Azerbaijan: Second Road Network Development Investment Program - Tranche 1

Sovereign Project | 45389-002 Status: Active

ADB is helping Azerbaijan with road upgrades along a route running from its border with the Russian Federation down to the border with Iran. The first project under the multitranche financing facility will fund a 30-kilometer section between Masalli and Jalilabad and support project implementation.  The project will boost trade and improve access to services for poor rural communities.

Project Details

Project Officer
Wu, Zheng Central and West Asia Department Request for information
Country
  • Azerbaijan
Modality
  • Loan
Sector
  • Transport
 
Project Name Second Road Network Development Investment Program - Tranche 1
Project Number 45389-002
Country Azerbaijan
Project Status Active
Project Type / Modality of Assistance Loan
Source of Funding / Amount
Loan 2921-AZE: Second Road Network Development Investment Program - Tranche 1
Ordinary capital resources US$ 250.00 million
Strategic Agendas Inclusive economic growth
Regional integration
Drivers of Change Private sector development
Sector / Subsector

Transport - Road transport (non-urban)

Gender Equity and Mainstreaming Some gender elements
Description Project 1 will fund two components: i) Infrastructure Development Component - construction of an approximately 30 km section of the new motorway between Masalli and Jalilabad of the Masalli-Shorsulu road; and ii) Project Implementation Support Components - project implementation support to ARS for construction supervision and program management covering planning, procurement, project preparation and implementation.
Project Rationale and Linkage to Country/Regional Strategy

The Southern Corridor is a major transportation artery for Azerbaijan. The existing southern corridor road, from Alyat to Astara (M3) is a 240 km two-lane road. Current road section is in poor condition, resulting in high transport costs, long delivery times and traffic accidents due to limited capacity, and has a high roughness index and is in need of major rehabilitation. Previous analyses have concluded that improvements on the southern corridor required building a totally new 4-lane road in order to minimize the resettlement problem that widening the existing road would have created.

Improvement of the southern road corridor will (i) provide a good road connection with Iran with expanded capacity and facilitate bilateral trade and transit trade at a faster rate; (ii) reduce the cost of transportation of agricultural products to Baku markets; and (iii) bring savings in travel time and transportation cost for all road users in general and for the local population in particular.

Impact Generate economic growth in Azerbaijan and expanded trade with neighboring countries.

Project Outcome

Description of Outcome An adequate, efficient, safe, and sustainable road network in Azerbaijan, connecting the country domestically and internationally
Progress Toward Outcome All contracts have been awarded. Project implementation is ongoing.
Implementation Progress
Description of Project Outputs

About 30 km section of the newly constructed motorway between Masalli and Jalilabad.

Project implementation support to ARS for construction supervision and program management.

Due diligence requirements completed for new road sections R32 and M5/R57.

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

Consultants' contracts signed on 28 December 2013. The construction supervision and program management consultants continues to provide services to support the PIU/ARS.

The civil works contract for Jalilabad-Masalli section was signed on 11 Dec 2013 and works commenced on 5 March 2014 and has undergone one contract variation with the revised contract completion date of 30 June 2017. As of 28 February 2017, cumulative work progress is about 76.3%, against the elapsed contract period of 89.0%. AAY confirmed that the Contractor can complete the project by 30 June 2017.

The preparation of TOR for the development of road standards and specifications, is still on hold as a consulting report of _Design Manual for Roads in Azerbaijan_ was prepared in December 2013 under a WB grant and another consulting report of _Pavement Performance Investigation and Design Manual_ was prepared in June 2016 under an EBRD grant. Proceeding with the foregoing study will be subject to results of government's review of completed studies to avoid duplication of donor efforts, and adjustment will be made accordingly. Relatedly, the TOR for the Road Safety study has been endorsed by AAY and preparation to carry out this study is underway.

Geographical Location Masalli-Shorsulu Road

Safeguard Categories

Environment A
Involuntary Resettlement A
Indigenous Peoples C

Summary of Environmental and Social Aspects

Environmental Aspects An environment assessment and review framework for the investment program was prepared following ADB's Safeguard Policy Statement (2009) and relevant laws and regulations in Azerbaijan. The proposed motorway is on a new alignment with a 7 km section passing through wetlands. The sections to be financed by tranche 1 and 2 are classified as environment category A. The environmental impact assessment (EIA) reports were prepared in 2007; in 2011, the World Bank prepared an addendum that looked more closely into the wetlands and its environmental implications. Based on these reports, a single updated EIA was prepared that reflects compliance with the requirements of ADB's Safeguard Policy Statement. The EIA recommends specific mitigation measures with regard to motorway design and construction and a robust long-term monitoring program. The contracts for the supervision consultant, program management consultant, and civil works will include stringent provisions for compliance with environmental safeguards. An ecological expert and environmental specialist will be engaged to ensure implementation of the environmental management plan. Assurances to mitigate potential harm to the wetlands are also included in the loan agreement, framework financing agreement, and facility administration manual.
Involuntary Resettlement A resettlement framework for the investment program was prepared following ADB's Safeguard Policy Statement and relevant laws and regulations in Azerbaijan, and adopting the rehabilitation strategy in the resettlement policy framework. LAR activities were substantially completed based on the World Bank's resettlement plan, which the government agreed upon under the earlier World Bank-assisted highway project. A due diligence assessment confirmed that compensation payments were made following the resettlement policy framework agreed upon with the World Bank and are consistent with the requirements of ADB's Safeguard Policy Statement. Outstanding LAR activities include compensating the remaining 2% (15 privately owned plots) of households losing portions of their agricultural lands, paying compensation for affected municipal land, and providing additional rehabilitation assistance for severely affected and vulnerable households by prioritizing them for civil works jobs. Tranche 1 is classified as category A for involuntary resettlement. For tranche 1, a land acquisition and resettlement plan was prepared to cover the remaining LAR activities, including rehabilitation measures and actions to address temporary impacts and emerging LAR issues during implementation. Both the LAR framework and plan were disclosed on the ADB website on 23 July 2012. Implementation of the LAR plan will be monitored internally and externally. The program management consultant will conduct refresher training for the land acquisition department of ARS and respective district administrative staff on safeguards, and will monitor LAR-related activities.
Indigenous Peoples The investment program area does not have any known social or cultural groups classified as indigenous peoples under ADB's Safeguard Policy Statement. Tranche 1 is classified as category C for indigenous peoples impact.
Stakeholder Communication, Participation, and Consultation
During Project Design Public consultation were undertaken with communities, government and non-governmental organisations (NGOs) in relation to the construction of the road. Most feedback received from communities related to land compensation and access matters with little comment on environmental issues. At a meeting with environmental NGOs and local biodiversity experts some concerns were expressed over potential impacts on wetland ecology and a number of design mitigation measures were agreed to be considered.
During Project Implementation Consultation will be conducted during project implementation, when required.

Business Opportunities

Consulting Services Consultant recruitment financed will follow ADB's Guidelines on the Use of Consultants (2013, as amended from time to time).
Procurement Procurement of goods and works will follow ADB's Procurement Guidelines (2013, as amended from time to time).

Responsible Staff

Responsible ADB Officer Wu, Zheng
Responsible ADB Department Central and West Asia Department
Responsible ADB Division Transport and Communications Division, CWRD
Executing Agencies
"Azeravtoyol" Open Joint-Stock Company
Mr. Saleh Mammadov
[email protected]
Block 2025, R. Ismayilov Str.,
Bilajari Settlement, Binagadi Distr.,
Baku, Azerbaijan Republic, AZ1117
Baku

Timetable

Concept Clearance -
Fact Finding -
MRM 24 Jul 2012
Approval 25 Oct 2012
Last Review Mission -
Last PDS Update 20 Mar 2017

Loan 2921-AZE

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
25 Oct 2012 22 Apr 2013 30 Jul 2013 31 Dec 2016 31 Jan 2018 -
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 312.00 Cumulative Contract Awards
ADB 250.00 25 Oct 2012 152.31 0.00 61%
Counterpart 62.00 Cumulative Disbursements
Cofinancing 0.00 25 Oct 2012 127.39 0.00 51%
Status of Covenants
Category Sector Safeguards Social Financial Economic Others
Rating - - Satisfactory - - 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.

The Public Communications Policy (PCP) 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.

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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.

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
Second Road Network Development Investment Program - Tranches 1 and 2: Jalilabad-Masalli, Jalilabad-Shorsulu Internal Monitoring Report Social Monitoring Reports Feb 2017
Second Road Network Development Investment Program - Tranche 1: Biannual Environmental Monitoring Report (July-December 2016) Environmental Monitoring Reports Dec 2016
Second Road Network Development Investment Program - Tranche 1: Jalilabad–Masalli Section (km 110.7–km 142.9) Resettlement Monitoring Report Social Monitoring Reports Dec 2016
RNIDP II - Tranches 1 and 2: Alat-Astara Highway Social Monitoring Report Social Monitoring Reports Aug 2016
Second Road Network Development Investment Program - Tranche 1: Supplementary Land Acquisition and Resettlement Plan for Masalli–Jalilabad Section (km 110.700–km 142.9) Resettlement Plans Aug 2016
Second Road Network Development Investment Program - Tranche 1: Biannual Environmental Monitoring Report (January-June 2016) Environmental Monitoring Reports Jun 2016
Second Road Network Development Investment Program - Project 1: Biannual Environmental Monitoring Report (July-December 2015) Environmental Monitoring Reports Dec 2015
Second Road Network Development Investment Program - Project 1: Biannual Environmental Monitoring Report (January-June 2015) Environmental Monitoring Reports Jul 2015
Second Road Network Development Investment Program - Project 1: Biannual Environmental Monitoring Report (July-December 2014) Environmental Monitoring Reports Dec 2014
Second Road Network Development Investment Program - Tranche 1: Alat-Astara Motorway Masalli-Jalilabad Intersection Social Audit Report Social Compliance Audit Report Nov 2014
Second Road Network Development Investment Program: Alat-Masalli Section, Project 1 and Project 2 Social Monitoring Reports Jan 2014
Second Road Network Development Investment Program - Tranche 1: Addendum to Resettlement Plan (Jalilabad-Masalli Section) Resettlement Plans Aug 2013
Second Road Network Development Investment Program - Tranche 1: External Monitoring Report for the Land Acquisition and Resettlement Plan Implementation for Jalilabad–Masalli Section Project 1 (km 112.9–km 142.9) Social Monitoring Reports Jun 2013
Second Road Network Development Investment Program - Tranche 1: Internal Monitoring Report for Alat - Masalli Section (Km 112.9 - Km 142.9) Social Monitoring Reports Mar 2013

Evaluation Documents See also: Independent Evaluation

None currently available.

Related Publications

None currently available.


The Public Communications Policy (PCP) 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

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Contracts Awarded

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