Nepal : Rural Connectivity Improvement Project - Additional Financing

Project Name

Rural Connectivity Improvement Project - Additional Financing

Project Number

48218-011

Country / Economy

• Nepal

Project Status

Active

Project Type / Modality of Assistance

• Loan
• Technical Assistance

Source of Funding / Amount

Loan 4320-NEP: Rural Connectivity Improvement Project - Additional Financing

Source	Amount
Concessional ordinary capital resources lending	US$ 100.00 million

TA 10113-NEP: Implementation Support and Institutional Strengthening for the Rural Connectivity Improvement Project - Additional Financing

Source	Amount
Technical Assistance Special Fund	US$ 1.00 million

Operational Priorities

• OP1: Addressing remaining poverty and reducing inequalities
• OP2: Accelerating progress in gender equality
• OP3: Tackling climate change, building climate and disaster resilience, and enhancing environmental sustainability
• OP5: Promoting rural development and food security
• OP6: Strengthening governance and institutional capacity

Sector / Subsector

• Agriculture, natural resources and rural development / Rural market infrastructure

Gender

Effective gender mainstreaming

Description

The overall project is estimated to cost $255.72 million, including additional financing of $120.00 million, of which ADB is providing a concessional loan of $100.00 million from ADB's ordinary capital resources. The government will finance $20.00 million of the proposed additional financing project. The attached TA is estimated to cost $1.00 million, which will be financed on a grant basis by ADB's Technical Assistance Special Fund.

The impact and outcome of the overall project will remain unchanged from those of the ongoing project. The proposed additional financing will scale up the current output 1 by an additional 324 km of rural roads and output 2 by increasing capacity support to fulfill the roles and responsibilities in a federal system.

Project Rationale and Linkage to Country/Regional Strategy

The additional financing will increase the project's scope by upgrading an additional 324 km of rural roads across five provinces. The implementation arrangements will evolve from the ongoing project to better align and support federalism. The overall project scope is aligned with the government's priorities under the Fifteenth Plan (fiscal year 2020-FY2024), ADB's country partnership strategy for Nepal, 2020-2024 and ADB's Strategy 2030.

The roads will improve connection of rural and agricultural areas with administrative and socio-economic centers. The roads will be improved to all-weather standards, with safety features, and will be maintained for 3 years under performance-based maintenance contracts. The additional financing will also integrate climate adaptation and disaster resilience measures into the technical designs of the infrastructure. Compared to the ongoing project, the additional financing will also include upgrading bridges that are essential for all-weather connectivity and include more intermediate lanes necessary for higher volume areas and steeper slopes.

Impact

Connectivity between rural communities, productive agricultural areas, and socioeconomic centers in Nepal improved

Project Outcome

Description of Outcome

Transport efficiency on project roads increased

Progress Toward Outcome

- All planned civil works packages (NCB-01, NCB-02, NCB-03, NCB-04, NCB-05, NCB-06, NCB-07, NCB-08, NCB-09, NCB-10, and NCB-11) have been awarded. Contract of NCB-04 was terminated due to poor performance of contractor which has been re-awarded in September 2020. Additional 2 packages for construction of 4 additional roads ( packages 12 and 14) from the saving amount have also been identified and awarded on May 2021.

- Capacity Development Consultant, Poject Management Consultants recruited.

- Recruitment of 5 consulting firms for DPR preparation has been completed. Field work of feasibility study of 2,937.69 km has been completed. Field work of detail engineering survey of about 1,897.63 km has been completed. Field work of CPP of 1,013 km and draft report of 290 Km has been completed. Survey completed of 37 and draft design of 7 bridges has also been completed.

- Contract awarded for livelihood related skill training.

Implementation Progress

Description of Project Outputs

Rural road conditions between the selected rural communities, productive agricultural areas, and socioeconomic centers improved

Capacity of rural infrastructure agencies and road users in project areas enhanced.

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

Geographical Location

Bagmati Province, Gandaki, Karnali, Koshi, Lumbini Province

Safeguard Categories

Environment

B

Involuntary Resettlement

B

Indigenous Peoples

C

Summary of Environmental and Social Aspects

Environmental Aspects

Involuntary Resettlement

Indigenous Peoples

Stakeholder Communication, Participation, and Consultation

During Project Design

During Project Implementation

Business Opportunities

Consulting Services

Procurement of consulting services shall follow the ADB Procurement Policy (2017, as amended from time to time) and Procurement Regulations for ADB Borrowers (2017, as amended from time to time).

Procurement

Procurement of goods, and works shall follow the ADB Procurement Policy (2017, as amended from time to time) and Procurement Regulations for ADB Borrowers (2017, as amended from time to time).

Contact

Responsible ADB Officer

Tiwari, Hemant

Responsible ADB Department

Sectors Group

Responsible ADB Division

Transport Sector Office (SG-TRA)

Executing Agencies

Ministry of Urban Development

Timetable

Concept Clearance

19 May 2022

Fact Finding

29 Aug 2022 to 12 Sep 2022

MRM

09 Dec 2022

Approval

13 Jun 2023

Last Review Mission

-

Last PDS Update

16 Jun 2023

Funding

Loan 4320-NEP

TA 10113-NEP