The components proposed for financing under the requested PFR include Road Connectivity and Capacity Building.
A. Road Connectivity component
This comprises construction of rural roads that are part of the PMGSY to provide connectivity to all habitations of population of 500 persons (250 or more in hilly or desert areas, or scheduled tribe areas) or more with all weather roads. Subprojects covering about 3,461 km in total (342 km in Assam, 1,008 km in Chhattisgarh, 1,187 km in Madhya Pradesh, 757 km in Odisha, and 167 km in West Bengal) are proposed to be taken up in the 1st PFR.
B. Capacity Building component
This component will include (i) support to the establishment of Rural Connectivity Training and Research Centers (RCTRCs); (ii) support to the establishing of Rural Road Network Management Units (RRNMUs) in each participating state; (iii) assistance to the MORD/NRRDA and state governments in implementation of the additional policy, and administrative requirements inherent to ADB-assisted projects; and (iv) additional support in operation, monitoring, evaluation and risk management.
One RCTRC and one pilot RRNMU will be established in each state under PFR 1. The support will include construction of modern field offices, including laboratories and providing all necessary state-of-the art equipment, system and tools. Support to RCTRCs will also include consulting services to assist staff in rolling out systematic and large scale training in participating states and support RCTRCs in research and compiling best practices and experiences in rural roads.
Assistance to the MORD/NRRDA and state governments to comply with administrative requirements inherent to ADB-assisted projects, and additional support in operation, monitoring, evaluation and risk management will be provided through the engagement of a Project Implementation Consultant (PIC) engaged and financed by the Government of India, and Technical Support Consultant (TSC) engaged by NRRDA and financed by ADB.
|Project Rationale and Linkage to Country/Regional Strategy
ADB's country partnership strategy (CPS) for India is closely aligned with the priorities of India's Eleventh Five Year Plan, 2007 2012. The CPS reconfirms continuing ADB assistance for development of rural roads, which are critical for rural development as they provide access to markets, health, education, and administrative services. Absence of all-weather road connectivity is a serious problem, making rural communities inaccessible for up to 90 days a year. Poor road infrastructure affects economic growth in rural areas, agricultural productivity, and employment, and has a strong link to poverty. The Government of India is addressing this problem through implementation of a nationwide rural road investment program the Prime Minister's Rural Roads Program (PMGSY) aimed at providing all-weather road connectivity to currently unconnected eligible habitations in India's rural areas. The investment program will support the government's objectives under the PMGSY.
The PMGSY identified the investment program states among the 10 states with large rural populations that lack adequate coverage in terms of all-weather road connectivity. The poverty head count rates in these states are among the highest in India. The PMGSY started in 2000 and has thus far constructed 108,637 km of rural roads in the investment program states, connecting 39,721 habitations to a greater transportation network. Construction of an additional 32,158 km of roads is ongoing. According to the June 2011 program update, 85,690 km of roads to connect all remaining eligible habitations in the investment program states are yet to be constructed under the PMGSY.
The latest estimate for the remaining PMGSY financing requirement to achieve its goal by 2016 in the investment program states is about $7.95 billion, while available PMGSY funding for the same period is estimated to be around $5.04 billion. While exploring the possibilities for domestic borrowing to close the financial gap, the government has approached ADB to provide funding of $0.8 billion under the investment program to assist with the implementation of the PMGSY in the investment program states. The investment program is consistent with the strategic objective set out in the CPS, 2009 2012 and is included in ADB's country operations business plan, 2011 2013.
Apart from the need to provide all-weather road connectivity in India's rural areas, the investment program states need support in improving business procedures covering the whole life cycle of rural roads, and strengthening related capacities. Specifically, while the emphasis is shifting from construction to the operation and maintenance of the rural road network, the related capacities for rural road network management are lagging. There is also a mismatch between the extent of the rural road network (around 80% of the total road network) and supply of skills, as the training of civil engineers, technicians, and site supervisors is oriented towards high-category roads.