The World Bank Efficient & Sustainable City Bus Services (P132418) REPORT NO.: RES40108 RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF EFFICIENT & SUSTAINABLE CITY BUS SERVICES APPROVED ON DECEMBER 9, 2014 TO DEPARTMENT OF ECONOMIC AFFAIRS TRANSPORT SOUTH ASIA Regional Vice President: Hartwig Schafer Country Director: Junaid Kamal Ahmad Global and Regional Director: Guangzhe Chen Practice Manager/Manager: Shomik Raj Mehndiratta Task Team Leader(s): Nupur Gupta The World Bank Efficient & Sustainable City Bus Services (P132418) ABBREVIATIONS AND ACRONYMS PDO Project Development Objective GEO Global Environment Objective MoHUA Ministry of Housing & Urban Affairs ITS Intelligent Transport System MIS Management Information System PMU Project Management Unit ESCBS Efficient and Sustainable City Bus Services SUTP Sustainable Urban Transport Project GEF Global Environment Facility NURM National Urban Renewal Mission GHG Green House Gases EA Environmental Assessment The World Bank Efficient & Sustainable City Bus Services (P132418) Note to Task Teams: The following sections are system generated and can only be edited online in the Portal. BASIC DATA Product Information Project ID Financing Instrument P132418 Investment Project Financing Original EA Category Current EA Category Partial Assessment (B) Partial Assessment (B) Approval Date Current Closing Date 09-Dec-2014 31-Dec-2019 Organizations Borrower Responsible Agency Department of Economic Affairs Ministry of Urban Development Project Development Objective (PDO) Original PDO The project's Global Environment Objective (GEO) is to improve the efficiency and attractiveness of city bus transport and reduce greenhouse gas emissions in the demonstration cities. OPS_TABLE_PDO_CURRENTPDO Summary Status of Financing Net Ln/Cr/Tf Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed TF-18577 31-May-2016 31-May-2016 29-Aug-2016 31-Dec-2019 9.20 4.13 5.07 Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No The World Bank Efficient & Sustainable City Bus Services (P132418) I. PROJECT STATUS AND RATIONALE FOR RESTRUCTURING A. Project Components 1. The project comprises two major components:  Component 1 - National Capacity Building for Urban Bus Sector: This component is implemented by the Ministry of Housing & Urban Affairs (MoHUA, erstwhile Ministry of Urban Development) and covers: (i) a review of the legal, regulatory, institutional and fiscal constraints to operation of sustainable city bus services; and (ii) capacity building initiatives involving development of knowledge materials, training activities, knowledge sharing and cross learning events.  Component 2 - City Demonstration Projects: This component involves targeted city level modernization interventions to showcase low cost high impact investments in bus operation efficiency and user responsiveness: (i) modern depot equipment; (ii) intelligent transport systems (ITS) including management information systems (MIS); and (iii) technical assistance and capacity building to support the modernization initiatives i.e. technical assistance with ITS-MIS, bus fuel efficiency, business planning etc. in four demonstration cities, Bhopal, Chandigarh, Jaipur and Mira Bhayandar. B. Project Status 2. The Project was approved by the Board in December 2014 and became effective in August 2016. Following initial delays project progress has improved in the past year. 3. Under Component 1, the capacity building component managed by MoHUA has made progress in all modules and activities are expected to be substantially complete within the project timeline except one. The TA on legislative, institutional and fiscal constraints to city bus services is expected to complete well beyond the current timeline by September 2020. A TA to support Chandigarh and Mira Bhayandar with service and business planning has been initiated and LUTP training has been successfully concluded. In the event of slippages in these activities MoHUA proposes to complete them through its own funds. 4. Under Component 2A, the depot modernization subcomponent is now substantially complete with cities like Chandigarh beginning to realize gains. The new Todi depot in Jaipur is operational and the Ghodbunder Depot in Mira Bhayander is complete with installation of equipment. Mira Bhayander has awarded the operations and maintenance contract to a private operator and operations have improved considerably. Procurement of additional depot equipment from redeployment of grant savings in Bhopal and Jaipur is complete. Bhopal and Jaipur have hired a depot expert for assistance in usage of depot equipment, and Mira Bhayandar has hired key operations staff for supporting its bus operations. The World Bank Efficient & Sustainable City Bus Services (P132418) 5. On ITS-MIS, Bhopal and Mira Bhayandar have completed pilot testing and are scheduled to complete full implementation and go live within the project timeline. After some delay, Chandigarh has also completed the procurement of ITS-MIS and finalized the system integrator. It has secure funding to be able to complete the project which will go beyond project closing. Implementation will require one year. 6. Under Component 2B, which consists of Technical Assistance (TA) activities to support the Project Cities in the implementation of projects, technical support for ITS implementation and capacity building are in various stages of implementation, and various training programs and capacity building activities have been undertaken for both city officials as well as crew and artisans. 7. The status of procurement and commitments by components as of November 2019 is provided below. Commitment & Disbursement Status as of November 2019 Grant Committed Current Allocation Cost Disbursement Component 1 0.70 3.16 0.60 Project 0.40 0.25 0.10 Management Component 2 Component 2A 6.0 5.0 2.87 Component 2B 2.1 0.81 0.54 Total 9.2 8.45 4.11 8. The project has disbursed about 45 percent of the total grant amount of $9.2 million and is currently scheduled to close in December 31, 2019. It is expected that the project would achieve a 70% disbursement with this closing date. 9. With the hiring of the private operator already the number of buses on the road has increased from 22 to 51 in Mira Bhayandar. The availability of the fully equipped new depot and the ITS-MIS system should help sustain better reliability and operating performance in the city. Further, they have now recruited a full-time team to support bus operations. Chandigarh has begun to realise and document the benefits from the installed depot equipment. Similarly, Bhopal and Jaipur have started using the equipment and should gradually begin seeing the gains of improved maintenance even with a hugely depreciated fleet. With both Bhopal and Chandigarh likely to have modern ITS-MIS system in place significant improvements are possible in the design and management of operations. The ongoing service plan study for Chandigarh and Mira Bhayandar is likely to help improve the service plans and make them more demand responsive. Many of these benefits will become evident in the coming 3-12 months. C. RATIONALE FOR RESTRUCTURING 10. The proposed project restructuring comprises of the following:  Extension of project Closing date from December 31, 2019 to September 30, 2020  Changes to disbursement estimate. The World Bank Efficient & Sustainable City Bus Services (P132418) 11. The Government of India is in advanced stages of planning the launch of a national Bus Scheme as an economic revival package for the country but also to initiate much needed reform of the bus sector. MoHUA sees ESCBS as strategic and timely for supporting the larger scale up of the urban bus public transport program across India. 12. Under ESCBS, the ongoing Technical Assistances on (i) Legislative, Institutional and Fiscal Constraints to the Bus Sector, (ii) Manual for ITS and MIS Functional Specifications; (iii) Training Modules for City Bus officials; (iv) Manual for Design & Implementation of urban Depots; (v) Review and Updation of Model Contracts for contracting private City Bus Operators, (vi) Service & Business Plans etc. form the key building blocks of the reform agenda for the bus sector. Given time for their proper completion they can become a valuable part of the proposed national scheme package for cities. Guidance materials, capacity building and support for the local implementing agencies will contribute greatly to the performance and impact of the proposed scheme. 13. ESCBS also has some uncommitted funds to the tune of USD 0.8mn which can be quickly deployed for balance activities to support the preparation of the bus scheme. 14. As a fallout, with additional time available for the stabilization in the usage of depot equipment and ITS system, the grant funds can be fully utilized and the likelihood of achievement of PDO improves tremendously. II. DESCRIPTION OF PROPOSED CHANGES The details of the proposed changes are as follows: A. Extension of Closing Date 15. The Project closing date proposed for extension from 31 December 2019 to 30 September 2020. 16. There are approximately $0.8mn of uncommitted funds which are proposed to be utilized for additional capacity building and technical assistance activities under the Component I being implemented by MoHUA towards the preparatory activities of the national program. Some of these include activities agreed to previously but not actioned. The following additional activities are proposed to be taken up through available grant resources.  Review of model contract document for hiring private city bus operators including electric buses  Evaluation of practices for UMTA/UTF and difficulties in proceeding with existing documentation  Preparation of business model and RFP for a National level ITS platform  Development of the M&E Framework for the national scheme  Extension of ESMAP Bus Fuel Efficiency Training Program to another 12 cities  Documentation of SUTP demo project case studies  Knowledge Workshops on City Bus. The World Bank Efficient & Sustainable City Bus Services (P132418) 17. The additional activities are in line with the project description of Component 1 and vital to the development of the sector. These will require a 5-6 month timeframe for completion and could be taken up within the extended time provided MoHUA completes all procurements by February 2020 as committed. B. Disbursement Projections. The cumulative disbursement projections are provided below. FY20: $7.0 mn FY21: $9.2 mn C. Implementation Schedule Sub-Component Completion Timeline Component 1: Capacity Building  Ongoing TA (excluding one): Completion by March 2020  Legislative, Institutional & Fiscal Constraints TA: Sept 2020  New Activities: Procurement concluded by Feb 2020; Completion of TA by Sept 2020 Component 2A: Depot Modernization  This subcomponent is substantially complete  Commissioning and usage of final set of equipment in Bhopal and Jaipur: March 2020 Component 2A: ITS-MIS  Bhopal & Mira Bhayandar: Implementation Completed by December 2019; Operational Acceptance by March 2020  Chandigarh: Implementation substantially completed by September 2020 III. SUMMARY OF CHANGES Changed Not Changed Loan Closing Date(s) ✔ Disbursement Estimates ✔ Implementation Schedule ✔ Implementing Agency ✔ DDO Status ✔ The World Bank Efficient & Sustainable City Bus Services (P132418) Project's Development Objectives ✔ Results Framework ✔ Components and Cost ✔ Cancellations Proposed ✔ Reallocation between Disbursement Categories ✔ Disbursements Arrangements ✔ Overall Risk Rating ✔ Safeguard Policies Triggered ✔ EA category ✔ Legal Covenants ✔ Institutional Arrangements ✔ Financial Management ✔ Procurement ✔ Other Change(s) ✔ Economic and Financial Analysis ✔ Technical Analysis ✔ Social Analysis ✔ Environmental Analysis ✔ IV. DETAILED CHANGE(S) OPS_DETAILEDCHANGES_LOANCLOSING_TABLE LOAN CLOSING DATE(S) Original Revised Proposed Proposed Deadline Ln/Cr/Tf Status Closing Closing(s) Closing for Withdrawal Applications TF-18577 Effective 31-Dec-2018 31-Dec-2019 30-Sep-2020 30-Jan-2021 OPS_DETAILEDCHANGES_DISBURSEMENT_TABLE DISBURSEMENT ESTIMATES Change in Disbursement Estimates Yes The World Bank Efficient & Sustainable City Bus Services (P132418) Year Current Proposed 0000 0.00 0.00 2015 0.00 0.00 2016 0.00 0.00 2017 0.00 0.00 2018 910,000.00 910,000.00 2019 1,220,000.00 1,220,000.00 2020 7,070,000.00 4,870,000.00 .