The Madhya Pradesh Power Sector Investment Program in India was a multitranche financing facility (MFF) designed to support Madhya Pradesh state’s sustainable economic growth and social development by investing in the statewide power transmission and distribution networks. The MFF supported the state government in expanding its power transmission, distribution, and management infrastructure and capacity.
Overall, the evaluation assessed the facility successful, as it found the facility to be relevant, effective, and highly efficient, despite being less than likely sustainable due to more recent weak financial performance of the distribution companies and lack of a long-term strategy to mitigate the situation. The preliminary development impacts and the performance of both the Asian Development Bank (ADB) and the borrower were all deemed to be satisfactory.
The evaluation has two issues for ADB to consider: (i) a need for provision of technical assistance before MFF closure to ensure the sustainability of outcomes through risk mitigation, capacity building, and fostering behavioral changes; and (ii) a need to allocate sufficient monitoring support during long-term sector engagements to obtain consistent and accurate valuation of benefits. For follow-up, ADB should consider committing adequate resources for the economic and financial analysis during the preparation of the project completion reports for the two ongoing projects in the region and sector to better justify increased assistance for power distribution companies in developing member countries.