Bhutan: Secondary Towns Urban Development Project

Sovereign Project | 42229-016

The Secondary Towns Urban Development Project will improve water supply in three secondary towns of Samdrup Jongkhar, Sarpang, and Trashigang; improve sewerage in Samdrup Jongkhar; and develop drainage and road infrastructure in Sarpang''s new satellite town. The project will support the strengthening of institutional capacity for the management and operation and maintenance (O&M) of municipal infrastructure assets and develop water tariff guidelines.

Project Details

  • Project Officer
    Norbu, Tshewang
    South Asia Department
    Request for information
  • Country/Economy
    Bhutan
  • Modality
    • Loan
  • Sector
    • Water and other urban infrastructure and services
Project Name Secondary Towns Urban Development Project
Project Number 42229-016
Country / Economy Bhutan
Project Status Active
Project Type / Modality of Assistance Loan
Source of Funding / Amount
Loan 3674-BHU: Secondary Towns Urban Development Project
Concessional ordinary capital resources lending US$ 10.00 million
Strategic Agendas Environmentally sustainable growth
Inclusive economic growth
Drivers of Change Gender Equity and Mainstreaming
Governance and capacity development
Sector / Subsector

Water and other urban infrastructure and services / Other urban services - Urban flood protection - Urban policy, institutional and capacity development - Urban sewerage - Urban water supply

Gender Equity and Mainstreaming Effective gender mainstreaming
Description The Secondary Towns Urban Development Project will improve water supply in three secondary towns of Samdrup Jongkhar, Sarpang, and Trashigang; improve sewerage in Samdrup Jongkhar; and develop drainage and road infrastructure in Sarpang''s new satellite town. The project will support the strengthening of institutional capacity for the management and operation and maintenance (O&M) of municipal infrastructure assets and develop water tariff guidelines.
Project Rationale and Linkage to Country/Regional Strategy

The growth of Bhutan''s secondary towns is constrained by deficiencies in infrastructure and basic urban services resulting from inadequate urban planning, weak urban institutions and municipal finances, limited budgetary support, and limited local capabilities for urban infrastructure development. Water supply service in majority of secondary towns is intermittent for 2-12 hours daily. Without a continuous water supply, it is difficult to assess nonrevenue water, but estimates suggest the ranges to be 30%70%. Water tariffs cover only about 20% of the O&M costs of water supply. Less than half of the secondary towns have a piped sewerage system. The government is concerned about this unbalanced urbanization.

To enable balanced and equitable growth, the government''s strategy for urban development aims to foster secondary towns into regional growth centers by developing trade, transport, logistics, and manufacturing. Medium-scale industries are being established along the regional centers in southern Bhutan that border India, including Samdrup Jongkhar and Sarpang, both of which are secondary towns identified as growth centers. The secondary towns need substantial urban infrastructure improvements to realize the government''s vision. The project is designed to complement the government''s efforts to develop secondary towns to ensure Bhutan''s balanced urbanization.

The project will support infrastructure development and institutional strengthening in three important secondary towns: Samdrup Jongkhar and Sarpang in the southern border region of Bhutan, which are planned as growth centers with high economic potential; and Trashigang, the largest urban center in eastern Bhutan, which has gained importance with the opening in 2017 of the Yonphula airport, which was supported by ADB. These towns were selected for their strategic economic importance.

The project is aligned with the government''s Eleventh Five-Year Plan, 2013-2018, which focuses on balanced and sustainable urban development of human settlements. It is in line with ADB''s country partnership strategy, 2014-2018 for Bhutan, which identifies inclusive economic growth as a key strategic pillar, and is included in ADB''s country operations business plan for Bhutan, 2018-2020. It will contribute to Sustainable Development Goals 6 (ensuring availability and sustainable management of water and sanitation for all) and 11 (making cities and human settlements inclusive, safe, resilient, and sustainable).

Impact

Balanced and sustainable development of human settlements in Samdrup Jongkhar, Sarpang, and Trashigang ensured

Project Outcome
Description of Outcome

Quality, efficiency, and sustainability of urban services improved

Progress Toward Outcome Project is ongoing; Outcome indicators will be assessed during Project Completion Review Mission.
Implementation Progress
Description of Project Outputs

Urban infrastructure expanded and/or upgraded

Capacity of institutions and local communities strengthened

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

In Ranjung: (i) Eight BTP of 10 cum each have been completed; (ii) 6.5 km transmission line completed; (iii) one 230 cum CWR completed; (iv) intake works and grid chamber completed and (v) 113 water meters installed. In Trashigang: (i) 16.7 km water distribution network completed; (ii) One 230 cum CWR completed; (iii) Two BPT 10 cum and 5 cum completed; and (v) 367 water meters installed. In Dewathang: (i) sites for water intake and water treatment plant finalized. Tender for works under preparation. In Samdrup Jongkhar: (i) 3 km trunkline from WTP to CWR completed; (ii) 19.89 km water distribution network completed; (iii) 2.5 km sewerage collection pipeline under construction. In Shechamthang LAP: (i) 6.5 km new road and 4.3 km drain completed; (ii) 12.13 km water transmission line completed; and (iii) 13 km water distribution line completed.

GAP implementation and monitoring underway. The NGO is implementing this activity through community outreach and workshops. The institutional expert has been mobilized from October 2022. The urban infrastructure trainer recruitment under process.

Geographical Location Samdrup Jongkhar, Sarpang, Trashigang Dzongkhag
Safeguard Categories
Environment B
Involuntary Resettlement B
Indigenous Peoples C
Summary of Environmental and Social Aspects
Environmental Aspects The project is categorized 'B' as per ADB's Safeguards Policy Statement (SPS) 2009 as there are no environmentally sensitive features in the project. Initial environmental examination (IEE) report, including environmental management plan (EMP) for the project has been prepared following ADB's Safeguard Policy Statement (2009), government guidelines, regulations, and policies. The project involves the construction of water treatment plants, water transmission and distribution networks, sewerage network, urban roads, and drainage. The project components do not pass through environmentally sensitive areas, and no significant and irreversible environmental impacts are expected. Anticipated environmental impacts during implementation include construction-related issues such as generation of dust, noise, waste from construction and worker camps, traffic congestion, erosion, siltation, and occupational health and safety issues. Key operational impacts include health hazards due to poor water quality, increased generation of sewage and sullage due to enhanced water supply, and the need to dispose of waste from filter beds in treatment plants. To address these impacts, the project design includes adequate water monitoring guidelines (including the development of water safety plans) and methods for safe disposal of waste streams. Meaningful consultations have been conducted throughout the project preparation stage and all concerns of the affected persons and stakeholders have been incorporated in the initial environmental examination and the EMP. An integrated social and environmental grievance redress mechanism has been formed to continue receiving feedback and complaints, if any, from affected parties, and to address them during the construction and operation stages. Implementation arrangements ensure that the PMU and PIUs have adequate capacity to manage environmental impacts through consultant support and capacity building. Environmental monitoring is being carried out regularly. The semi-annual environmental monitoring report for January-June 2022 reporting period has been prepared, submitted and disclosed.
Involuntary Resettlement The project is classified category B for involuntary resettlement. Involuntary resettlement impacts of the project have been adequately assessed, and the proposed mitigation measures are adequate. The resettlement impacts include tree loss for agricultural landholders for the laying of about 2 km of water transmission pipelines in Sarpang (41 trees and 300 cardamom shoots owned by 12 households). Land for development of basic services in the Sarpang satellite town was acquired through land pooling initiated in 2011, wherein 93 landowners have donated their land in exchange for development of common urban infrastructure. Land pooling was not undertaken in anticipation of ADB financing. The due diligence process (including third-party independent assessors report) confirms that there was no asymmetry in information availability, land inclusive of non-land assets was voluntarily pooled, no coercion was involved, and that the process was undertaken in a fair and transparent manner. Alternative land for the construction of water treatment plant in Dewathang is being identified. Compensation for non-land assets is being paid in line with government policy. EA is providing update in the quarterly progress reports and submitting semi-annual reports. For all works packages, resettlement plans (RPs) or Due diligence reports as appropriate are prepared as part of the bidding document. The safeguard documents are disclosed on the ADB website, and relevant information shared with the affected persons.
Indigenous Peoples The project is categorized "C" for Indigenous People safeguards as per ADB's Safeguards Policy Statement (SPS) 2009 as there are no indigenous peoples living in the project areas. No impacts anticipated.
Stakeholder Communication, Participation, and Consultation
During Project Design Project preparation included meaningful and widespread consultation, and the concerns of affected persons and stakeholders have been incorporated into the project design. The executing agency is familiar with ADB safeguard policies, having previously implemented two ADB-funded projects and currently implementing another ADB urban project in Thimphu, Phuentsholing, and Samdrup Jongkhar. It has adequate institutional capacity and commitment and is ensuring continued consultations through the project implementation units to manage social and environmental risks.
During Project Implementation Consultation with all communities in the project area is continuing during implementation, and a grievance redress mechanism is established.
Business Opportunities
Consulting Services The PMU will procure all works and consultancy packages, including the engagement of a project management and supervision consultant, using the quality- and cost-based selection method in accordance with ADB''s Procurement Guidelines (2015, as amended from time to time) and ADB''s Guidelines on the Use of Consultants (2013, as amended from time to time).
Procurement The procurement classification is B. Procurement will be undertaken at the executing agency level. The procurement risk assessment concluded that the overall procurement risk for the project is moderate, highlighting the need for procurement training and additional assistance through consultants. To address these issues, the project management and supervision consultants will provide support to the PMU, and conduct regular procurement training sessions to improve procurement capacity.
Responsible ADB Officer Norbu, Tshewang
Responsible ADB Department South Asia Department
Responsible ADB Division BHRM
Executing Agencies
Department of Engineering Services (DES)
Department of Macroeconomic Affairs, Ministry of Finance
Timetable
Concept Clearance 12 Dec 2013
Fact Finding 09 Nov 2017 to 17 Nov 2017
MRM 26 Mar 2018
Approval 18 Jun 2018
Last Review Mission -
Last PDS Update 07 Dec 2022

Loan 3674-BHU

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
18 Jun 2018 03 Jul 2018 30 Jul 2018 31 Jan 2024 - -
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 12.00 Cumulative Contract Awards
ADB 10.00 26 Jan 2023 7.21 0.00 76%
Counterpart 2.00 Cumulative Disbursements
Cofinancing 0.00 26 Jan 2023 8.19 0.00 86%

Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.

The Access to Information Policy (AIP) recognizes that transparency and accountability are essential to development effectiveness. It establishes the disclosure requirements for documents and information ADB produces or requires to be produced.

The Accountability Mechanism provides a forum where people adversely affected by ADB-assisted projects can voice and seek solutions to their problems and report alleged noncompliance of ADB's operational policies and procedures.

In preparing any country program or strategy, financing any project, or by making any designation of, or reference to, a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.

Title Document Type Document Date
Secondary Towns Urban Development Project: Audited Project Financial Statements (July 2021-June 2022) Audited Project Financial Statements Dec 2022
Secondary Towns Urban Development Project: Procurement Plan Procurement Plans Jan 2022
Secondary Towns Urban Development Project: Audited Project Financial Statements (July 2019-June 2020) Audited Project Financial Statements Dec 2021
Secondary Towns Urban Development Project: Audited Project Financial Statements (July 2019-June 2020) Audited Project Financial Statements Jun 2021
Secondary Towns Urban Development Project: Audited Project Financial Statements (July 2018-June 2019) Audited Project Financial Statements Jan 2020
Loan Agreement (Ordinary Operations [Concessional]) for Loan 3674-BHU: Secondary Towns Urban Development Project Loan Agreement (Ordinary Resources) Jul 2018
Secondary Towns Urban Development Project: Report and Recommendation of the President Reports and Recommendations of the President May 2018
Secondary Towns Urban Development Project: Project Administration Manual Project/Program Administration Manual May 2018
Secondary Towns Urban Development Project: Gender Action Plan Gender Action Plans May 2018
Secondary Towns Urban Development Project (Formerly Improved Urban Environmental Infrastructure Project): Project Data Sheet (Dzongkha Translation) Translated PDS Dec 2016
Secondary Towns Urban Development Project: Poverty and Social Assessment Consultant’s Report Consultants' Reports Aug 2015

Safeguard Documents See also: Safeguards
Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.

Title Document Type Document Date
Secondary Towns Urban Development Project: Social Monitoring Report (January-June 2022) Social Monitoring Reports Oct 2022
Secondary Towns Urban Development Project: Environmental Monitoring Report (January-June 2022) Environmental Monitoring Reports Oct 2022
Secondary Towns Urban Development Project: Dewathang Water Supply Augmentation Subproject Final Initial Environmental Examination Initial Environmental Examination May 2022
Secondary Towns Urban Development Project: Environmental Monitoring Report (August 2021-January 2022) Environmental Monitoring Reports Feb 2022
Secondary Towns Urban Development Project: Social Monitoring Report (August 2021-January 2022) Social Monitoring Reports Feb 2022
Secondary Towns Urban Development Project: Social Monitoring Report (August 2019-January 2020) Social Monitoring Reports Nov 2021
Secondary Towns Urban Development Project: Social Monitoring Report (August 2020-January 2021) Social Monitoring Reports Nov 2021
Secondary Towns Urban Development Project: Social Monitoring Report (February-July 2021) Social Monitoring Reports Nov 2021
Secondary Towns Urban Development Project: Environmental Monitoring Report (August 2020-January 2021) Environmental Monitoring Reports Sep 2021
Secondary Towns Urban Development Project: Social Monitoring Report (February-July 2020) Social Monitoring Reports Nov 2020
Secondary Towns Urban Development Project: Environmental Monitoring Report (February-July 2021) Environmental Monitoring Reports Nov 2020
Secondary Towns Urban Development Project: Environmental Monitoring Report (February-July 2020) Environmental Monitoring Reports Aug 2020
Secondary Towns Urban Development Project: Samdrup Jongkhar Land Acquisition and Resettlement Due Diligence Report Safeguards Due Diligence Reports Mar 2020
Secondary Towns Urban Development Project: Trashigang and Rangjung Land Acquisition and Resettlement Due Diligence Report Safeguards Due Diligence Reports Mar 2020
Secondary Towns Urban Development Project: Environmental Monitoring Report (August 2019-January 2020) Environmental Monitoring Reports Feb 2020
Secondary Towns Urban Development Project: Environmental Monitoring Report (August 2019-January 2020) Environmental Monitoring Reports Feb 2020
Secondary Towns Urban Development Project: Social Monitoring Report (February-July 2019) Social Monitoring Reports Aug 2019
Secondary Towns Urban Development Project: Environmental Monitoring Report (February-July 2019) Environmental Monitoring Reports Aug 2019
Secondary Towns Urban Development Project: Samdrup Jongkhar Water Supply, Sewerage and Sanitation Subproject Initial Environmental Examination Initial Environmental Examination Jul 2019
Secondary Towns Urban Development Project: Rangjung Water Supply Subproject Initial Environmental Examination Initial Environmental Examination May 2019
Secondary Towns Urban Development Project: Social Monitoring Report (August 2018-January 2019) Social Monitoring Reports Feb 2019
Secondary Towns Urban Development Project: Environmental Monitoring Report (August 2018-January 2019) Environmental Monitoring Reports Feb 2019
Secondary Towns Urban Development Project: Trashigang Water Distribution Network Improvement Subproject Initial Environmental Examination Initial Environmental Examination Mar 2018
Secondary Towns Urban Development Project: Sarpang and Shechamthang Land Acquisition and Resettlement Due Diligence Report Safeguards Due Diligence Reports Mar 2018
Secondary Towns Urban Development Project - Trashigang: Land Acquisition and Resettlement Due Diligence Report Safeguards Due Diligence Reports Mar 2018
Secondary Towns Urban Development Project: Samdrup Jongkhar Sewerage and Sanitation Subproject Initial Environmental Examination Initial Environmental Examination Mar 2018
Secondary Towns Urban Development Project: Sarpang Water Supply and Shechamthang Roads, Drainage and Water Supply Resettlement Plan Resettlement Plans Mar 2018
Secondary Towns Urban Development Project: Sarpang Satellite Town Urban Roads and Drains Subproject Initial Environmental Examination Initial Environmental Examination Mar 2018
Secondary Towns Urban Development Project: Rangjung Intake and WTP Rehabilitation Subproject Initial Environmental Examination Initial Environmental Examination Mar 2018
Secondary Towns Urban Development Project: Sarpang Water Supply Development Subproject Initial Environmental Examination Initial Environmental Examination Mar 2018
Secondary Towns Urban Development Project: Dewathang Water Supply Augmentation Subproject Initial Environmental Examination Initial Environmental Examination Mar 2018
Secondary Towns Urban Development Project: Sarpang Satellite Town Water Supply Distribution Network Subproject Initial Environmental Examination Initial Environmental Examination Mar 2018
Secondary Towns Urban Development Project: Samdrup Jongkhar Water Supply System Improvement Subproject Initial Environmental Examination Initial Environmental Examination Mar 2018

Evaluation Documents See also: Independent Evaluation

None currently available.


Related Publications

None currently available.


The Access to Information Policy (AIP) establishes the disclosure requirements for documents and information ADB produces or requires to be produced in its operations to facilitate stakeholder participation in ADB's decision-making. For more information, refer to the Safeguard Policy Statement, Operations Manual F1, and Operations Manual L3.

Requests for information may also be directed to the InfoUnit.

Tenders

Tender Title Type Status Posting Date Deadline
International Urban Infrastructure Trainer Individual - Consulting Closed 10 Dec 2022 24 Dec 2022
Institutional Expert to design Urban Tariff Individual - Consulting Closed 26 Jan 2022 09 Feb 2022
Structural Engineer to study the cause of intake failure and to redesign Individual - Consulting Closed 24 Jan 2021 05 Feb 2021
Recruitment of Hydrologist Individual - Consulting Closed 24 Jan 2021 05 Feb 2021
National NGO for Implemenation of Gender Action Plan Firm - Consulting Closed 29 Jul 2020 27 Aug 2020
Institutional Specialist Individual - Consulting Closed 09 Apr 2019 29 Apr 2019
Loan No. 42229-BHU: Secondary Towns Urban Development Project [SM/UR/001] Invitation for Bids Closed 01 Mar 2018 06 Apr 2018
BHU: Secondary Towns Urban Development Project Advance Notice Active 23 Feb 2018
Loan No. 42229-BHU: Secondary Towns Urban Development Project [SM/UWS/002] Invitation for Bids Closed 23 Feb 2018 28 Feb 2018
Secondary Towns Urban Development Project (Formerly Improved Urban Environmental Infrastructure Project) Firm - Consulting Closed 09 Oct 2017 21 Nov 2017

Contracts Awarded

Contract Title Approval Number Contract Date Contractor | Address Executing Agency Total Contract Amount (US$) Contract Amount Financed by ADB (US$)
MONITORING CONSULTANT FOR GENDER ACTION PLAN Loan 3674 14 Jun 2021 TARAYANA FOUNDATION | CHANGLAM THIMPHU BHUTAN Department of Engineering Services (DES) 148,523.05 144,932.97
SAMDRUP JONGKHAR WATER SUPPLY AND SEWERAGE PROJECT Loan 3674 29 Jul 2020 CHIMMI RD CONSTUCTION PVT. LTD. | THIMPHU BHUTAN Department of Engineering Services (DES) 1,837,282.96 1,640,488.72
PROJECT MANAGEMENT AND SUPERVISION CONSULTANT Loan 3674 20 Nov 2018 APECS CONSULTANCY | THIMPHU BHUTAN Department of Engineering Services (DES) 433,150.00 430,456.00
DEVELOPMENT OF SHECHAMTHANG LAP INFRASTRUCTURES: ROADS, DRAINAGE AND WATER SUPPLY DISTRIBUTION NETWORK PROJECT Loan 3674 10 Oct 2018 PENJORE CONST PVT LTD & JABAB CONST PVT LTD | CDB NO. 1958 & CDB NO. 1149 THIMPHU BHUTAN Department of Engineering Services (DES) 2,321,948.00 2,071,544.00

Procurement Plan