India: Kolkata Environmental Improvement Investment Program (Facility Concept)

Sovereign Project | 42266-013

Summary

Kolkata is the largest city in the state of West Bengal and the seventh largest in India. It has a population of 4.5 million and contributes at least 13% of West Bengal's gross domestic product. The city is and will remain the dominant commercial and financial hub in the state. Although its livability has improved, the quality of basic urban services remains below national standards. The gap is particularly noticeable in water supply and sewerage services in regard to coverage, continuity, and quality. This affects the city's ability to attract investment, facilitate trade, and create jobs, as well as its productivity, its competitiveness, and, most importantly, its quality of life and welfare. Investment and policy gaps hinder how effectively and efficiently institutions deliver services, and how well the policy framework creates an enabling environment for better service delivery and sustainability.

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Project Name Kolkata Environmental Improvement Investment Program (Facility Concept)
Project Number 42266-013
Country India
Project Status Approved
Project Type / Modality of Assistance Loan
Source of Funding / Amount
MFF Facility Concept 0075-IND: MFF- Kolkata Environmental Improvement Investment Program (Facility Concept)
Ordinary capital resources US$ 400.00 million
Strategic Agendas Environmentally sustainable growth
Inclusive economic growth
Drivers of Change Governance and capacity development
Private sector development
Sector / Subsector Water and other urban infrastructure and services - Water supply and sanitation
Gender Equity and Mainstreaming Effective gender mainstreaming
Description Kolkata is the largest city in the state of West Bengal and the seventh largest in India. It has a population of 4.5 million and contributes at least 13% of West Bengal's gross domestic product. The city is and will remain the dominant commercial and financial hub in the state. Although its livability has improved, the quality of basic urban services remains below national standards. The gap is particularly noticeable in water supply and sewerage services in regard to coverage, continuity, and quality. This affects the city's ability to attract investment, facilitate trade, and create jobs, as well as its productivity, its competitiveness, and, most importantly, its quality of life and welfare. Investment and policy gaps hinder how effectively and efficiently institutions deliver services, and how well the policy framework creates an enabling environment for better service delivery and sustainability. These limitations have been manageable, but Kolkata's expanding economy and deficient investment and maintenance over the years have made narrowing the gaps more urgent. The Kolkata Municipal Corporation (KMC), created to administer the city under the KMC Act in 1980, is responsible for delivering water and sewerage services. The Asian Development Bank (ADB) has been working with KMC since 2000, but only regarding sewerage. The partnership has yielded good results. KMC has a strategy, sector road map, policy framework, and investment plan to address gaps in operational efficiency, institutional effectiveness, policy, and sustainability. The investment program combines physical and other investments. KMC wants ADB to continue its role as a key financing and advisory partner.
Project Rationale and Linkage to Country/Regional Strategy Water supply and sewerage services in Kolkata have excelled the national average, particularly in terms of quality, continuity, and coverage. The city also has a good, low-cost sewage treatment system. However, service provision is not uniform across the city and is increasingly strained by economic expansion. As shown in Table 1, service is better in the city center than in the periphery. This is both a problem and an opportunity. The problem is that the number of vulnerable households has grown rapidly in the periphery as the population has declined in the center, which is subserviced. The opportunity arises from the KMC's ability to generate revenues from a still-large population with higher income in the center, with which to fund investment in the periphery. The city has worked hard to narrow service disparities. Efforts started with two loans provided in 2000 and 2006 for the Kolkata Environmental Improvement Project (KEIP), which financed the renovation of 564 kilometers (km) of the sewer drain network and the rehabilitation of three sewage treatment plants, raising the percentage of the population with direct sewer connection from 31% in 2001 to 43% in 2011. The service coverage for water supply is higher than for sewerage, but disparities between central and peripheral areas remain, particularly in service continuity. Unless addressed rapidly, these disparities will widen as population shifts from the center to the periphery.
Impact Improved access to water supply and sanitation in KMC
Project Outcome
Description of Outcome Improved water supply, sewerage, and drainage service quality and operational sustainability in selected areas of KMC
Progress Toward Outcome Tranche 1 implementation ongoing.
Implementation Progress
Description of Project Outputs

Inefficient water supply assets rehabilitated.

Sewerage extension to peripheral areas continued.

Financial and project management capacity further developed.

Status of Implementation Progress (Outputs, Activities, and Issues) Under Tranche 1, five civil works packages awarded, three of which started construction in 2014.
Geographical Location
Summary of Environmental and Social Aspects
Environmental Aspects B
Involuntary Resettlement B
Indigenous Peoples C
Stakeholder Communication, Participation, and Consultation
During Project Design Consultations have been held throughout the planning and design stage with Mayor, PMU, KMC officials, and state government departments like Pollution Control Board (PCB). Walk through informal discussions have been held with the local community along the proposed transmission stretch to assess the kind of impacts.
During Project Implementation The design and technique adopted by KMC has helped address and mitigate potential social issues associated with works. However, information disclosure is an integral part of safeguards planning during project implementation. Consultations and information disclosure will be carried out at different stages of the project cycle. Consultation measures envisaged for the project are: (i) KMC will inform through its officials and contractor about the construction schedule to minimize the temporary impacts; (ii) PMU will ensure that the affected people's if any will be identified and informed about the assistance to be provided for any temporary loss of livelihood; and (iii) attempts will be made to ensure that vulnerable groups, if any, will understand the process and that their specific needs will be taken in to consideration.
Business Opportunities
Consulting Services All consultants will be recruited accroding to ADB's Guidelines on the Use of Consultants (2013, as amended from time to time). The procurement plan indicates the threshold, mode of procurement, and consultant selection, review procedures, and contract packages.
Procurement All procurement of goods and works will be undertaken in accordance with ADB's Procurement Guidelines (2013, as amended from time to time). The concurred standard bididng documents for the national competitive bidding will be used throughout the Facility period.
Responsible ADB Officer Neeta Pokhrel
Responsible ADB Department South Asia Department
Responsible ADB Division Urban Development and Water Division, SARD
Executing Agencies
Kolkata Municipal Corporation5, S.N. Banerjee Road
Kolkata 700 013, India
Timetable
Concept Clearance 08 May 2013
Fact Finding 24 May 2012 to 31 May 2012
MRM 14 Aug 2012
Approval 26 Sep 2013
Last Review Mission -
Last PDS Update 18 Mar 2015

MFF Facility Concept 0075-IND

Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 570.00 Cumulative Contract Awards
ADB 400.00 - 0.00 0.00 %
Counterpart 170.00 Cumulative Disbursements
Cofinancing 0.00 - 0.00 0.00 %

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