Bangladesh: South Asia Subregional Economic Cooperation Road Connectivity Project

Sovereign Project | 40540-014

Summary

The proposed project will (i) upgrade about 110 kilometers (km) of Dhaka-Northwest corridor by 4-laning of the Joydebpur-Chandra-Tangail-Hatikamrul Road and (ii) improve 2 land ports at Benapole and Burimari. This trunk road section forms part of a major international road corridor. The project will also strengthen the capacity of the road sector. By increasing road capacity of a major international trade corridor and enhancing land port capacity, the project will not only boost the national economy but also facilitate subregional cooperation and increase trades.

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Consulting Notices

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Procurement Notices

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Procurement Documents


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Project Name South Asia Subregional Economic Cooperation Road Connectivity Project
Project Number 40540-014
Country Bangladesh
Project Status Approved
Project Type / Modality of Assistance Loan
Technical Assistance
Source of Funding / Amount
Loan 2949-BAN: South Asia Subregional Economic Cooperation Road Connectivity Project
Asian Development Fund US$ 198.00 million
Loan 8263-BAN: South Asia Subregional Economic Cooperation Road Connectivity Project
OPEC Fund for International Development US$ 30.00 million
Loan: South Asia Subregional Economic Cooperation Road Connectivity Project
Abu Dhabi Fund US$ 30.00 million
TA 8221-BAN: Institutional Strengthening of the Roads and Highways Department
Japan Fund for Poverty Reduction US$ 1.50 million
Strategic Agendas Environmentally sustainable growth
Inclusive economic growth
Regional integration
Drivers of Change Governance and capacity development
Partnerships
Sector / Subsector Transport - Road transport (non-urban)
Gender Equity and Mainstreaming Some gender elements
Description The proposed project will (i) upgrade about 110 kilometers (km) of Dhaka-Northwest corridor by 4-laning of the Joydebpur-Chandra-Tangail-Hatikamrul Road and (ii) improve 2 land ports at Benapole and Burimari. This trunk road section forms part of a major international road corridor. The project will also strengthen the capacity of the road sector. By increasing road capacity of a major international trade corridor and enhancing land port capacity, the project will not only boost the national economy but also facilitate subregional cooperation and increase trades.
Project Rationale and Linkage to Country/Regional Strategy

The SAARC Thimphu Summit in 2010 recognized the importance of developing transport infrastructure and transit facilities, especially for the landlocked countries to promote intra-SAARC trade. Agreements between Bangladesh and India in 2010 for regional connectivity is a critical stepping stone for opening connectivity, not only between Bangladesh and India, but also with Bhutan and Nepal, diversifying regional and international transport routes. This will enhance markets and opportunities of regional development in South Asia, leading to balanced regional growth and poverty reduction.

Bangladesh has the potential to become a transport and transshipment center for the subregion. It borders India and Myanmar and is close to the landlocked countries of Bhutan and Nepal, and Kunming, the key transportation hub in Southwest China. With the opening of the Bhangabandhu Bridge over River Jamuna (the Jamuna Multipurpose Bridge) and the provision of access to ports, e.g., Chittagong and Mongla, for these countries, the Northwest-Dhaka-Chittagong transport corridor and other strategic transport corridors can facilitate trade between Bangladesh and the northeastern states of India, the Indian state of West Bengal, Bhutan, and Nepal and thereby attract more foreign and domestic investment to the country. Bangladesh has major international and subregional trade corridors as identified in SAARC Regional Multimodal Transport Study and the Asian Highways network.

A study on transit traffic through Bangladesh estimates that the improvement of Bangladeshi sections of priority regional transport corridors could facilitate the movement of about 18 million tons of freight in Bhutan, India, and Nepal. A World Bank study shows that the impact of raising South Asia's trade facilitation performance toward international levels would result in large gains for both intra and inter-regional trade, e.g., intra-regional trade within South Asia would increase by almost 60% and trade with the rest of the world would increase by over 30%.

Throughout South Asia, trucks carry a substantial majority of inland freight. The road sector is central to the competitiveness of supply chains. An expansion in rail freight is both desirable and possible, but the absolute importance of road transport is unlikely to diminish, especially as the markets for higher value and higher volume goods increase with per capita incomes. Therefore, among these international trade corridors, the highest priority is SAARC Highway Corridors (SHC) 4 and 8, which provide Bhutan and Nepal with the access to Bangladesh ports (Chittagong and Mongla), including land ports. For trades between Bangladesh and India, the Benapole land port (BLP) is the priority to be improved as it is the busiest crossing, providing transshipment services for around 80% of the annual trades between the two countries, e.g., 450 trucks a day carrying in total an estimated 1.4 billion tones valued at $4 billion passed BLP in 2010/11.

The road network in Bangladesh is very poor in terms of capacity and conditions, and the demand for road transport is rapidly increasing. Insufficient funding and inefficient implementation of road maintenance have increased the number of roads that are beyond maintainable condition, and the backlog of deferred maintenance. A mix of motorized and non-motorized traffic, and encroachment onto roads, results in higher accident rates. The large number of rivers that are still crossed by ferries hampers smooth movement of traffic. To address these constraints, the Government of Bangladesh (GOB) developed and has been implementing the Road Master Plan (2007/2026). The road sector development strategy under Bangladesh's 6th Five-Year Plan (FY2011-2015) highlights (i) prioritized undertaking of development projects, (ii) cost recovery from users, (iii) streamlining procedures of pre-construction activities, (iv) private sector financing, and (v) road sector institutional strengthening, as provided in the Road Master Plan. One of the major tasks is the improvement of the regional road connectivity to boost trade and commerce, pursuing the policy of corridor based road development with a view to accommodate regional as well as international traffic in the country. GOB plans to upgrade the Asian Highway Network in Bangladesh into 4 lanes, with special emphasis on 3 arterial corridors: Dhaka-Chittagong, Dhaka-Northwest, and Khulna-Northwest. The road sector strategy in the 6th Five-Year Plan includes institutional changes, and capacity development in maintaining existing road network, addressing road safety issues, improving land port connectivity, and controlling overload.

RHD developed and manages major highways and urban areas. ADB-financed Road Network Improvement and Maintenance Project II provided a list of reform agenda for the road sector in Bangladesh, together with DFID and the World Bank, mainly covering (i) a long-term and integrated transport policy, (ii) modernization of the road sector institution, (iii) road maintenance financing, and (iv) private sector participation. The overall progress has been slow, but GOB took initiatives to address weaknesses. The road master plan has been approved and the national land transport policy is prepared. MOC and RHD have been restructured. RHD has computerized its financial management and asset management systems, supported by DFID. The central management system (CMS) is now spread for the RHD-wide use at the district level. The procurement capacity is being strengthened under the World Bank's Public Procurement Reform II, utilizing CMS and introducing e-procurement. Pending liability for major unpaid contracts has been eliminated except delayed release of the approved budget. The maintenance financing has substantially increased, and the latest approved budget for 2012/13 demonstrated the GOB's policy emphasis on the maintenance, e.g., increase by 20% for the revenue budget from 2011/12 while reduction for the development budget. PPP cell has been established in RHD and Pilot PPP road projects have been identified. The project will continue these reform agenda, as agreed in the Institutional Development Action Plan (Supplementary Appendix A).

The Land Port Authority (LPA) currently administers 16 land ports. As development and operations are mainly outsourced to private sector, LPA is a lean organization and financially self-sustained for the current level of operational efficiency and volumes. However, taking into account expected increase to trades among SASEC countries through land ports based on recent dialogue, it is urgently required to improve facilities for operational efficiency.

The project road is the common section of SHC 4 and 8, and also the Asian Highway No. 2, carrying the traffic, i.e., about 15,000 vehicles per day, excluding 2 and 3 wheelers, which is second busiest to the Dhaka-Chittagong road. However, this road section experiences substantial bottlenecks due to limited capacity, pavement deterioration and mixed traffic of slow moving vehicles, which also results in many traffic accidents at several accident-prone areas so-called safety blackspots. The Burmari land port is one of the northwestern end points of the Dhaka-Northwest corridor, providing a gateway to Bhutan through India via SHC 8. The Benapole land port is the busiest land port at the west end point of the Asian Highway No.1 and SHC No.1 in Bangladesh. Both Burimari and Benapole landports are complemented by the India's ongoing Integrated Customs Posts Program at Changrabandha and Petrapole, respectively on the Indian side. The proposed scope has been endorsed by the SASEC Trade Facilitation and Transport Working Group meeting held in Kolkata on 5 March 2012 (see Map).

Impact Increased domestic and regional trade through Bangladesh
Project Outcome
Description of Outcome Improved road connectivity and efficiency of the Dhaka-Northwest international trade corridor
Progress Toward Outcome Overall progress of the whole project is satisfactory.
Implementation Progress
Description of Project Outputs

1. Increased capacity of key section of an international trade corridor: Jodeypur-Chandra-Tangail-Elenga section

2. Improved operational efficiency of land ports (Benapole and Burimari)

3. Enhanced institutional capacity of RHD in developing and maintaining roads and bridges

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

Project Implementation Consultant has been mobilized on 16 March'14. Selection of Consultant for BLPA's operational efficiency improvement is under process.

Procurement of civil works packages are ongoing.

Road works packages procurement from Vogra Bazar intersection to Elenga intersection are ongoing.

Geographical Location
Safeguard Categories
Environment B
Involuntary Resettlement A
Indigenous Peoples C
Summary of Environmental and Social Aspects
Environmental Aspects

Environment-related activities include enhancement of hygienic conditions in the land ports, construction of an environmentally-friendly office building for RHD and expansion of the Joydeypur-Chandra-Tangail-Elenga Road. All three components fall under environment category B . Environmental impacts in the land ports and RHD office building are largely positive and include establishment of structures and mechanisms for managing waste, drainage and occupational health and safety. Negative impacts related to construction waste; air, noise and water pollution; occupational health and safety; tree removal; and erosion are expected for all project components. However, these are mainly confined to the construction period and mitigation measures have been proposed in the Environmental Management Plan (EMP) which will be included in the agreement with the contractor. Initial Environmental Examination (IEE) reports have been prepared for each component and are disclosed on the ADB website as required by ADB's Safeguard Policy Statement, 2009 (SPS). Local communities were consulted while preparing the IEE reports. Details of consultations, feedback received and grievance redress mechanism are included in the IEE reports.

While RHD has a Social and Environmental Unit to address safeguard concerns, the LPA does not have such a unit. Safeguards focal persons will be appointed in LPA headquarters and at sites. They will be supported by the PIC's environmental specialist. Safeguard training workshops will be conducted during pre-construction and construction, as necessary. Capacity development for LPA will also be provided under the loan. Annual environmental monitoring reports will be submitted by the respective executing agencies to ADB.

Involuntary Resettlement Two resettlement plans (RPs) have been prepared based on ADB s SPS and the Acquisition and Requisition of Immovable Property Ordinance II of Bangladesh (1982). Affected communities were extensively consulted to understand their views. There will be significant impact with approximately 18.9 hectares of land acquired with commercial tenants experiencing the majority of impact. 2,394 households comprising 9,885 persons will be affected. The RP will be updated based on detailed design and will be implemented by an experienced NGO with the PIC providing external monitoring. For the RHD institutional development component, 11 non-titleholder households consisting of 38 persons will be impacted. RHD has over 18 years of experience in managing social safeguard risks, including in projects funded by multilateral donors. The land port component does not require land acquisition and resettlement. The project will comply with ADB s information disclosure requirements.
Indigenous Peoples The project is not expected to have impacts on Indigenous Peoples.
Stakeholder Communication, Participation, and Consultation
During Project Design

Workshops, community mobilization, and consultation conducted for discussion on the potential needs of the community, social related issues such as gender, HIV/AIDs, human trafficking, child labor, environment and social safeguard issues.

Community meetings and focus group discussions are organized as part of the poverty and social analysis. The local consultative meetings involve all relevant stakeholders including representatives of the poor and other socially excluded groups (e.g., women, scheduled tribes, etc.) to disseminate the information as well as to get the feedback about the project design and its potential impacts. Other key stakeholders such as the relevant line departments, local government representatives and NGOs are also be consulted. Consultations were undertaken with the affected households and communities during the course of the census survey and socioeconomic survey along the project roads for the preparation of the safeguard plans. In the Resettlement Plans, a C&P plan is included for project implementation phase.

During Project Implementation
Business Opportunities
Consulting Services

An estimated 2,710 person-months (249 international, 2,461 national) of consulting services are required to (i) facilitate project management and implementation for LPA and RHD, and (ii) enhance operational efficiency of LPA. Consulting firms will be engaged using the quality- and cost-based selection (QCBS) method with a quality:cost ratio of 90:10. A higher quality ratio is adopted because the task involves a certain level of innovativeness to coordinate with LPA and RHD, and to mobilize and manage several teams at the same time. To engage quality consultants in a timely manner, ADB and the government have agreed that ADB carry out consultant selection on behalf of the government. The government will retain its authority for contract negotiation and contract signing.

The proposed TA will undertake 3 major components: (i) maintenance scheme for roads and bridges, (ii) overloading control scheme, and (iii) RHD modernization, covering institutional changes and streamlining business processes. As part of the capacity development for procurement processes, the TA will also provide for a procurement review to be undertaken for the proposed project. It is proposed that ADB will finance $1,500,000 equivalent, on a grant basis from a trust fund.

Procurement Procurement activities will be the responsibility of the Project Directors, who will be supported by the consultants under TA loan 2688 and the PIC. ADB engaged an international consultant during procurement processes for probity. ADB will closely monitor all procurement and implementation activities. Contracts for civil works and goods will comprise about 7 international competitive bidding (ICB) packages. Contract packages for equipment under RHD institutional development will be based on required technical features and timing of procurement. Packages will be identified during implementation by consultants engaged under technical assistance.
Responsible ADB Officer Mohammad Nazrul Islam
Responsible ADB Department South Asia Department
Responsible ADB Division Bangladesh Resident Mission
Executing Agencies
Roads and Highways DepartmentBlock A, Room 122, Sarak Bhaban
Ramna, Dhaka
Bangladesh
Bangladesh_Land Port AuthorityYHCHOWDHURY@YAHOO.COMBangladesh Sthala Bandar Kartripaksha
TCB Building, 1 Karwan Bazar
Timetable
Concept Clearance 02 Jul 2012
Fact Finding 01 Jul 2012 to 16 Jul 2012
MRM 15 Aug 2012
Approval 22 Nov 2012
Last Review Mission -
Last PDS Update 30 Mar 2015

Loan

Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 116.70 Cumulative Contract Awards
ADB 0.00 - 0.00 0.00 %
Counterpart 86.70 Cumulative Disbursements
Cofinancing 30.00 - 0.00 0.00 %

Loan 2949-BAN

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
22 Nov 2012 05 Jun 2013 28 Feb 2014 30 Jun 2018 - -
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 314.70 Cumulative Contract Awards
ADB 198.00 22 Nov 2012 177.83 0.00 99%
Counterpart 86.70 Cumulative Disbursements
Cofinancing 30.00 22 Nov 2012 3.18 0.00 2%

Loan 8263-BAN

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
12 Sep 2012 13 Aug 2013 19 Mar 2014 30 Sep 2017 - -
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 30.00 Cumulative Contract Awards
ADB 0.00 12 Sep 2012 0.00 0.00 0%
Counterpart 0.00 Cumulative Disbursements
Cofinancing 30.00 12 Sep 2012 0.00 0.00 0%

TA 8221-BAN

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
22 Nov 2012 14 Nov 2013 14 Nov 2013 31 Oct 2014 31 Oct 2015 -
Financing Plan/TA Utilization Cumulative Disbursements
ADB Cofinancing Counterpart Total Date Amount
Gov Beneficiaries Project Sponsor Others
0.00 1,500,000.00 0.00 0.00 0.00 0.00 1,500,000.00 22 Nov 2012 860,712.78

Evaluation Documents

See also: Independent Evaluation

No documents found.


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