India: Rural Roads Sector II Investment Program (Project 3)
The Government of India requested the Asian Development Bank for a multitranche financing facility (MFF) of $750 million over a 5-year availability period. This financing aims to contribute to the upgrading or construction of about 14,000 kilometers (km) of rural roads in the states of Assam, Orissa, and West Bengal; and to provide capacity building for road management as part of the Pradhan Mantri Gram Sadhak Yojana (Prime Minister’s Rural Roads Program). The expected total cost of the projects was $2.1 billion with the government providing the cofinancing. The MFF, under each subsequent tranche or subproject, was to cover about one-third of the annual financing required for the planned investment program. The MFF was considered an appropriate instrument for long-term cofinancing of a government program involving multiple state agencies since it allowed for predictable financing sources and a more flexible financing arrangement for a well-defined government program with standard operating procedures that are based on an annual program implementation cycle. The third tranche of the MFF was to finance the construction and upgrading of 950 km of rural roads in Assam and 720 km of rural roads in West Bengal. A project completion report for this third tranche was prepared in July 2016 and is the subject of this validation. IED overall assessment: Successful.