The World Bank Assam State Roads Project (P096018) REPORT NO.: RES27745 RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF ASSAM STATE ROADS PROJECT APPROVED ON MARCH 13, 2012 TO DEPARTMENT OF ECONOMIC AFFAIRS, GOVERNMENT OF INDIA TRANSPORT & DIGITAL DEVELOPMENT SOUTH ASIA Regional Vice President: Annette Dixon Country Director: Junaid Kamal Ahmad Senior Global Practice Director: Jose Luis Irigoyen Practice Manager/Manager: Karla Gonzalez Carvajal Task Team Leader: Elena Y. Chesheva, N. S. Srinivas, Sanjeev Deorao Moholkar The World Bank Assam State Roads Project (P096018) ABBREVIATIONS AND ACRONYMS ACRONYM EXPANDED DEFINITION ARRTI Assam Roads Research Training Institute ASRB Assam State Roads Board ASRP Assam State Roads Project EPC Engineering Procurement Construction GOA Government of Assam IBRD International Bank for Reconstruction & Development INR Indian Rupees PDO Project Development Objective PWRD Public Works (Roads) Department RAMS Road Asset Management System SIL Specific Investment Loan USD / US$ United States Dollar The World Bank Assam State Roads Project (P096018) BASIC DATA Product Information Project ID Financing Instrument P096018 Investment Project Financing Original EA Category Current EA Category Full Assessment (A) Full Assessment (A) Approval Date Current Closing Date 13-Mar-2012 31-Mar-2018 Organizations Borrower Responsible Agency Department of Economic Affairs, Government of India Public Works Roads Department Project Development Objective (PDO) Original PDO The project development objective is to enhance the road connectivity of Assam by assisting the Public Works Roads Department to improve and effectively manage its road network. OPS_TABLE_PDO_CURRENTPDO Summary Status of Financing Net Ln/Cr/Tf Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed IBRD-81360 13-Mar-2012 05-Nov-2012 25-Jan-2013 31-Mar-2018 320.00 128.84 191.16 TF-11446 27-Apr-2012 27-Apr-2012 27-Apr-2012 31-Mar-2015 1.75 1.75 0 Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No The World Bank Assam State Roads Project (P096018) I. PROJECT STATUS AND RATIONALE FOR RESTRUCTURING 1. The World Bank Board of Executive Directors approved the original Assam State Roads Project (ASRP) (LN. 8136-IN) on March 13, 2012, and the project became effective on January 25, 2013. The total loan amount from the International Bank for Reconstruction & Development (IBRD) was USD 320 million. The current loan closing date of the project is March 31, 2018. The project has disbursed to date an amount of USD 113.61 million, which works out to 35.5% of the loan amount. 2. The project has committed 100% of the loan amount. Notable progress has been made in the project over the last 2 years with all the components under the project performing reasonably well. All major procurements envisaged under the project have been substantially completed. Based on the improved project performance, the project IP rating was upgraded to “Moderately Satisfactory”. However, initial delays in the project implementation and delays due to the need to terminate and re-tender some of the civil works contracts, would not allow all project activities to be completed by the current closing date of the project. Therefore, the PDO rating of the project has been rated at “Moderately Unsatisfactory”, even though the PDO remains valid. Once the loan closing date extension is processed, the PDO rating is expected to be upgraded to “Moderately Satisfactory”. (a) Civil Works: In terms of project progress, the civil works component is moving at a reasonably steady pace. This component, during its initial stages of implementation, came across several challenges that included poor performing contractors, delays in completion of pre-construction activities, lack of availability of materials etc. Over the last two years, Government of Assam and Public Works (Roads) Department took several corrective actions, such as termination of poor performing contracts, swift re-bidding and award of these terminated contracts, speeding up of administrative approvals for completion of pre-construction activities etc. These efforts paved the way for improved project performance. Of the 258 km of upgrading works, about 101 km has been completed to date. Under the rehabilitation packages, about 491 km has been completed to date against a total length of 769 km. Similarly, under the bridge works in this component, 14 bridges are expected to be constructed. Of these, 2 bridges have been completed and the remaining are in different stages of construction. In addition to these standard design bridges, one innovative bridge with EPC mode of contracting was also proposed to be taken up under the project. However, due to the time and cost involved in the construction of this bridge, it was agreed with PWRD not to add it to the project scope. Furthermore, two upgradation packages that are unlikely to be completed during the project life viz; SH-46/1C (ongoing court case) and SH45/9 (terminated due to poor performance of the contractor) are being dropped from the project. (b) Status of Institutional Strengthening: Progress under this component has been satisfactory. A number of key activities have been substantively completed, including: (i) development and operationalization of Road Asset Management System (RAMS), (ii) development and scaling up including adoption of e-portal for digitizing and DPR approvals, project monitoring (all projects of the state, ~2200 projects monitored online), grievance registration, interfacing with RAMS with public viewing, (iii) revision of Department code and outdated manuals; (iv) design of innovative and standard Bridge Manual for the state. These activities have resulted in a more efficient way of managing PWRD assets and works. Some other long-term transformational activities on this component include strengthening of Assam State Roads Board (ASRB), strengthening of Assam Roads Research Training Institute (ARRTI), however, more support for these activities is required, as well as for the system integration The World Bank Assam State Roads Project (P096018) services to augment web-based PWRD Portal. The documents for development of Assam State Roads Board and ARRTI were extensively deliberated and consulted among the key stakeholders and have been endorsed by Government of Assam for implementation / execution. The Government of Assam would need to explore suitable avenues to take these initiatives forward. Support for them has been included in the proposal for ASRP-II that was recently developed by the government and submitted to the GoI for consideration. (c) Status of Road Safety: Assam Road Safety Action Plan was prepared with the support by the project, and has been subsequently adopted by the Government of Assam. One demo safe corridor (Amingaon to Kalitakushi) has been completed with road safety engineering measures and enhanced enforcement. The Road Safety Audit has been conducted on 220 km of project roads and specifications for the road safety improvement works have been prepared. It has been agreed with the PWRD that procurement of these works would be undertaken as soon as closing date extension is processed. All road safety improvement works will be completed before the proposed revised closing date. Blackspot mitigation measures have been undertaken on 16 identified blackspots. Development of the Road Accident Data Management System could be accomplished under the project within the proposed revised closing date, provided the procurement is done without delays. The project has supported preparation of designs for the Model Safe Corridor with integrated traffic management system and intelligent transport system on an arterial urban corridor in Guwahati (Jalukbari-Khanapara). However, support for implementation of this corridor is outside of the scope of this project. The Government of Assam needs to identify suitable modalities to take this multi-sectoral initiative forward. II. DESCRIPTION OF PROPOSED CHANGES 3. The proposed restructuring would entail the following:  Extension of the loan closing date by 18 months;  Revision of the Project Results Framework and Monitoring Indicators. 4. The details of the proposed changes are as given below: (a) Extension of Loan Closing date: As explained in the previous section, the project implementation has been affected due to the numerous challenges faced by the project. The corrective actions taken by Government of Assam and Public Works (Roads) Department yielded positive results that enabled bringing the project back on track. All the components under the project have been exhibiting an improved performance which has also resulted in improved disbursement performance in the last year and a half. Out of 66 civil works contracts, only 15 are expected to be completed by the current closing date of March 31, 2018. Thus, it would be impossible to achieve the PDO of the project. In view of this, the project proposes an extension of the loan closing date by 18 months, up to September 30, 2019. This time extension should be sufficient for completion of all project activities. This will be the first extension to be sought by the project. (b) Revision of the Project Results Framework and Monitoring Indicators: In addition to the proposed extension of the loan closing date, the project results indicators are proposed to be revised. The purpose is to align the indicators with the outcomes and outputs likely to be achieved under each of the project components and revise the targets according to the latest project progress and the targets likely to be achieved at the end of the project. The snapshot of the proposed changes / revisions is as given below in Table 1: TABLE 1: SUMMARY OF ADJUSTMENTS FOR MONITORING AND EVALUATION FRAMEWORK The World Bank Assam State Roads Project (P096018) Items Current number of Changes proposed Indicators PDO Indicators 4 Revision of the target (including description) - 2 To be Dropped - 1 No Change – 1 Intermediate Results Indicator Component 1: Road Improvement 2 Revision of the target – 2 To be Dropped – 0 No Change – 0 Component 2: Road Sector 5 Revision of the target– 2 Modernization and Performance To be Dropped – 2 Enhancement No Change – 1 Component 3: Road Safety 2 Revision of the target - 1 Management To be Dropped - 0 No Change – 1 Total (Intermediate Indicators) 9 Revision of targets- 5 To be Dropped – 2 No change – 2 Details of the changes made in the project results framework is provided in Annex 1. III. SUMMARY OF CHANGES Changed Not Changed Change in Results Framework ✔ Change in Loan Closing Date(s) ✔ Change in Implementing Agency ✔ Change in DDO Status ✔ Change in Project's Development Objectives ✔ Change in Components and Cost ✔ Cancellations Proposed ✔ Reallocation between Disbursement Categories ✔ Change in Disbursements Arrangements ✔ Change in Disbursement Estimates ✔ Change in Overall Risk Rating ✔ Change in Safeguard Policies Triggered ✔ The World Bank Assam State Roads Project (P096018) Change of EA category ✔ Change in Legal Covenants ✔ Change in Institutional Arrangements ✔ Change in Financial Management ✔ Change in Procurement ✔ Change in Implementation Schedule ✔ Other Change(s) ✔ Change in Economic and Financial Analysis ✔ Change in Technical Analysis ✔ Change in Social Analysis ✔ Change in Environmental Analysis ✔ IV. DETAILED CHANGE(S) OPS_DETAILEDCHANGES_RESULTS_TABLE RESULTS FRAMEWORK Project Development Objective Indicators PDO_IND_TABLE Secondary road network in good or fair condition (Percentage, Custom) Unit of Measure: Percentage Indicator Type: Custom Baseline Actual (Current) End Target Action Value 25.00 15.10 30.00 No Change Date 01-Jan-2012 22-Mar-2018 30-Sep-2019 Reduction in travel time on the project corridors (Percentage, Custom) Unit of Measure: Percentage Indicator Type: Custom Baseline Actual (Current) End Target Action Value 0.00 0.00 20.00 No Change Date 01-Jan-2012 14-May-2017 30-Sep-2019 Safety Rating of project corridors (Percentage, Custom) Unit of Measure: Text Indicator Type: Custom The World Bank Assam State Roads Project (P096018) Baseline Actual (Current) End Target Action Value 10 Procurement initiated 40.00 Marked for Deletion Date 01-Jan-2012 14-May-2017 31-Mar-2018 Improved Asset Management (Number, Custom) Unit of Measure: Percentage Indicator Type: Custom Baseline Actual (Current) End Target Action Value 0.00 54.00 40.00 No Change Date 01-Jan-2012 22-Mar-2018 30-Sep-2019 Intermediate Indicators IO_IND_TABLE Increased Maintenance Funding (INR million) (Number, Custom) Unit of Measure: Number Indicator Type: Custom Baseline Actual (Current) End Target Action Value 1800.00 6000.00 5000.00 No Change Date 31-Mar-2012 14-May-2017 30-Sep-2019 Effective execution of maintenance works (Percentage, Custom) Unit of Measure: Percentage Indicator Type: Custom Baseline Actual (Current) End Target Action Value 5.00 100.00 50.00 Marked for Deletion Date 01-Jan-2012 14-May-2017 31-Mar-2018 Development and Implementation of Road Safety strategy (Yes/No, Custom) Unit of Measure: Yes/No Indicator Type: Custom Baseline Actual (Current) End Target Action Value No Yes Yes No Change Date 13-Mar-2012 14-May-2017 30-Sep-2019 Annual district performance reports and maintenance plans published (Percentage, Custom) Unit of Measure: Percentage The World Bank Assam State Roads Project (P096018) Indicator Type: Custom Baseline Actual (Current) End Target Action Value 0.00 0.00 50.00 Marked for Deletion Date 01-Jan-2012 14-May-2017 31-Mar-2018 Road improvement and rehabilitation of 500 km core network roads (Kilometers, Custom) Unit of Measure: Kilometers Indicator Type: Custom Baseline Actual (Current) End Target Action Value 0.00 592.00 1000.00 No Change Date 01-Jan-2012 22-Mar-2018 30-Sep-2019 Pilot projects on innovative design of bridges (Text, Custom) Unit of Measure: Text Indicator Type: Custom Baseline Actual (Current) End Target Action Value None 700 No Change Date 13-Mar-2012 14-May-2017 30-Sep-2019 Institutional strengthening of PWRD (Text, Custom) Unit of Measure: Text Indicator Type: Custom Baseline Actual (Current) End Target Action Various actions under Actions under RSMP are Value Not applicable the road sector No Change underway moderninzation plan Date 13-Mar-2012 14-May-2017 30-Sep-2019 Training of PWRD staff - percent staff receving one week training annually (Percentage, Custom) Unit of Measure: Percentage Indicator Type: Custom Baseline Actual (Current) End Target Action Value 0.00 1.00 25.00 No Change Date 01-Jan-2012 14-May-2017 30-Sep-2019 Road safety improvements (Kilometers, Custom) Unit of Measure: Text The World Bank Assam State Roads Project (P096018) Indicator Type: Custom Baseline Actual (Current) End Target Action Value 0 0 300.00 Marked for Deletion Date 01-Jan-2012 17-Jun-2016 31-Mar-2018 Road safety improvements (Kilometers, Custom) Unit of Measure: Text Indicator Type: Custom Baseline Actual (Current) End Target Action Value 0 23.00 300.00 Revised Date 01-Jan-2012 14-May-2017 30-Sep-2019 Roads rehabilitated, Rural Unit of Measure: Kilometers Indicator Type: Custom Baseline Actual (Current) End Target Action Value 0.00 206.00 500.00 Marked for Deletion Date 01-Jan-2012 17-Jun-2016 31-Mar-2018 OPS_DETAILEDCHANGES_LOANCLOSING_TABLE LOAN CLOSING DATE(S) Original Revised Proposed Proposed Deadline Ln/Cr/Tf Status Closing Closing(s) Closing for Withdrawal Applications IBRD-81360 Effective 31-Mar-2018 30-Sep-2019 30-Jan-2020 31-Mar-2015, 01- TF-11446 Closed 30-Jun-2013 Oct-2015 The World Bank Assam State Roads Project (P096018) ANNEX 1: ADJUSTMENTS TO MONITORING AND EVALUATION FRAMEWORK Table A.1 Summary Analysis for Adjustment to the Monitoring and Evaluation Framework Project Development Objective: To enhance the road connectivity of Assam by assisting the Public Works Roads Department to improve and effectively manage its road network Original Indicator Suggestion(s) Justification(s) Modification(s) Revised Indicator PDO Indicator Secondary road network in good To be modified - Highly relevant to achieve Definitions to be revised: Good Secondary road network in or fair condition connectivity condition < IRI 4 and Fair condition good or fair condition.1 [baseline: 25%; target: 40%] - The current description within IRI 4-6 [baseline: 25%; target: 40%] needs modification – “IRI < 4 or surveys as per the operational manual.” In description only the criteria for good condition (IRI < 4) is mentioned. As PWRD doesn’t have any operation manual, thus the criteria for fair condition cannot be defined. Hence, with current description this PDO can only be assessed partially 1 Good condition < IRI 4 and Fair condition, IRI 4-6 The World Bank Assam State Roads Project (P096018) Original Indicator Suggestion(s) Justification(s) Modification(s) Revised Indicator Reduction in travel time on the To be Kept - Highly relevant to achieve No modification project corridors2 enhanced connectivity [baseline: 0%; target: 20%] Improved Asset Management To be modified - Highly relevant to aid The sub-indicator “using a Improved Asset Management PWRD in effectively performance-based or other system 3 [baseline: 0; target: 50] manage Road Network to of maintenance contracting for state enhance connectivity. roads;” may be removed as the [baseline: 0; target: 40] However, after examining activity is not funded by the project the procedures and and is beyond the control of the documents being used by project. PWRD, Bank task team has concluded that they are not following the PBMC method, but following a Volume based BOQ method and is also not funded by the Bank. Safety Rating of project corridors To be dropped Road Safety Rating cannot 4 be an outcome indicator [baseline:10%; target: 40%] as the PDO is focused on achieving connectivity. Intermediate Results Indicator Intermediate Results Indicator (Road Improvement Component) Road Improvement and Description & Target to - Highly relevant to achieve Road improvement and Road improvement and rehabilitation of 500km core be modified enhanced connectivity rehabilitation of roughly 1000km rehabilitation of core network network roads [target: 500 km] core network roads has been roads [target: 1000 km] planned. Hence instead of 500km, 2 Current average speed for cars, buses, and trucks is around 30km/hr, 25km/hr, and 20km/hr, respectively 3 Sum of the districts (i) preparing annual maintenance plans using the asset management module of APCP; (ii) having a web-based system allowing road inventory and condition data for state roads for public viewing; and (iii) using computerized workflow of APCP for project management. Maximum value of this indicator could be 3 times the number of districts in the state, i.e., 81 (three times of 27 districts). 4 This indicator will apply to the 300km roads for widening and strengthening on which the road safety countermeasures will be applied. % of km having 3+ iRAP star rating. The World Bank Assam State Roads Project (P096018) Original Indicator Suggestion(s) Justification(s) Modification(s) Revised Indicator the target may be changed to 1000km to reflect the current situation. Pilot projects on innovative Description & Target to Bridges are highly relevant The indicator may be renamed to Pilot projects on innovative design of bridges [target (no of be modified to improve connectivity. “Pilot projects on bridges.” Also, the design of bridges bridges):10; baseline: 0] However, “Innovative targets may require modification to [(Y6): 150m bridges technology” not highly improve the measurability. Currently completed; (Y8): 700m relevant to enhance 14 Bridges are included with a span bridges completed] connectivity. length of roughly 700 m. Therefore, targets may be revised as follows: Y6 – 150m bridges completed.5 Y8 – 700m bridges completed. Intermediate Results Indicator (Road Sector Modernization & Performance Enhancement Component) Increased Maintenance Funding To be kept. Essential for maintaining None [target: 500 cr INR.] connectivity and effectively managing Road Network. Currently, Rs.600 cr had been allocated towards maintenance for this FY 2016-17. Annual district performance To be dropped Districts generating reports and maintenance plans Maintenance plans using published [target: 50% districts] RAMS are already being counted in the primary PDO indicator - “Improved Asset Management”. Hence this indicator may be dropped 5 The stage of completion needs to be decided in consensus with PWRD Bridge design team. The World Bank Assam State Roads Project (P096018) Original Indicator Suggestion(s) Justification(s) Modification(s) Revised Indicator Effective execution of To be dropped Since the maintenance will maintenance works6 [target: 50% be done through the state districts] budget allocation, performance of this indicator does not have any direct impact on the project. Institutional Strengthening of Targets to be modified. This is an indicator which is Revised targets proposed are given Institutional Strengthening of PWRD quite subjective. The below: PWRD. targets may need to be Y2- Road Fund Operational, Strategic modified to only those Core network established. Target- outputs which are relevant Y3- PWRD prepares a capacity Y2- Road Fund Operational, for institutional building plan for the construction Strategic Core network strengthening of PWRD industry and starts its established. within ASRP context implementation Y3- PWRD prepares a capacity Y4- PWRD adopts an HR and building plan for the professional development strategy construction industry and for its staff; starts its implementation Y5- Revised PWD Code accepted by Y4- PWRD adopts an HR and Government professional development Y6 - Road Board functioning as an strategy for its staff; apex body for the Road Sector; Y5- Revised PWD Code Asset Management strategy adopted accepted by Government by GoA; Y6 - Road Board functioning as an apex body for the Road Sector; Asset Management strategy adopted by GoA; Training of PWRD staff7 [target: Target & Description to PWRD engineers required The indicator description may be Training of PWRD staff8 25% staff.] be modified to be trained to effectively revised to “%age staff receiving [target: 25% staff.] 6 % districts contracting routine maintenance for a minimum of 20% of their network 7 % staff receiving minimum one-week training annually 8 % staff receiving minimum 2-days training annually. The World Bank Assam State Roads Project (P096018) Original Indicator Suggestion(s) Justification(s) Modification(s) Revised Indicator manage the burgeoning minimum 2 days training annually”, network. However, the as 7 days training is an unachievable indicator needs proposition given PWRD’s current modification to be more capacity constraints realistic. Intermediate Results Indicator (Road Safety Management Component) Development & Implementation To be kept All the intermediate targets of road safety strategy Target - 9 mentioned in footnote can be achieved within project closure date. Road safety improvements Description & Target to Road Safety Rating is not The indicator may be renamed to “Road Safety Improvement on [target: 300 km] be modified highly relevant to the PDO. “Road Safety Improvement on selected Project Corridors”. Also, given the current selected Project Corridors”. Target: Y3 – 50 km; Y4- 100 progress of Component 1, Target: Y3 – 50 km; Y4- 100 km; Y5 – km; Y5 – 150 km; Y6 – 200 km iRAP assessment of 300km 150 km; Y6 – 200 km Upgradation Roads is an unrealistic proposal. 9(1) Process initiated to prepare a road safety strategy; (2) GoA adopts Road Safety Strategy; (3) Road safety integrated in engineering tools; (4) Safe Road Demonstration program implemented