fbpx 46538-002: Supporting Public–Private Partnership Investments in Sindh Province | Asian Development Bank

Pakistan: Supporting Public–Private Partnership Investments in Sindh Province

Sovereign (Public) Project | 46538-002 Status: Active

The Asian Development Bank is working with Pakistan to strengthen the standards in the development and delivery of public-private partnership (PPP) projects and help bridge the infrastructure investment gap in Sindh province.

Project Details

Project Officer
Masood, Sana Central and West Asia Department Request for information
Country
  • Pakistan
Modality
  • Grant
  • Loan
  • Technical Assistance
Sector
  • Public sector management
 
Project Name Supporting Public–Private Partnership Investments in Sindh Province
Project Number 46538-002
Country Pakistan
Project Status Active
Project Type / Modality of Assistance Grant
Loan
Technical Assistance
Source of Funding / Amount
Grant 0518-PAK: Supporting Public-Private Partnership Investments in Sindh Province
Department for International Development US$ 19.23 million
Loan 3469-PAK: Supporting Public-Private Partnership Investments in Sindh Province
Ordinary capital resources US$ 100.00 million
TA 9239-PAK: Enhancing Public Private Partnerships in Pakistan (Provincial Support)
Government of the United Kingdom US$ 4.75 million
Strategic Agendas Inclusive economic growth
Drivers of Change Governance and capacity development
Partnerships
Sector / Subsector

Energy / Energy sector development and institutional reform

Public sector management / Public administration - Public expenditure and fiscal management

Transport / Transport policies and institutional development

Gender Equity and Mainstreaming No gender elements
Description

The project will support the development policies of GoS for sustainable infrastructure provision through PPPs. It is aligned with Midterm Review of Strategy 2020, in which PPPs are a key driver of change, and the Country Partnership Strategy 2015-2019. The project builds on ADBs partnership with GoS to develop the PPP framework under a program cluster in 2009, using lessons learned from this program and the Country Assistance Program Evaluation for Pakistan.

The expected impact of the project is aligned with the number of infrastructure investments and services in Sindh improved. The expected outcome is fiscally-responsible private sector participation and investment in infrastructure increased in Sindh.

The outputs are (i) GoS capacity to select and develop PPP projects strengthened; (ii) PPP project-related fiscal risk effectively managed by the PPP Support Facility (PSF); and (iii) PPP project selection and subsequent management capacity of line departments, finance, and planning and development departments strengthened.

Project Rationale and Linkage to Country/Regional Strategy

With 44 million inhabitants representing 23% of Pakistan's population and a GDP share of 32%, Sindh has large infrastructure and social service needs, which exceed the provincial public resources available. With limited sources of revenue, federal transfers constituted 79% of Sindh's budget in 2016. Only PRs 225 billion or 25% of Sindh's annual budget was allocated to the Annual Development Plan (ADP) in FY2017, which funds infrastructure development among other initiatives. The World Bank estimates that Sindh's annual infrastructure investments only represent 3% to 4% of estimated requirements in transport, electricity, water supply and sanitation, solid waste, telecom, and irrigation. In addition Sindh requires investments in health, and education This also highlights GoS inability to fully utilize the development budget for meeting its infrastructure needs under the traditional public procurement mechanism. To meet the pressing needs of infrastructure in the province, public sector investments must be augmented by stronger private sector participation. In addition to bridging the funding gap for infrastructure investments, PPPs may also help in accelerating completion and enhancing the efficiency of operations of infrastructure projects. However, PPPs also carry significant fiscal risks that need to be managed and mitigated.

To close the significant infrastructure demand supply gap in the context of extremely limited fiscal resources, GoS began reforms to facilitate the use of PPP investments by promulgating the Sindh PPP Act 2010, as well as legal guidelines and procurement rules, institutional arrangements for PPPs and providing public resources through its financing. A PPP Policy Board, led by the Chief Minister, was established to approve PPPs. A PPP Unit within the Sindh Finance Department (SFD) helps relevant government departments to identify and develop suitable PPP projects within Sindh's ADP. A project development facility (PDF) and a viability gap fund (VGF) were established in 2010 to support the use of transaction advisory services and fund the public financing portion of PPPs. So far Sindh has funded five (5) PPP investments that commenced operation in 2013-2015. Sindh has so far identified a pipeline of projects, of which 36 have passed concept approval, with an estimated cost of PRs 240 billion.

However, the experience of the first years demonstrates that considerable efforts are required to improve the leverage of public financing through private capital and adjust financing policies and modalities to reach that objective and minimize fiscal risks related to PPPs. As PPP investments and contingent liabilities grow, it is essential to better prioritize project selection followed by proper structuring to minimize fiscal risks. As a first step PPP project identification should be reflected in Sindh's ADP and carefully consider project revenue generation and identify potential risks and its mitigation.

The structure of Sindh's PPPs must be significantly improved through: (i) robust policy that guides the selection of eligible viable PPP projects (including the treatment of non-solicited proposals) based on Sindh's ADPs; (ii) equitable risk participation from investors and lenders; (iii) rigorous risk management policies and supporting systems that entail project and related fiscal risks; and (iv) sound policies that guide the proper use of public funding through the VGF and otherwise.

Impact Infrastructure investments and services in Sindh improved
Project Outcome
Description of Outcome Fiscally-responsible private sector participation and investment in infrastructure increased in Sindh.
Progress Toward Outcome All conditions precedent to the loan effectiveness have been met and the loan was declared effective on 31 March 2018.
Implementation Progress
Description of Project Outputs

Government of Sindh capacity to select and develop PPP projects strengthened

PPP project-related fiscal risk effectively managed by PSF

PPP project selection and subsequent management capacity of line departments, finance, and planning and development departments strengthened

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

i) Consultants have been recruited under the attached Technical Assistance for capacity development.

ii) Project selection criteria have been developed.

iii) Interim management for PSF is in place; while recruitment for full time management is in process.

Geographical Location Sindh
Safeguard Categories
Environment FI
Involuntary Resettlement FI
Indigenous Peoples FI-C
Summary of Environmental and Social Aspects
Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design GoS Finance Department, Planning and Development Department, sector departments with PPP portfolios, commercial banks and other private sector entities are the main stakeholders. The project incorporates the findings of and agreements reached during extensive consultations with the stakeholders.
During Project Implementation The consultative process will continue during the project implementation. The project will use and build on the tested consultative approach that was previously and successfully implemented for PPPs in Sindh, including the use of resources from the attached technical assistance to engage in consultations with stakeholders.
Business Opportunities
Consulting Services The TA requires 20 person-months of international and 590 person-months of national consulting services for technical, advisory, and capacity development support through short-term and full-time engagement with the project counterparts and stakeholders.
Responsible ADB Officer Masood, Sana
Responsible ADB Department Central and West Asia Department
Responsible ADB Division Pakistan Resident Mission
Executing Agencies
Finance Department,GOS
Sindh Provincial Government
Karachi, Pakistan
Timetable
Concept Clearance 25 Jun 2014
Fact Finding 06 Nov 2014 to 18 Nov 2014
MRM 17 Jul 2015
Approval 24 Nov 2016
Last Review Mission -
Last PDS Update 25 Sep 2018

Grant 0518-PAK

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
24 Nov 2016 12 Sep 2017 31 Mar 2018 31 Dec 2022 - -
Financing Plan Grant Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 19.23 Cumulative Contract Awards
ADB 0.00 24 Nov 2016 0.00 0.43 2%
Counterpart 0.00 Cumulative Disbursements
Cofinancing 19.23 24 Nov 2016 0.00 15.43 80%

Loan 3469-PAK

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
24 Nov 2016 12 Sep 2017 31 Mar 2018 31 Dec 2022 - -
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 165.00 Cumulative Contract Awards
ADB 100.00 24 Nov 2016 0.00 0.00 0%
Counterpart 65.00 Cumulative Disbursements
Cofinancing 0.00 24 Nov 2016 7.51 0.00 8%

TA 9239-PAK

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
24 Nov 2016 20 Dec 2016 20 Dec 2016 30 Jun 2022 - -
Financing Plan/TA Utilization Cumulative Disbursements
ADB Cofinancing Counterpart Total Date Amount
Gov Beneficiaries Project Sponsor Others
0.00 4,750,530.00 0.00 0.00 0.00 0.00 4,750,530.00 24 Nov 2016 1,225,441.92

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.

None currently available.

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
PPP Specialist Individual - Consulting Closed 09 Jun 2020 15 Jun 2020
PPP Specialist (legal) Individual - Consulting Closed 09 Jun 2020 15 Jun 2020
Financial Management Specialist Individual - Consulting Closed 28 May 2020 03 Jun 2020
PPP Specialist Individual - Consulting Closed 20 May 2020 26 May 2020
National Environment Specialist 2 Individual - Consulting Closed 24 Oct 2019 30 Oct 2019
Financial Modelling Specialist Individual - Consulting Closed 07 Sep 2019 18 Sep 2019
Tax and Accounting Specialist Individual - Consulting Closed 07 Sep 2019 18 Sep 2019
Water Specialist Individual - Consulting Closed 29 Aug 2019 04 Sep 2019
Water Utility PPP Specialist Individual - Consulting Closed 29 Aug 2019 04 Sep 2019
PPP Specialist (Legal Expert - Health) Individual - Consulting Closed 10 Jul 2019 12 Jul 2019
PPP Specialist (Health Expert) Individual - Consulting Closed 06 Jul 2019 12 Jul 2019
PPP Specialist (Health and Finance) Individual - Consulting Closed 29 Jun 2019 05 Jul 2019
PPP Specialist (Works & Services Node) Individual - Consulting Closed 24 Apr 2019 30 Apr 2019
National PPP Specialist Individual - Consulting Closed 21 Mar 2019 27 Mar 2019
National Senior Monitoring and Evaluation Specialist Individual - Consulting Closed 02 Mar 2019 08 Mar 2019
National PPP Analyst Individual - Consulting Closed 05 Feb 2019 11 Feb 2019
PPP Specialist (Finance Specialist, PMU) Individual - Consulting Closed 10 Jan 2019 30 Jan 2019
National PPP Specialist (Project and Infrastructure Management) Individual - Consulting Closed 29 Nov 2018 05 Dec 2018
National PPP Specialist (Finance Specialist - Works & Services node) Individual - Consulting Closed 03 Nov 2018 13 Nov 2018
National PPP Specialist 3 Individual - Consulting Closed 29 May 2018 04 Jun 2018
National Senior Monitoring and Evaluation Specialist 2 Individual - Consulting Closed 03 May 2018 09 May 2018
National PPP Specialist 8 (water infrastructure sector) Individual - Consulting Closed 28 Mar 2018 03 Apr 2018
National PPP Specialist 7 Individual - Consulting Closed 23 Aug 2017 29 Aug 2017
National PPP Specialist 6 Individual - Consulting Closed 23 Aug 2017 29 Aug 2017

Contracts Awarded

Contract Title Approval Number Contract Date Contractor Contractor Address Executing Agency Contract Description Total Contract Amount (US$) Contract Amount Financed by ADB (US$)
Capacity Development Technical Assistance 9239 06 Nov 2019 Norton Rose Fulbright (Asia) LLP (SINGAPORE) One Raffles Quay, North Tower, 34-02, 04 pore Singapore Finance Department,GOS Consulting Services 378,460.00

Procurement Plan

None currently available.