India: MFF -National Capital Region Urban Infrastructure Financing Facility -Tranche 1

Sovereign Project | 41598-023

Summary

The facility will support NCRPB in (i) leveraging its resources through a line of credit and other market access support services, and (ii) implementation support that will focus on design, implementation, and delivery of quality growth-oriented and public health and environmental urban services, enhance capacity to partner with the private sector, and support other capacity enhancements.

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Project Name MFF -National Capital Region Urban Infrastructure Financing Facility -Tranche 1
Project Number 41598-023
Country India
Project Status Approved
Project Type / Modality of Assistance Loan
Source of Funding / Amount
Loan 2660-IND: MFF -National Capital Region Urban Infrastructure Financing Facility -Tranche 1
Ordinary capital resources US$ 60.00 million
Strategic Agendas Environmentally sustainable growth
Inclusive economic growth
Drivers of Change Governance and capacity development
Sector / Subsector

Transport - Multimodal logistics - Road transport (non-urban)

Water and other urban infrastructure and services - Urban water supply

Gender Equity and Mainstreaming Effective gender mainstreaming
Description The facility will support NCRPB in (i) leveraging its resources through a line of credit and other market access support services, and (ii) implementation support that will focus on design, implementation, and delivery of quality growth-oriented and public health and environmental urban services, enhance capacity to partner with the private sector, and support other capacity enhancements.
Project Rationale and Linkage to Country/Regional Strategy

NCRPB is a regional planner and financier of NCR, which is one of the fastest growing urban agglomerate regions in India. NCRPB's Regional Plan 2021 envisages massive scaling- up of urban infrastructure investments in NCR. However, due to domestic debt market limitations, the tenure that NCRPB is able to currently offer is a maximum of 10 years. Moreover, due to weak project development and project management capacities in a number of subborrowers of NCRPB, adequate number of projects are not generated, and there are systemic weaknesses in project execution. Before weak urban infrastructure becomes a binding constraint on rapid pace of economic growth in NCR, among others, NCRPB needs to enable scaling-up of urban infrastructure by implementing priorities of Regional Plan 2021. This is partly possible by NCRPB providing longer tenure low cost debt; implementation support for subborrowers (borrowers of NCRPB) in urban planning, project development, project implementation; identification of bankable projects and enabling private sector investments; and improving urban basic service provision, among others, through partnership with private sector. Adequate incentives need to be provided by NCRPB to motivate cities and state government entities to undertake public and environmental urban infrastructure projects that can mitigate greenhouse gas emission, and introduce private sector efficiencies. The proposed Facility is built around this rationale.

National Capital Region (NCR) and Counter Magnet Area. NCR is a 33,578 square kilometer area covering Delhi and sub-regions of the states of Haryana, Rajasthan and Uttar Pradesh. NCR consists of 9 districts of Haryana (Faridabad, Gurgaon, Rohtak, Rewari, Palwal, Jhajjar, Mewat, Sonipat and Panipat), 1 district of Rajasthan (Alwar district) and 5 districts of Uttar Pradesh (Meerut, Ghaziabad, Gautam Buddha Nagar, Bulandshahr and Baghpat). The population of NCR is 37 million (urbanization level of 54% as per 2001 census), which is expected to increase to 64 million by year 2021. In addition to NCR, NCRPB has identified and supports Gwalior (Madhya Pradesh State); Patiala (Punjab); Hissar (Haryana); Kota (Rajasthan); and Bareilly (Uttar Pradesh) as Counter Magnet Areas (CMA) where development strategies need to be implemented in order to ease the projected population pressure on National Capital Territory (NCT) of Delhi.

Rapid economic growth in NCR is likely to generate increased demand for drinking water, waste water management and solid waste management of the order of Rupees (Rs) 230,000 million ($5 billion approximately), which is excluding the demand for urban transport infrastructure in the region. While the NCT of Delhi is making rapid strides in urban infrastructure development, the remaining portions of NCR are still lagging behind in infrastructure resources, especially the sub-region administered by the Government of Uttar Pradesh. Environment and public health related infrastructure water supply, sewerage, solid waste has been relatively neglected in the past, and should be one of the key thrust areas. Analyses of the economies of States and cities in NCR suggest that self generated funds and technological know-how are insufficient to provide the desired rapid growth in urban infrastructure.

NCR's strength is that it continues to attract the largest share of foreign direct investments in India and there are efforts to enhance this potential by developing Delhi and Mumbai corridor inclusive of a high-speed rail connectivity. In this context, the supply of urban infrastructure needs planning and financing to ensure that regional impacts of growth are maximized to foster competitiveness and environmental sustainability. Since most of these infrastructure demands require coordination, a regional approach is needed to minimize geographic and functional fragmentation. This is one of the primary motivation of NCRPB s creation and is the basis of the proposed NCRPB business plan and the Facility.

National Capital Region Planning Board. NCRPB came into being by virtue of the NCRPB Act, 1985 passed by the Parliament and duly confirmed by the legislatures of Haryana, Rajasthan and Uttar Pradesh. As a financier, NCRPB s role is to facilitate financing of the investments in the region, and in pursuance of this, NCRPB has provided loans to 239 projects of Rs 64,610 million as of 30 October 2009. These loans have been advanced out of grants received from GOI, Delhi Government, internal accruals and market. Over the years there has been a shift in focus of NCRPB in terms of diversification of sectoral allocation of resources, more importantly towards environmental infrastructure and connectivity. The current policy of NCRPB is to diversify the State focus in its lending and the project development fund set up by NCRPB in 2009 is one of the measures to achieve this objective as well as improve the supply side and enhanced access to capital markets by NCRPB and subborrowers.

1. Road Map: Regional Plan 2021. NCRPB in 2005 notified the Regional Plan 2021 with focus on core sectors of transportation, power, water and sanitation and solid waste and an investment requirement of Rs 1,937,520 million. Regional Plan (2021) aims to facilitate growth and balanced development of NCR by providing for economic base in the identified major settlements (metro centers and regional centers) for absorbing economic development impulses of Delhi, efficient transport network, development of physical infrastructure, rational land use pattern, and improved environment and quality of life. Since the input studies in formulating the Regional Plan 2021, NCRPB, in 2009 has progressed substantially in developing a Transport Sector Plan (2009) and a Water Supply Plan and its Management (2009). The functional plans for water resources sector and urban transport define the long term needs, and the investment needs are placed at Rs 8 billion and Rs 1,750 billion respectively. The sector investment plans for sewerage and solid waste management including regional landfill sites are under preparation.

Being a statutory body created as a result of Act of the Parliament, NCRPB is not regulated by Reserve Bank of India guidelines for a non-banking financial company or by the Securities and Exchange Board India under the Company Act. It is primarily a fund which blends GOI grants (not accounted for as equity or contribution) with market borrowings and lends out to the state governments and local governments. While NCRPB has been previously financing investments, NCRPB is in the process of repositioning itself to achieve its scaled-up mandates.

The basic vision of NCRPB is in terms of being a financier of relevance and planner of significance. This entails: (i) planner of relevance for entities that operate at a regional level and financier of relevance in case of local bodies; (ii) move away from unlimited liability, administered credit pricing and low leverage; and (iii) fill an institutional vacuum pertaining to urban infrastructure planning and development to address the unique challenges and constrains in scaling-up urban infrastructure investments in NCR and CMAs. NCRPB needs to address institutional aspects to enable scaling-up of infrastructure financing and mitigate specific challenges pertaining to urban infrastructure development in NCR.

There is also a lag in conversion of functional plans prepared by NCRPB into projects and in part constrained by limited technical assistance resources within the subborrowers and NCRPB. To a certain degree the project development fund established by NCRPB would address this constraint. However, there is a need to enhance the skills and improve project design and management in the subborrowers as well in NCRPB to convert functional plans into implementable projects. It is difficult for public institutions like the local municipalities and other urban local bodies alone to meet this

Impact Urban residents use improved urban infrastructure services in the intervention cities of National Capital Region (NCR) and counter magnet areas (CMA) in accordance with Regional Plan 2021 priorities.
Project Outcome
Description of Outcome Improved transport system and connectivity in NCR, and access to safe drinking water in subproject cities.
Progress Toward Outcome To be reported in the project completion report of the Borrower
Implementation Progress
Description of Project Outputs

Road network improved in Jhajjar and Sonepat Districts

Traffic diverted from Badli city center

Multi-Modal Transit Centers (MMTC) developed in Anand Vihar and Sarai Kale Khan

Provision of safe drinking water and water supply coverage increased in Panipat City

Project Management and capacity building

Provision of safe drinking water and water supply coverage increased in Pataudi

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

As of 31 Dec 2014:

-construction of Jhajjar roads completed; Sonepat roads 96% completed

-construction of Badli bypass completed

-4 new road packages in various stages of construction (68% to 100% completed)

-Sonepat drainage 60% completed

-Pataudi and Nuh water supply packages in progress (23% and 10%, respectively)

-PMC recruited and mobilized in Nov 2012

-recruitment of 3 vacated PMU staff positions in process

-$18 million cancelled effective 29 Aug 2013

Geographical Location National capital region and counter magnet areas.
Safeguard Categories
Environment FI
Involuntary Resettlement FI
Indigenous Peoples FI
Summary of Environmental and Social Aspects
Environmental Aspects The Tranche's safeguard categories for environment, involuntary resettlement, and indigenous peoples are category FI. Due diligence and review show that there are no anticipated significant adverse environmental impacts. Limited negative impacts during construction can readily be mitigated. There are significant positive environmental and public health benefits from subprojects. A subproject selection criteria ensures that involuntary resettlement impacts will be avoided or minimized hence anticipated impacts are limited. There are no anticipated impacts on indigenous peoples. Environmental impacts during design and construction stages are readily addressed through mitigation measures. An Environmental and Social Management System (ESMS) is in place and an ESMS document has been prepared, which clarifies NCRPB's environmental and social policies; and safeguards screening, categorization, and review procedures. The ESMS document also sets out a plan to strengthen the environment and social organization structure and staffing; and performance monitoring and reporting procedures. The ESMS includes further development of institutional capacity within NCRPB to manage environmental and social issues. Disclosure of subproject safeguards documents are further described in the ESMS.
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design Wide range of consultations were held with the MOUD, NCRPB, the officials and elected representatives of member states of NCR (Delhi, Haryana, Rajasthan, Madhya Pradesh, and UP), private sector representatives, nongovernment organizations, and inhabitants of NCR including slum dwellers. A socio-economic survey was conducted with a sample size of 1500 households (318 households were from slums). Sample households have been drawn from the three towns of Gaziabad, Panipat and Hapur.
During Project Implementation Borrower and the sub-borrowers will conduct consultations with stakeholders during subproject development and implementation. The objectives of such consultations are to (i) engage stakeholders in priorities and program design (i.e., goals, objectives, activities, etc.), and (ii) provide stakeholders with opportunities to assess the subproject. Subproject consultations on program design and implementation involving stakeholders including government, NGOs, civil society organizations, and affected communities. These consultations occur on a formal and informal basis and may involve (i) pre-design consultations to ensure that the program reflects priorities, needs, experiences, and lessons learned of stakeholders; and (ii) consultations with target groups/beneficiaries as part of program design and implementation.
Business Opportunities
Consulting Services Project Management Consultants
Procurement

Panipat - Water Supply

Multi Modal Transit Centre - Sarai Kale Khan

Multi Modal Transit Centre - Anand Vihar

Development of State Highways (Jhajjar)

Development of Roads (Sonepat)

Badli Byepass - 5.70 Km

See updated procurement plan

Responsible ADB Officer Norio Saito
Responsible ADB Department South Asia Department
Responsible ADB Division Urban Development and Water Division, SARD
Executing Agencies
National Capital Region Planning BoardCore-IV B, First Floor,
India Habitat Centre
Lodhi Road, New Delhi-110003
Timetable
Concept Clearance 07 Jan 2010
Fact Finding -
MRM 06 Mar 2010
Approval 18 Aug 2010
Last Review Mission -
PDS Creation Date 28 Apr 2009
Last PDS Update 06 Mar 2015

Loan 2660-IND

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
18 Aug 2010 17 Mar 2011 29 Jun 2011 31 Dec 2014 - -
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 85.00 Cumulative Contract Awards
ADB 60.00 18 Aug 2010 0.36 0.00 100%
Counterpart 25.00 Cumulative Disbursements
Cofinancing 0.00 18 Aug 2010 0.36 0.00 100%
Status of Covenants
Category Sector Safeguards Social Financial Economic Others
Rating Partly satisfactory Partly satisfactory Satisfactory Satisfactory - Satisfactory

Safeguard Documents

See also: Safeguards
Title Document Type Document Date
National Capital Region Urban Infrastructure Financing Facility: Annual Environmental and Social Management System Implementation Report (2014) Environmental and Social Monitoring Reports Mar 2015
National Capital Region Urban Infrastructure Financing Facility - Tranche 1: Environmental Monitoring Report (July-December 2014) Environmental Monitoring Reports Feb 2015
National Capital Region Urban Infrastructure Financing Facility - Tranche 1: Social Monitoring Report (July-December 2014) Social Monitoring Reports Jan 2015
National Capital Region Urban Infrastructure Financing Facility (Project 1) - Bahadurgarh-Badli and Gurgaon-Badli Roads: Social Monitoring Report (December 2014) Social Monitoring Reports Dec 2014
National Capital Region Urban Infrastructure Financing Facility (Project 1) - Gurgaon-Badli Road: Social Monitoring Report (November 2014) Social Monitoring Reports Nov 2014
National Capital Region Urban Infrastructure Financing Facility (Project 1) - Bahadurgarh-Badli Road: Social Monitoring Report (November 2014) Social Monitoring Reports Nov 2014
National Capital Region Urban Infrastructure Financing Facility - Project 1: Resettlement Corrective Action Plan Safeguards Due Diligence Reports Nov 2014
National Capital Region Urban Infrastructure Financing Facility - Project 1: Rehabilitation of 9 Roads in Jhajjar District Resettlement Plan Resettlement Plans Oct 2014
National Capital Region Urban Infrastructure Financing Facility - Project 1: Social Monitoring Report (January-June 2014) Social Monitoring Reports Oct 2014
National Capital Region Urban Infrastructure Financing Facility - Project 1: Social Monitoring Report (July-December 2013) Social Monitoring Reports Aug 2014
National Capital Region Urban Infrastructure Financing Facility - Tranche 1: Environmental Monitoring Report (January-June 2014) Environmental Monitoring Reports Jul 2014
National Capital Region Urban Infrastructure Financing Facility - Project 1: Badli-Gurgaon Road Resettlement Plans Apr 2014
MFF-National Capital Region Urban Infrastructure Financing Facility - Tranche 1: Nuh Water Supply Subproject Initial Environmental Examination Apr 2014
National Capital Region Urban Infrastructure Financing Facility: Annual Environmental and Social Management System Implementation Report (2013) Environmental and Social Monitoring Reports Mar 2014
National Capital Region Urban Infrastructure Financing Facility - Project 1: Gohana-LakhanMajra-Meham-Bhiwani Road Resettlement Plans Feb 2014
National Capital Region Urban Infrastructure Financing Facility - Tranche 1: NUH Water Supply Resettlement Plans Jan 2014
National Capital Region Urban Infrastructure Financing Facility - Tranche 1: Environmental Monitoring Report (July-December 2013) Environmental Monitoring Reports Dec 2013
National Capital Region Urban Infrastructure Financing Facility - Project 1: Social Monitoring Report (January-June 2013) Social Monitoring Reports Dec 2013
National Capital Region Urban Infrastructure Financing Facility - Tranche 1: Environmental Monitoring Report (October 2012 - July 2013) Environmental Monitoring Reports Sep 2013
MFF - National Capital Region Urban Infrastructure Financing Facility -Tranche 1: Resettlement Plan for Bahadurgarh-Badli Road Resettlement Plans Sep 2013
MFF - National Capital Region Urban Infrastructure Financing Facility -Tranche 1: Sonepat Drainage Resettlement Plan Resettlement Plans Aug 2013
National Capital Region Urban Infrastructure Financing Facility - Project 1: Sonepat Drainage Initial Environmental Examination Aug 2013
MFF -National Capital Region Urban Infrastructure Financing Facility -Tranche 1: Bahadurgarh-Badli Road Initial Environmental Examination (Draft) Initial Environmental Examination May 2013
MFF - National Capital Region Urban Infrastructure Financing Facility -Tranche 1: Environmental & Social Management System Implementation Report 2012 Environmental and Social Monitoring Reports May 2013
MFF-National Capital Region Urban Infrastructure Financing Facility - Tranche 1: Gohana-Lakhan Majra-Meham-Bhiwani Road Subproject (Revised) Initial Environmental Examination May 2013
MFF-National Capital Region Urban Infrastructure Financing Facility - Tranche 1: Sonepat Gohana Road Subproject (Revised) Initial Environmental Examination May 2013
MFF-National Capital Region Urban Infrastructure Financing Facility - Tranche 1: Nuh Water Supply Subproject (Revised) Initial Environmental Examination Apr 2013
MFF - National Capital Region Urban Infrastructure Financing Facility -Tranche 1: Badli-Gurgaon Road Subproject Initial Environmental Examination Apr 2013
MFF-National Capital Region Urban Infrastructure Financing Facility - Tranche 1: Pataudi Water Supply Subproject (Revised) Initial Environmental Examination Apr 2013
MFF - National Capital Region Urban Infrastructure Financing Facility -Tranche 1: Resettlement Plan for Sonepat-Gohana Road Resettlement Plans Mar 2013
National Capital Region Urban Infrastructure Financing Facility - Tranche 1: Environmental Monitoring Report (April-September 2012) Environmental Monitoring Reports Sep 2012
National Capital Region Urban Infrastructure Financing Facility - Project 1: Construction of Badli Bypass Resettlement Plans Jul 2012
National Capital Region Urban Infrastructure Financing Facility - Project 1 - Rehabilitation of 9 Roads in Jhajjar District Environmental Assessment and Review Framework Feb 2012
National Capital Region Urban Infrastructure Financing Facility - Tranche 1 Environmental Monitoring Reports Feb 2012
National Capital Region Urban Infrastructure Financing Facility - Project 1 - Rehabilitation of 9 Roads in Jhajjar District Resettlement Planning Documents Jul 2011
National Capital Region Urban Infrastructure Financing Facility - Project 1: Resettlement Plan for Sonepat District Resettlement Plans Jul 2011
National Capital Region Urban Infrastructure Financing Facility - Project 1: Initial Environmental Examination for Badli Bypass Initial Environmental Examination Mar 2011
National Capital Region Urban Infrastructure Financing Facility - Project 1: Initial Environmental Examination for Sonepat District Initial Environmental Examination Mar 2011

Evaluation Documents

See also: Independent Evaluation

No documents found.


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