan Promptly upon its availability
APRDC/RBD website
PIO/APIO, Social Consultant
Public Consultation
Minutes of Formal Public Consultation Meetings.
Within two weeks of meeting
APRDC/RBD website; Tehsil and Panchayat offices
PIO/APIO, Consultant
Engineering List of roads proposed to be undertaken, clearly indicating start and end points of the contract. Proposed works / treatment giving details of widening, bypasses, junction improvement, drainage, traffic safety feature etc. Construction program with milestones and completion dates. Proposed cross section and strip plan depicting major features.
Prior to awarding works and to remain on website until end of DLP.
APRDC/RBD website
PIO/APIO
Physical and financial progress of each contract. Work progress photographs
To be updated by the 10th. of every quarter ending.
Environment Management
Environmental Screening Report. Environment Assessment Reports (including a summary in English and Telugu). Environment Management Plans (including a summary in English and Telugu). Biodiversity Assessment and Management Plan.
Once in the entire project cycle and prior to awarding works. But to remain on the website and other disclosure locations throughout the project period.
World Bank’s Infoshop; APRDC/RBD website; State and District Libraries.
PIO/APIO, Env. Mgt Unit of APRDC/RBD, and Environment Consultant.
Quarterly Progress Report on Environmental Management.
Within 15 days after end of each quarter.
APRDC/RBD website.
Env. Mgt. unit of APRDC/RBD
Financial Management
All final audit reports and all formal responses from the government.
Promptly after their receipt.
APRDC/RBD website.
PIO/APIO; Financial Management
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Topic Documents to be disclosed Time & Frequency
Media Responsibility
Annual Audited Financial Statements.
Annually, upon completion of Audit.
Officer
Procurement Annual procurement plans and schedules.
Promptly upon their finalization, annually.
APRDC/RBD website.
PIO/APIO
All general and specific procurement notices, national invitations to express interest and to tender, bid documents, RFPs, minutes of pre-bid conferences (to bidders only) and addenda/corrigenda to bids. Bidding documents and RFPs issued in accordance with the procurement provisions.
When required; In the case of requests for proposals (RFP), the relevant documents will only be made available after notification of award to the successful firm.
APRDC/RBD website UNDB for larger contracts; National press for smaller contracts.
PIO/APIO
All short listed consultants and, in cases of pre-qualification, lists of pre-qualified contractors and suppliers.
Promptly upon availability; to be regularly updated as and when changes are required.
APRDC/RBD website
Information regarding the contract awards for all contracts for goods and works in accordance with the Bank’s Guidelines; Summary of the evaluation of all bids and proposals for such proposed contracts.
Promptly after the notification of the award to the successful bidder/consultant.
APRDC/RBD website
PIO/APIO
Other Progress on institutional reforms and progress of TA consultancies.
As and when appropriate.
APRDC/RBD website
PIO/APIO
Project Performance Indicators, Targets and Actual Figures.
Annually APRDC/RBD website
PIO/APIO
User satisfaction surveys results.
Once every 2 years APRDC/RBD website
PIO/APIO
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Appendix 2: Sample Procedure for dealing with complaints relating to construction quality
1. Complaints received directly from the public relating to the quality of a specific work, good or service shall be in writing. They are to be received and then reviewed by the concerned Complaint handling officer (CHO) and dealt with in the following way:
i. The CHO shall record all complaints, whether they are referred from other recipients or directly, in a register to be maintained in a secure location in his own office.
ii. The CHO shall, within 10 working days of receipt of complaint, acknowledge receipt in writing to the complainant indicating that he is considering the issues raised and will discuss them with the concerned officers of the APRDC.
iii. The CHO shall then consult with the relevant officers of the APRDC and, after thorough review of the facts as well as interviewing of officers concerned as necessary, shall make a judgment as to the validity of the complaint.
iv. Within 30 working days, the CHO shall instruct the relevant officer to take remedial action as necessary.
v. The CHO shall write to the complainant within 45 working days of the receipt of such complaint as to the final decision of the competent authority.
vi. In the event that a complaint is received concerning an externally funded contract, the relevant funding agency shall be informed at each stage of the complaint handling process.
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Annex 6B: Supervision Strategy Matrix
INDIA: Andhra Pradesh Road Sector Project 1. The Supervision Strategy for the proposed APSRP is developed based on the lessons learned from the India Portfolio, which identified, among other things, weaknesses in Bank’s supervision strategy and lack of field and independent verification of project activities. The Supervision Strategy also draws from the lessons learned by the Bank-financed studies on Value Engineering and Construction Industry in India. These studies highlighted weakness in quality and capacity for cost-effective construction and contract management. Finally, the Supervision Strategy links the key project risks identified in the Risk Identification Worksheet with the mitigation measures laid out in the Governance and Accountability Action Plan. The overall aim of the Supervision Strategy is to ensure the effective and timely implementation of mitigation measures to deter chances of corruption and fraud and ensure cost-effective project implementation and the achievement of the project’s development outcome.
2. Procurement Activities: The total project cost is US$646 million and the IBRD loan is US$320 million. There will be a total of nine ICB contracts with average contract value of US$33.6 million to be let out in two phases (six contracts in the first phase and three in the second phase), and eleven NCB contracts for OPBMC with average contract value US$5 million to be let out in Phase 1. A number of technical assistance and consultant services and goods will be procured competitively to support civil works supervision, PPP Transaction Adviser, institutional development, and capacity strengthening in APRDC/RBD. All procurement will be handled centrally by the Project Management Unit (PMU) in the APRDC. No decentralized procurement will be done by field offices since the contract sizes are large and the road stretches traverse more than one field office.
3. Arrangements to Prevent Fraud and Corruption in Procurement: As a part of its e-Government initiatives, GOAP has set up an E-Procurement Marketplace, linking government departments, agencies and local bodies with their vendors. The main objectives of the e-Procurement initiative were: (i) reduction of the time and cost of doing business for both vendors and government; (ii) realization of better value for money spent through increased competition and the prevention of cartel formation; (iii) standardization of the procurement processes across government departments/agencies; (iv) increase in buying power through demand aggregation; (v) provision of a single-stop shop for all procurements; (vi) allowing of equal opportunity to all vendors; and (vii) bringing of transparency and ultimately reduction of corruption.
4. A Governance and Accountability Action Plan (GAAP): A GAAP for APSRP has been prepared within the framework of the India RTI Act, 2005, GOAP’s ongoing e-procurement and other governance reforms to ensure greater transparency and accountability of APRDC/RBD and project to be finance by the Bank. The main features of the GAAP are the following:
• Establishing systems and procedures, including project-specific website, for effective compliance with on-demand requests for information and for suo moto disclosure as per the RTI Act.
• Business process re-engineering and analysis of corruption prone process, including process simplification, rationalization and improvement of systems, PWD codes and manuals, and a comprehensive analysis of corruption prone processes.
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• Designating a Complaints Officer at both headquarters and divisional levels to strengthen preventive vigilance.
• Third Party monitoring by involving university students and professors from reputed local universities for monitoring qualify of design and construction.
• Strengthening Core Process in Procurement and Financial Management, including capacity development and reforms to improve APRDC’s procurement, contract and financial management practices, database for costs and contractor performance, and introducing computerized financial management system.
• Monitoring and evaluation to assess compliance with the GAAP.
5. Supervision Methodology: The project supervision will be based on: (i) physical verification of civil works by Bank task team and Bank-hired consultant; (ii) sample cross-checking and verification of reports (quarterly progress reports) provided by the client, consultant supervision and other consultants, and third party monitoring; (iii) increased coverage of post-review contracts and cross-checking and verification of procurement and financial management related documents; (vi) close scrutiny of audit reports and Financial Management Reports; (v) thematic supervision on key topics and high risk areas, such as construction quality, safety during construction operations, design changes and variation orders during construction, procurement and financial management, and management of social and environmental issues, and implementation of the agreed Institutional Strengthening program; (vi) discussions and regular meetings with the government officials and field staff of the implementing agencies, consultants, and stake-holders; (vii) close follow up with the client on key issues highlighted from the various supervision activities; and (viii) active involvement of the Bank management and the Department of Economic Affairs to resolve key issues specifically those related to fraud and corruption.
6. Team Composition: The World Bank Supervision core team will comprise about six to eight specialists having high level of skills covering overall highway engineering, construction quality, engineering designs, road safety, performance based maintenance contracts, contract management, social and environmental management, procurement, FM and audit, institutional strengthening (including capacity building), governance and /accountability, and monitoring and evaluation.
7. The Bank task team will be assisted by two Bank-hired consultants who will regularly undertake field visits for expanded period to closely supervise construction quality, design changes, variation orders, and compliance to the contract conditions, time and cost over runs, performance of the construction supervision consultants, project supervision by the RDC field divisions and HQ including the quality and reliability of project related documents, and management of environment and social safeguards. The consultants will also review implementation of the GAAP including complaint handling, information disclosure, and compliance to various actions highlighted during various reviews, supervision missions, third-part quality monitoring, and consultants own reviews. Most of the task team will be based in the Delhi Bank office, which will allow prompt visits by individual team members to the field as may be needed. In addition, the Bank will hire international experts from time to time as needed to check on quality of construction and assess overall project implementation.
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8. Frequency of Visits: The Bank team will visit Andhra Pradesh and projects sites twice in a year. The Bank-hired consultants will spend extended periods of time per year in Hyderabad and project sites. Thematic supervisions will take place as necessary. The supervision task team will develop, together with the RDC, check-lists to review the implementation of road works and environment and social safeguards in the field. The check-lists will ensure uniformity and standardization of the review process during physical review of activities in the field.
9. Sample Size for Field Visits and Other Reviews: The Bank supervision mission or the Bank-hired consultants will undertake field visits to all road improvement contracts and a minimum of 20 percent the LTPBMC contracts in each supervision mission. The Bank-hired consultants will undertake field visits and other reviews for extended periods prior to the Bank supervision missions and in between as required. The procurement, financial management, social, and environment specialists will also review and verify related documents for a minimum of 10 percent construction contracts. The sample contracts for field visits will be randomly selected by the Bank staff at the beginning of the mission.
10. Supervision Budget: US$200,000 per year to cover Bank staff, consultants and travel expenses, including the three consultants that would be stationed in Andhra Pradesh for extended amount of time.
11. Supervision Strategy, Sampling and Expected Outcome: The main supervision activities to be covered by the Bank and the client are provided in the Table 15 below, which also highlights a proposed sampling framework and expected outcome from the enhanced supervision.
Table 15: Supervision Strategy Matrix Client’s role22 Bank’s role Expected outcomes
TECHNICAL and QUALITY ASPECTS
Construction supervision of the road improvement works to be carried out by Construction Supervision Consultant (CSC) as the FIDIC Engineer. RDC field divisions to oversee the work of contractors and CSC as the client representatives in the field. Supervision of the LTPBMC contracts to be carried out by the field divisions of the RDC. The MDRDC, PD, GMs, and Land Acquisition Officer, and Environmental Office of the RDC to undertake periodic field visits to see the overall quality, progress including on land acquisition and shifting of utilities, any design issue, and compliance to the contract conditions.
The Bank-hired consultant to assess the contractors’ capacity, role of Joint Ventures contractors, including availability of lead JV firm, assess the supervision capacity by CSC and RDC field staff. Visual inspection of 100 percent road improvement works and 20 percent of the LTPBMC contracts by the Bank staff and Bank-hired consultant in each supervision missions. Detailed investigation of 25 percent civil works carried out annually by Bank-hired consultant. Third party quality check by University Engineering Students and their professors. Review of reports received from the client, CSC and other consultants, third party quality monitoring.
Compliance to contract conditions, engineering designs, and technical specifications Construction quality meets prescribed standards Reduced cost and time over runs Reduced number of variation orders and time extensions Early resolution of contractual disputes and other implementation issues
22 Includes NGO and consultants hired by the client
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Client’s role22 Bank’s role Expected outcomes Meetings and discussions with various government staff, contractors, and stakeholders.
Contractors fully mobilized on time and have the required capacity.
PROCUREMENT
- GOAP clearance process to be followed for all works, goods and TA contracts, including clearances by the Finance Department. - RDC to use Bank’s Standard Bidding Documents (SBD) for ICB and updated NCB model document. RDC to ensure that all procurements are done with full compliance of the Bank procurement procedures, bid documents are prepared with good quality and clarity, bids are invited and evaluated timely, and all awards are made promptly. - RDC to create and maintain a database on contractors’ performance. - RDC staff to attend training courses on: (i) Bank procurement procedures; and (ii) contract administration. - RDC staff to regularly enhance their exposure and refresh their procurement capacity on an ongoing basis. - Experienced transaction advisor to provide support to RDC on PPPs.
- All identified civil works will be subject to prior review as per the agreed threshold for prior review contracts. - Some consultancy services and goods will be subject to post-review. - Review of contracts awarded by APRDC, not subject to prior review by the Bank in terms of procurement arrangements defined in Annex 8 and as described in Procurement Plan shall be carried out on annual basis. The Bank shall cause to carry out such reviews either through the Bank team or Bank-hired consultants who will review agreed sample of contracts so awarded. Observations from such reviews shall be shared with the Borrower and lessons learnt will be implemented for future procurements.
- Bank/GOAP procurement guidelines followed. - Open and transparent competitive procurement achieved. - Database on contractors’ performance to be maintained and updated regularly and used for future decision making process.
FINANCIAL MANAGEMENT
- Reconciliation of expenditure with the Treasury and Accountant General (AG) to be used as an essential control mechanism in the Project and to be regularly followed up with the implementing departments. - PMU to maintain a commitment/payments register centrally, tracking all contracts (works, consultant services, goods, materials, other NGO services etc). This will provide the project with information required on pending payments and help track project progress. - The CAG of India through its offices in Andhra Pradesh to conduct an annual audit of the operations of the Project; the audit report to be submitted to the Bank within six months of the close of each FY. - FM wing of PMU to scrutinize all claims of suppliers, contracts, consultants received from the field engineers, make payments, keep all the accounting records as per APRDC system of accounting as per APRDC Code, submit monthly accounts to AG, Andhra Pradesh and submit financial reports to GOAP and CAA&A.
- Focus on the adequacy of the financial reporting arrangements, including timeliness and completeness of the Treasury financial reports, as the basis for disbursements from the Loan. - Desk reviews of external and performance audit reports. - To review commitment tracking system. - To review quarterly FM reports and audit reports and follow-up actions taken on such reports. - Participate in site visits as needed to review internal control procedures and practices.
- Compliance with (i) all FM covenants, and (ii) State Financial Rules & Regulations. - Audit comments taken into consideration. - Financial progress closely23 following physical progress.
23 Within 5 percent range
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Client’s role22 Bank’s role Expected outcomes
SOCIAL SAFEGUARDS
- Supervision to be carried out by the Package Manager. - Supervision of R&R payment to be carried out by Nodal NGO client-hired. - Supervision to be carried out by the Social Management Cell (SMC) in PMU. - Monitoring by Rehabilitation and Periphery Advisory Committee. - an external agency (client hired) will undertake social audit on six-monthly basis.
- Supervision to be carried out by the Bank staff as part of supervision missions. - 100 percent visit of roads; random sample check on implementation of RAP, and consultation with PAPs. -Bank-hired social consultant to closely check and verify implementation of RAP in a sample of 25 percent of the projects.
- 100 percent of required regulatory clearances obtained by APRDC/PMU and Contractors. - 100 percent compliance with Bank’s social and environmental safeguards. – 100 percent implementation of the project’s R&R framework and RAP. - 100 percent resolution of any complaints submitted through the redressal mechanism.
ENVIRONMENTAL SAFEGUARDS
- Evaluation to be carried out by the Independent Environmental Committee (constituting of officials/experts from Department of Forests, Wildlife Wing and State Pollution Control Board) with the assistance of Environmental Management Cell (APRDC/PMU) once in every six months. -Regular monitoring and supervision to be carried out by PMU and their Environment Advisor, focusing on forestry and wildlife.
- Supervision to be carried out by the Bank staff as part of regular supervision missions. -100 percent check of all roads; random sample check on implementation of EMP. - Bank-hired environmental consultant to closely check and verify implementation of EMP in a sample of 25 percent of the projects.
- 100 percent of required regulatory clearances obtained by APRDC/PMU and Contractors. - 100 percent compliance with the Project’s environmental and social safeguard policy.
TRANSPARENCY, INFORMATION DISCLOSURE AND COMPLAINTS HANDLING
- Information Disclosure as per the Disclosure Policy.
Verification of disclosure through checking of website, number of information requests received/responded to, information brochures, availability of project reports at APRDC offices and any other method of dissemination (advertisements, TV/radio programs, etc.)
Full compliance with disclosure requirements under Bank policy and the RTI Act.
- Establishment of effective Complaint Handling Mechanism.
Verification through website, number of complaints received/responded to both online and physically.
Better public participation and scrutiny of project.
INSTITUTIONAL STRENGTHENING
- Implementation of the agreed Institutional Strengthening Action Plan (ISAP) covering APRDC and R&BD is to be facilitated by new IS cell.
Review of reports received from the client and “ISAP implementation support” consultants. Consultations with GOAP officials and stakeholders.
Main IS targets fully implemented in APRDC and R&BD by EOP.
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Annex 7: Financial Management and Disbursement Arrangements
INDIA: Andhra Pradesh Road Sector Project 1. State level Financial Accountability Assessment (SFAA). The Andhra Pradesh State Financial Accountability Assessment was conducted by the Centre of Good Governance (CGG), Hyderabad on behalf of the Government of Andhra Pradesh (GOAP) and was completed in 2004. The Assessment examined inter alia the areas of budget formulation and execution, accounting and reporting, internal controls and external auditing and identified strengths and weaknesses in the above areas and made suggestions and recommendations for improving the overall financial management and accountability systems in the state.
2. One of the key issues that emerged from the Fiduciary Risk Assessment Report of the SFAA was the danger of circumventing the Treasury System of the state government and the government accounting and reporting procedures. The report concluded that the state systems have built in checks and balances, and bypassing them could lead to to weaker financial control and accountability. The project financial management arrangements have been designed keeping this aspect in view. The report also concluded that compliance with controls was adequate in the treasury system and in those areas in which discipline can be enforced through the treasury system (this also includes the PAO system for payment functions in respect of “works” departments). However compliance in other departmental areas such as cash records, utilization certificates, AC/ DC bills and Personal Deposit accounts (PD accounts) in the past has been weak.” All these aspects have also been examined while designing the project financial management arrangements and preparing the Risk Management table. 3. Assessment of FM capacity of RBD, GOAP. As part of the preparation activities, an assessment of the financial management (FM) arrangements of the Implementing Entity, the Roads and Buildings Department (RBD) of the GOAP was carried out. This assessment for RBD covered aspects of financial systems in the RBD, including flow of funds, accounting and financial reporting, approvals and payments, and auditing arrangements, as also the level of staffing. The assessment concluded that the existing system of the RBD (state system) is Satisfactory in terms of transactional control and accounting, and has reasonable amount of internal checks and balances as per the state government system. The capacity of the FM staff, who are not professional accountants, is limited to the extent of the prescribed financial system in the RBD, and this will need to be enhanced. The internal audit function is almost non- existent and is limited to the pre-check of bills by the Pay and Accounts Officer (PAO) before payment. The system of financial reporting in the form of compiled monthly accounts rendered to the state Accountant General (AG) is regular; however the financial information is not being used for the purposes of management information. While there is some basic level of computerization at the CE(R&B) level, the accounting systems at the CE(R&B) office and at the field divisions are manual in nature.
4. State level Financial Management issues. The issue of availability of funds on a timely basis to the project implementing entity applies to the project. However, externally aided projects generally have not faced fund flow problems in AP, though this may not necessarily be the case in the future. Quality and timeliness of audit reports (with audited financial statements) could be an issue – the audit will be conducted according to the standard Terms of Reference (TORs) agreed with the CAG and the Government of India (Ministry of Finance/ DEA) for audit of all
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the World Bank projects. The standard TORs also have the the draft format of the financial statements and of the various audit opinions and the RBD will coordinate with AG (Audit), AP, to ensure this.
5. Strengths in Financial Management. The GOAP RBD has handled the first AP State Highways project and is thus familiar with management of externally aided projects and accounting and reporting for the same. The RBD as a department of the Government of AP follows the financial rules and procedures laid down in the relevant codes/manuals of the GOAP, and the executive instructions/GOs issued by the GOAP from time to time. The RBD will implement the project through dedicated field divisions, supported by Divisional Accountants with experience in the Works’ departments of the GOAP. A system of monthly reporting from the RBD divisions to the state AG is in operation in the form of compiled monthly accounts, which report budget head wise the monthly and cumulative expenditure incurred, in comparison with the allocated budget.
6. FM Risk Assessment. The table below shows the risks and mitigations measures.
Risks/ weaknesses Risk Rating
Remarks/ Proposed risk mitigation measures Residual risk rating*
Inherent Risk: Experience with Road sector Bank projects have been that they have a high level of inherent risk due to large volume transactions and high value of contracts.
H
This risk will be mitigated by having a regular internal audit of the project by the Internal Audit wing of the GOAP finance department. The internal audit will be as per agreed TORs and will also cover audit of contracts and high value transactions.
S
Control Risks: Budgeting The GOAP is committed to adequate funding for the project but this could if the financial position of the state changes. Accounting: Delay in preparation of project accounts if information from the field units is delayed. Funds flow: Risk of project not receiving adequate allocations from the finance department or delay in issue of LoC to the PMU and to RBD field divisions. Internal Controls: Departmental and divisional level controls are often not adhered to, also there is no effective internal audit system in place.
M
S
S
H
The GOAP will ensure appropriate budget allocations for the project – this is a standard legal covenant. The state accounting system will capture all the transactions as per the project major, minor and detailed heads, both for the divisions and the PMU. The GOAP will ensure adequate allocations and regular/ quarterly issue of LoC by RBD to PMU and the field divisions – this could be a legal covenant. The RBD will be solely responsible for implementation of all the project components and will follow GOAP rules and procedures, and no other entity will be involved operationally. The RBD will be responsible for all sanctions, approvals, verifications and payments. The project internal audit will be conducted six-monthly under TORs
M
M
M
S
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Risks/ weaknesses Risk Rating
Remarks/ Proposed risk mitigation measures Residual risk rating*
agreed with the Bank. Financial reporting: Risk of delay in financial reporting if information from field units is not received in time. Auditing: CAG audit is limited to certification of SOEs and not certification of complete financial statements or propriety audit.
H
S
• Reporting through IUFRs will be based on the
project accounting system, and expenditure figures reconciled with those reported in the monthly state level government accounting system for the RBD, in which compiled accounts are sent to the state AG.
• The full finance team (PMU and field divisions) will be in place before implementation. They will be responsible for coordination to ensure that financial information is received on time.
• Project will post a gazetted finance officer from the state finance department (preferably the Directorate of works accounts) at the PMU.
The audit will be conducted according to the standard Terms of Reference (TORs) agreed with the CAG and the Government of India (Ministry of Finance/DEA) for audit of all the World Bank projects. The standard TORs also have the the draft format of the financial statements and of the various audit opinions.
S
M
Overall Control Risk H S Overall Risk Rating H S
(M- Moderate, S- Substantial, H- High)
* The proposed mitigation measures have been agreed with the GOAP, and the ratings will be reviewed as and when the mitigation measures are successfully implemented, some of which have already started.
7. Implementing Entity. The implementing agency for the project is the Roads and Buildings Department (RBD) of the Government of AP, and will be responsible for all FM functions for the project including incurring expenditure and making payments (division level payments will be done by the RBD field divisions), financial reporting and preparing IUFRs, and coordinating internal and external audits. There will be a project management unit (PMU) within the RBD, which will oversee day to day project implementation and coordination, that will be responsible for preparing consolidated financial statements for the project at the end of the financial year, and getting these audited and certified by the CAG. The PMU is headed by Chief Engineer (Core Road Network), who will be responsible for overseeing implementation of all project components, and will have appropriate financial and accounting staff. Designated field divisions of the RBD will be responsible for implementation of the project in the field. The Divisional Officers (Executive Engineers) will be responsible for getting the works executed (through contractors) and make payments for the divisional level works, which are Long Term Performance Based Maintenance contracts (LTPBMC) maintenance related, under the Output based Performance Road Contracts. The Upgrading works under the Road Improvement Component, will be implemented and monitored directly by the PMU, and contracts under these will be centrally awarded by the PMU. Bills will be raised by the PMU, and payments will be made following regular processes of the state government, by the Hyderabad PAO. The latter
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will also maintain the accounts for payments under this component, as per regular practices of the works departments of the GOAP. The RBD/ PMU will take these figures for consolidation of the quarterly IUFRs, as also expenditure figures from the field implementing divisions. Supervision consultants will physically check progress of the works being executed, as per design specifications agreed with the PMU and provide an independent check on the physical quality of the works being executed under the project from the PMU. They will also monitor the quality of work and to certify the contractors' bills for payment, after which the CE (RBD, CRN) will approve and pass the bills for payment by the Hyderabad PAO.
8. Financial Management arrangements. The guiding principle for the financial management arrangements would be to keep these aligned with the financial procedures of the GOAP for Works Departments (and to use the existing GOAP financial and control systems, to the extent possible. The GOAP will receive the Bank funds on a back-to-back basis through the Government of India. The WB project will follow the existing GOAP fund flow arrangements.
9. Budgeting and funds flow. The GOAP will make an appropriate annual budget allocation for the project in line with the overall financial plan agreed during the project preparation, and release funds through the mechanism of the budget. The CE (RBD)/ Project Director and the designated RBD field divisions will provide inputs for this process. The state government will make an annual budgetary allocation for the project as a ”Plan” item (expenditure head of account), under a separate budget line item “APRSP- World Bank Project”, in the Demand for Grants of the R&B department. The RBD will reallocate these funds, through a Letter of Credit (LOC)24, as per detailed budget projections, to the PMU and to the field divisions for implementation of works under the project. The PMU/ divisions will raise bills for payment till the limit indicated in the LOC, and the concerned PAO (Hyderabad/ district PAO respectively) will issue cheques for the amount indicated in the bill.
10. Accounting arrangements. Accounting for project expenditures will be maintained on cash basis as per GOI system and the PWD accounts and codes. This requires the RBD to compile their accounts monthly, for submission to the AG. The Monthly Compiled Accounts are comprehensive and provide substantial financial details of all the transactions at the Divisions for that month and cumulative expenditure on works. Classified Abstract provides consolidated expenditure up to Sub Head and Objects and Works Abstracts gives details of work wise expenditure. The Classified abstracts provide details of expenditure against each budget head. The prevailing financial rules and regulations of GOAP will apply to all project expenditures.
11. Accounting arrangements for the project will be on the basis of the following codes and manuals: AP Treasury Code (APTC), AP Financial Code (APFC), AP Accounts Code (APAC), AP Public Works (PW) Accounts Code and AP PW Departmental Code. The books of accounts will be maintained on a cash basis and the standard books of accounts as required under the GOAP PW Code will be maintained. The standard governmental Chart of Accounts for the R&B department (with appropriate modifications, if necessary), will be used to account for and report on the expenditure incurred, and all the project related expenditures will be separately identified, accounted and reported in the consolidated monthly accounts prepared by the Accountant General, AP. Details of expenditures by project components and sub components
24 An LOC is the Finance Department’s authorization to the bankers to honor payments from each implementing unit up to the limit set in the LoC
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will be tracked at the scheme level and updated information available both at the AG as well as the departmental level. Key aspects of accounting for the project are as follows:
• All payments to contractors, consultants and suppliers are considered as expenditure, other transfers are considered as advances.
• Mobilization Advance can only be given on specific approval of the Government. Such advances are generally against bank guarantee and taken to expenditure at the time of payment. Subsequently, deductions are made from the running bills of the contractor and the net amount is then booked to expenditure
• The procedure for payment of bills of the contractors for works includes: (a) writing of MB (Measurement Book) by the Assistant Engineer/Junior Engineer; (b) Running Bill prepared by the Asst Engineer and signed by the Executive Engineer (EE); (c) verification of Running Bill by Accounts Branch of the Division from financial angle; pre-audited and passed for payment; and (d) verification and passing of Running Bill by the EE.
12. Approval and payment procedures. The completion of works under the Widening and Strengthening Component will be certified by the Supervision Consultant after all the necessary checks and measurements etc. and then approved by the PD. The bills will be received from the Divisions, and the PD after going through all the necessary checks and verification procedures. Subsequently, the bill will be sent to PAO Hyderabad for scrutiny and payment. In respect of the LTPBMC (maintenance) component, the authority for payments of the contracts will be the Executive Engineer under the PAO system. The contractors will submit their bills to the Executive Engineer, who will then apply all the regular procedures and checks (including verifying the physical execution of work) for the bills, and certify and approve them for payment. The regular financial management rules and procedures of the GOAP (including the AP state Finance and Account Codes and the PW account codes as well as the relevant orders and circulars issued from time to time by the GOAP finance department) will be applicable to the entire project. This would cover aspects like financial delegations and approvals, issue of sanctions, raising and approval of bills for the works completed and authorization of payment through the Pay and Accounts Officer (PAO) system.25 13. Since the regular payment procedures of the GOAP are being used (PAO system), the RBD will not maintain or operate any bank account for the project or deposit project funds into any Personal Deposit (PD) account or Bank account operated by the R&B department or any other independent entity under the RBD. Neither the Project Director nor the Divisional Officers (Executive Engineers), or any other official of the project or RBD will be have cheque drawing or issuing powers, or act as cheque drawing and disbursing officers (DDOs).
14. FM Staffing. The finance and accounts function at the PMU of the RBD will be headed by a Financial Advisor/Manager who will be a senior officer of the state finance service/AP finance department on deputation (preferably from the Directorate of Works Accounts who have experience in the finance function of the works’ departments of the GOAP). He will be supported by a deputy who is a Divisional Accountant and has extensive experience in the finance function in PWD divisions. The Finance manager will be responsible for all aspects of
25 The PAO is an independent authority reporting directly to the finance department, and is responsible for making payments in respect of bills approved by the Executive Engineers of the respective divisions.
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accounting, financial reporting, fund flow, internal controls, overseeing the internal auditors and reviewing their reports, and coordinating the statutory (external) audit exercise for the project. S(he) will also be responsible for preparing the quarterly financial monitoring reports after consolidating information from the PIU and the project divisions, and sending them to the Bank for disbursement. The FM function of the RBD field divisions will be headed by a Divisional Accounts Officer (DAO) and will be supported by other support staff in the field. Government Orders creating the field divisions to execute the project have to be issued and the Divisional Accounts Officers have to be in position before the start of the project. The Finance Manager/ Advisor will have to be in position by date of project effectiveness.
Financial Reporting and Monitoring:
15. The PMU will compile quarterly Interim Un-audited Financial Reports (IUFRs) on the basis of consolidation of actual expenditure information received from the field divisions and the actual expenditure incurred at the PMU. This expenditure information will be compiled by project components and sub-components, and will be reconciled with the monthly expenditure statements (compiled accounts) sent by the divisions and the PMU to the state Accountant General. The project director will certify that the expenditure reported by the IUFRs is in agreement with the monthly accounts sent to the AG, AP. The form and content of the IUFRs will be agreed with the GOAP during negotiations.
16. Internal Controls and Internal Audit. GOAPs financial and Treasury Codes and circulars provide the framework for procedural transaction control of individual items of expenditure and receipts, and this will be applicable to the project. They also provide detailed guidance on internal controls, including safeguarding of cash, control over inventories, segregation of duties and delegation of authority for approvals. Reconciliation of expenditure with the AG is concurrent and would be an essential control mechanism in the Project and would be regularly followed up with the implementing departments. It was also agreed that the PMU will maintain a commitment/payments register centrally at the PMU, tracking all contracts (works, consultant services, goods, materials, other NGO services etc). This will provide the project with information required on pending payments and help track project progress. The Bank project will be audited six-monthly by the Internal Audit wing of the GOAP finance department as per agreed TORs. The auditors will be responsible for completing the audit at the PIU and at the divisional levels under TORs agreed with the Bank, and review and comment on the adherence to the rules and procedures of the GOAP and the effectiveness of internal controls.
17. External Audit. The CAG of India through the office of the Accountant General (Audit) AP will be the statutory auditor for the project. The CAG’s office will conduct an annual audit of the operations of the Project. The statutory audit of the project financial statements will be conducted according to the standard Terms of Reference (TORs) agreed with the CAG and the Government of India (Ministry of Finance/DEA) for audit of all the World Bank projects. The standard TORs also have the the draft format of the financial statements and of the various audit opinions. The form of project financial statements will be prepared by the project and will be agreed with the CAG of India. The audit report would be submitted within six months of the close of the GOAP fiscal year. The following audit reports will be monitored in ARCS.
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Implementing Agency Audit Auditors Roads and Buildings Department (RBD), GOAP (including RDC as PMU and the project field implementing divisions)
Audit of project financial statements (PFS)
CAG of India / AG (Audit), AP
Department of Economic Affairs/GOI
Special Account Comptroller and Auditor General
Disbursement Arrangements/Special Account 18. Disbursements from the IBRD loan will be made against “actual expenditures” as evidenced by the payment vouchers and captured in the PW departmental accounting system, and reported monthly to the state Accountant General. The “actual expenditures” will be reported in the quarterly IUFRs and no forecast based advances will be provided. A Designated Account will be opened by the GOI with the Reserve Bank of India to receive funds under the project, and will be operated by the Department of Economic Affairs (DEA) of GOI. The authorized allocation of the Designated Account will be agreed between the Bank and the GOAP at negotiations. Funds will be withdrawn from the designated account on the receipt of quarterly withdrawal applications from GOAP and transferred to GOAP following the standard Centre-State mechanism of Additional Central Assistance. The project will submit withdrawal applications to Controller of Aid, Accounts and Audit (CAA&A) in DEA for onward submission to the World Bank for replenishment of the special account. The following table specifies the categories of eligible expenditures that may be financed out of the proceeds of the loan (and the disbursement percentages, as indicated in the PAD).
Table 16: Categories of Eligible Expenditure
Category Amount of the Loan
Allocated (expressed in
USD)
Percentage of Expenditures to be financed
(inclusive of Taxes)
(1) Works & R&R Assistance: (a) for Components 1(a) 4 (a) and 4 (c) of
the Project
(b) for Component 1(b) of the Project
239,060,000
52,560,000
80%
20%
(2) Goods, Consultants’ Services and Training, and Incremental Operating Costs
27,580,000
80%
(3) Front-end Fee 800,000
Amount payable pursuant to Section 2.03 of this Agreement in accordance with Section 2.07 (b) of the General Conditions
(4) Premia for Interest Rate Cap or Interest Rate Collar
-0- Amount payable pursuant to Section 2.07 (c) of this Agreement in accordance with Section 4.05 (c) of the General Conditions
TOTAL AMOUNT 320,000,000
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19. Retroactive Financing: Retroactive financing up to a limit of US$64 million is available to cover eligible project expenditures as agreed with the Bank between November 1, 2008 and loan signing date. Retroactive financing will support project costs pertaining to all project components as required. Retroactive financing of all expenditure, including contracts selected for Bank financing, would be based on a separate, stand-alone, audit report/ certificate/audited IUFR which will be provided by the CAG as per standard audit TORs. The audit report will certify the actual expenditure incurred and the eligible expenditure, and also report details of expenditures seeking to be reimbursed on contracts procured as per the Bank’s Procurement Guidelines. Under retroactive financing, the amounts sought for IBRD financing should correspond with disbursement by the project on the identified contracts. Supervision Plan 20. The focus during the supervision will be on the reviewing the operation of procedures and internal controls in the R&B department and field divisions, functioning of project financial reporting system, reviewing the funds flow position and ensuring that the observations in CAGs audit are addressed in time. In the early stages, FM supervision activities will focus on the adequacy of the financial reporting arrangements, including the timeliness and completeness of the IUFRs, as the basis for disbursements from the Credit/Loan. As the implementation moves forward, desk reviews of external and performance audit reports will be conducted. Key FM fiduciary work includes: (i) review compliance with all FM covenants; (ii) review compliance with State Financial Rules and Regulations; (iii) review of commitment tracking system; (iv) review of quarterly financial management reports and audit reports and follow-up actions taken on such reports; and (v) participating in site visits as needed to review internal control procedures and practices. Based on the assessed risk, FM supervision plans will be prepared.
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Annex 8: Procurement Arrangements
INDIA: Andhra Pradesh Road Sector Project
1. Procurement for the proposed project will be carried out in accordance with the World Bank’s "Guidelines: Procurement under IBRD Loans and IDA Credits" dated May 2004, revised October, 2006 (Procurement Guidelines); and "Guidelines: Selection and Employment of Consultants by World Bank Borrowers" dated May 2004, revised October 2006 (Consultancy Guidelines) and the provisions stipulated in the Legal Agreement.
2. The various items under different expenditure categories are described in general below. For each contract to be financed by the Loan, the different procurement methods or consultant selection methods, estimated costs, prior review requirements, and time frame are agreed between the Borrower and the Bank in the Procurement Plan. The Procurement Plan will be updated at least annually or as required to reflect the actual project implementation needs and improvements in institutional capacity. A General Procurement Notice (GPN) was published in UNDB in 22-12-2005. An updated GPN will be published on September 30, 2009 in UNDB on-line and in its printed version as well as in dgMarket online. Specific Procurement Notices (SPN) will be published for all ICB procurement and Consulting contracts as per Guidelines as the corresponding bidding documents and RFPs become ready and available.
3. Procurement under the proposed project include nine contracts (for a total of seven roads) for upgrading of 429 km of roads, 37 long term performance based maintenance contracts (LTPBMC) on the lines of output-and-performance-based road contracts (OPRC) for existing roads totaling to 6,241Kms, construction of office building for Andhra Pradesh Road Development Corporation (APRDC) and a range of consultancy servicesand goods.
4. Procurement of Works: for nine contracts of the Road Improvement Component will be done by using the Bank’s Standard Bidding Documents (SBD) for ICB (Works) and NCB model document (including NCB provisions indicated in paragraph 9 below and in the procurement plan) as per applicable threshold.
5. The procurement of Long-term Performance Based Maintenance Contracts: will be done using updated NCB model document integrated with the Bank’s output-and-performance based roads contract (OPRC). The integrated document will have to be acceptable to the Bank. The NCB procurement process as described in this section will be followed for these contracts.
6. Procurement of Goods: for the project including Road Management System (RMS) implementation support such as purchase of equipment, computers and software & hardware for RMS, lab equipment, scientific equipment, MIS/LAN, furniture and renovation of office building. The procurement for ICB and NCB packages will be done following the Bank’s procurement procedure as described in the Procurement Plan and Bank’s SBDs for Goods will be used.
7. Selection of Consultants: Services of consultant firms will be required for preparing detailed project reports, construction supervision and technical audits. In addition, for the Public Private Partnership (PPP) roads and RMS implementation, a range of technical consultancy and advisory services will be engaged. For all consultant procurement, the Bank’s Standard Request for Proposal (RFP) document and pertinent Form of Contract will be used.
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8. Operating Costs: The project will support various incremental costs for efficient and timely project implementation. Operating costs financed by the project according to an annual budget approved by the Bank. Activities would be procured using the implementing agency’s administrative procedures which were reviewed and found acceptable to the Bank.
9. The bidding documents shall be drafted following the Bank’s Standard Bidding Document. The following conditions must be met in order for the bidding process under NCB to be acceptable to the Bank:
i. Only the model bidding documents for NCB agreed with the GOI Task Force (and as amended from time to time) shall be used for bidding;
ii. Invitations to bid shall be advertised in at least one widely circulated national daily newspaper, at least 30 days prior to the deadline for the submission of bids;
iii. No special preference will be accorded to any bidder either for price or for other terms and conditions when competing with foreign bidders, state-owned enterprises, small-scale enterprises or enterprises from any given State;
iv. Except with the prior concurrence of the Bank, there shall be no negotiation of price with the bidders, even with the lowest evaluated bidder;
v. Extension of bid validity shall not be allowed without the prior concurrence of the Bank (a) for the first request for extension if it is longer than four weeks; and (b) for all subsequent requests for extension irrespective of the period;
vi. Re-bidding shall not be carried out without the prior concurrence of the Bank. The system of rejecting bids outside a margin or “bracket” of prices shall not be used in the project;
vii. Rate contracts entered into by Directorate General of Supplies and Disposals will not be acceptable as a substitute for NCB procedures. Such contracts will however be acceptable for any procurement under Shopping procedures; and
viii. Two or three envelope system will not be used.
Assessment of the Agency’s Capacity to Implement Procurement 10. The State concluded implementation of AP State Highway Project (APSHP) project in Road Sector in the past and is as such familiar with World Bank’s procurement methods and project implementation. Although several members of team which implemented APSHP have been transferred or retired, many members of the current team have been working for the last three years on the preparation of the APRSP and are increasingly becoming more familiar with World Bank procurement methods and processes. In addition, the APRDC has created a procurement committee of four officials for the procurement of works (including upgrading of roads and LTPBMC), Goods, Consultancy services and PPP. The PPP and LTPBMC being relatively new areas, focused efforts are required for capacity building in these areas. For Procurement in PPP concessions the APRSP is being supported by a transaction advisor.
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11. Per G.O. Ms. No. 248, dated August 28, 2008, the Roads and Building Department has been designated as the implementing agency for the project and the Chief Engineer (CRN), is also the Managing Director of the Andhra Pradesh Road Development Corporation (APRDC) is designated as the PMU. CE (CRN)/MD APRDC is assisted by three GM of APRDC. For all contracts and consultancy services, the Chief Engineer (R & B), Core Road Network is employer and client respectively.
12. For up-gradation component, the PMU will be supported by a Project Management Consultancy (known as Construction Supervision Consultant) for monitoring and supervising the day-to-day implementation of the up-gradation civil works. For the OPRC contracts the day to day implementation, supervision and monitoring will be done by the field level Executive Engineers of RBD/APRDC. The third party monitoring for quality and performance under OPRC contracts will be done by consultants who will report to the CE (CRN)/MD APRDC. The procurement responsibilities and arrangements in the PMU are described in the following paragraphs.
13. Procurement Setup in the Project Management Unit of CE (CRN): All Procurement matters are finalized in accordance with the powers delegated in the APPWD code and GO. Ms 94 dated 01-07-2003. The procurement function is carried out by individual units at different locations, the delegation of powers per works is as follows:
i) Executive Engineers at Divisional level up to Rs. 1 million ii) Superintending Engineers at Circle level up to Rs. 5 million iii) Chief Engineers at head quarters Hyderabad above Rs 5 million and up to Rs. 20
million iv) Commissioner of Tenders (COT) for beyond Rs. 20 million
Other State Funded Works (other than BOT and externally aided) 14. COT (Commissionerate of Tenders) is the control authority, for finalization of tenders beyond Rs. 20 million, for all departments. But the tender process is initiated by individual units only.
15. BOT (PPP) and externally aided Projects: total procurement activities in the state are dealt with at agency headquartered in Hyderabad in a centralized manner, and as such the APRSP procurement activities will be done at the headquarters by the CE (CRN).
16. The procurement of all works, goods and consultancies beyond Rs. 20 Million procured using system other than e-procurement are to be approved by the Government in Transport, Roads and Buildings (TR&B) Department by the (i) Financial Evaluation committee after recommendations of (ii) Technical Evaluation committee constituted per GO Ms. No. 270 dated December 29, 2006.
17. Technical Evaluation Committee comprising of following members has been constituted by the GOAP to finalize the activities like: (i) approval of RFQ documents; (ii) approval of prequalification of tenders/short listing of tenders; and (iii) any other activity of specific importance, involving any need of concept in procurement or otherwise.
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Technical Evaluation Committee
a. Advisor, Quality Control for R&B …. Member b. Engineer-in-Chief (R&B) Admn. & Roads …. Member c. Chief Engineer (CRN) /MD, APRDC …. Member/Convener d. Deputy Financial Advisor Finance (PMU) …. Member
18. Financial Evaluation Committee approves award on recommendations of the TEC. The average time taken to get their approval is 15 days.
Financial Evaluation Committee
a. Principal Secretary (R&B Wing), TR&B …. Member b. Principal Secretary (W&P), Finance …. Member c. Secretary (IF), Finance …. Member d. Chief Engineer (R&B) /MD, CRN/ MD APRDC …. Convener
19. Procurement Set Up in the PMU: Each component of the project is overseen by GM, and these are supported by various levels of engineers and offices. The Procurement Cell also provides technical backstopping and oversight of procurement activities for the different units of the PMU. The implementation arrangements of the project are described in Annex 6.
20. Additional help is taken from technical experts, consultants in finalization of technical specifications and proposal evaluations. A panel of five legal experts helps on legal matters such as arbitration, legal vetting and concession agreements, etc.
21. Evaluation Committee for Selection of Consultants: The Government of Andhra Pradesh has constituted two committees as above (refer paragraphs 17-18 above).The Technical Evaluation Committee examines the technical issues and recommend to Financial Evaluation Committee for approval. The FEC finalizes the selection of Consultant. An assessment of the capacity of PMU to implement procurement actions for the project has been carried out, using the principles outlined in the Dynamic Risk Assessment Model based on the information collected in the standard questionnaire and during discussions with the implementing agency. The assessment reviewed the organizational structure for implementing the project, the process of procurement and applicable codes as being followed in the procurement process, the staffing of the PMU, and the tiers as well as authority levels in the procurement decision process. An Action Plan was developed as output from the above assessment, which was shared with GOAP and PMU. The action listed there-under, have been monitored on regular basis during preparation phase of the project. The latest updated Action Plan with status of agreed actions for risk mitigation and capacity building of PMU is placed at Table 17 below.
Risk and Mitigation Measures 22. The key procurement risks and mitigation measures have been identified and highlighted below.
23. Lack of Dedicated Procurement Staff: Since there is no dedicated Procurement Officers at PMU, the initial procurement actions were carried out through the involvement of PMU
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engineers who have additional responsibilities. However, this arrangement required strengthening with the re-allocation of a few dedicated procurement officers, who would be responsible not only for executing the planned procurement activities but also for coordination and monitoring procurement progress at PMU, and for overseeing contract administration during the implementation phase. A Procurement committee comprising of four Engineers has been setup by the PMU on September 23, 2008, vide proceedings No. 45.
24. Capacity Building Measures: The PMU staffs have been associated with project preparation and are familiar with Bank procedures. Some of the PMU staffs dealing with procurement have attended a training course on Bank procurement procedures at the Administrative Staff College of India (ASCI) in Hyderabad/National Institute of Finance Management (NIFM) Faridabad. During project implementation, the PMU is working out a training plan for more staff to enhance their exposure and refresh their procurement capacity on an ongoing basis.
25. In addition, as part of the institutional capacity building, PMU engineers who will be associated for the project implementation will undergo an orientation course on the essentials of procurement (advertisement, document preparation, prequalification & bidding process and evaluation procedures) using Bank procedures, PPP as well as a course on Contract Administration. These staff will also be exposed to international good practices in Out-put based roads contracts and PPP concession contracts through study tours during preparation and implementation phase of the Project. The training courses may be designed and conducted in-house by training institutions at the request of PMU, their staff would be sent for the training to different institutions in India.
26. Disclosure Requirements: As per Banks’ Procurement Guidelines, May 2004 (revised October 2006) and Consultant’s Guidelines, May 2004 (revised October 2006) will be complied. The provisions for disclosure as detailed in “Appendix 1 of Annex 6: Governance and Accountability Action Plan (GAAP)” go a step further from Bank’s said disclosure requirements and adequately satisfy Bank’s requirement.
27. Identification of procurement risks and mitigation plan to address these risks by enhancing the procurement capacity of PMU is provided below:
Table 17: Procurement Capacity Risk Mitigation Plan
Description of risk/Issue
Rating of risk
Mitigation measures
Rating of
residual riskRecord Keeping and Documentation
S At the beginning of the project a brief
overview of the documents to be maintained and filed would be discussed with Project Authorities (PA). Subsequently during project implementation, the record keeping and documentation regarding procurement shall be monitored.
M
Use of Bidding documents and RFP ( for Bank financed contracts)
M Bank's SBDs for ICB (Works) and Model documents NCB will be used, which provides for this.
L
Inadequate capacity to handle World Bank Procurement Methods and
S • Setting up of procurement cells, its capacity building including
M
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Description of risk/Issue
Rating of risk
Mitigation measures
Rating of
residual riskSystems participation in long duration &
detailed procurement training of all team members of PMU engaged in procurement and procurement decision making.
• List of the staff having undergone such training/exposure shall be provided to the Bank. Also a detailed list of training scheduled for the future will be prepared and provided for information of the Bank.
Probability of staff handling procurements being transferred.
S Transfer of Procurement staff after they have undergone training is a possibility. Agree with the GoAP and PA that the trained procurement staff will normally not be transferred during the project implementation phase.
M
Delays in land acquisition, obtaining necessary approvals of utility shifting, tree cutting and making the sections of roads available free from encumbrances to the contractors
S The Project will take advance steps to avoid delays in land acquisition, taking necessary approvals of utility shifting, tree cutting and making the sections of roads available free from encumbrances to the contractors on a time bound manner as per a planned schedule to be included in the bidding documents.
M
Several members of team which implemented APSHP are transferred or retired and many members of the current team were not familiar with World Bank procurement methods and process at the start of project preparation.
S PMU staff has gained procurement experience during the last three years of project preparation. In addition, a procurement committee has been created and trained officials are allocated for the procurement of works, goods and consultants and PPP transactions. These officials will be continuously trained.
M
Experience in long-term performance based contracts suggests the perceived risks of bidders and their non-familiarity with the bid structure and payment security is resulting in low competition.
S Minimum four workshops to be organized aimed at familiarization and seeking feedback from prospective bidders. The format of workshops will include a presentation to the prospective bidders on the project, bid structures and risk mitigation plan and their feedback to address the genuine issues raised by them. Experience gained in the Phase 1 contracting will be used in the design of Phase 2 contracts.
M
F&C risk (including collusion and outside interference) in contracting process.
H • Measures to improve competition such as broad technical specifications, realistic post qualification criteria, appropriate contract packaging (lot sizes) and good publicity of bids etc.
S
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Description of risk/Issue
Rating of risk
Mitigation measures
Rating of
residual risk• Better disclosure, complaint handling,
MIS, documentation, etc. • Training in detecting F&C indicators.
Complaint redressal mechanism. S • A complaint handling mechanism
would be prepared. A half-yearly report of all complaints received and action taken will be reviewed by the MD APRDC/CE CRN and also furnished to the Bank.
M
Corruption in procurement. S • Disclosure of contract opportunities, contract award decisions, internal/ external procurement and financial audits.
M
OVER ALL RISK S M
H-High, S – Substantial, M-Moderate and L- Low The above mitigation measures are confirmed by the Borrower during Appraisal and negotiations and would be carried out during implementation.
28. After the above prescribed mitigation measures are taken, the overall project risk for procurement will be rated as Moderate.
Procurement Plan 29. The AP Road Development Corporation has developed a Procurement Plan for the first 18 months project implementation period and is the basis for the procurement methods to be used for procurement of works (Up-gradation as well as LTPBMC), Goods and Consultancy services. The Procurement Plan has been agreed between the GOAP and the Bank during appraisal and is available at the websites of AP Road Development Corporation as well as GOAP. It will also be available in the project’s database and in the Bank’s external website. The Procurement Plan will be updated at least annually (or as required from time to time) to reflect the actual project implementation needs and improvements in institutional capacity. The Procurement Plan establishes the thresholds for prior review by the Bank, which will also be reviewed during the implementation phase of the project to reflect changes in the capacity and risk assessment of PMU using the principles of Dynamic Risk Assessment Model.
Frequency of Procurement Supervision 30. In addition to the prior reviews to be carried out by the Bank, it is recommended that procurement supervision /implementation support missions will be conducted to the field every six months initially, and increased to once a year during the later part of the project implementation period. The Bank will also carry out post reviews of procurement actions taken below the prior review threshold either during supervision missions or through consultants to be engaged for this purpose on periodic basis.
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Procurement Arrangement for Phases 1 and 2
Procurement of Goods, Works (including Up-gradation and LTPBMC) and non-consulting services.
31. Methods of Procurement:
• Use of ICB for each contract above US$10 million for works and above US$500,000 for goods.
• NCB for each contract, up to US$10 million for works (including LTPBMC) and up to US$500,000 for goods.
• Shopping for each contract up to US$30,000 for works and goods. • Direct Contracting, proprietary items, such as spare parts and software meeting
requirements stated in the Procurement Guidelines of the Bank. • Force account for works to be detailed in the Procurement Plan.
32. Prior Review Threshold. Procurement Decisions subject to Prior Review by the Bank as stated in Appendix 1 to the Procurement Guidelines
Table 18: Prior Review Threshold for Procurement of Goods and Works
Procurement Method Prior Review Threshold Goods Contracts above US$400,000, and first
contract irrespective of value ICB (Works) /Goods All contracts irrespective of value NCB (Works) including LTPBMC
Contracts above US$5,000,000
Direct Contracting All contracts irrespective of value Force Account All contracts irrespective of value
Selection of Consultants 33. Methods of Procurement: The following methods of selection will be adopted depending upon size and complexity of assignment, as defined in the Consultancy Guidelines:
• Quality and Cost Based Selection (QCBS) • Quality Based Selection (QBS) • Selection under Fixed Budget (FBS) • Least Cost Selection (LCS) • Selection based on Consultant’s Qualifications (CQS) • Single Source Selection (SSS) • Individual Consultants • Individual Consultants on SSS
34. Prior Review Threshold: Selection decisions subject to Prior Review by Bank as stated in Appendix 1 to the Consultancy Guidelines.
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Table 19: Prior Review Threshold for Consultant Selection
Selection Method Prior Review Threshold Remarks Competitive Methods (Firms) More than US$200,000
equivalent per contract
Individual Consultants (Competitive Method)
More than US$50,000 equivalent per contract
Single Source (Firms and Individuals) All
35. The Expression of Interest for consultancy services estimated to cost above US$200,000 equivalent per contract for firms shall be advertised in UNDB online and DgMarket and other provisions of paragraph 2.5 of the Consultant Guidelines.
36. Consultancy services estimated to cost above US$200,000 equivalent per contract for firms, US$50,000 per contract for individuals using competitive methods and single source selection of consultants (firms and individuals) for any value will be subject to prior review by the Bank.
37. Short list of consultants for services, estimated to cost less than US$500,000 equivalent per contract, may comprise entirely of national consultants in accordance with the provisions of paragraph 2.7 of the Consultant Guidelines.
38. Any Other Special Selection Arrangements:
The Bank’s Guidelines and processes will be followed for procurements and selections even during preparation phase for being eligible for retroactive financing as per respective Guidelines. All no objections issued during this phase will be subject to signing of loan agreement and without any commitment by the Bank.
39. Financing the Operational Cost for the Project, such as
i. Remuneration and Reimbursable Expenditures for Incremental Staff of the PMU and Contract Employees.
ii. Furnishing of Office Space, office rental, and purchase of furniture for PIU staff iii. Fuel and vehicle rental. iv. Any other item agreed with Bank in advance.
40. Procurement Plan for first 18 Months has been provided in Appendix 1
E-Government Procurement (e-GP) 41. E-Government Procurement will be applicable as and when the same is agreed with the Bank.
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Appendix 1: Procurement Plan
(As on September 4, 2009)
I. GENERAL
A. Bank’s approval Date of the procurement Plan: Original: September 04, 2009 Revision 1: ……
B. Date of General Procurement Notice:22-12-2005 (appeared in UNDB)
C. Period covered by this procurement plan: First 18 months of the project
II. Goods and Works and Non-Consulting Services.
A. Methods of Procurement:
Procurement Method Method of Procurement Comments
1. ICB (Goods) More than US$500,000 equivalent per contract.
2. NCB (Goods) Up to US$500,000 equivalent per contract. 3. ICB (Works) More than US$10,000,000 equivalent per
contract for works, and all PPP (BOT) contracts.
4. NCB (Works) Up to US$10,000,000 equivalent per contract for works (including LTPBMC).
5. Shopping for Works and Goods Up to US$30,000 equivalent per contract. 6. Direct Contracting Proprietary items, such as spare parts and
software, which meet the requirements mentioned in the Procurement Guidelines of the Bank.
7. Force Account for Works As detailed in the Procurement Plan.
B. Prior Review Threshold: The Prior Review threshold limits will be as under: -
Procurement Method Prior Review Threshold Comments
1 ICB (Goods) All contracts irrespective of value 2 NCB (Goods) More than US$400,000 equivalent per
contract and First contract irrespective of value.
3 ICB (Works) All contracts irrespective of value. 4 NCB (Works) inclusion LTPBMC
(based on Output and Performance based Road Contract (OPRC) following NCB).
More than US$5,000,000 equivalent per contract.
5 Direct Contracting All contracts irrespective of value. 6 Force Account All contracts irrespective of value.
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C. Any Other Special Procurement Arrangements:None
Section III B. Paragraph 2 (a) of the Loan Agreement, Procurement through National Competitive Bidding (NCB) method shall be carried out in accordance with paragraph 3.3 and 3.4 of the Guidelines and the following provisions shall additionally apply:
o Only the model bidding documents for NCB agreed with the GOI Task Force (and as
amended from time to time) shall be used for bidding;
o Invitations to bid shall be advertised in at least one widely circulated national daily newspaper, at least 30 days prior to the deadline for the submission of bids;
o No special preference will be accorded to any bidder either for price or for other terms and conditions when competing with foreign bidders, state-owned enterprises, small-scale enterprises or enterprises from any given State;
o Except with the prior concurrence of the Bank, there shall be no negotiation of price with the bidders, even with the lowest evaluated bidder;
o Extension of bid validity shall not be allowed without the prior concurrence of the Bank (a) for the first request for extension if it is longer than four weeks; and (b) for all subsequent requests for extension irrespective of the period;
o Re-bidding shall not be carried out without the prior concurrence of the Bank. The system of rejecting bids outside a margin or “bracket” of prices shall not be used in the project;
o Rate contracts entered into by Directorate General of Supplies and Disposals will not be acceptable as a substitute for NCB procedures. Such contracts will however be acceptable for any procurement under Shopping procedures; andTwo or three envelope system will not be used.
o Two or three envelope system will not be used.
III. Selection of Consultants
A. Methods of Selection: 1. The following methods of selection will be adopted depending up on size and complexity of assignment, as defined in the Consultancy Guidelines:
Quality and Cost based Selection (QCBS) Quality Based selection (QBS) Selection under Fixed Budget (FBS) Lease Cost selection (LCS) Selection based on Consultants’ Qualification (CQS) Single Source Selection (SSS) Individual Consultants Individual Consultants on SSS
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2. The method of selection to be adopted for each consultancy shall be mentioned in the Procurement Plan approved by the Bank.
B. Prior Review Threshold: Selection decisions subject to Prior Review by Bank as stated in Appendix 1 to the Guidelines Selection and Employment of Consultants:
Selection Method Prior Review Threshold Comments 1. Competitive Methods (Firms) More than US$200,000
equivalent per contract
2. Single Source Selection (Firms and Individuals)
All contracts
3. Individual Consultants (Competitive Methods)
More than US$50,000 equivalent per contract
C. Short list comprising entirely of national consultants: Short list of consultants for services, estimated to cost less than US$500,000 equivalent per contract, may comprise entirely of national consultants in accordance with the provisions of paragraph 2.7 of the Consultant Guidelines.
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SL No.
Package No.
Description of Works/Goods
Estimated Cost (Rs. Millions)
Method of Procurement ICB/NCB
Design/Investigation completed (Date)
Prior Review/ Post Review
Whether Margin of Domestic Preference Applicable (Yes/No)
Estimate Prepared & Sanctioned (Date and
Value)
Preparation of Bid Document (Date)
Bank's No. Objection to Bidding Document
(Date)**
Bid
s
Contract Award decided
(Date/Value/Currency)
Bank's No. Objection to Contract Award
(Date)**
Contract Signed (Date/ Value/ Currency)
Contract No.
Name of Contractor/Nationality
& ZIP Code
**WBR No.
Date of completion of Contract
Exp. Incur-red to Date (Rs.Millions)
Invitation (Date)
Opened on (Date)
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
I
Wid
enin
g a
nd S
tren
gth
enin
g o
f r
oads
U1
Chit
toor-
Pu
ttu
r R
oad
1507
ICB
(w
ork
s)
10.0
4.0
8
Pri
or
Rev
iew
N
o
25.0
4.0
8
26.0
7.0
8
26.0
8.0
8
28.0
8.0
8
11.1
2.0
8
09.0
2.0
9
15.0
6.0
9
12.0
8.0
9
11.0
2.1
2
U2
Kan
di
- S
had
nag
ar
Road
2477
ICB
(w
ork
s)
15.0
5.0
8
Pri
or
Rev
iew
N
o
25.0
7.0
8
20.1
0.0
8
12.1
2.0
8
19.1
2.0
8
27.0
5.0
9
25.0
7.0
9
10.0
9.0
9
05.1
0.0
9
04.0
4.1
2
U3
Myd
ukur
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mm
alam
adugu R
oad
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1
935
ICB
(w
ork
s)
15.0
5.0
8
Pri
or
Rev
iew
N
o
25.0
7.0
8
20.1
0.0
8
12.1
2.0
8
19.1
2.0
8
27.0
5.0
9
25.0
7.0
9
25.0
8.0
9
25.0
9.0
9
25.0
9.1
1
U4
Myd
ukur
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mm
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oad
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2
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ICB
(w
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15.0
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8
Pri
or
Rev
iew
N
o
25.0
7.0
8
20.1
0.0
8
12.1
2.0
8
19.1
2.0
8
27.0
5.0
9
25.0
7.0
9
25.0
8.0
9
25.0
9.0
9
25.0
9.1
1
U5
Kurn
ool
- D
evan
akond
a R
oad
1020
ICB
(w
ork
s)
15.0
5.0
8
Pri
or
Rev
iew
N
o
25.0
7.0
8
20.1
0.0
8
12.1
2.0
8
19.1
2.0
8
27.0
5.0
9
25.0
7.0
9
25.0
8.0
9
25.0
9.0
9
25.0
3.1
2
U6*
Jagit
yal
- P
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R
oad
1132
ICB
(w
ork
s)
30.0
8.0
8
Pri
or
Rev
iew
N
o
15.1
0.0
8
17.1
2.0
8
12.0
3.0
9
20.0
5.0
9
12.0
8.0
9
30.0
9.0
9
31.1
0.0
9
28.1
1.0
9
27.0
5.1
2
U7*
Kak
inad
a -
Raj
ahm
undry
R
oad
2657
ICB
(w
ork
s)
15.0
5.0
9
Pri
or
Rev
iew
N
o
31.1
0.0
9
15.1
1.0
9
15.1
2.0
9
20.1
2.0
9
05.0
2.1
0
31.0
3.1
0
30.0
4.1
0
01.0
6.1
0
31.1
2.1
3
90
U8*
P
edan
a -
Vis
sann
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oad
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14
40
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iew
N
o 31
.10.
09
15.1
1.09
15
.12.
09
20.1
2.09
05
.02.
10
31.0
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0
30.0
4.1
0
01.0
6.1
0
31.1
2.1
3
U9*
P
edan
a -
Vis
sann
apet
a R
oad
– 02
10
66
ICB
(w
orks
)
Pri
or
Rev
iew
N
o 31
.10.
09
15.1
1.09
15
.12.
09
20.1
2.09
05
.02.
10
31.0
3.1
0
30.0
4.1
0
01.0
6.1
0
31.1
2.1
3
II
L
on
g T
erm
Per
form
an
ce B
ase
d M
ain
ten
an
ce C
on
tra
ct S
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Ph
ase
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n O
PR
C M
od
el
L1
OP
RC
for
the
M
ain
ten
ance
of
Pac
kage
1-
Roa
ds i
n V
isak
hapa
tna
m D
istr
ict
of
And
hra
Pra
desh
300
NC
B
01.1
1.07
P
rior
R
evie
w
No
28.0
2.08
01
.03.
08
19.0
3.08
26
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08
15.0
7.08
Rs.
26
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9,
899
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t 28
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008
30.0
9.0
8
24.0
1.0
9
4/A
PR
SP
Sri
M
ukam
bi
ka
Const
ruct
ions
V
izia
naga
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10/1
2
3.0
1.1
4
85.8
1
L2
OP
RC
for
the
M
ain
ten
ance
of
Pac
kage
2-
Roa
ds i
n E
ast
God
avar
i D
istr
ict
of
And
hra
Pra
desh
340
NC
B
01.1
1.07
P
rior
R
evie
w
No
15.0
7.08
01
.03.
08
19.0
3.08
27
.03.
08
15.0
7.08
Rs.
31
,21,1
0,
359
D
t 28
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008
30.0
9.0
8
05.0
2.0
9
7/A
PR
SP
SV
C
onst
ruct
ions
Vubal
ank
a Rav
ula
pal
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ast
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ari
Dis
tric
t
10/2
04.0
2.1
4
131.3
L3
OP
RC
for
the
M
ain
ten
ance
of
Pac
kage
3-
Roa
ds i
n G
untu
r D
istr
ict
of
And
hra
Pra
desh
340
NC
B
01.1
1.07
P
rior
R
evie
w
No
28.0
2.09
31
.07.
08
01.0
8.08
05
.08.
08
17.0
9.08
Rs.
28
,07,7
7,
810
/ D
t 29
/01/2
00
9
15.1
1.0
8
24.0
2.0
9
11/A
PR
SP
M/s
S
iddhar
dh
a Const
ruct
ions
Vis
akap
atnam
19
23.0
2.1
4
50.6
4
91
L4
OP
RC
for
the
M
aint
enan
ce
of P
acka
ge 4
- R
oads
in
Wes
t G
odav
ari
Dis
tric
t of
A
ndhr
a P
rade
sh
240
NC
B
01.1
1.07
P
ost
Rev
iew
N
o 28
.02.
08
01.0
3.08
19
.03.
08
29.0
3.08
15
.07.
08
Rs.
21
,28,
97,
050
Dt
28-8
-200
8
30.0
9.08
05
.02.
09
8/A
PR
SP
Mar
uthi
C
onst
ruct
ion
s
Vub
alan
ka R
avul
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ast
God
avar
i D
istr
ict
10/3
04
.02.
14
57.1
7
L5
OP
RC
for
the
M
aint
enan
ce
of P
acka
ge 5
- R
oads
in
Kad
apa
Dis
tric
t of
A
ndhr
a P
rade
sh
350
NC
B
01.1
1.07
P
rior
R
evie
w
No
28.0
2.08
01
.03.
08
19.0
3.08
24
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08
14.0
7.08
Rs.
31
,50,
20,
709
D
t 28
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008
30.0
9.08
23
.01.
09
2/A
PR
SP
M/s
D
war
aka
Con
stru
cti
ons
Kad
apa
10/4
22
.01.
14
97.0
9
L6
OP
RC
for
the
M
aint
enan
ce
of P
acka
ge 6
- R
oads
in
Kur
nool
D
istr
ict
of
And
hra
Pra
desh
330
NC
B
01.1
1.07
P
rior
R
evie
w
No
28.0
2.08
01
.03.
08
19.0
3.08
25
.03.
08
15.0
7.08
Rs.
29
,43,
21,
679
D
t 28
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008
30.0
9.08
12
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09
10/A
PR
SP
M/S
E
swar
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&
Co
Hyd
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10/5
11
.02.
14
75.1
5
L7
OP
RC
for
the
M
aint
enan
ce
of P
acka
ge 7
- R
oads
in
Chi
ttoo
r D
istr
ict
of
And
hra
Pra
desh
420
NC
B
01.1
1.07
P
rior
R
evie
w
No
31.0
7.08
31
.07.
08
01.0
8.08
06
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08
20.0
9.08
Rs.
33
,12,
39,
295
/ D
t 29
/01/
200
9
15.1
2.08
24
.02.
09
12/A
PR
SP
M/s
PL
R-
RK
E(
JV)
H
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4A
23.0
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59
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L8
OP
RC
for
the
M
aint
enan
ce
of P
acka
ge 8
- R
oads
in
Kar
imna
gar
Dis
tric
t of
A
ndhr
a P
rade
sh
320
NC
B
01.1
1.07
P
rior
R
evie
w
No
15.0
7.08
31
.07.
08
01.0
8.08
05
.08.
08
17.0
9.08
Rs.
25
,07,
77,
142
/ D
t 29
/01/
200
9
15.1
1.08
25
.02.
09
13/A
PR
SP
Sri
K
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yana
raya
na
Rao
K
arim
nag
ar
20
24.0
2.14
23
.47
92
L11
OP
RC
for
the
M
aint
enan
ce
of P
acka
ge
11-
Roa
ds i
n M
edak
&
Ran
ga R
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y D
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of
And
hra
Pra
desh
340
NC
B
01.1
1.07
P
rior
R
evie
w
No
28.0
2.08
01
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08
19.0
3.08
24
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08
15.0
7.08
Rs.
27
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45,
684/
D
t 28
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008
30.0
9.08
31
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09
5/A
PR
SP
M/s
S
VS
VS
P
roje
cts
lim
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--
30.0
1.14
14
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L12
OP
RC
for
the
M
aint
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ce
of P
acka
ge
12-
Roa
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n N
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D
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of
And
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350
NC
B
01.1
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rior
R
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w
No
28.0
2.08
01
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08
19.0
3.08
21
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08
15.0
7.08
Rs.
31
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535
Dt
28-8
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8
30.0
9.08
31
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09
6/A
PR
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VS
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P
roje
cts
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3
0.01
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7
L13
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for
the
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aint
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of P
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n A
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A
ndhr
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sh
410
NC
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01.1
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rior
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w
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31
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08
01.0
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08
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Rs.
33
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20,
993
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08
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26
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09
14/A
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to
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man
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10
31.0
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28.0
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G
OO
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300
NC
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rior
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30
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25
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10
10.0
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31
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31
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10
2 P
rint
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&
Fax
0.
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Sho
ppin
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Pri
or
Rev
iew
N
o 15
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09
30.0
9.09
N
A
NA
N
A
31.1
0.09
N
A 15
.11.
09
1
4.2.
10
93
3 C
opie
rs
0.02
4 S
hoppi
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ost
R
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w
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30.0
9.09
15
.10.
09
NA
N
A
NA
15
.11.0
9
NA
30.1
1.0
9
28.0
2.1
0
4
Sof
t w
are
&
Har
dwar
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tain
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to
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S
0.4
Sho
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P
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N
o 30
.09.
09
15.1
0.09
N
A
NA
N
A
15.1
1.0
9
NA
30.1
1.0
9
28.0
2.1
0
E
qu
ipm
ent:
5
Lab
eq
uipm
ent
&
Sci
enti
fic
Inst
rum
ents
et
c.
0.23
8 N
CB
Pos
t R
evie
w
No
31.1
0.09
15
.11.
09
NA
25
.11.
09
25.1
2.09
25
.01.1
0
NA
15.0
2.1
0
14.0
5.1
0
6
Fu
rnit
ure
: T
able
s,
Cha
irs,
R
ack
s, e
tc
(Inc
ludin
g re
nova
tion
of
the
Off
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Bu
ild
ing)
.
0.12
S
hoppi
ng
P
ost
Rev
iew
N
o 31
.10.
09
15.1
1.09
N
A
NA
N
A
15.1
2.0
9
NA
15.0
1.1
0
14.0
4.1
0
94
PR
OC
UR
EM
EN
T P
LA
N F
OR
CO
NS
UL
TA
NC
Y
A
P R
OA
D S
EC
TO
R P
RO
JE
CT
W
B L
OA
N/C
RE
DIT
No
……
……
……
…
Sl. No.
Package No.
Description of Services
Estimated Cost (Rs. Millions)
Methods of Selection @
Prior Review/Post review
Advertising for Short listing (Date)
TOR/Short list to be Finalised (Date)
***RFP Final Draft to be forwarded to the Bank (Date)**
No Objection from Bank for TOR/ Shortlist/ Final RFP (Date) **
RFP Issued (Date)
Proposals to be Received by the Project Authorities (Date)
Evaluation to be Finalised (Technical / # Combined/Draft Contract/ Final
Contract) (Date)
No Objection by the Bank (Technical/# Combined Draft Contract/ Final
Contract ) (Date)**
Contract Number, Value and Currency
Name of Consultant / Nationality & Zip Code, if USA
Services to be Completed (Date).
**WBR No.
Exp. Incurred to Date.
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
*P
P
R
A
1
C
onsu
ltan
cy
serv
ices
fo
r pr
epar
ator
y
serv
ices
fo
r L
ong
Ter
m P
erfo
rman
ce
Bas
ed M
aint
enan
ce
Con
trac
ts
(LT
PB
MC
/ O
PR
C)
in A
P I
ndia
48.5
Q
CB
S
Prior
05.0
5.06
04
.08.
06
25.0
8.06
28
.08.
06
04.0
9.06
15
.11.
06
27.0
1.07
13.0
3.07
10.0
4.08
02.0
2.07
20.0
3.07
16.0
4.07
Ag
No.
2 A
PR
SP
/MD
-A
PR
DC
/ 20
07-0
8 D
T.0
3-05
-20
07
AU
D
9.57
,400
IN
R
2,39
,07,
600
M/s
SM
EC
In
tern
atio
nal
A
ust
rali
a i
n
asso
ciat
ion
wit
h
SM
EC
H
Indi
a P
vt L
td
and
M/s
VIC
R
oads
.I
nter
nati
onal
A
ust
rali
a
02.0
5.10
2
43.0
1
2
P
PP
tec
hno
Eco
nom
ic
Fea
sib
ilit
y st
ud
y an
d tr
ansa
tion
A
dvis
or f
or
sele
cted
sta
e R
oad
s in
the
sta
te o
f A
P ,
Indi
a.
49
QC
BS
Prior
28.0
4.06
05
.08.
06
05.0
8.06
28
.08.
06
31.0
8.06
06
.11.
06
03.0
1.07
09
.03.
07
10.0
4.07
19.0
1.07
13.0
3.07
20.0
4.07
Ag.
No.
1/
AP
RS
P/M
D-
AP
RD
C/
2007
-08
DT
.02-
05-
2007
R
s.48
.07
m ,
M/S
Fee
d B
ack
ve
ntur
es p
vt
ltd
New
d
elh
i
1st
Nov
20
09
1
1,19
,27,
872
3
AP
roa
d f
inan
cin
g st
udy
5.6
QC
BS
Ls.
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97
Annex 9: Economic and Financial Analysis
INDIA: Andhra Pradesh Road Sector Project A. Summary of Benefits and Costs 1. The road improvement component economic evaluation comprises three programs designed to upgrade and maintain the road network under RDC management: (i) upgrading about 422 km of priority state highways under public sector financing; and (ii) Phase 1 of maintenance of 6,500 km of the Core Road Network under long-term output and performance based road contracts (OPRC), totaling 1,997 km. The economic analysis of these programs was done using the Highway Development and Management Model (HDM-4), a globally accepted key analytical tool for economic analysis of highways investment alternatives, which simulates life cycle conditions and costs and provides economic decision criteria for multiple road design and maintenance alternatives. The main project economic benefits are savings in vehicle operating costs, travel time costs, distance savings and maintenance costs arising from the road works.
2. The cost-benefit analysis of the project indicates that the project economic benefits are satisfactory. The overall Net Present Value (NPV) of the upgrading of priority state highways and the Phase 1 OPRC maintenance program components to be financed under the project is US$ 687 million, at a 12 percent discount rate over a twenty year evaluation period. The Economic Internal Rate of Return (EIRR) is 29.6 percent. The following table presents the economic analysis summary.
Table 20: Economic Analysis Summary
Economic Analysis Summary Benefits Upgrading Program 611.0 (US$ million) OPRC Maintenance Program 335.0 Total 946.0 Costs Upgrading Program 199.0 (US$ million) OPRC Maintenance Program 58.0 Total 257.0 Net Benefits Upgrading Program 412.0 (US$ million) OPRC Maintenance Program 277.0 Total 689.0 Economic Internal Rate Upgrading Program 21.4% of Return (%) OPRC Maintenance Program 58.5% Total 29.6%
B. Main Assumptions 3. For the economic analysis, fast moving motorized traffic including two wheelers and non-motorized vehicles have been considered. The cost of vehicles and tires were collected from manufacturers and dealers located in Andhra Pradesh. All the transfer payments such as sales tax and excise duty were deducted from financial costs to arrive at economic costs. The following table presents the vehicle fleet characteristics and economic unit costs for motorized vehicles.
98
Table 218: Motorized Vehicle Fleet Characteristics Motorized Vehicle Fleet Characteristics
New Vehicle Cost
(US$/vehicle)
New Tire Cost
(US$/tire) Fuel Cost (US$/liter)
Lubricant Cost
(US$/liter)
Maintenance Labor
Cost(US$/hour) Motorcycle 800 15 0.62 0.06 2.00
Three Wheeler 2,220 19 0.62 0.06 2.00
Car, Jeep, Taxi 6,500 62 0.62 0.06 2.00
LCV, Van, Light Truck 12,960 112 0.59 0.06 3.00
Medium Truck (2axles) 16,880 175 0.59 0.06 3.60
Heavy Truck (3axles) 21,280 175 0.59 0.06 3.60
Small Bus (12 Passengers) 12,400 175 0.59 0.06 3.00
Large Bus (20 Passengers) 19,093 175 0.59 0.06 1.80
Crew Cost (US$/hour) Overhead
Working Passenger
Time (US$/hour)
Cargo Delay
(US$/hour) Passengers (no) Motorcycle 0.00 0 0.61 0.00 2 Three Wheeler 0.28 200 0.61 0.00 2 Car, Jeep, Taxi 0.32 40 0.76 0.00 2 LCV, Van, Light Truck 0.54 600 0.03 0.03 0 Medium Truck (2axles) 0.72 600 0.06 0.06 0 Heavy Truck (3axles) 0.82 200 0.07 0.07 0 Small Bus (12 Passengers) 0.78 200 0.51 0.00 12 Large Bus (20 Passengers) 1.28 200 0.51 0.00 20
Kilometers Driven per Year (km)
Hours Driven per Year (hr)
Service Life (years)
Gross Vehicle Weight (tons)
ESA Loading Factor
Motorcycle 10000 220 10 0.10 0.00 Three Wheeler 20000 800 8 0.25 0.02 Car, Jeep, Taxi 40000 1000 10 0.50 0.00 LCV, Van, Light Truck 60000 1700 10 2.00 0.10 Medium Truck (2axles) 80000 2600 10 5.00 1.00 Heavy Truck (3axles) 90000 2800 10 6.00 1.40 Small Bus (12 Passengers) 50000 1400 10 1.50 0.04 Large Bus (20 Passengers) 80000 2400 10 3.00 0.70 Non-working time = 12% working time Interest = 12%
4. Based on the above assumptions, the following table presents typical economic road user costs, in US$/vehicle-km, for an upgrading project widening and intermediate lane road to 7.0m carriageway with paved shoulder.
99
Table 22: Road User Costs
Typical Unit Road User Costs (US$/vehicle-km) Without Project With Project Vehicle Travel Vehicle Travel Operating Time Total Operating Time Total Costs Costs Costs Costs Costs Costs Motorcycle 0.0325 0.0139 0.0464 0.0318 0.0092 0.0409 Three Wheeler 0.0840 0.0185 0.1025 0.0731 0.0122 0.0852 Car, Jeep, Taxi 0.1057 0.0232 0.1289 0.0931 0.0152 0.1084 LCV, Van, Light Truck 0.1675 0.0008 0.1683 0.1534 0.0005 0.1539 Medium Truck (2axles) 0.2259 0.0016 0.2275 0.2115 0.0011 0.2126 Heavy Truck (3axles) 0.3478 0.0019 0.3497 0.3229 0.0013 0.3241 Small Bus (12 Passengers) 0.1656 0.0911 0.2568 0.1522 0.0602 0.2124 Large Bus (20 Passengers) 0.1862 0.1243 0.3105 0.1688 0.0822 0.2509
5. The economic evaluation has been done for an analysis period of 20 years with a discount rate of 12 percent. The capital costs (financial) of the project road works have been converted into economic costs by using a standard conversion factor of 0.9. The table below presents average financial unit cost of different road works.
Table 23: Average Financial Unit Road Works Costs Average Financial Unit Road Works Costs
Cost Road Work (US$/km) Routine Maintenance two-lane 1,600 Periodic Maintenance two-lane (SDBC 25mm) 35,000 Periodic Maintenance two-lane (BM+SDBC 40mm) 70,000 Widening to two-lane 7.0m CW with Earth Shoulder 360,000 Widening to two-lane 7.0m CW with Paved Shoulder 530,000 Widening to four-lane with Earth Shoulder 1,100,000 Widening to four-lane with Paved Shoulder 1,400,000 SDBC = Semi Dense Bituminous Concrete, BM = Bituminous Macadam CW = Carriageway Width
C. Upgrading Program 6. The Government of Andhra Pradesh has embarked on a program for upgrading, rehabilitation, strengthening and capacity augmentation of State Highways and Major District Roads to improve the connectivity and upgrade the transport infrastructure to provide impetus to developmental activities. The Roads and Buildings Department (RBD) through Andhra Pradesh Road Development Corporation (APRDC) identified a core network of state roads of 10,040km. Subsequently, APRDC appointed consultants to carry out a pre-feasibility and Strategic Option Study (SOS) as part of Andhra Pradesh Economics Restructuring Project that recommended rehabilitation and upgrading of about 2,000 km. A sequel study to the SOS was undertaken with the following objectives: (i) comprehensive feasibility, preliminary design and initial safeguard scoping study of about 2,000 km of the state roads identified in the pre-feasibility study; and (ii) economic analysis, detailed engineering, design and project preparation for the identified 900 km
100
high priority roads. The 422 km to be upgraded under the project, represent Phase 1 of the 900 km high priority roads program.
7. Classified traffic volume counts were carried out for seven days for each traffic homogenous segments in the month of March-April 2007. One day (24-hour continuous, both directions) axle load surveys were carried out at three locations, one location for each region of the State, along or in vicinity of the project roads. The growth rates for different vehicles types and the different horizon periods have been estimated for each region. On average, the adopted annual traffic growth rate for cars, motorcycles and three wheelers is ten percent from 2007 to 2010, eight percent from 2011 to 2015, seven percent from 2016 to 2020, and five percent from 2020 on wards. For trucks and buses, the annual traffic growth rate adopted is eight percent from 2007 to 2010, seven percent from 2011 to 2015, six percent from 2016 to 2020, and five percent from 2020 on wards. One percent traffic growth has been adopted for non-motorized vehicles.
8. A road inventory, pavement investigations and analysis, bridge and cross –drainage inventory, cross-drainage condition and interpretation, and determination of available road land (right of way) of data have been done for each project road. The type and extent of surface distress were evaluated using the detailed visual inspection (DVI) method. A calibrated “Car mounted Bump Integrator” was used for the determination of pavement roughness along the entire length of all project roads. The pavement strength was evaluated using the Benkelman Beam deflection method on a sample basis. The table below presents the pertinent basic characteristics of the project roads.
Table 24: Upgrading Program Road Characteristics Upgrading Program Road Characteristics
Existing Existing Average Cracking
Road Length Number Width Roughness +
Ravelling Deflection
No, Road Name – Section (km) Lanes (m) (IRI,
m/km) (%) (mm) 1 Kandi - Shadnagar – I 33.5 2L N 6.8 3.8 19 1.09 1 Kandi - Shadnagar – II 33.5 2L S 7.5 3.9 28 0.64 1 Kandi - Shadnagar – Total 67.0 7.1 3.9 53 0.87 2 Chittoor - Puttur – I 3.0 2L S 7.1 4.8 36 1.09 2 Chittoor - Puttur – II 35.3 IL 5.5 3.0 11 1.09 2 Chittoor - Puttur – III 11.6 2L N 6.7 4.7 18 1.09 2 Chittoor - Puttur – IV 11.0 SL 4.5 3.3 20 1.09 2 Chittoor - Puttur – Total 60.9 5.7 3.6 15.4 1.09 3 Kurnool – Devanakonda – I 30.6 2L N 6.4 5.1 5 1.09 3 Kurnool – Devanakonda – II 22.1 IL 5.7 5.8 5 1.09 3 Kurnool - Devanakonda – Total 52.7 6.1 5.4 5.0 1.09 4 Mydukuru - Jammalamadugu – I 18.4 2L S 7.0 4.7 10 1.09 4 Mydukuru - Jammalamadugu – II 16.6 2L S 7.0 5.0 5 1.09 4 Mydukuru - Jammalamadugu – Total 35.0 7.0 4.8 7.6 1.09 5 Kakinada - Rajahmundry – I 14.0 2L S 7.0 4.0 6 0.69 5 Kakinada - Rajahmundry – II 47.6 2L S 8.2 4.6 14 0.69 5 Kakinada - Rajahmundry – Total 61.6 7.9 4.5 12.1 0.69 6 Pedana - Nuzvid - Vissanapetta - I 25.6 2L N 6.5 4.8 20 0.69 6 Pedana - Nuzvid - Vissanapetta - II 25.0 2L S 7.0 4.8 5 0.69 6 Pedana - Nuzvid - Vissanapetta – III 35.0 IL 6.0 2.0 12 1.00 6 Pedana - Nuzvid - Vissanapetta – Total 85.6 6.4 3.4 12.9 0.84 7 Jagityal - Peddapalli – I 31.2 2L S 7.0 4.0 11 1.09 7 Jagityal - Peddapalli – II 27.6 SL 3.5 7.0 27 1.09 7 Jagityal - Peddapalli – Total 58.8 5.4 5.4 18.4 1.09
Total 421.6 6.5 4.3 16.6 0.95
101
9. The seven project roads have been subdivided into 18 homogeneous sections representing similar traffic, pavement width and condition. The average roughness of the project roads is 4.4 IRI, m/km and the average deflection is 0.95 mm. The table below presents the current daily traffic of each road. The average total motorized traffic is 5,699 AADT, (3,474 AADT excluding motorcycles) and the average non-motorized traffic is 779 AADT. Motorcycles account for 39 percent of the motorized traffic and bicycles account for 97 percent of non-motorized traffic.
Table 25: Upgrading Program Motorized Traffic Annual Average Daily Traffic Upgrading Program Motorized Traffic Annual Average Daily Traffic (AADT, vpd)
Car 2-Axle 3-
Axle Auto MT NMT Jeep Rigid Rigid Rick_ Two Total Total Road Name – Section Taxi Bus LCV Truck Truck shaw Wheeler Tractor AADT AADT Kandi - Shadnagar – I 217 87 43 1,565 261 826 1,217 130 4,346 94 Kandi - Shadnagar – II 786 169 449 1,797 449 562 955 449 5,617 70 Kandi - Shadnagar - Total 495 127 241 1,678 353 697 1,089 286 4,966 82 Chittoor - Puttur – I 852 852 465 1,006 77 619 3,639 232 7,742 673 Chittoor - Puttur – II 834 556 278 556 0 333 2,890 111 5,558 197 Chittoor - Puttur – III 834 556 278 556 0 333 2,890 111 5,558 197 Chittoor - Puttur – IV 268 298 119 357 30 208 1,577 119 2,976 904 Chittoor - Puttur - Total 746 529 262 546 8 328 2,720 118 5,257 331 Kurnool - Devanakonda - I 871 677 145 726 48 822 1,306 242 4,837 265 Kurnool - Devanakonda - II 273 137 59 254 59 430 703 39 1,953 427 Kurnool - Devanakonda - III 273 137 59 254 59 430 703 39 1,953 407 Kurnool - Devanakonda – Total 586 420 104 501 53 635 1,019 145 3,464 340 Mydukuru - Jammalamadugu - I 829 829 207 829 104 2,486 4,455 622 10,360 1,628 Mydukuru - Jammalamadugu – II 497 452 45 633 45 859 1,311 678 4,519 466 Mydukuru - Jammalamadugu – Total 671 650 130 736 76 1,714 2,964 648 7,590 1,077 Kakinada - Rajahmundry - I 2,307 865 577 1,586 0 3,173 5,624 288 14,421 3,250 Kakinada - Rajahmundry - II 958 348 523 2,264 0 871 3,658 87 8,709 495 Kakinada - Rajahmundry – Total 1,271 468 535 2,107 0 1,405 4,114 134 10,035 1,135 Pedana - Nuzvid - Vissanapetta – I 383 230 192 192 0 920 1,839 77 3,832 1,010 Pedana - Nuzvid - Vissanapetta – II 575 256 256 959 64 1,406 2,620 256 6,390 2,901 Pedana - Nuzvid - Vissanapetta – III 1,014 203 271 1,150 135 1,353 2,232 406 6,763 1,830 Pedana - Nuzvid - Vissanapetta – Total 728 222 243 817 79 1,232 2,195 273 5,790 1,810 Jagityal - Peddapalli – I 293 195 98 293 0 1,123 2,782 98 4,881 122 Jagityal - Peddapalli – II 127 63 21 169 0 717 950 63 2,110 996 Jagityal - Peddapalli - Total 216 135 62 236 0 936 1,939 82 3,606 524 Total 676 338 233 967 87 953 2,225 220 5,699 779
102
10. The following table presents the proposed road works and estimated costs. The economic evaluation considered a without project alternative that includes routine maintenance, patching and periodic maintenance every five years and a with project alternative that includes the proposed upgrading works followed by routine maintenance, patching and periodic maintenance every five years.
Table 26: Upgrading Program Proposed Road Works
11. The following table presents the economic evaluation results and sensitivity analysis carried out by increasing costs by 20 percent, decreasing benefits by 20 percent and increasing costs by 20 percent plus decreasing benefits by 20 percent. The NPV of the road upgrading program is US$412 million and the EIRR is 21.4 percent. Under a worst case scenario of increasing costs by 20 percent plus decreasing benefits by 20 percent, the EIRR would decrease to 16.2 percent
Upgrading Program Proposed Road Works Road Shoulder Cost Cost Road Name – Section Work Type (US$ M) (US/km) Road Name – Section Work Type (US$ M) (US/km)Kandi - Shadnagar – I Widening Two Lane Paved 10.3 308,214 Kandi - Shadnagar – II Widening Four Lane Unpaved 24.6 734,353 Kandi - Shadnagar – Total 34.9 521,284 Chittoor - Puttur – I Widening Four Lane Unpaved 2.4 791,972 Chittoor - Puttur – II Widening Two Lane Paved 13.6 384,608 Chittoor - Puttur – III Widening Two Lane Paved 6.2 535,983 Chittoor - Puttur – IV Widening Two Lane Paved 3.4 309,274 Chittoor - Puttur – Total 25.6 419,901 Kurnool - Devanakonda – I Widening Two Lane Paved 11.7 381,272 Kurnool - Devanakonda – II Widening Two Lane Unpaved 6.7 303,759 Kurnool - Devanakonda – Total 18.4 348,767 Mydukuru - Jammalamadugu - I Widening Four Lane Unpaved 16.6 900,117 Mydukuru - Jammalamadugu – II Widening Four Lane Unpaved 12.7 764,690 Mydukuru - Jammalamadugu – Total 29.3 835,886 Kakinada - Rajahmundry – I Widening Four Lane Unpaved 21.2 1,512,897
Kakinada - Rajahmundry – II Widening Two Lane Paved 32.3 679,190 Kakinada - Rajahmundry – Total 53.5 868,669 Pedana - Nuzvid - Vissanapetta – I Widening Two Lane Paved 12.5 487,968 Pedana - Nuzvid - Vissanapetta – II Widening Two Lane Paved 11.8 470,054 Pedana - Nuzvid - Vissanapetta – III Widening Two Lane Paved 15.5 441,505 Pedana - Nuzvid - Vissanapetta – Total 39.7 463,738 Jagityal - Peddapalli – I Widening Two Lane Unpaved 8.1 259,124 Jagityal - Peddapalli – II Widening Two Lane Unpaved 11.3 408,020 Jagityal - Peddapalli – Total 19.3 329,014 Total 220.7 523,449
103
Table 27: Upgrading Program Economic Evaluation Results
Upgrading Program Economic Evaluation Results NPV/ EIRR Sensitivity Analysis
NPV Cost EIRR A:Cost+20% B:Ben.-
20% A &
B Road Name – Section (US$ M) (#) (%) (%) (%) (%) Kandi - Shadnagar – I 19.1 1.9 28.0% 25.1% 24.4% 21.7%
Kandi - Shadnagar – II 8.8 0.4 15.6% 13.8% 13.4% 11.7%
Kandi - Shadnagar – Total 28.0 0.8 19.6% 17.5% 17.0% 15.0%
Chittoor - Puttur – I 1.9 0.8 20.4% 18.0% 17.4% 15.2%
Chittoor - Puttur – II 6.4 0.5 21.5% 19.2% 18.7% 16.5%
Chittoor - Puttur – III 33.8 5.4 30.9% 27.9% 27.3% 24.5%
Chittoor - Puttur – IV 1.9 0.6 17.9% 15.8% 15.3% 13.3%
Chittoor - Puttur – Total 43.9 1.7 26.6% 23.8% 23.3% 20.8%
Kurnool - Devanakonda – I 14.8 1.3 24.3% 21.7% 21.2% 18.8%
Kurnool - Devanakonda - II 3.6 0.5 20.4% 17.5% 16.9% 14.3%
Kurnool - Devanakonda - Total 18.3 1.0 23.2% 20.5% 20.0% 17.5%
Mydukuru - Jammalamadugu – I 10.1 0.6 19.7% 17.0% 16.5% 14.0%
Mydukuru - Jammalamadugu – II 4.8 0.4 16.5% 14.3% 13.8% 11.8%
Mydukuru - Jammalamadugu – Total 14.8 0.5 18.3% 15.8% 15.3% 13.0%
Kakinada - Rajahmundry – I 10.4 0.5 18.3% 15.7% 15.1% 12.7%
Kakinada - Rajahmundry – II 26.4 0.8 20.5% 18.1% 17.6% 15.4%
Kakinada - Rajahmundry - Total 36.8 0.7 19.7% 17.2% 16.7% 14.4%
Pedana - Nuzvid - Vissanapetta - I 1.5 0.1 13.8% 11.5% 11.0% 8.9%
Pedana - Nuzvid - Vissanapetta - II 6.0 0.5 17.9% 15.6% 15.1% 13.0%
Pedana - Nuzvid - Vissanapetta - III 39.0 2.5 27.3% 25.0% 24.5% 22.4%
Pedana - Nuzvid - Vissanapetta – Total 46.5 1.2 22.1% 19.8% 19.4% 17.2%
Jagityal - Peddapalli – I 8.3 1.0 20.9% 18.1% 17.6% 15.1%
Jagityal - Peddapalli – II 9.4 0.8 24.6% 21.8% 21.2% 18.6%
Jagityal - Peddapalli - Total 17.7 0.9 22.5% 19.7% 19.1% 16.6%
Total 412.0 1.9 21.4% 19.0% 18.5% 16.2%
D. Long-Term Output and Performance Contracts Program 12. The economic evaluation of the long-term output and performance based road contracts was done considering the estimated routine maintenance and periodic maintenance needs of the 11 packages, totaling 1,997 km, which comprise Phase 1 of the total program of 6,500 km. The table below presents the basic characteristics of each package.
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Table 28: OPRC Package Characteristics OPRC Package Characteristics
Total Reseal Overlay Total Cost Length Works Works Years 1 to 5
Package (km) (km) (km) (M US$) Vizag District 186 48 14 5.4
East Godavari District 151 81 37 6.2 Guntur District 208 55 19 5.6
West Godavari District 124 58 29 4.3 Kadapa District 274 94 55 6.3 Kurnool District 162 67 32 5.9 Chittoor District 179 67 34 6.6
Karimnagar District 185 92 21 5.0 Medak and Ranga Reddy Districts6.9Nizamabad
District7.4Adilabad District 143 89 30 6.0 Vizag District 186 102 45 6.4
East Godavari District 200 105 41 6.7 Total 1,997 859 356 64.4
13. The average length of each contract is 182 km and it is estimated that 63 percent of the length of these roads will require periodic maintenance over the next five years that is comprised of either resealing (typically 25 mm semi dense bituminous concrete) or structural overlays (typically bituminous macadam and 40 mm semi dense bituminous concrete). Routine maintenance comprises ordinary maintenance, spot repairs and emergency works. The table below presents the average daily traffic of each package. The average total motorized traffic is 6,272 AADT (3,7496 AADT excluding motorcycles).
Table 29: OPRC Motorized Traffic Annual Average Daily Traffic OPRC Motorized Traffic Annual Average Daily Traffic (AADT, vpd)
Car 2-Axle 3-Axle Auto MT Jeep Rigid Rigid Rick_ Two Total
Package Taxi Bus LCV Truck Truck shaw Wheeler AADT Vizag District 848 352 170 1,675 200 1,600 1,626 6,470
East Godavari District 1,006 579 166 393 105 4,997 6,941 14,187 Guntur District 1,377 929 233 1,069 432 2,166 3,310 9,516
West Godavari District 706 334 233 668 317 3,104 5,808 11,171 Kadapa District 425 337 213 308 206 481 988 2,957 Kurnool District 140 72 112 99 260 2,133 483 3,298 Chittoor District 401 290 121 482 204 281 644 2,422
Karimnagar District 1,250 493 25 275 163 1,426 2,899 6,530 Medak and Ranga
Reddy DistrictsNizamabad
DistrictAdilabad District 564 198 240 699 272 921 1,688 4,582
Vizag District 540 392 182 618 527 1,323 2,066 5,648 East Godavari District 317 505 52 110 167 277 782 2,210
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14. The economic evaluation considered a without project alternative that includes routine maintenance, patching and overlay when the road roughness reaches 4.5 IRI, m/km, and a with project alternative that includes the proposed periodic maintenance works executed during the initial four years of the evaluation period followed by routine maintenance, patching and overlay when the road roughness reaches 4.5 IRI, m/km. The table below presents the economic evaluation results and sensitivity analysis carried out by increasing costs by 20 percent, decreasing benefits by 20 percent and increasing costs by 20 percent plus decreasing benefits by 20 percent. The NPV of the OPRC program is 277 million and the EIRR is 58.5 percent. Under a worst case scenario of increasing costs by 20 percent plus decreasing benefits by 20 percent, the EIRR would decrease to 48.7 percent.
Table 30: OPRC Program Economic Evaluation Results OPRC Program Economic Evaluation Results
NPV/ EIRR Sensitivity Analysis NPV Cost EIRR A:Cost+20% B:Ben.-20% A & B
Package (US$ M) (#) (%) (%) (%) (%)
Vizag District 10 1.9 52.8% 48.4% 47.4% 43.2% East Godavari
District 109 17.5 106.1% 99.4% 98.0% 91.9% Guntur District 38 6.8 89.2% 83.1% 81.7% 76.0% West Godavari
District 54 12.7 88.4% 82.6% 81.3% 76.0% Kadapa District 4 0.6 22.5% 19.4% 18.7% 15.8% Kurnool District 2 0.4 22.3% 19.2% 18.6% 15.6% Chittoor District 2 0.2 19.6% 16.6% 16.0% 13.2%
Karimnagar District 17 3.4 54.8% 50.1% 49.1% 44.8%
Medak and Ranga Reddy
Districts 13 2.1 41.0% 37.2% 36.4% 32.9% Nizamabad
District 22 3.4 49.6% 45.3% 44.4% 40.4% Adilabad District 7 1.1 35.4% 31.6% 30.8% 27.3%
Total 277 4.3 58.5% 53.9% 52.9% 48.7%
F. Sensitivity Analysis and Switching Values 15. The total NPV of the upgrading of priority state highways and the Phase 1 OPRC maintenance program components is US$689 million and the EIRR is 29.6 percent. The sensitivity of the EIRR to changes in the underlying costs and benefits show that assuming a 20 percent increase in project costs would decrease the EIRR to 26.5 percent. If benefits are reduced by 20 percent of the original estimates, the EIRR would decrease to 25.9 percent. In a more adverse scenario of a simultaneous 20 percent project cost increase and 20 percent reduction of benefits, the overall EIRR will be 23.0 percent. The switching value analysis shows that the percentage increase in costs for the NPV to become zero is 245 percent and the percentage decrease in benefits is 71 percent.
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G. Public Private Partnerships Program 16. The three roads to be widened to four lanes under the Phase 1 of the public private partnership program have undergone an economic analysis adopting the same methodology and assumptions applied to the economic analysis of the upgrading program. The table below presents the roads characteristics.
Table 31: OPRC Program Road Characteristics PPP Program Road Characteristics
Road No,
Road Name – Section ExistingLength (km)
NumberLanes
ExistingWidth
(m)
Average Roughness
(IRI, m/km)
Cracking +
Ravelling (%)
Deflection(mm)
1 Hyderabad - Karimnagar – Ramgundam 207.0 2L 7.5 4.3 11 0.65
2 Narketpalli - Addanki - Medaramitia 213.0 2L 7.0 4.5 10 0.70 3 Puthalapattu - Naidupet 101.0 2L 7.1 4.7 8 0.75
Total 521.0 7.2 4.5 10 0.70
17. The table below presents the average daily traffic of each road. The average total motorized traffic is 8,454 AADT, (6,725 AADT excluding motorcycles) and the average non-motorized traffic is 338 AADT. Motorcycles account for 20 percent of the motorized traffic.
Table 32: PPP Program Motorized Traffic Annual Average Daily Traffic PPP Program Motorized Traffic Annual Average Daily Traffic (AADT, vpd)
Car 2-Axle 3-
Axle Auto MT NMT Jeep Rigid Rigid Rick_ Two Total Total Road Name Taxi Bus LCV Truck Truck shaw Wheeler Tractor AADT AADT Hyderabad - Karimnagar – Ramgundam 2,323 855 274 1,729 1,773 1,149 2,222 139 10,463 374 Narketpalli - Addanki – Medaramitia 907 465 160 1,201 1,658 812 1,388 232 6,823 334 Puthalapattu - Naidupet 2,189 1,052 164 1,158 1,112 532 1,434 134 7,775 272 Total 1,718 734 206 1,402 1,598 892 1,728 176 8,454 338
18. The following table presents the proposed road works and estimated costs. The average cost of widening to four lanes with paved shoulders is US$1.183 million per km.
Table 1933: PPP Program Proposed Road Works PPP Program Proposed Road Works
Road Work
Shoulder Type
Cost (US$ M)
Cost (US/km) Road Name – Section
Hyderabad - Karimnagar – Ramgundam Widening Four Lane Paved 271.6 1,312,261Narketpalli – Addanki – Medaramitia Widening Four Lane Paved 239.4 1,123,793Puthalapattu – Naidupet Widening Four Lane Paved 105.7 1,046,535Total 616.7 1,183,697
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19. The table below presents the typical road work cost composition.
Table 34: Typical Road Work Cost Composition Typical Road Work Cost
Composition Item %
Earthwork & Subgrade 7.95 Subbase and Base 19.26 Bituminous Course 33.33 Mayor Bridges 3.60 Road Junctions 0.79 Drainage & Protective Works 20.74 Line Marking & Signs 2.40 Other 11.94 Total 100.00
20. The following table presents the economic evaluation results and sensitivity analysis carried out by increasing costs by 20 percent, decreasing benefits by 20 percent and increasing costs by 20 percent plus decreasing benefits by 20 percent. The NPV of the PPP program is US$680 million and the EIRR is 22.4 percent. Under a worst case scenario of increasing costs by 20 percent plus decreasing benefits by 20 percent, the EIRR would decrease to 17.0 percent.
Table 35: PPP Program Economic Evaluation Results PPP Program Economic Evaluation Results
NPV/ EIRR Sensitivity Analysis NPV Cost EIRR A:Cost+20% B:Ben.-20% A & B Road Name (US$ M) (#) (%) (%) (%) (%) Hyderabad - Karimnagar – Ramgundam 437.2 1.6 27.2% 24.1% 23.5% 20.7%
Narketpalli - Addanki – Medaramitia 126.7 0.5 17.1% 15.1% 14.7% 12.9%
Puthalapattu - Naidupet 115.9 1.1 21.9% 19.5% 19.0% 16.8%
Total 679.9 1.1 22.4% 19.9% 19.4% 17.0%
Financial Analysis of PPP Roads
21. During the early stages of project preparation, a high-level pre-feasibility analysis was carried out to select road improvements on a PPP basis. Based on this analysis, in consultation with APRDC, eight roads with a total length of 1,177 km were selected based on their high traffic count and potential to attract private sector financing. These roads are existing two-lane State Highway corridors linking various national highways, viz., NH-5, NH-9, NH-16, NH-18, NH-202 and NH-205, and are proposed to be widened to four-lane facilities through PPP route. Subsequently, APRDC engaged a Transaction Advisor to prepare Preliminary Project Reports for these projects and also assist them in structuring and awarding concessions for roads that are found to amenable for development as PPPs, with or without viability gap support. Thus far, the transaction adviser prepared techno-economic feasibility reports and draft preliminary project reports for three projects and draft technical feasibility reports for four road projects. Based on
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the information available at the time of appraisal, a total of five road projects with a total length of 836 km have been identified as amenable for development as PPP projects. According to these reports, the base case Equity (Post-Tax) IRR of these roads is ranging from 17 percent to 23 percent. The base case financial analysis for these projects suggests that the state government’s support for bridging the viability gap may not be required for three projects but the remaining two would require such support (see Table below). However, in light of the current tight credit environment and lowered economic growth expectations, APRDC is anticipating that some state government support for viability gap may be required for all the projects. The key initial analysis indicators pertaining to these three roads – drawn from various reports of the transaction advisory consultants - are summarized below:
Table 36: Key Financial Indicators for PPP Roads Sl. No.
Name of Road Road Length (Km)
Concession Period
Key Financial Indicators
Project Cost
Rs. Cr.
Equity (Post-Tax) IRR
Avg. DSCR
Viability Gap Support
Rs. Cr.
% of TPC
Phase I 520 3084 149
1 Hyderabad-Karimnagar-Ramagundam
207 25 Years 1358 22.65% 3.47
0 0%
2 Narketpalli-Addanki-Medaramitla
213 30 Years 1197 21.15% 2.75
102 8.5%
3 Puthalapattu-Naidupet 100 30 Years 529 17.33% 2.41
48 9.0%
Phase II 315 1478
591
4 Kadapa-Renigunta Road 138 20 Years 697 17.41% 2.42 279
40.0%
5 Khammam-Tallada-Devarapalli
177 20 Years 781 19.63% 4.9 312
40.0%
Total
835 4562 741 Sources: (i) For Phase I roads, Techno-Economic Feasibility Reports (Revised) Jan 2009; and (ii) For Phase II roads, Technical Feasibility Reports submitted in March 2008.
22. Hyderabad – Karimnagar – Ramagundam road (207 km): The draft TEFR suggests that this projects can be developed as viable stand alone PPP without viability gap support. Its EIRR, at 27 percent, is above the general hurdle rate of 20 percent. At an estimated landed cost of US$243 mn, under the base case scenario, the project yields Equity (post-tax) IRR of 23 percent. Even in a worst case scenario, where the benefits decrease by 15 percent and costs increase by 15 percent, the Equity (post-tax) IRR is 17 percent.
23. Narketpalli – Addanki – Madramitla road (213 km): This project, with an EIRR of 17 percent in base case, is found to be viable for development as a stand alone PPP, with an estimated viability gap support of 8.5 percent of the total project cost (Rs.1,197 crore). The financial analysis from the TEFR suggests that, the project gives an Equity (post-tax) IRR of 21 percent in the base case scenario and an average DSCR of 2.75.
24. Puthalapattu – Naidupet Road road (100 km): According to TEFR findings, with an estimated landed project cost of Rs.529 crore, the base case Equity (post-tax) IRR would be 22
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percent and the DSCR is estimated at 2.41. The project is amenable for development as PPP, with a viability gap fund support of nine percent of the total project cost.
25. Kadapa-Renigunta road (138 km): The draft Technical Feasibility Report (TFR) findings suggest that this project could be developed as PPP, with a viability gap support of about 40 percent of the total project cost estimated at Rs.697 crore. In a base case scenario, the project is likely to yield a base case Equity (post-tax) IRR of 17 percent and an average DSCR of 2.42.
26. Khammam- Tallada – Devarapalli road (172 km): is a part of SH-08 with an existing intermediate and two-lane carriageway starting from Khammam town and ending in West Godavari district. The draft Technical Feasibility Report (TFR) findings suggest that this project could be developed as PPP, with a viability gap support of about 40 percent of the total project cost estimated at Rs.781 crore. In a base case scenario, the project is likely to yield a base case Equity (post-tax) IRR of 19.6 percent and an average DSCR of 4.9.
Other Relevant Background Issues
27. India’s PPP program, which has been rapidly growing in the recent past has witnessed a decline in investor enthusiasm in the aftermath of the global financial crisis. As debt and equity investors are adopting a very cautious approach, the threshold of commercial attractiveness of a project to be successfully awarded and financed as PPP has been increasing. For example, this trend of lower participation of bidders was reported in PPP projects put out for bids in the recent months and, reportedly, financial closure of PPP projects is becoming increasingly difficult. Here, it is noteworthy that while the flow has depleted, robust projects are still attracting bidders and financial closures are still happening. For example, since July 2008, APRDC itself had put out five projects with project costs ranging from about Rs.60 crore to Rs.800 crore on BoT-Toll/Annuity basis, and received a minimum of two bids and maximum of five bids for these projects. Informal interactions with some of the financial institutions providing debt financing to PPP projects suggest that, in order to be able to attract private partners and achieve financial closures in the current context, structuring of PPP projects need to be very robust, i.e., with adequate cushion to be able to withstand sizeable variations in the projected revenues. In light of this, availability of adequate viability gap support from the government is emerging as critical pre-requisite for eliciting private sector interest in PPP projects.
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Annex 10: Safeguard Policy Issues
INDIA: Andhra Pradesh Road Sector Project Environment Management 1. Environment Assessment Complying with Category “A” – Full Assessment, and the country systems (Government of India and Government of AP), the EA undertaken included: (i) Environmental Screening carried out in parallel with the engineering feasibility study; (ii) Environmental Assessment to prepare EMPs as an integral part of designs; and (iii) Environmental and Social Management Framework for Maintenance Roads. A concurrent independent review of the environmental assessment process and outputs has been conducted by APRDC through an independent consultant. This measure was adopted by the client as the EA responsibilities for the project components is part of design engineering consultancies.
2. Stakeholder Consultations played a key role in EA process, with an objective to improving the plan and design of the project, apart from project information dissemination. The consultations were carried out with state level highway experts, NGOs, forest department and other selected Government Agencies, and other key highway stakeholders and project affected persons to: (a) collect baseline information; (b) obtain a better understanding of the potential impacts; (c) appreciate the perspectives/concerns of the stakeholders; and (d) secure their active involvement during finalization of EMPs. Consultations were designed in a way that: (i) affected people were included in the decision making process; (ii) links between communities and their natural, physical and cultural resources base adjacent to project locations were safeguarded; (iii) public awareness and information sharing on project alternatives, benefits and entitlements were promoted; and (iv) views on designs and solutions from the communities were solicited. Further, specific stakeholder consultations were conducted for all the first year project roads passing through sensitive land uses, including forested areas.
3. Environmental Impacts of the project, identified through environmental screening and detailed environmental assessment include: (a) forest diversions (about 4Ha. in two roads) and unavoidable felling of roadside trees; (b) impact on local and regional drainage and flood situations, and possible impact on water resources during construction stage; (c) impacts on existing physical, community and cultural properties; (d) construction related temporary Environment Health and Safety impacts including those related to operation of construction facilities/camp site operation, dust generation from haul roads, traffic related issues, etc.; (e) construction and operation phase air/noise pollution impacts on sensitive receptors like schools, hospitals, religious congregation areas; and (f) road safety issues during construction phase. The proposed project interventions and or activities are not likely to lead to long-term adverse environmental impacts due to future activities on the selected roads and state highways. The project is likely to have positive environmental benefits such as: (a) improving local drainages along and across the proposed road; and (b) road safety improvement due to better geometry and minimization of blind spots as well as due to the additional Road Safety component included in the project design. Any induced development likely to happen would be guided by the state agencies.
4. Corridor Specific Environmental Management Plans have been prepared for upgrading component (and PPP components of the Phase-I project roads). These EMPs are corridor specific to: (a) minimize and mitigate impacts related to corridor alignment, construction activities
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including generic environmental management measures such as dust and noise pollution control; safe debris disposal, restoration of borrows areas, minimization of construction camp site impacts, etc.; (b) protecting environmental and community and cultural properties; and (c) relevant environmental enhancement measures. These plans address construction-stage and operation-stage impacts as well as monitoring, reporting and supervision protocols. The EMPs have been integrated in to the corridor specific designs and contract documents for effective implementation. Some of these key inputs include:
• Minimizing road side tree cutting through design modifications and protection of some giant trees and green tunnel sections; and provide at least 1:2 compensatory tree plantations for unavoidable tree cutting;
• Provision of appropriate crossings including underpasses to minimize community severance and improve road safety, especially near schools;
• Specific measures to improve cross drainage and minimize flooding conditions;
• Reuse of construction debris for developing access points to villages, as identified during stakeholder consultations;
• Protection of cultural properties, either by relocation or through access improvements;
• Enhancement of community properties, including village ponds, safety for roadside schools, weekly markets adjacent to the roads;
• Ground water recharge pits in urban sections, where ever the corridors pass through dry areas; etc.
• Landscaping of incidental spaces left over at geometric correction areas.
5. Environmental and Social Management Framework for integrating Environmental and Social Management Measures in to maintenance roads26. As part of this, environmental screening has been conducted for 6,073km maintenance roads and environmentally sensitive road links have been pre-identified. Depending on the nature of links, the ESMF provides specific Environmental Management Framework (EMF) as well as Environmental Management Plans (EMPs) that need to be integrated as part of bidding documents in the for form of technical specifications. EMPs also include exclusion principles location of construction facilities. Based on this, Standard Bidding Documents have been finalized which also includes penalty provisions for non-compliance of EMP specifications. Safeguards Management measures for road maintenance activities in sensitive land uses including schools, hospitals, and forested areas include five key elements: (a) Minimizing the maintenance activities in such areas; (b) Compliance with regulatory requirements; (c) Responsive design measures to minimize impacts on sensitive land uses, based on detailed stakeholder consultations; (d) Environmental management measures to minimize construction impacts – such as exclusion principles for: construction camp sites, location of plant and missionary, disposal of debris, extraction of construction material, night time construction, etc; and (e) Effective supervision, monitoring, and reporting.
26 The project activities on maintenance roads are limited to resurfacing without either widening the paved part of the road or widening the ROW. The maintenance activities are based on output based performance contracts which also includes environmental performance specifications.
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6. Compensatory Plantation: Complying with Water Land and Tree Act of GOAP, APRDC is finalizing the tree plantation schedule to compensate cutting of road side trees. Compensatory plantations forms part of EMP implementation. The tree cutting clearances are in advanced stage of progress.
7. Regulatory Clearances: The environmental safeguard documents are prepared in line with regulatory clearance requirements including Forest Conservation Act, 1980; and EIA Notification, September 2006, EP Act, 1986; and Water, Land, and Tree Act, GOAP, 2002. Further, the contract documents integrate different environmental clearances to be secured by the contractor prior to initiation of work and compliance through the construction phase.
8. EMP Implementation: The EMPs have been appropriately integrated and cross-referenced in the design drawings, contract conditions and Bills of Quantities. The institutional mechanism for effective implementation of EMPs is addressed through Environmental and Social Management Unit (ESMU) staffed with one forest officer and Environmental Engineer working full time at head quarters in APRDC supported by field engineers in various divisions. Further, Construction Supervision Consultants for upgrading component, Independent Engineers for PPP corridors, and Technical Audit and Quality Assessment Consultants for maintenance Roads will have environmental experts in their respective teams. Social Impact Management 9. The main objective of the project is to further improve the state road network to provide better quality and safer roads to the users in a sustainable manner. This will enable improved access to markets, jobs and services and new economic opportunities for people living in project areas (including vulnerable ones). The core principle in planning and implementing project is that the people affected by project interventions will be supported to mitigate their losses and help improve or at least restore their livelihood. Social Impact Assessment (SIA) Process 10. As part of project preparation, a comprehensive SIA was undertaken which included stakeholders’ consultations. The required data was collected through structured questionnaires and discussion guidelines. Specific social parameters were used in screening and prioritization of roads from the core network for inclusion under the project. For the selected roads, the SIA included inventory of loss of road side structures, assessment of the type and extent of impacts, preparation of strip plans to establish the right of way (RoW), assessment of the extent of land acquisition (LA) and extensive stakeholders’ consultations. For each of the Packages of the first year roads, assessment also included identification and census survey of adversely affected families and the assessment of the extent of losses to structures and common property resources (CPR) coming within the corridor of impact. In order to delineate the corridor of impact (CoI), the structures identified were plotted on the strip plans and the engineering designs were super imposed on these plans. This process also helped in changing the designs, were feasible so as to minimize adverse impacts on the local population and reduce involuntary resettlement. A separate study was undertaken to identify indigenous people (referred locally as tribal) in relation to the proposed project. The results of these assessments helped to develop a resettlement and rehabilitation (R&R) entitlement framework and a strategy for the tribal development. For each of the 1st year packages, a Resettlement Action Plan (RAP) has been prepared which also
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includes a section on tribal development (for packages with significant tribal population). A separate action plan has been prepared to address HIV/AIDS issues in the project corridors. 11. For LTPBMC component, a social assessment was also undertaken separately. The results of this assessment provided input in the preparation of an Environmental and Social Management Framework for integrating Environmental and Social Management Measures in to maintenance of roads. The framework defines specific screening process for identifying the social impacts and the social management measures including the R&R entitlement framework to address specific adverse social impacts during the proposed road maintenance works. The social assessment undertaken for first year road contracts (about 2,400km) concluded no adverse impacts resulting from the proposed maintenance works. 12. Involuntary Resettlement: This is the most important social safeguard issues associated with the proposed interventions. The scope of the project includes widening and strengthening of selected road stretches. In areas with population congestion, by-passes are planned which account for the major acquisition of private land for the project. LA is also envisaged where the designs include curve improvement and realignment. Encroachment of RoW is a major issue and the proposed project interventions will result in physical displacement of a significant number of squatters and encroachers found within the RoW. The project, however, recognizes that not all encroachment/squatters are required to be disturbed. Therefore, in order to minimize displacement, most of the works will be confined to CoI which is less than RoW at several places. Based on the state R&R Policy 2005, an R&R policy framework has been developed which provides the affected families in their R&R process and restore their livelihoods. 13. In terms of adverse impacts on the local population, the core principle in planning and implementing project civil works is to avoid, if not minimize the adverse impacts and those affected by the project interventions would be supported in their R&R process and help them restore the loss of livelihood. Thus, those affected because of loss of land or livelihood for the project will be compensated and supported as per the R&R entitlement framework of the project agreed for the project. During project implementation, efforts will continue to minimize the negative impacts of the project. The R&R framework agreed for the project (table 37) has been drawn from the provisions of the National R&R policy, 2007, the state level R&R policy, 2005 and the provisions made in Resettlement Action Plans (RAP) prepared for the 1st year of the project. As part of preparing R&R entitlement framework, a gap analysis of the state R&R policy (2005) in relation to the Bank’s OP 4.12 on involuntary resettlement was carried out. Additional measures thus required have been approved by GOAP. The agreed R&R policy framework is applicable to all the components (upgrading, PPP and OPRC roads) of the present project. Project affected persons, encroachers, squatters and vulnerable groups used in the following R&R entitlement framework are defined as follows:
i. Project Affected Person (PAP): Under the project, a PAP is if a person suffers adverse impacts due to project interventions in terms of: (a) severing of land; (b) loss of land and other immovable properties; and (c) loss of livelihood. These include members of project affected ‘encroacher and squatter’ families who are covered in the census survey of affected families and are jointly verified by the staff of APRDC/PWD and Revenue Department.
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ii. Encroacher: is a person/family, who transgresses into the public land (prior to the cut-off date), adjacent to his/her own land or other immovable asset and derives his/her livelihood (either for housing or for commercial purpose) – this is based on the definition provided in the amendments to Andhra Pradesh Resettlement and Rehabilitation Policy (APRRP) for inclusion of those with no legal title to land.
iii. Squatter: is a person who has settled on public land without permission or has been occupying public building without authority prior to the cut-off date. However, affected squatters (PAPs) with alternate housing will not be enlisted for resettlement support – this is based on the definition provided in the amendments to APRRP for inclusion of those with no legal title to land.
iv. Vulnerable PAFs: In addition to what is included in the APRRP (ST, landless and BPL), the vulnerable groups among the affected community will include those belonging to BPL, SC, ST (if not covered under Indigenous People Development Plan (IPDP)), destitute, physically handicapped, landless laborer and others identified in the social survey.
Table 37: R&R Entitlement Framework (as provided in the RAP approved by GoAP/APRDC)
Type of Loss Unit of Entitlement
R&R Entitlement Framework
Agricultural Land Titleholder Family
(i) Compensation as per the LA Act. (ii) The difference between replacement value and market value (approved by the Government) will be paid in the form rehabilitation grant (as per RAP approved by GOAP/APRDC. Also provided in section 7.19 OF NRRP in the form of ex-gratia payment). (iii) If alternate land is provided under section 6.4 of APRRP, the cost of land will be deducted from the compensation amount and the rehabilitation grant will be proportionately reduced, however other R&R entitlements will be extended as per APRRP 2005 (iv) 750 days,500 days and 375 days of minimum agricultural wages will be paid as one time lump sum amount to those (owner) PAFs who after LA become landless, marginal, small farmers respectively (section 6.10, 6.11 and 6.12 of APRRP) (iv) At least 3 months notice in advance of crop harvest. Compensation for crop lost will be paid, if notice is not served in advance (as per RAP approved by GOAP/APRDC) (v) Training will be arranged for income generation (IG) to one member of a PAF in suitable IG activities { as per RAP approved by GOAP/APRDC and also in accordance with section 7.13.1 (b) and section 7.13.2 of NRRP} Special benefit to ST families (section 6.19 of APRRP and section 7.21.5 of NRRP) • Preference in allotment of land • Additional 500 days minimum wages for lost customary rights or use of
forest produce (if any) Share cropper An affected share cropper will get a sum equal to the unexpired lease period
(as per RAP approved by GoAP/APRDC) Homestead (or non-agricultural land)
Titleholder (i) Compensation as per LA Act for the loss of homestead land (ii) If more than 25 percent of the structure is lost, such affected people will be categorized as ‘displaced’ (as per amendments to APRRP for road sector project and in accordance with the RAP approved by GoAP/APRDC) (iii) Those affected but not displaced will get compensation (as per LA Act) for the portion of homestead land and structure affected by the project and permission to salvage construction material. (iv) Those displaced will get • Compensation for the structure affected (part or full) computed at SSR
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without deducting depreciation • Permission to salvage construction material • Alternate house site (to a maximum extent of 150 sqm in rural areas and
75 sqm in urban areas) – section 6.2 of APRRP. • A sum total of Rs 40,000 as one time financial assistance to BPL for
house construction (section 6.3 of APRRP). • Subsistence allowances of 240 days of minimum agriculture wages
(section 6.14 of APRRP). • Grant for a cattle shed equivalent to a sum total of Rs 3000 (section 6.7
of APRRP)/ • IG scheme grant to artisans, small trader, and self employed person at Rs
25,000 per PAF (section 6.9 of APRRP) • Grant for transporting materials of Rs 5,000 (section 6.8 of APRRP)
Tenant/Lease holder
Only displaced tenant will get (provided in RAP approved by GOAP/APRDC):
• A sum equal to two months rental in consideration of disruption caused. • Transportation allowance of Rs. 2,000 towards shifting household
materials. Land under commercial use (as per amendments to APRRP for road sector projects and included in RAP approved by GOAP/APRDC)
Titleholder (owner and occupier)
(i) Compensation for the loss of land used for commercial purpose (as per LA Act). (ii) For the structure affected (part or full), compensation will be computed at SSR without deducting depreciation (iii) Permission to salvage construction material (iv) If more than 25 percent of the structure is lost, the affected business/work place will be categorized as ‘displaced’ (as per amendments to APRRP for road sector projects and included in RAP approved by GOAP/APRDC). (v) PAFs affected but not displaced will get compensation (as per LA Act) for the portion of land lost and the structure (at SSR without depreciation) affected by the project. (vi) Those displaced will get • An alternate site of 50 sq.mt or cash equivalent (section 6.2 of APRRP). • A construction assistance of Rs.40,000(section 6.3 of APRRP) (v) Alternatively, if alternate shop/work place is allotted by the project, those displaced will not be eligible for alternate site and construction assistance. (v) Other assistance: • A transition allowance of nine month rental after site vacation • A transportation allowance of Rs.5,000
Titleholder (absentee landlord)
(i) He/she will receive only compensation for both land and structure (owned) – as per LA Act (ii) Permission to salvage materials from the demolished structure.
Tenant/Lease holder
Only displaced tenant will get (as provided in RAP approved by GOAP/APRDC):
• A sum equal to two months rental in consideration of disruption caused. • Transportation allowance of Rs. 1,000 towards shifting.
Other assets Owner affected family
Loss of other assets (including wells, trees) will be compensated (as per LA Act) equivalent to their replacement value.
Encroachers* (Agril. land)
Family If a PAF is dependent on the public land required for the project for the livelihood and belongs to ‘vulnerable’ groups he/she will get assistance to take up self employment activities by dovetailing government programs and/or providing an assistance of Rs.25,000 to take up IG Activity (as provided in the amendments to PARRP by GOAP for road sector projects and as per RAP approved by GOAP/APRDC).
Encroachers* (Non-agril. land)
Family If encroached land is used for housing and/or commercial purpose and if the affected person loses more than 25percent of the built up structure of one’s own portion) will be given the same R&R assistance as available to a displaced family. However, such PAFs will not get the compensation for the encroached land and structure (as provided in the amendments to PARRP by GOAP for road sector projects and as per RAP approved by GOAP/APRDC).
Squatters** (for homestead purpose)
Family If the public land is occupied for homestead purpose and if the affected person has no alternate housing he/she will get (as provided in the amendments to PARRP by GOAP for road sector projects and as per RAP
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approved by GOAP/APRDC): • Notice to remove the structure • Alternate housing from the government housing program or equivalent
cash in lieu there of • If no housing is provided, an alternate house site or cash (for the house
site and for construction of house) in lieu there of • A transportation assistance of Rs.2,000 • A maintenance allowance of Rs.1,000 per month for six months
Squatters** (for commercial)
Family
If the PAF has no alternate place, he/she will get (as provided in the amendments to PARRP by GOAP for road sector projects and as per RAP approved by GOAP/APRDC): • Notice to remove the structure • Alternate commercial place or equivalent cash in lieu there of • If no alternate site is provided, pay compensation for the structure,
permission to salvage construction material and an alternate or cash in lieu there of
• A transportation assistance of Rs.1,000 • A maintenance allowance of Rs.2,000 • PAFs from vulnerable sections will be provided training to take up self
employment activity and a sum equivalent to 180 days minimum agricultural wages to take up new assignment
Kiosks Vendor Ambulatory vendors licensed for fixed locations will be considered as kiosks and each affected vendor will get (as per RAP approved by GOAP/APRDC). • Alternate site for kiosks or a sum of Rs.5000 for self relocation NOTE: Vendors in groups (of more than 50) will be considered for relocating in a commercial complex, if developed by the project.
Common infrastructure and common Property Resources
Community • Common properties will be replaced in consultation with the community • Civic infrastructure will be replaced in consultation with the affected
community and the local administration
Any Unforeseen Impacts
Affected community and/persons
Any unforeseen impact would be mitigated/enhance as per the APRRP 2005 or through any additional measures as may be required
* Defintions are given in Para 13, page 113 above
14. The resettlement plans (RAP) prepared for the first year works (Chittor-Puttur, Mydukuru-Jammalamadugu, Kandi-Shadnagar and Kurnool-Devekonda) include measures to minimize displacement and the mitigation measures to ensure that those affected are helped to improve or at least restore their livelihoods. 15. In case of PPP projects, with assistance from the transaction adviser financed under the PPP facilitation component of the project and in close collaboration with the Bank team, APRDC have completed the preparation of environmental documents including Environmental Management Plans for first three roads. As regards social safeguards, the census surveys and consultations were completed, but the Resettlement Action Plans are yet to be finalized. The Bank reviewed the draft RAP for one of the projects (Narketapalli-Addanki-Medarmetla Road) and observed certain shortcomings which are expected to be addressed appropriately in the revised version. The draft RAPs for other roads are under preparation. These documents prepared by the transaction advisor financed under the Project will be drawn upon to the extent they are compatible with the environment laws and other PPP guidelines of India to guide the implementation of the environmental and social safeguards in the PPP transactions. 16. Indigenous Peoples Policy (OP 4.10) applies in this project to tribal people. There are road stretches proposed under the project which pass through tribal areas. As part of SIA, an
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assessment was carried out to identify and assess the issues related to tribal communities vis-á-vis the proposed project activities. Specific consultations held with these vulnerable communities helped to inform them about the project interventions and expected benefits. At the same time, it helped to solicit their views on the proposed measures to help them benefit from the project. The assessment revealed that the project interventions are not expected to have any adverse impacts on the tribal communities. However, for the tribal affected on individual basis will be eligible for additional R&R support under the state R&R policy and R&R entitlement framework agreed for the project. Further, RAP prepared for roads with significant tribal population also includes a section on Tribal Development Plan (TDP). The main objective of the TDP is to ensure that potential benefits of the project are accessible to these road side communities. As presented below, TDP includes the following measures to help these communities to access project benefits at par with others.
Table 38: Measures to help tribal PAFs and communities Issues Specific measures included in RAP
Loss of Agriculture land
• Compensation at replacement value • Preference in allotment of alternate land • Additional financial assistance equivalent to 500 days of agricultural wages • Resettlement near to displacement in a close habitat • Lump sum assistance for economic rehabilitation • 25 percent additional benefit if resettled outside the tribal areas
Loss of employment
• Training for self employment • Dovetailing Government scheme for income generation activities
(IGA) • Additional assistance to tribal families
Loss of Shelter • Alternate housing (weaker section housing scheme) • House construction grant • Maintenance allowance and other assistance
Loss of income from commercial shops
• Site for shop or a constructed shop • Shop construction grant • Training for IGA • Dovetailing Government schemes for income generation
Loss of CPR & facilities
• Replacement of community facilities with enhanced facilities • Alternate community facilities during construction
Issues of lack of Consultation
• Consultation on RAP in the Gram Sabha mandatory • Distribute pamphlet (in local language) on project, RAP and other dissemination materials. • Disclose RAP
17. HIV/AIDS: AP is one of the states with highest numbers of HIV cases in the country. With the proposed improvement of roads, the movement of workers, truckers, road side utilities and services and mobility of commercial sex workers will increase, leading to increased incidence of HIV/AIDS. To contain the spread and control HIV/AIDS in the project roads, an action plan has been prepared in close coordination with the AP State AIDS Control Society (APSACS). The overall strategy under the project is to prevent HIV/AIDS cases through increased awareness level about HIV/AIDS, referral services for medical care and treatment and
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promoting safe sex. The strategy for implementation includes partnering with APSACS and the NGOs working with it. The project will provide additional inputs in the form of NGO services and multiplication of IEC material for effective implementation of AIDS Action Plan. 18. Stakeholders’ consultations were carried out with a variety of project stakeholders at various levels - at the village, mandal, Package and district levels. The stakeholders included road users and other project beneficiaries, peoples’ representatives, local communities, women, scheduled castes and tribes and other vulnerable groups, affected households, project staff, government agencies, researchers and expert groups and NGOs and civil societies. These consultations were held in all the road stretches proposed to be included in the project but specific consultations were held only in the first year packages. All these consultations have been adequately documented including video-graphs, photos and proceedings of the meetings.
19. The main messages emerging from these consultations are the importance of addressing issues related to alternate project alignments, compensating land and other assets required for the project, support to the affected families including encroachers and squatters and other vulnerable among them in their R&R process. Participants also recognized the need to provide adequate opportunities for the involvement of tribal and other vulnerable sections in planning and implementing mitigation measures and other development activities for their benefit. Consultations were also held on issues related to HIV/AIDS and the measures required to control its spread. Stakeholder consultations will continue during the project implementation. 20. The institutional arrangements for implementing the social management plans (RAP, TDP and HIV/AIDS Plan) include a Social Management Unit (SMU) at the project level within PMU. This Unit will be responsible for overseeing the planning, implementing and overseeing the SMP activities. At the Package level, APRDC field level staff and the Package NGO will be responsible for implementing SMP (including RAP) activities. A Nodal NGO at the project level will be engaged to focus on SMPs and ensure adequate treatment of issues related to losers of land, physical displaced people, affected families (including encroachers and squatters), tribal development and HIV/AIDS. The District Administration will be involved particularly in implementing LA/RAP activities. The costs and implementation arrangements have been mainstreamed into the project design and are described in the RAPs for each Package, Project Implementation Plan (PIP) and other project documents. 21. Monitoring of SMP will be carried through both internal and external mechanisms. Internal monitoring will be done by the Package Manager and the facilitating NGO at the Package level and the SMU at the project level. Nodal NGO at the project will help in this process. An inbuilt mechanism (including the District Level R&R Committee), envisaged in the state R&R policy will redress grievances for individual PAPs. An external Monitoring and Evaluation (M&E) agency will be engaged to provide regular feed back to the project on the SMP implementation and suggest measures to improve its implementation and effectiveness. Mid-term and end line evaluation of RAP for each Package will be done by this external M&E agency.
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Safeguard Policies 22. Safeguard Policies Triggered: The project has triggered six safeguards policies. The physical interventions proposed under the project could result in environmental and social impacts including tree cutting, forest land diversions, impact on community and cultural resources, land acquisition and involuntary resettlement of local population, and impacts on local communities, particularly tribals in certain stretches. As part of the project preparation, social and environmental assessments were undertaken to identify and assess the impacts associated with the proposed project activities, and develop mitigation measures and plans. 23. Environmental Assessment (OP/BP/GP 4.01): Complying with Category “A” – Full Assessment, and the country systems, the EA undertaken included: (i)Environmental Screening carried out in parallel with the engineering feasibility study; (ii) Environmental Assessment to prepare EMPs as an integral part of designs; and (iii) Environmental and Social Management Framework for Maintenance Roads. A concurrent independent review of the environmental assessment process and outputs has been conducted by APRDC through an independent consultant. The outcomes of EA process, in the form of EMPs have been integrated with relevant implementation mechanisms including project implementation contracts, and institutional set up for implementation of the project. 24. Natural Habitats (OP/BP 4.04): This policy is triggered because some of the project roads pass through forested areas. However, none of the project roads pass through any designated wildlife sanctuaries and do not lead to any conversion or degradation of forests and/or have adverse impacts on natural habitats. In addition, the project will not finance any roads that pass through wildlife sanctuaries, including Tiger Reserves in Andhra Pradesh. The EA process adopted by APRDC included systematic stakeholder consultations in determining the impacts on forest areas. The project specific EMPs include, detailed management measures, and exclusion principles prohibiting construction related activities such as construction camp sites, location of plant and machinery, disposal of debris, extraction of construction material, night time construction, etc. in the forest areas. 25. Forests (OP/BP 4.36): The proposed corridors under Road Upgrading and PPP components would entail limited acquisition of forest land. These forest land acquisitions are marginal and the impacts on the quality of forested areas is insignificant. Currently land for compensatory afforestation has been delineated and forest diversion proposals are in advanced stage of progress. The road side plantations in Andhra Pradesh are regulated under Water Land and Tree Act (WALTA) with a provision for compensatory plantation in 2:1 ratios for each tree cut. The EMP measures include sufficient provisions and budget to meet the requirements. 26. Physical Cultural Resources (OP/BP 4.11): The proposed roads under the project have several religious structures along the sub-project roads. Some of these could be affected physically or access to such properties could be affected. All such areas of cultural and religious importance have been identified as part of EA/SA for specific measures. All these measures will be planned and implemented in consultation with and close involvement of local communities. There are no known archeological sites affected by any of the proposed project corridors.
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27. Involuntary Resettlement (OP/BP 4.12): The project involves acquisition of land and road side structures for the proposed improvements, alignments and by passes. Encroachment of the RoW is the main issue. Based on the findings of SIA, an R&R entitlement framework has been developed to ensure that those affected by project interventions are helped to enhance, if not at least restore their livelihood. RAP for the first year packages of upgrading component have been prepared. Preparation of RAP for the subsequent year packages is under progress. Adequate institutional mechanism will be in place to implement RAPs. This includes a Social Management Unit at the project level, Nodal NGO, Package Management Unit and Package level NGO. 28. Indigenous Peoples (OP/BP 4.10): As part of IESA, a separate study on tribal people was undertaken. The results indicate that tribal as groups/communities will not be adversely affected due to project interventions. However, those affected on individual basis will be supported as per the R&R entitlement framework which provides additional support to tribal affected families. 29. Disclosure: APRDC has conducted extensive stakeholder consultations as part of the EA/SA process. In country disclosure of the Environmental and Social Management Framework for Long Term Performance Based Maintenance Contracts (LTPBMC), as well as the Environmental Management Plans, and Social Management Plans for upgrading component of Phase 1 Roads (Kornool-Devankonda, Mydukur - Jammalamadugu, Kandi–Shadnagar, and Chittoor–Puttur Roads) were completed on January 22, 2009. The disclosures included documents in local language. The documents were also disclosed on the Bank’s Infoshop on February 4, 2009.
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Annex 11: Project Preparation and Supervision
INDIA: Andhra Pradesh Road Sector Project Planned Acutal PCN review 05/31/2006 06/01/2006 Initial PID to PIC 06/22/2006 06/22/2006 Initial ISDS to PIC 06/23/2006 06/23/2006 Appraisal 03/02/2009 03/02/2009 Negotiations 03/23/2009 08/31/2009 Board/RVP approval 05/21/2009 10/15/2009 Planned date of effectiveness 11/26/2009 11/01/2009 Planned date of mid-term review 11/26/2012 11/01/2012 Planned closing date 05/26/2016 06/30/2015
Key institutions responsible for preparation of the project: Andhra Pradesh Road Development Corporation (APRDC) Bank staff and consultants who worked on the project included:
Name Title Unit Binyam Reja Sr. Transport Economist/TTL SASDT A.K. Swaminathan Sr. Transport Specialist (Past TTL) SASDT Addepalli Sita Ramakrishna Environmental Specialist SASDI Anand Kumar Srivastava Senior Procurement Specialist SARPS Ashok Kumar Senior Highway Engineer SASDT Atul Bhalchandra Deshpande Senior Financial Management Specialist SARFM Baher El-Hifnawi Sr. Transport Economist, Peer Reviewer EASTE Chris Hoban Portfolio Manager, Peer Reviewer ECIAF Ernst Huning Institutional Strengthening Specialist /Consultant SASDT Gizella Diaz Program Assistant SASDO Harinath Sesha Appalarajugari Environmental Specialist SASDI I. U. B. Reddy Senior Social Development Specialist SASDI Krishnan Srinivasan GAAP Specialist / Consultant SASDT Kumudni Choudhary Program Assistant SASDO Mohammad Hasan Senior Social Development Specialist SASDI Naseer Ahmad Rana Adviser (Governance) SARVP Natalya Stankevich Operations Analyst SASDT Nupur Gupta Transport Specialist SASDT Om Prakash Procurement Specialist / Consultant SARPS Pratap T Transport Specialist SASDT Radha Narayan Procurement Assistant SARPS Rodrigo Archondo-Callao Senior Highway Engineer ETWTR Santhanam Krishnan Procurement Specialist SARPS Satya N. Mishra Social Development Specialist / Consultant SASDI Sri Kumar Tadimalla Senior Public Private Partnerships Specialist SASDT Yingying Shi Junior Professional Associate SASDT
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Bank funds expended to date on project preparation: 1. Bank resources: US$504,000. 2. Trust funds: US$22,400.- 3. Total: US$ 526,400.-
Estimated Approval and Supervision costs: 1. Remaining costs to approval: US$43,000 2. Estimated annual supervision cost: US$200,000.-
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Annex 12: Documents in the Project File
INDIA: Andhra Pradesh Road Sector Project Consulting Services for A.P. Road Sector Financing Study-Furnishing of Final Assessment
Report and Final Road Financing Report from M/s PricewaterhouseCoopers. July 2008 Andhra Pradesh Road Sector Financing Study. Final Road Financing Report. Price Waterhouse
Coopers. June 2008. Andhra Pradesh Road Sector Project Feasibility Study, Design and Detailed Engineering.
Detailed Project Report. Upgrading of Kurnool-Devanakonda Road, Volume – I, Main Report. The Louis Berger Group, Inc. April 2008.
--------- Upgrading of Kurnool-Devanakonda Road, Volume – VI, Cost Estimates. The Louis Berger Group, Inc. April 2008.
--------- Upgrading of Chittoor – Puttur Road, Volume – I, Main Report. The Louis Berger Group, Inc. April 2008.
--------- Upgrading of Kurnool-Devanakonda Road, Volume – VI, Cost Estimates. The Louis Berger Group, Inc. April 2008.
Andhra Pradesh Road Sector Financing Study. Inception Report. Price Waterhouse Coopers. October 2007
Andhra Pradesh Road Sector Project Preparatory Services for Long Term Performance Based Maintenance Contract System. Inception Report: SMEC International PTY Ltd. July 2007
Andhra Pradesh Road Sector Project Feasibility Study, Design and Detailed Engineering. Feasibility Study Report, Vol. I - Main Report: The Louis Berger Group, Inc. July 2007
--------- Vol. IB-Annexures to Main Report (Bridges): The Louis Berger Group, Inc. July 2007 --------- Vol. II – Strip Plan: The Louis Berger Group, Inc. July 2007 --------- Vol. I - Main Report: The Louis Berger Group, Inc. May 2007 --------- Vol. II – Strip Plan: The Louis Berger Group, Inc. May 2007 --------- Vol. III – Annexure to Environmental Screening Report & Strip Plan: The Louis Berger
Group, Inc. May 2007 --------- Vol. III – Environmental Screening Report: The Louis Berger Group, Inc. May 2007 --------- Vol. IV – Social Assessment and Framework: The Louis Berger Group, Inc. May 2007 --------- Vol. IA-Annexures to Main Report: The Louis Berger Group, Inc. May 2007 Andhra Pradesh Road Sector Project Feasibility Study, Design and Detailed Engineering.
Prioritzation Report: Phase I. The Louis Berger Group, Inc. February 2007 --------- Inception Report: The Louis Berger Group, Inc. February 2007 --------- Inception Report (Environmental Assessment Study): The Louis Berger Group, Inc.
February 2007 --------- Inception Report (Social Assessment Study): The Louis Berger Group, Inc. February
2007 --------- Quality Assurance Plan. The Louis Berger Group, Inc. February 2007
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Annex 13: Statement of Loans and Credits
INDIA: Andhra Pradesh Road Sector Project
AS OF SEPTEMBER 8, 2009
Original Amount in US$ Millions
Difference between expected and actual
disbursements
Project ID FY Purpose IBRD IDA SF GEF Cancel. Undisb. Orig. Frm. Rev’d
P110051 2010 Haryana Power System Improv Project 330.00 0.00 0.00 0.00 0.00 330.00 0.00 0.00
P102331 2009 MPDPIP-II 0.00 100.00 0.00 0.00 0.00 100.70 0.00 0.00
P100735 2009 Orissa Community Tank Management Project
56.00 56.00 0.00 0.00 0.00 105.33 -2.07 0.00
P100101 2009 Coal-Fired Generation Rehabilitation 180.00 0.00 0.00 0.00 0.00 180.00 3.00 0.00
P096023 2009 Orissa State Roads 250.00 0.00 0.00 0.00 0.00 245.29 -4.09 0.00
P094360 2009 National VBD Control&Polio Eradication 0.00 521.00 0.00 0.00 0.00 492.61 37.32 0.00
P093478 2009 Orissa Rural Livelihoods Project 0.00 82.40 0.00 0.00 0.00 75.20 0.53 0.00
P112033 2009 UP Sodic III 0.00 197.00 0.00 0.00 0.00 198.44 0.00 0.00
P102547 2008 Elementary Education (SSA II) 0.00 600.00 0.00 0.00 0.00 349.96 142.70 0.00
P102737 2008 Bihar DPL 150.00 75.00 0.00 0.00 0.00 111.86 111.10 0.00
P101653 2008 Power System Development Project IV 1,000.00 0.00 0.00 0.00 0.00 602.32 -21.34 0.00
P095114 2008 Rampur Hydropower Project 400.00 0.00 0.00 0.00 0.00 318.30 24.30 0.00
P105124 2008 HP DPL I 135.00 65.00 0.00 0.00 0.00 99.75 0.00 0.00
P083187 2007 Uttaranchal RWSS 0.00 120.00 0.00 0.00 0.00 111.58 54.93 0.00
P096019 2007 HP State Roads Project 220.00 0.00 0.00 0.00 0.00 195.63 28.85 0.00
P090585 2007 Punjab State Roads Project 250.00 0.00 0.00 0.00 0.00 143.81 -3.29 0.00
P090592 2007 Punjab Rural Water Supply & Sanitation 0.00 154.00 0.00 0.00 0.00 142.56 87.90 0.00
P090764 2007 Bihar Rural Livelihoods Project 0.00 63.00 0.00 0.00 0.00 59.07 2.27 0.00
P090768 2007 TN IAM WARM 335.00 150.00 0.00 0.00 0.00 406.12 97.73 0.00
P075060 2007 RCH II 0.00 360.00 0.00 0.00 0.00 204.65 60.43 0.00
P075174 2007 AP DPL III 150.00 75.00 0.00 0.00 0.00 76.02 -77.33 0.00
P100789 2007 AP Community Tank Management Project
94.50 94.50 0.00 0.00 0.00 174.53 25.30 0.00
P071160 2007 Karnataka Health Systems 0.00 141.83 0.00 0.00 0.00 85.08 -7.70 0.00
P078538 2007 Third National HIV/AIDS Control Project
0.00 250.00 0.00 0.00 0.00 197.47 130.06 0.00
P078539 2007 TB II 0.00 170.00 0.00 0.00 0.00 112.22 -8.56 0.00
P102768 2007 Stren India's Rural Credit Coops 300.00 300.00 0.00 0.00 0.00 287.38 148.58 0.00
P099047 2007 Vocational Training India 0.00 280.00 0.00 0.00 0.00 202.52 -8.77 0.00
P093720 2006 Mid-Himalayan (HP) Watersheds 0.00 60.00 0.00 0.00 0.00 33.41 5.40 0.00
P092735 2006 NAIP 0.00 200.00 0.00 0.00 0.00 165.17 54.06 0.00
P086414 2006 Power System Development Project III 400.00 0.00 0.00 0.00 0.00 23.86 -112.81 0.00
P083780 2006 TN Urban III 300.00 0.00 0.00 0.00 0.00 189.94 105.69 -0.66
P078832 2006 Karnataka Panchayats Strengthening Proj 0.00 120.00 0.00 0.00 0.00 83.15 -31.51 0.00
P079675 2006 Karn Municipal Reform 216.00 0.00 0.00 0.00 0.00 171.18 77.52 0.00
P079708 2006 TN Empwr & Pov Reduction 0.00 120.00 0.00 0.00 0.00 82.85 33.60 0.00
P073370 2005 Madhya Pradesh Water Sector Restructurin
394.02 0.00 0.00 0.00 0.00 302.87 229.52 0.00
P073651 2005 DISEASE SURVEILLANCE 0.00 68.00 0.00 0.00 0.00 50.48 42.03 0.00
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P075058 2005 TN HEALTH SYSTEMS 0.00 110.83 0.00 0.00 20.06 35.28 45.35 19.46
P077856 2005 Lucknow-Muzaffarpur National Highway 620.00 0.00 0.00 0.00 0.00 215.12 105.12 0.00
P077977 2005 Rural Roads Project 99.50 300.00 0.00 0.00 0.00 100.11 67.58 0.00
P086518 2005 SME Financing & Development 520.00 0.00 0.00 0.00 0.00 320.65 -78.35 -38.35
P084792 2005 Assam Agric Competitiveness 0.00 154.00 0.00 0.00 0.00 70.27 48.91 -4.23
P084790 2005 MAHAR WSIP 325.00 0.00 0.00 0.00 0.00 223.19 135.52 0.00
P094513 2005 India Tsunami ERC 0.00 465.00 0.00 0.00 0.00 387.87 378.09 0.00
P084632 2005 Hydrology II 104.98 0.00 0.00 0.00 0.00 83.91 72.74 45.26
P078550 2004 Uttar Wtrshed 0.00 69.62 0.00 0.00 0.00 35.01 3.73 0.00
P050655 2004 RAJASTHAN HEALTH SYSTEMS DEVELOPMENT
0.00 89.00 0.00 0.00 0.00 40.55 34.58 0.00
P082510 2004 Karnataka UWS Improvement Project 39.50 0.00 0.00 0.00 0.00 7.38 7.38 4.15
P050649 2003 TN ROADS 348.00 0.00 0.00 0.00 0.00 48.22 48.22 0.00
P067606 2003 UP ROADS 488.00 0.00 0.00 0.00 0.00 90.26 90.26 0.00
P071272 2003 AP RURAL POV REDUCTION 0.00 215.03 0.00 0.00 0.00 27.07 -58.48 0.00
P073094 2003 AP Comm Forest Mgmt 0.00 108.00 0.00 0.00 0.00 17.84 -2.77 0.00
P076467 2003 Chatt DRPP 0.00 112.56 0.00 0.00 20.06 49.94 56.09 0.00
P072539 2002 KERALA STATE TRANSPORT 255.00 0.00 0.00 0.00 0.00 89.65 89.65 0.00
P071033 2002 KARN Tank Mgmt 32.00 130.90 0.00 0.00 25.07 112.37 50.39 -6.15
P069889 2002 MIZORAM ROADS 0.00 78.00 0.00 0.00 0.00 9.77 -19.94 0.00
P040610 2002 RAJ WSRP 0.00 140.00 0.00 0.00 25.84 36.82 23.87 0.00
P050668 2002 MUMBAI URBAN TRANSPORT PROJECT
463.00 79.00 0.00 0.00 0.00 235.21 222.30 139.30
P050653 2002 KARNATAKA RWSS II 0.00 151.60 0.00 0.00 15.04 16.01 3.46 0.00
P050647 2002 UP WSRP 0.00 149.20 0.00 0.00 40.11 61.38 72.24 0.00
Total: 8,455.50 6,775.47 0.00 0.00 146.18 9,025.19 2,621.29 158.78
INDIA STATEMENT OF IFC’s
Held and Disbursed Portfolio In Millions of US Dollars
AS ON SEPTEMBER 8, 2009
Committed Disbursed
IFC IFC
FY Approval Company Loan Equity Quasi Partic. Loan Equity Quasi Partic.
2005 ADPCL 39.50 7.00 0.00 0.00 0.00 0.00 0.00 0.00
2006 AHEL 0.00 5.08 0.00 0.00 0.00 5.08 0.00 0.00
2005 AP Paper Mills 35.00 5.00 0.00 0.00 25.00 5.00 0.00 0.00
2005 APIDC Biotech 0.00 4.00 0.00 0.00 0.00 2.01 0.00 0.00
2002 ATL 13.81 0.00 0.00 9.36 13.81 0.00 0.00 9.36
2003 ATL 1.00 0.00 0.00 0.00 0.68 0.00 0.00 0.00
2005 ATL 9.39 0.00 0.00 0.00 0.00 0.00 0.00 0.00
2006 Atul Ltd 16.77 0.00 0.00 0.00 0.00 0.00 0.00 0.00
2003 BHF 10.30 0.00 10.30 0.00 10.30 0.00 10.30 0.00
2004 BILT 0.00 0.00 15.00 0.00 0.00 0.00 15.00 0.00
2001 BTVL 0.43 3.98 0.00 0.00 0.43 3.98 0.00 0.00
2003 Balrampur 10.52 0.00 0.00 0.00 10.52 0.00 0.00 0.00
126
2001 Basix Ltd. 0.00 0.98 0.00 0.00 0.00 0.98 0.00 0.00
2005 Bharat Biotech 0.00 0.00 4.50 0.00 0.00 0.00 3.30 0.00
1984 Bihar Sponge 5.70 0.00 0.00 0.00 5.70 0.00 0.00 0.00
2003 CCIL 1.50 0.00 0.00 0.00 0.59 0.00 0.00 0.00
2006 CCIL 7.00 2.00 0.00 12.40 7.00 2.00 0.00 12.40
1990 CESC 4.61 0.00 0.00 0.00 4.61 0.00 0.00 0.00
1992 CESC 6.55 0.00 0.00 14.59 6.55 0.00 0.00 14.59
2004 CGL 14.38 0.00 0.00 0.00 7.38 0.00 0.00 0.00
2004 CMScomputers 0.00 10.00 2.50 0.00 0.00 0.00 0.00 0.00
2002 COSMO 2.50 0.00 0.00 0.00 2.50 0.00 0.00 0.00
2005 COSMO 0.00 3.73 0.00 0.00 0.00 3.73 0.00 0.00
2006 Chennai Water 24.78 0.00 0.00 0.00 0.00 0.00 0.00 0.00
2003 DQEL 0.00 1.50 1.50 0.00 0.00 1.50 1.50 0.00
2005 DSCL 30.00 0.00 0.00 0.00 30.00 0.00 0.00 0.00
2006 DSCL 15.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
2005 Dabur 0.00 14.09 0.00 0.00 0.00 14.09 0.00 0.00
2003 Dewan 8.68 0.00 0.00 0.00 8.68 0.00 0.00 0.00
2006 Federal Bank 0.00 28.06 0.00 0.00 0.00 23.99 0.00 0.00
2001 GTF Fact 0.00 1.20 0.00 0.00 0.00 1.20 0.00 0.00
2006 GTF Fact 0.00 0.00 0.99 0.00 0.00 0.00 0.99 0.00
1994 GVK 0.00 4.83 0.00 0.00 0.00 4.83 0.00 0.00
2003 HDFC 100.00 0.00 0.00 100.00 100.00 0.00 0.00 100.00
1998 IAAF 0.00 0.47 0.00 0.00 0.00 0.30 0.00 0.00
2006 IAL 0.00 9.79 0.00 0.00 0.00 7.70 0.00 0.00
1998 IDFC 0.00 10.82 0.00 0.00 0.00 10.82 0.00 0.00
2005 IDFC 50.00 0.00 0.00 100.00 50.00 0.00 0.00 100.00
IHDC 6.94 0.00 0.00 0.00 0.00 0.00 0.00 0.00
2006 IHDC 7.90 0.00 0.00 0.00 0.00 0.00 0.00 0.00
2006 Indecomm 0.00 2.57 0.00 0.00 0.00 2.57 0.00 0.00
1996 India Direct Fnd 0.00 1.10 0.00 0.00 0.00 0.66 0.00 0.00
2001 Indian Seamless 6.00 0.00 0.00 0.00 6.00 0.00 0.00 0.00
2006 JK Paper 15.00 7.62 0.00 0.00 0.00 7.38 0.00 0.00
2005 K Mahindra INDIA 22.00 0.00 0.00 0.00 22.00 0.00 0.00 0.00
2005 KPIT 11.00 2.50 0.00 0.00 8.00 2.50 0.00 0.00
2003 L&T 50.00 0.00 0.00 0.00 50.00 0.00 0.00 0.00
2006 LGB 14.21 4.82 0.00 0.00 0.00 4.82 0.00 0.00
2006 Lok Fund 0.00 2.00 0.00 0.00 0.00 0.00 0.00 0.00
2002 MMFSL 7.89 0.00 7.51 0.00 7.89 0.00 7.51 0.00
2003 MSSL 0.00 2.29 0.00 0.00 0.00 2.20 0.00 0.00
2001 MahInfra 0.00 10.00 0.00 0.00 0.00 0.79 0.00 0.00
Montalvo 0.00 3.00 0.00 0.00 0.00 1.08 0.00 0.00
1996 Moser Baer 0.00 0.82 0.00 0.00 0.00 0.82 0.00 0.00
1999 Moser Baer 0.00 8.74 0.00 0.00 0.00 8.74 0.00 0.00
2000 Moser Baer 12.75 10.54 0.00 0.00 12.75 10.54 0.00 0.00
Nevis 0.00 4.00 0.00 0.00 0.00 4.00 0.00 0.00
2003 NewPath 0.00 9.31 0.00 0.00 0.00 8.31 0.00 0.00
2004 NewPath 0.00 2.79 0.00 0.00 0.00 2.49 0.00 0.00
2003 Niko Resources 24.44 0.00 0.00 0.00 24.44 0.00 0.00 0.00
2001 Orchid 0.00 0.73 0.00 0.00 0.00 0.73 0.00 0.00
127
1997 Owens Corning 5.92 0.00 0.00 0.00 5.92 0.00 0.00 0.00
2006 PSL Limited 15.00 4.74 0.00 0.00 0.00 4.54 0.00 0.00
2004 Powerlinks 72.98 0.00 0.00 0.00 64.16 0.00 0.00 0.00
2004 RAK India 20.00 0.00 0.00 0.00 20.00 0.00 0.00 0.00
1995 Rain Calcining 0.00 2.29 0.00 0.00 0.00 2.29 0.00 0.00
2004 Rain Calcining 10.00 0.00 0.00 0.00 10.00 0.00 0.00 0.00
2005 Ramky 3.74 10.28 0.00 0.00 0.00 0.00 0.00 0.00
2005 Ruchi Soya 0.00 9.27 0.00 0.00 0.00 6.77 0.00 0.00
2001 SBI 50.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
1997 SREI 3.21 0.00 0.00 0.00 3.21 0.00 0.00 0.00
2000 SREI 6.50 0.00 0.00 0.00 6.50 0.00 0.00 0.00
1995 Sara Fund 0.00 3.43 0.00 0.00 0.00 3.43 0.00 0.00
2004 SeaLion 4.40 0.00 0.00 0.00 4.40 0.00 0.00 0.00
2001 Spryance 0.00 1.86 0.00 0.00 0.00 1.86 0.00 0.00
2003 Spryance 0.00 0.93 0.00 0.00 0.00 0.93 0.00 0.00
2004 Sundaram Finance 42.93 0.00 0.00 0.00 42.93 0.00 0.00 0.00
2000 Sundaram Home 0.00 2.18 0.00 0.00 0.00 2.18 0.00 0.00
2002 Sundaram Home 6.71 0.00 0.00 0.00 6.71 0.00 0.00 0.00
1998 TCW/ICICI 0.00 0.80 0.00 0.00 0.00 0.80 0.00 0.00
2005 TISCO 100.00 0.00 0.00 300.00 0.00 0.00 0.00 0.00
2004 UPL 15.45 0.00 0.00 0.00 15.45 0.00 0.00 0.00
1996 United Riceland 5.63 0.00 0.00 0.00 5.63 0.00 0.00 0.00
2005 United Riceland 8.50 0.00 0.00 0.00 5.00 0.00 0.00 0.00
2002 Usha Martin 0.00 0.72 0.00 0.00 0.00 0.72 0.00 0.00
2001 Vysya Bank 0.00 3.66 0.00 0.00 0.00 3.66 0.00 0.00
2005 Vysya Bank 0.00 3.51 0.00 0.00 0.00 3.51 0.00 0.00
1997 WIV 0.00 0.37 0.00 0.00 0.00 0.37 0.00 0.00
1997 Walden-Mgt India 0.00 0.01 0.00 0.00 0.00 0.01 0.00 0.00
2006 iLabs Fund II 0.00 20.00 0.00 0.00 0.00 0.00 0.00 0.00
Total portfolio: 956.52 249.41 42.30 536.35 604.74 175.91 38.60 236.35
Approvals Pending Commitment
FY Approval Company Loan Equity Quasi Partic.
2004 CGL 0.01 0.00 0.00 0.00
2000 APCL 0.01 0.00 0.00 0.00
2006 Atul Ltd 0.00 0.01 0.00 0.00
2001 Vysya Bank 0.00 0.00 0.00 0.00
2006 Federal Bank 0.01 0.00 0.00 0.00
2001 GI Wind Farms 0.01 0.00 0.00 0.00
2004 Ocean Sparkle 0.00 0.00 0.00 0.00
2005 Allain Duhangan 0.00 0.00 0.00 0.00
Total pending commitment: 0.04 0.01 0.00 0.00
128
Annex 14: Country at a Glance
INDIA: Andhra Pradesh Road Sector Project
India at a glance ~--POVERTY _ SOCIAL ~. mKldIe_ -. .... i. -- O' •• .."....n' ...........
~,
PopWIioo, mod-.,.,...lmiIiioosJ 1,123.3 1,520 l ,4lr ~-. GNI po< capito (Ali .. ""'rood, US$) = = 1,1187
GNI (All ... ""rood, US$ _oJ 1,009.4 '.n' '.-....... ,age """u .. grOWl~, 1001-117
PopWIioo (%) " " " c"' /J "- -labor force 1"1 ,. " " ~
'\ / -M"", ,.""'" .. timate I~te"' Y"''' ... ;Ioble, 2001-071 " ,,0 --P<>-'Y (% of popd8!JM below MIiooaII'C"'<f!Y hi UIDoo1 popti.- (% of"". ~I ~ ~ " lk .~ "' bdI (yews) " " " Infant mortality (per 1,000 /We_'; " " " Child ~ (% o/chiIrffen <.r>d<;- ~J .. " 3 Aece .. ., ~ ...... ,.. ooun:e Ac""," 10 .... ~ WlIIe< source (% of p<>p<J __ j 00 "' "' Ulefocy (% 0( p<><>Ohboo .". " . ) "' ~ 00 Gro>o ptimaoy....- I" 0( ___ pop<i"'""'i
'" '"' '" --~. '" '" 11 2 --L""",,-mdd/e-inromegroup ,- ' W '" 'W
KEY ECONOM IC RATIOS and LONG TERM TRENDS
,&, ,., ~, ~, Eo ......... ' ..... '
GOP (US$""""I 276.0 410.9 916 .3 1, I n o Groos e . .... formalionlGDP n" no .. ., .-Export. 0/ <p:>do and """;ces/GO P " 10.8 22 .1 2!.l Gro>o <Iome<O< .. ~P ~, n. n" "'
+ Gro>o fI8!ior>oI ~ 20.9 24 .7 " 37.2
C..-r"" 0«0001 baIaoocelGOP _1.9 _1.4 _1.1 _2.1 ~, ,-"'I<,r" ' po)mOf1WGDP "' " "' TotaideWG£lP 20.' n" IS.7 - -T __ """;ce/export> m 21 .6 " _ value aI <leWGDP 12 .7
_ ,aI"" aI <leWe,*""" 48 .5 -1987 _91 1991-07 - ~, 2001_\\ raver _ __ [TO'MhJ w, " •• " "" "' --GOP per capita " " " " " --L"""",_-inoome _
Exporto 0/ <p:><!s and """'""" 11.5 15.4 18 .9 " 13.3
STRUCTlIRE "'t"" ECOOOMY ,&, ,., ~, ~, "''''''''' of ....... ond GDf' I") I" oIGDPI
=:~ : A9"ru1ture ~ . ~ , 18 .3 I n -. ~, ~, "' ~,
MoruIaCM"", 1 6_~ 16 .4 16 .3 16 .' -- " ., . 7 .1 O . ~ ,
__ final """""""" e>:pOfldittxe 6 U 00 . .. " ' , • " • • • GMenli g<>'II'I _ conoumpIIOn expend.ture 11 _3 11 .4 10 .3 10 .1 - , - " IrYiports 01 \100<IO _ ...-..ices
" 12 .1 " 14 .'
1931-91 1991-Q7 ~, ~, G" " .. , " o • • • port> ond ,_ ,,,, (a verage __ fTO"1hl
A9"atture ,., " .. "
~b~ -. ., " 11 .0 " M:nJiacM"", " " 12 .0 " -- " " 11 .1 10 .3
__ final """""""" e>:pOfldittxe " " 10 .3 " GMenli g<>'II'I _ conoumpIIOn expend.ture
" " " " . . , . . . • Groos <.;>itol rorma_ " 11 .0 1 • . 3 13.3 - - --IrYiports 01 \100<IO _ ...-..ices 11 _3 14.8 2 • .5 " N<!Ie. 2001 do .. life preliminooye_,.. ThIll bible WM produ<:e<I 1rom the ~ Eronomocs l OO do," _ _
• The diamond> show fOUf key indi<Btors in the <000..,. r .. bold) ~ w.1h its _ -9'00II ....... _ _ W dolo . ", mi""'g, the d ",mood \frill
~-
129
I'!din
PIlICES and GOVERNMf HT f iNANCE ,., ,., ,- ~,
"''''' .... 1''1 Domo.1i<: ",ku
""'-' J:: ::=-~ ._- '" , .. " " Impliei! GO P <leta"" .. , " " .. , Gov«mIHYII fill.""" I" "'GOP, _ cvrrent~"""'1 ._- 19 .• l H ~, n .• " , • • • " Cur=tl1Judo;jot baOOce _2.1 _3.5 _H _1.6 - "",,",.>to< ~" Ovefoll ourpI\JsI<Ieft<~ _9.2 ~, -1; . ~ _5.6
,- ,., ,., ,- ~,
.. """ ·""_ ...... luSl ... ' .) (USf_1 TotoI_ (IOO) 12,6U >.= 128,03:' 146,632 =--- ... 1,201 1.14-1 "''''' .. ... ,,~"" .... ~ 1,00 1 1,0'"" =--.- 8,1 95 26,S.l 82,811 91,651
Too" Jnports (cd) 19,812 51,1 81 191,2501 236,:196 ,- 1,1 . 1 1,. 83 3,291 .. -f"'" _ eoe«J\' 3,11 8 8,1 S. 51,Ol~
Capital \IIlO<lS '.- 9.100 52,9-I~ 11,311
" " " • " , " &port poco rnex j2(XX.1_I001 '" '" Imp<JtI price indoo. ,2000-1001 '" '". .c_ .-'e<m. OI'-- ("",","'WI "' ,. 6AlNlCf 0/ PAVMf NT S ,., ,., ,- ~, c.".", ..... m' ..... "".'0 GO<' f"1 (USf_1 bpom 01 goods and oeMces 16,216 . 5,1 00 ~,2&4 246,011
Imp<Jrto 01 \IIlO<lS """ ~ 22,839 59,291 235,6?' 291,_ Reoouroe boIar>c. "&,623 _1. ,1 88 _31,361 311, 116
N .. income _1,331 _3,52 1 "&,57: Net eurr"", ~omIeIo 2,698 11,= 21,9-1 1 311, 116
Cur=tI account boil"""" _5,262 _5,819 _9,!« _2.,.[16
f rnneinQ items (ntI) . ,526 9,112 . 6,59!: 44,282 ,
CI>or"ges ., net,..."....,. ,. _3,893 _36 ,60< _19,574 " O-R""""", ... ......,.,.... (VSJ _'J _,223 N ,Y;l ' ,,",11( 218,<;.82
C~ "'''' (~C, locaWSfI 13.0 312 45.2 ~0.3
EXTERNAL DfBT aod RHOURCf flOWS ,., ,., ,- ~, c......,.,._ '" , .... ..... IU . $ mOl .) (USf mi-.s) Totol dell< <>U1sIa<Idirog oM disburllOd 55,510 ~,311 1S3,OlO
'"W ..,00 8,1 38 6,1 11 1,(l.ID J,II ,"" A,o.m '" 11.615 11.912 2 • . 0~ 26.512
TotoIdeIl<_ '.~ 12,. 13 11,81[ ,.w ~ 1,. 10 ~, n. '" ,. .. M' m C~ oInet r......-.:e1lows
Off",iaI gants "' ., 87: Off",ialcr~ 2,.98 •• 2,1 4~ -- 2,811 1,069 16,09J t Ol"91 <!.fed_lnet"""""') ", 3,~1I If,'''' , ".'" Portloiio equity (no, _) • '.= 9,54[
World s.. Pf09I1Ill
COIYWIliImettts '.~ '>" 1,221 3,1 74 • L"RO C ......... Qisbur""ments 2,212 1,312 1,18J '.~ • '". o · ""'"' "'"',' ''' .. "
, Pri .. ~ I'nrH:ipaI repo)'lYlOtlt> •• 1,010 ., 1,089 • .. • ~-,"- 1.1 1. ., M. " .. 1_." po)mOf1" '" m .. ~
Netn""._ 1,238 ... "' '" The World s.. Group: This _ wao prepared by ~ ........ ~; figure> ... y 0iI!e< from o1he< Wotld Sanl< pWlished dato ~~
130
Annex 15: Map IBRD 37131
INDIA: Andhra Pradesh Road Sector Project
ADILABAD
NIZAMABADKARIMNAGAR
MEDAK WARANGAL
RANGAREDDYKHAMMAM
NALGONDA
SRIKAKULAM
VIZIANAGARAM
VISHAKHAPATNAM
EASTGODAVARI
WEST
GODAVARI
KRISHNA
GUNTURMAHBUBNAGAR
KURNOOL
PRAKASAM
ANANTAPUR
C U D D A PA H
NELLORE
C H I T T O O R
BANGALORE
HYDERABAD
CHENNAI(MADRAS)
To Raipur
To Wardha
To Jalna
To Parbhani
To SolapurTo
Dha
rwad
To Goa
To Hassan
To Coimbatore
To Dindgul
To Wardha
To KoraputTo Jagdalpur
To Bhubaneshwar
Adilabad
Nizamabad
Karimnagar
Warangal
Sangareddi
Mahbubnagar
Nalgonda
Khammam
Guntur
Machilipatnam
Srikakulam
Vizianagaram
Vishakhapatnam
Kakinada
Eluru
Kurnool
Anantapur
Cuddapah
Ongole
Nellore
Chittoor
Bay ofBengal
Krishna R.Krishna R.
Godavari R.
Godavari R.
Penneru R.
Papa
gni R
.
Kandleru R.
I N D I A
ANDHRA PRADESHROAD SECTOR PROJECT
ROADS TO BE UPGRADED ORIMPROVED UNDER THE PROJECT
PPP ROADS
NATIONAL HIGHWAYS
SELECTED STATE ROADS
RAILROADS
DISTRICT CAPITALS
STATE CAPITALS
DISTRICT BOUNDARIES
STATE BOUNDARY
0 50 100
KILOMETERS
This map was produced by the Map Design Unit of The World Bank.The boundaries, colors, denominations and any other informationshown on this map do not imply, on the part of The World BankGroup, any judgment on the legal status of any territory, or anyendorsement or acceptance of such boundaries.
UPGRADATION &IMPROVEMENT ROADS:
Kandi–Shad Nagar RoadChittor–Putttor RoadKurnool–Devanakonda RoadMydukuru–Jammalamadugu RoadKakinada–Rajahmundry RoadPedana–Vissannapet RoadJagityal–Peddapalii Road
1234567
PPP ROADS:Phase I
Phase II
Hyderabad–Karimnagar–Ramagundam RoadNarketpalli–Addanki–Medaramitla RoadPuthalapattu–Naidupet Road
123
Khammam–Takkada–Devarapalli RoadKadapa–Renigunta RoadWarangal–Khammam RoanPerecherla–Thokapallli RoadWarangal–Raipatnam Road
456
78
1
2
3
4
5
6
7
1
2
3
4
5
6
7
8
IBRD 37131
SEPTEMBER 2009