India : Karnataka State Highways Improvement III Project
The Karnataka State Highways Improvement III Project (KSHIP III) will improve about 418 kilometers (km) of state highways in the state of Karnataka, in line with the state's core road network (CRN) development plan. It will involve upgrading of identified state highways to two- and four-lane with paved shoulders, depending on traffic requirements, and reconstruction, widening, and strengthening of culverts and bridges. Contracts will be based on a hybrid-annuity model with a 7-year annuity period, post-construction. The project will carry out a road safety audit to identify critical accident spots across state highways on the CRN, and implement suitable measures to improve these accident spots. The project will also strengthen institutional capacity and efficiency in Karnataka Public Works, Ports, and Inland Water Transport Department (KPWD).
Project Details
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Project Officer
Bajaj, Arun
South Asia Department
Request for information -
Country/Economy
India -
Modality
-
Sector
- Transport
| Project Name | Karnataka State Highways Improvement III Project | ||||||||
| Project Number | 42513-014 | ||||||||
| Country / Economy | India |
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| Project Status | Active | ||||||||
| Project Type / Modality of Assistance | Loan |
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| Source of Funding / Amount |
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| Strategic Agendas | Environmentally sustainable growth Inclusive economic growth |
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| Drivers of Change | Gender Equity and Mainstreaming Governance and capacity development Partnerships Private sector development |
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| Sector / Subsector | Transport / Road transport (non-urban) - Transport policies and institutional development |
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| Gender | Some gender elements | ||||||||
| Description | The Karnataka State Highways Improvement III Project (KSHIP III) will improve about 418 kilometers (km) of state highways in the state of Karnataka, in line with the state's core road network (CRN) development plan. It will involve upgrading of identified state highways to two- and four-lane with paved shoulders, depending on traffic requirements, and reconstruction, widening, and strengthening of culverts and bridges. Contracts will be based on a hybrid-annuity model with a 7-year annuity period, post-construction. The project will carry out a road safety audit to identify critical accident spots across state highways on the CRN, and implement suitable measures to improve these accident spots. The project will also strengthen institutional capacity and efficiency in Karnataka Public Works, Ports, and Inland Water Transport Department (KPWD). | ||||||||
| Project Rationale and Linkage to Country/Regional Strategy | State context. Karnataka state in southwest India has an area of about 192,000 square km and a population of about 64 million. Economically, Karnataka is one of India's better-performing states: the net income per capita is about 50% above the national average, and grew at over 10% per year during FY2012 to FY2016. The population density is lower than the national average, and the sex ratio (number of females to males) is 968 females per 1,000 males, compared to the national average of 940. The unemployment and poverty rates are also lower than the national averages, and the state receives substantial foreign direct investment (third-highest nationally, after the National Capital Region and Maharashtra). Transport network. The state's rail network is sparse, with only about 3,000 route km, most of which is single line. The terrain along the western hill ranges limits east west rail connectivity to one line from Hassan in the hinterland to Mangalore on the west coast making the road network a critical element of the economic infrastructure. Consultants supported by the Asian Development Bank (ADB) technical assistance for the Karnataka State Highway Network Improvement Strategy completed a study identifying the CRN, which totals about 24,000 km. Government strategy. Although economic development in Karnataka has been above the national average, it has also been uneven, being focused around the capital region of Bengaluru and Mysuru, and the coastal towns of Mangaluru and Udupi. In its state road policy (2009), the Government of Karnataka (GOK) recognizes the importance of road development as an engine of economic growth, and proposed developing all state highways to a two-lane width. GOK has used various means including financing through the state budget, public private partnerships (PPPs), the World Bank, and ADB to improve state roads. The first project was approved by the World Bank in 2001 for $360 million, and addressed about 2,400 km of roads. The second project is ongoing, and covers about 1,500 km of roads; it comprises a $350 million World Bank loan approved in 2011, and a $315 million ADB loan approved in 2010. Further details of the road sector in Karnataka are given in the linked documents. The government's key objective is to upgrade the capacity and condition of the state highway system, improve maintenance, and increase road safety. Achieving these goals also requires that the state build the institutional capacity of the road agencies for planning, preparing, and implementing projects. Road institutions. KPWD is the main GOK institution responsible for state roads. The Karnataka Road Development Corporation, Ltd. established KPWD in 1999 to promote surface infrastructure by taking up specific road works and bridges, and take up projects with PPPs. In addition, a project implementation unit (PIU) for the Karnataka State Highways Improvement Project was established to undertake projects financed by multilateral agencies. The PIU, acting on behalf of GOK, will implement the present project. Priority road corridors. The Government's strategy calls for state highways to be improved to at least a two- or four-lane standard, depending on traffic. The CRN study initially prioritized roads across the state. The PIU subsequently commissioned a prefeasibility study to categorize and prioritize projects in the CRN. Based on these studies, the PIU identified nine key road corridors, portions of which could be taken up for upgrading on a priority basis. The corridors were chosen based on economic returns, connectivity to industrial and tourist centers, and other criteria. A feasibility study further assessed these roads and chose specific priority roads sections, following which consultants recruited by the PIU prepared detailed project reports for these roads, which have now been proposed to ADB for financing. Value added by ADB's assistance. The project will continue and strengthen ADB's engagement in the state. The continued contribution by ADB to the development of the state's roads sector will increase inclusiveness by improving access to markets and basic services. The project is in line with the objective set out in ADB's country partnership strategy for India 2018-2022 regarding development of the state CRN, with the objective of increased, more efficient, and sustainable movement of people and goods. ADB would also add value through the proposed use of hybrid-annuity contracts to improve the sustainability of capital investments. Under hybrid-annuity contracts, 75% of the project cost will be paid to the contractor on a milestone basis during construction. The balance of the project cost and the cost of maintenance will be paid in specified semi-annual payments over a period of 7 years following completion of construction. This approach shifts from traditional construction contracts to contracts focused on output delivery and sustainable asset maintenance. ADB's participation will encourage partial private financing of construction. The project will also conduct a road safety audit on all CRN state highways, and implement measures to improve identified accident black spots to improve road safety. KPWD field and headquarters units are managing road projects of increasing scale, leading the government to seek to improve KPWD's quality monitoring and management systems, including its environment management systems. ADB will support the assessment and process requirements for KPWD offices to attain conformity with International Organization for Standardization (ISO) 9001:2015 (quality management system) and ISO 14001:2015 (environmental management system) standards. This will build institutional capacity in KPWD. |
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| Impact | Mobility and accessibility to economic opportunities improved |
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| Project Outcome | |
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| Description of Outcome | Road transport efficiency and safety in Karnataka improved. |
| Progress Toward Outcome | NA |
| Implementation Progress | |
| Description of Project Outputs | State highways upgraded Road safety measures on state highways installed Institutional capacity and efficiency of KPWD improved |
| Status of Implementation Progress (Outputs, Activities, and Issues) | Package 1: Physical Progress Overall 59% DBM up to 67.5 kms completed.Package 2: Physical Progress Overall 63% DBM up to 104.4 kms completed.Package 3: Physical Progress Overall 33% DBM up to 45.9 kms completed.Road safety features are under implementation together with the ongoing Civil works under HAM projects. For recruitment of Road Safety Consultants, RFP Issued to the shortlisted firms. Two Prebid meetings have been held. Corrigendum based on second Prebid meeting issued on 13 May 2022. Technical proposals submitted by the shortlisted firms on 30 May 2022.Existing CHM is being utilized. Any further enhancements will be discussed & identified, and future action plan will be prepared.The contracts for documentation for both ISO signed on 4 Feb 2022. The consultants are mobilized. The procurement of two contracts for audit will be taken up in Q4-2022. |
| Geographical Location | Karnataka |
| Safeguard Categories | |
|---|---|
| Environment | B |
| Involuntary Resettlement | A |
| Indigenous Peoples | C |
| Summary of Environmental and Social Aspects | |
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| Environmental Aspects | The project scope involves improvement of existing state highways to standard two-lane width, with some four-lane sections. The project roads do not pass through environmentally sensitive areas, and no significant and irreversible environmental impacts are expected. Five initial environmental examination (IEE) reports, including an environmental management plan (EMP), have been prepared for the five project roads and are disclosed on ADB's website. Approximately 16,000 trees, including 866 considered large and old, will be removed. Best efforts (through measures such as eccentric widening) have been made to minimize removal of large old trees in the project design. Compensatory afforestation of 68,455 trees will be carried out. Other anticipated environmental impacts during construction entail typical road construction-related issues, such as generation of dust, noise, exhaust, and waste from construction and worker camps; water contamination; occupational health and safety; erosion; and siltation. Key operational impacts are increased noise levels and safety issues. To address these, noise barriers have been proposed and appropriate road safety features included in the project design. Mitigation measures to address all construction- and operation-related impacts have been included in the EMPs, which are part of the bidding documents, with implementation mandatory for the contractor. The project includes innovative environmental measures such as the use of plastic waste in the bitumen mix in urban road sections, where feasible. Meaningful consultations have been conducted during project preparation, and all concerns voiced by affected persons and stakeholders have been incorporated in the project design. The existing grievance redress mechanism being used by the PIU will be followed under this project. |
| Involuntary Resettlement | The project will require the acquisition of 544.63 hectares of land, including 463.58 hectares of private land. A total of 5,684 households (24,224 persons) will be affected. Most (75%) of affected households are titleholders, with about 60% of affected households below poverty level. The project will use direct purchase to acquire private land and assets based on the provisions of national law and ADB's Safeguard Policy Statement. Should negotiations fail, land and assets will be acquired in accordance with the same law and policy. Resettlement plans were prepared for all five roads and disclosed on ADB's website; they address identified impacts and reflect lessons from previous projects, including measures to ensure compensations at replacement cost, utility shifting and reconstruction assistance, special measures for vulnerable households, and a livelihood improvement program. GOK will finance all direct purchase, resettlement activities and utility shifting. Assessment of project impacts and proposed mitigation measures are both adequate. |
| Indigenous Peoples | Karnataka's tribal population makes up 6.95% of the total population. The roads do not cross customary or tribal land. The social impact assessment and census survey confirmed that 5.5% of affected households are scheduled tribes, and that these households hold similar occupations and religious beliefs as the wider society. |
| Stakeholder Communication, Participation, and Consultation | |
| During Project Design | The potential primary beneficiaries of the project are the road users, communities in the vicinity of the project influence area, villagers, Panchayats (rural local government), KPWD, other development partners active in India's transport sector development, and business and community groups. The poor and the excluded also get an improved access to roads, which further help them in reaching markets and other services. Adversely impacted stakeholders would primarily be those who lose land or livelihood. However, the focus of the project is on improving and rehabilitating existing roads, thus land acquisition will be limited to areas where roads need some geometric improvement, bridge approaches, or bypasses to avoid infringing existing settlements. Adverse impacts will be mitigated through proper stakeholder consultations and incorporated into the resettlement plan.The objective of the Project is improved road connectivity in the state of Karnataka, leading to improved access to basic services, trade, and employment. Primary concerns for poor and vulnerable stakeholders would be loss of land and/or livelihood as a result of land acquisition activities. The project preparation will include investigations and consultations covering all beneficiaries, including the poor and vulnerable stakeholders.Community meetings and focus group discussions will be organized as part of the poverty and social analysis. The local consultative meetings will involve all relevant stakeholders including representatives of the poor and other socially excluded groups (e.g., women, scheduled tribes, etc.) to disseminate the information as well as to get the feedback about the project design and its potential impacts. Other key stakeholders such as the relevant line departments, local government representatives and NGOs will also be consulted. Consultations will also be undertaken with the affected households and communities during the course of the census survey and socioeconomic survey along the project roads for the preparation of the safeguard plans. |
| During Project Implementation | Adverse impacts will be mitigated through proper stakeholder consultations and incorporated into the resettlement plan.The Project will build on the consultation and community participation exercises undertaken during the PPTA, with the support from PPTA consultants NGOs, and CBOs. These include community participation for planning, design and implementation in highly dense and poor settlements. Community consultations will also be carried over to the project implementation stages and user awareness will be included as an important activity. |
| Business Opportunities | |
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| Consulting Services | All consultants will be recruited according to ADB's Guidelines on the Use of Consultants (March 2013, as amended from time to time). KSHIP has engaged "Independent Engineers" (engineering consulting firms) for the implementation of the performance-based, hybrid-annuity contracts. Recruitment process for Independent Engineers under advance contracting had commenced in Q3 2016. All the three contracts of independent engineers were signed on 26-Apr-2019 (IE-1), 25-Jun-2018 (IE-2) and 4-Jun-2018 (IE-3) A consortium of firms was engaged to undertake the project preparatory technical assistance. The consulting firm was engaged following the quality- and cost-based selection method, in accordance with ADB's Guidelines on the Use of Consultants (March 2013). The assignment is completed and closed. Implementation Support Consultants are selected and mobilized. For two contracts for ISO9001 and ISO 14001 documentation, the contracts were signed on 4-Feb-2022. After documentation activities, certification activities will be undertaken thorough two contracts. REOI for those likely to be issued in Q3, 2022. |
| Procurement | The implementing agency is KSHIP. All procurement of goods and works will be undertaken in accordance with ADB's Procurement Guidelines (April 2015, as amended from time to time). The works contracts will be based on a "hybrid-annuity" concession model, where a percentage of the project cost will be paid during construction, and the balance, including operating and maintenance payments, will be paid on an annuity basis over a period of 7 years. Procurement actions for all the three hybrid annuity contract packages, under advance contracting, commenced in Q1 2017. The financial bid evaluation reports were received by ADB in Q1 2018. The concession agreements of Package 1, 2 & 3 were signed on 20-Feb-2019, 18-Jan-2019 and 18-Jan-2019 respectively. |
| Responsible ADB Officer | Bajaj, Arun |
| Responsible ADB Department | South Asia Department |
| Responsible ADB Division | India Resident Mission (INRM) |
| Executing Agencies |
Government of Karnataka Public Works, Ports & Inland Water Transport Dept. - Karnataka |
| Timetable | |
|---|---|
| Concept Clearance | 24 Jul 2014 |
| Fact Finding | 23 Jun 2016 to 30 Jun 2016 |
| MRM | 04 Sep 2017 |
| Approval | 08 Dec 2017 |
| Last Review Mission | - |
| Last PDS Update | 27 Jun 2022 |
Loan 3619-IND
| Milestones | |||||
|---|---|---|---|---|---|
| Approval | Signing Date | Effectivity Date | Closing | ||
| Original | Revised | Actual | |||
| 08 Dec 2017 | 30 Aug 2018 | 14 Nov 2018 | 30 Jun 2024 | - | - |
| Financing Plan | Loan Utilization | ||||
|---|---|---|---|---|---|
| Total (Amount in US$ million) | Date | ADB | Others | Net Percentage | |
| Project Cost | 548.00 | Cumulative Contract Awards | |||
| ADB | 346.00 | 12 Sep 2023 | 310.93 | 0.00 | 91% |
| Counterpart | 202.00 | Cumulative Disbursements | |||
| Cofinancing | 0.00 | 12 Sep 2023 | 197.27 | 0.00 | 57% |
| Status of Covenants | ||||||
|---|---|---|---|---|---|---|
| Category | Sector | Safeguards | Social | Financial | Economic | Others |
| Rating | - | - | - | - | - | Satisfactory |
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.
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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.
Evaluation Documents See also: Independent Evaluation
None currently available.
Related Publications
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ADB Provides $346 Million to Upgrade State Highways in Karnataka, India
ADB's Board of Directors has approved a $346 million loan to upgrade highways in the Indian state of Karnataka.
Tenders
Contracts Awarded
| Contract Title | Approval Number | Contract Date | Contractor | Address | Executing Agency | Total Contract Amount (US$) | Contract Amount Financed by ADB (US$) |
|---|---|---|---|---|---|---|
| Third Party Audit to Seek registration of conformity to ISO 9001-2015 International Standard for Quality Management System for 247 offices of Karnataka Public Works Department (KPWD) under KSHIP-3 Project. | 3619 | 30 Jun 2023 | M/s Inter Cert Private Limited, India | C-1118, Noida One, B-8, Sector 62, Noida - 201301 | Public Works, Ports & Inland Water Transport Dept. | 230,269.18 | 229,826.29 |
| Consultancy services for Road safety audit and design for the PWD South and Central Zone roads in the state of Karnataka (Package -2) under KSHIP-III Project | Loan 3619 | 20 Dec 2022 | Feedback Infra Private Limited in JV with PADECO Co. Ltd. and TPF Engineering Private Limited | 311, 3rd floor, Vardhaman Plaza, Pocket 7, Plot No. 6, Sector-12, Dwarka, New Delhi - 110078 | Public Works, Ports & Inland Water Transport Dept. | 1,408,586.71 | 1,408,586.71 |
| Road Safety Audit and Design for the PWD North and North East zone Roads in the State of Karnataka (Package-1) under KSHIP-3 Project | Loan 3619 | 16 Dec 2022 | LEA Associates South Asia Private Limited, India in JV with Central Road Research Institute & GeoVista Technologies Private Limited | LEA Associates South Asia Private Limited, B-1/E-27, Mohan Cooperative Industrial State, Mathura Road, New Delhi - 110044 | Public Works, Ports & Inland Water Transport Dept. | 1,891,746.62 | 1,884,384.90 |
| Quality Management System Documentation for ISO 9001:2015 for KPWD Sub-Divisional Offices | Loan 3619 | 11 Feb 2022 | M/s Allied Boston Consultants India Private Limited | 2205, Express Trade Tower-2, B-36, Sector 132, Noida-210301 | Public Works, Ports & Inland Water Transport Dept. | 616,697.62 | 613,309.51 |
| Environment Management System Documentation for ISO 14001:2015 for KPWD Offices | Loan 3619 | 11 Feb 2022 | M/s Allied Boston Consultants India Private Limited | 2205, Express Trade Tower-2, B-36, Sector 132, Noida-210301 | Public Works, Ports & Inland Water Transport Dept. | 378,327.82 | 376,249.31 |
| IMPLEMENTATION SUPPORT CONSULTANT FOR KSHIP- III ADB 2ND LOAN PROJECT | Loan 3619 | 26 Jun 2020 | PRICEWATERHOUSECOOPERS PRIVATE LIMITED | PRICEWATERHOUSECOOPERS PRIVATE LIMITED, BUILDING 10,TOWER C,DLF CYBER CITY,GGN INDIA | Government of Karnataka | 1,149,882.53 | 1,149,882.53 |
| KSHIP3-ADB-II-CW-ITB-PACAKGE 2-TWO LANING WITH PAVED SHOULDER OF MAGADI TO NEAR SOMWARPETH | Loan 3619 | 12 Mar 2019 | KNR CONSTRUCTIONS LIMITED | CONCESSIONNAIRE KNR SOMWARPET INFRA- PROJECT PVT LTD HYDERABAD INDIA | Government of Karnataka | 142,332,513.28 | 108,064,795.57 |
| KSHIP3-ADB II-CW-ITB-PACKAGE 1:(A) KOLLEGAL-HANNUR (23.8KM)(B)CHINTAMANI-AP BORDER (39.8KM)(C)NICE RD TOMAGADI & MAGADI-NH75 (50.7KM) | Loan 3619 | 12 Mar 2019 | PAN INDIA INFRAPROJECTS LIMITED | 513/A, 5TH FLOOR, KOHINOOR CITY, KIROLRD KURLA (WEST), MUMBAI, MAHARASHTRA INDIA | Government of Karnataka | 126,968,364.31 | 96,911,815.66 |
| KSHIP3-ADB II-CW-ITB-PACKAGE 3 - TWO LANING WITH PAVED SHOULDER OF GADAG TO HONNALI (138.2 KM) | Loan 3619 | 12 Mar 2019 | SADBHAV ENGINEERING LIMITED | CONCESSIONNAIRE SADBHAV GADAG HIGHWAY PRIVATE LIMITED SAKET NEW DELHI INDIA | Government of Karnataka | 114,807,287.77 | 87,166,493.42 |
| INDEPENDENT ENGINEER SERVICES KSHIP III-ADB II-IE2 | Loan 3619 | 14 Mar 2019 | AARVEE ASSOCIATES ARCHS ENGRS & CONS PVT LTD | RAVULA RESIDENCE, SRINAGAR COLONY MAIN ROAD, HYDERABAD-82 INDIA | Government of Karnataka | 3,521,270.18 | 1,765,969.32 |
| INDEPENDENT ENGINEER SERVICES KSHIP III-ADB II-IE3 | Loan 3619 | 14 Mar 2019 | LEA ASSOCIATES SOUTH ASIA PRIVATE LIMITED | B-1, E-27, MOHAN CO-OPERATIVE INDUSTRIAL ESTATE, MATHURA ROAD, NEW DELHI-110044 INDIA | Government of Karnataka | 3,259,637.97 | 1,635,982.70 |
| KSHIP III-ADB II-IE-1 INDEPENDENT ENGINEERS | Loan 3619 | 17 May 2019 | L. N. MALVIYA INFRA PROJECTS PVT. LTD. | T-10, 3RD FLOOR, CITY CENTRE, PRESS COM- PLEX, PLOT NO. 1, ZON-1, MP NAGAR BHOPAL INDIA | Government of Karnataka | 2,780,104.99 | 1,658,093.48 |
Procurement Plan
| Title | Document Type | Document Date |
|---|---|---|
| Karnataka State Highways Improvement III Project: Procurement Plan | Procurement Plans | May 2023 |