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 Name||Second Road Network Development Investment Program - Tranche 1|
|Project Type / Modality of Assistance||Loan
|Source of Funding / Amount||
|Strategic Agendas||Inclusive economic growth
|Drivers of Change||Gender Equity and Mainstreaming
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; rehabilitation of the R32 Ujar Zardab Agjabedi 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.
A major change in scope was approved on 6 June 2018 to utilize about $90 million of loan savings for the rehabilitation of the R32 Ujar-Zardab-Agjabedi road. The expanded project outputs include (i) construction of an approximately 30 km four-lane road section between the cities of Masalli and Jalilabad as part of the new Alat-Astara Road; (ii) project implementation support for construction supervision and program management covering planning, procurement, project implementation, financial management and compliance with safeguard requirements; and (iii) Rehabilitation of approximately 70 km of the R32 Ujar-Zardab-Agjabedi road.
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||Trade with neighboring countries expanded and economic growth of Azerbaijan improved.|
|Description of Outcome||Efficient, adequate, safe, and sustainable road corridors in Azerbaijan achieved.|
|Progress Toward Outcome||
Civil works for the Alat-Astara Motorway Masalli to Jalilabad Intersection (km 142.89 to km 110.7) is 100% completed (30 km), road is opened to traffic in September 2018.
Major change in scope of T1 approved on 6 June 2018, civil works contracts for R32 signed on 31 Oct 2018.
The R32 Ujar-Zardab-Agjabadi Road (70.5 km) comprises two lots: (i) Lot 1 contract (km 0-37) was awarded to JV Korpu Bina Tikiti and Mehmet Gunes on 31 October 2018, and (ii) Lot 2 contract (km 37-70.5) was awarded to Polat Yol Yapi Sanayi ve Ticaret A.S on 19 November 2018. A contract variation under Lot 1 contract was approved on 28 October 2019. The implementation of contracts is on schedule: as of 29 February 2020 (i) Lot 1 contract's physical and financial progress reached 54% and 57%, respectively; and (ii)Lot 2 contract's physical and financial progress reached 61% and 70%.
|Description of Project Outputs||
A new motorway between Masalli and Jalilabad constructed and key sections of R32 rehabilitated.
Support to AAY on program management, supervision and implementation provided.
Due diligence requirements for new road sections R32 and M5/R57 completed.
|Status of Implementation Progress (Outputs, Activities, and Issues)||
Consulting service to deliver due diligence requirements for 2 new road sections completed in Q1 2018.
Required report preparation and submission are attended to during project implementation.
All civil works and consulting services contracts under the project have been awarded. The works for Masalli-Jalilabad motorway section successfully completed, taking over certificate issued on 18 Aug 2017.
The R32 Ujar-Zardab-Agjabadi Road (70.5 km) comprises two lots: (i) Lot 1 contract (km 0-37) in the amount of AZN67,960,100.67 ($40,013,765.24 equivalent) was awarded to JV Korpu Bina Tikiti and Mehmet Gunes on 31 October 2018 (contract no. 01/ICB/2018/L1), and (ii) Lot 2 contract (km 37-70.5) for AZN59,604,647.11 ($35,079,450.02 equivalent) was awarded to Polat Yol Yapi Sanayi ve Ticaret A.S on 19 November 2018. The implementation of contracts is on schedule: as of 29 February 2020 (i) Lot 1 contract's physical and financial progress reached 54% and 57%, respectively; and (ii)Lot 2 contract's physical and financial progress reached 61% and 70%.
Construction supervision and program management consultants continues to provide services to support the PIU/ARS.
|Geographical Location||Dzhalilabad, Jalilabad District, Masally, Masally District|
|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.|
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 was monitored internally and externally. The program management consultant conducted refresher training for the land acquisition department of ARS and respective district administrative staff on safeguards, and monitored LAR-related activities.
The final LARP implementation report for R32 road was disclosed on ADB website on 9 January 2020. LARP completion validation mission took place during 30 January 6 February 2020. Subsequently, the updated LARP implementation report was provided on 10 April 2020.
|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.|
|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 ADB Officer||Faraj, Huseynbeyov|
|Responsible ADB Department||Central and West Asia Department|
|Responsible ADB Division||Azerbaijan Resident Mission|
State Agency of Azerbaijan Automobile Roads
Mr. Saleh Mammadov
Block 2025, R. Ismayilov Str.,
Bilajari Settlement, Binagadi Distr.,
Baku, Azerbaijan Republic, AZ1117
|MRM||24 Jul 2012|
|Approval||25 Oct 2012|
|Last Review Mission||-|
|Last PDS Update||23 Apr 2020|
|Approval||Signing Date||Effectivity Date||Closing|
|25 Oct 2012||22 Apr 2013||30 Jul 2013||31 Dec 2016||31 Dec 2020||-|
|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||242.50||0.00||97%|
|Cofinancing||0.00||25 Oct 2012||215.78||0.00||86%|
|Status of Covenants|
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.
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.
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.
|Tender Title||Type||Status||Posting Date||Deadline|
|Loan No. 2921-AZE: Second Road Network Development Investment Program - Tranche 1 [01/2018/AZE]||Invitation for Bids||Closed||16 Jan 2018||02 Mar 2018|
|Contract Title||Approval Number||Contract Date||Contractor||Contractor Address||Executing Agency||Contract Description||Total Contract Amount (US$)||Contract Amount Financed by ADB (US$)|
|CIVIL WORKS CONTRACT FOR THE RECONSTRUCTION OF ZAR DAB TO AGJABADI SECTION KM 37.00 TO KM 70.50||Loan 2921||21 Nov 2018||POLAT YOL YAPI SANAYI VE TICARET A.S.||UZUNCHAYIR YOLU CAD.,HAMZA POLAT ISH MERKAZI NO.6,HASANPASHA,ISTANBUL, TUR TURKEY||State Agency of Azerbaijan Automobile Roads||CONSTRUCTION||41,617,446.00||35,088,187.00|
|CONSTRUCTION OF THE UJAR TO ZARDAB ROAD KM 0.00 TO KM 37.00 ALONG R32||Loan 2921||13 Nov 2018||JV KORPU BINA TIKINTI AND MEHMET GUNES INSAAT||MAHATMA GANDHI CADDESI NO. 96/4 CANKAYA, ANKARA, TURKEY TURKEY||State Agency of Azerbaijan Automobile Roads||CONSTRUCTION||47,269,625.00||40,059,004.00|
|UPDATING FEASIBILITY STUDY, ENGINEERING DESIGNS, C OST ESTIMATE AND PREPARATION OF SAFEGUARDS REPORT AND BIDDING DOCUMENTS FOR CIVIL WORKS OF R32 ROAD||Loan 2921||15 Sep 2017||BCL ASSOCIATES LIMITED||JABBAR TOWER (10F),42 GULSHAN AVE GULSHAN-1,DHAKA-1212 BANGLADESH||Azeravtoyol Open Joint-Stock Company||302,775.00||302,775.00|
|UPDATING FEASIBILITY STUDY,ENGINEERING DESIGNS,COS T ESTIMATE AND PREPARATION OF SAFEGUARDS REPORTS A ND BIDDING DOCUMENTS FOR CIVIL WORKS OF M5R57 RO||Loan 2921||15 Sep 2017||KOCKS CONSULT GMBH||STEGEMANNSTRASSE 32-38 D-56068 KOBLENZ GERMANY||Azeravtoyol Open Joint-Stock Company||356,000.00||356,000.00|
|Title||Document Type||Document Date|
|Second Road Network Development Investment Program - Tranche 1: Procurement Plan||Procurement Plans||Nov 2018|