Bhutan: South Asia Subregional Economic Cooperation Road Connectivity Project

Sovereign Project | 39225-034

Summary

ADB and the Government of Bhutan are working together to bring safer roads and more opportunities to the southern part of the country. The South Asia Subregional Economic Cooperation Road Connectivity Project will build 68.3 km of the vital Southern East West Highway between the towns of Dewathang and Nganglam, which is one of the main crossing points between Bhutan and India. The new stretch of road will improve the connection between Bhutan''s main north south highways and India''s national highway network. As a result, travel time between Nganglam and Dewathang is being reduced by 80% from 12 hours to just a few hours. The project is also building a 1.2 km access road between Bhutan''s border with India and the Pasakha industrial estate, reducing travel time by 90 percent from nearly two hours to about 10 minutes. Border crossing stations in Phuentsholing City the town of Alay will also be improved, and a 2.7 km access road to the national highway will be built.

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Procurement Documents


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Project Name South Asia Subregional Economic Cooperation Road Connectivity Project
Project Number 39225-034
Country Bhutan
Project Status Approved
Project Type / Modality of Assistance Grant
Loan
Source of Funding / Amount
Grant 0400-BHU: South Asia Subregional Economic Cooperation Road Connectivity Project
Asian Development Fund US$ 18.96 million
Loan 3149-BHU: South Asia Subregional Economic Cooperation Road Connectivity Project
Asian Development Fund US$ 31.39 million
Strategic Agendas Environmentally sustainable growth
Inclusive economic growth
Regional integration
Drivers of Change Governance and capacity development
Sector / Subsector Transport - Road transport (non-urban)
Gender Equity and Mainstreaming Some gender elements
Description ADB and the Government of Bhutan are working together to bring safer roads and more opportunities to the southern part of the country. The South Asia Subregional Economic Cooperation Road Connectivity Project will build 68.3 km of the vital Southern East West Highway between the towns of Dewathang and Nganglam, which is one of the main crossing points between Bhutan and India. The new stretch of road will improve the connection between Bhutan''s main north south highways and India''s national highway network. As a result, travel time between Nganglam and Dewathang is being reduced by 80% from 12 hours to just a few hours. The project is also building a 1.2 km access road between Bhutan''s border with India and the Pasakha industrial estate, reducing travel time by 90 percent from nearly two hours to about 10 minutes. Border crossing stations in Phuentsholing City the town of Alay will also be improved, and a 2.7 km access road to the national highway will be built. The new roads and facilities will help develop the capacity of the country's engineers and government officials to build modern transport infrastructure. The project is designed to make Bhutan more competitive in terms of international trade and spread the benefits of cross-border commerce with its regional neighbors to people across the country, including the poorest and most disadvantaged.
Project Rationale and Linkage to Country/Regional Strategy In landlocked Bhutan, high-quality roads are one of the most effective ways of improving people''s lives. The about 720,000 people in the country are dispersed among beautiful and often rugged and remote mountains. Small roads that link to the country''s two major highways are vital for people in remote areas to reach clinics, schools and other government services. The major highways increase Bhutan''s trade with its economically vibrant neighbors and also benefit the entire South Asia region as they allow goods and services to flow through the country. Completing and improving the Southern East-West Highway, a route that could provide a quicker and safer passage across the country, is particularly important for improving national and international trade, and helping people in Bhutan become more prosperous. Improving Bhutan''s road system, and border trade facilities, is an effective way of improving the lives of the poorest people in the country while at the same time benefiting the overall economy and that of the region as a whole.
Impact Cross-border movement of goods between Bhutan and its neighboring countries improved.
Project Outcome
Description of Outcome Road connectivity and transport efficiency in the project areas in Bhutan improved
Progress Toward Outcome
Implementation Progress
Description of Project Outputs

1. Roads built and trade infrastructure established.

2. Road construction and maintenance capacity improved

3. Eco-friendly transport promoted

Status of Implementation Progress (Outputs, Activities, and Issues)

Consultants for (i) supervision & capacity development, and (ii) detailed design, procurement assistance and construction supervision have been selected.

Contract for civil works package for PAR01 has been awarded.

Procurement for Nganglam-Dewathang section component (2 packages) are still suspended due to security constraints in the area.

Geographical Location
Safeguard Categories
Environment A
Involuntary Resettlement A
Indigenous Peoples C
Summary of Environmental and Social Aspects
Environmental Aspects Environmental impacts will be assessed and mitigation measures recommended in compliance with ADB's Safeguard Policy Statement (2009) and government guidelines, regulations, and policies. Draft EIA for Nganglam-Deothang section of the national highway, IEE for other subprojects, and environmental management plan as applicable will be reviewed. These plans will be further reviewed during project processing.
Involuntary Resettlement Social impacts will be assessed and mitigation measures recommended in compliance with ADB's Safeguard Policy Statement (2009) and government guidelines, regulations and policies. Preliminary reviews of draft resettlement plans have been conducted. These plans will be further reviewed during the project processing.
Indigenous Peoples Social impacts will be assessed and mitigation measures recommended in compliance with ADB's Safeguard Policy Statement (2009) and government guidelines, regulations and policies.
Stakeholder Communication, Participation, and Consultation
During Project Design

DOR and PT will ensure that completed RPs and resettlement monitoring reports are made available to affected people and are submitted to ADB for posting on its Web site.

DOR and PT will ensure that EIA, IEEs and environmental monitoring reports are made available to affected people and are submitted to ADB for posting on its Web site.

During Project Implementation DOR and PT will provide ADB with (i) quarterly progress reports in a format consistent with ADB's project performance reporting system; (ii) consolidated annual reports including (a) progress achieved by output as measured through the indicator's performance targets, (b) key implementation issues and solutions; (c) updated procurement plan and (d) updated implementation plan for next 12 months; and (iii) a project completion report within 3 months of physical completion of the project components under DOR or PT respectively. To ensure the Project continue to be both viable and sustainable, project accounts and the executing agency AFSs, together with the associated auditor's report, should be adequately reviewed.
Business Opportunities
Consulting Services All consultants will be recruited according to ADB's Guidelines on the Use of Consultants (March 2013, as amended from time to time).
Procurement In order to accelerate the implementation, the government envisages the application of advance contracting for the project. All procurement of goods and works will be undertaken in accordance with ADB's Procurement Guidelines (March 2013, as amended from time to time).
Responsible ADB Officer Guenter Hoelscher
Responsible ADB Department South Asia Department
Responsible ADB Division Transport and Communications Division, SARD
Executing Agencies
Department of RoadsMinistry of Communications
Thimphu
Bhutan
Phuentsholing ThromdeDHIMAL.DC@GMAIL.COMPost Box. 02,Pelkhil Lam,District Chukha
,Phuentsholing, Bhutan
Timetable
Concept Clearance 21 Feb 2014
Fact Finding 24 Feb 2014 to 07 Mar 2014
MRM 23 Apr 2014
Approval 31 Jul 2014
Last Review Mission -
Last PDS Update 10 Jul 2015

Grant 0400-BHU

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
31 Jul 2014 05 Sep 2014 05 Sep 2014 31 Dec 2019 - -
Financing Plan Grant Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 37.61 Cumulative Contract Awards
ADB 18.96 31 Jul 2014 9.82 0.00 52%
Counterpart 18.65 Cumulative Disbursements
Cofinancing 0.00 31 Jul 2014 0.00 0.00 0%

Loan 3149-BHU

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
31 Jul 2014 05 Sep 2014 05 Sep 2014 31 Dec 2019 - -
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 31.39 Cumulative Contract Awards
ADB 31.39 31 Jul 2014 0.00 0.00 0%
Counterpart 0.00 Cumulative Disbursements
Cofinancing 0.00 31 Jul 2014 0.00 0.00 0%

Evaluation Documents

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