The project will rehabilitate and upgrade in terms of capacity, quality, and safety, about 160 kilometers (km) of Nepal's strategic road network, which comprise a critical section of the country's main East-West highway and its feeder road. It will improve transport connectivity in Nepal, with a focus on providing faster and better access to social services and economic opportunities. The project roads are also integral to the international and regional road network system that connects Nepal to India, and will facilitate closer trade integration and contribute to Nepal's export competitiveness. The project will have a transformational impact by facilitating national and regional integration.
|Project Name||South Asia Subregional Economic Cooperation Roads Improvement Project|
|Project Type / Modality of Assistance||Loan
|Source of Funding / Amount||
|Strategic Agendas||Environmentally sustainable growth
Inclusive economic growth
|Drivers of Change||Gender Equity and Mainstreaming
Governance and capacity development
Private sector development
|Sector / Subsector||
Transport / Road transport (non-urban)
|Gender Equity and Mainstreaming||Effective gender mainstreaming|
|Description||The project will rehabilitate and upgrade in terms of capacity, quality, and safety, about 160 kilometers (km) of Nepal's strategic road network, which comprise a critical section of the country's main East-West highway and its feeder road. It will improve transport connectivity in Nepal, with a focus on providing faster and better access to social services and economic opportunities. The project roads are also integral to the international and regional road network system that connects Nepal to India, and will facilitate closer trade integration and contribute to Nepal's export competitiveness. The project will have a transformational impact by facilitating national and regional integration.|
|Project Rationale and Linkage to Country/Regional Strategy||
In Nepal, transportation connectivity is one of the country's most critical bottlenecks to reducing poverty and sustaining inclusive economic growth. With its challenging mountainous terrain, roads are the predominant mode of transport in the country, carrying 90% of passengers and goods. However, Nepal has the lowest road density among countries in South Asia (about 14 km per 100 square kilometers and 0.9 km per 1,000 people), and the overall efficiency and reliability of the road network is poor. Consequently, high transport cost and poor connectivity limit access to opportunities, and hinder job creation and delivery of services. It also impedes trade with neighboring countries as the cost of importing and exporting becomes much higher, and undermines development of competitive industries in Nepal, such as high-value agriculture, agro-processing, and manufacturing. Moving forward, Nepal needs to deliver on its economic potential and this requires significant investment in road improvements to ensure faster and better access to social services, domestic and international markets, and employment opportunities. Accordingly, the government''s 14th Development Plan (FY 2017- 2019) has prioritized the development of the country's physical infrastructure, and integrating with those of neighboring countries.
In support of the government''s plan, the proposed project will rehabilitate and upgrade sections of Nepal''s strategic road network, which comprise the East-West highway (115 km from Narayanghat to Butwal) and its feeder road (45 km from Bhairahawa to Taulihawa). The East-West highway is the main arterial road cutting across the entire width of the country in Terai area (southern lowland plains bordering India). The project influence area is at the center of the East-West highway, which is the most productive region in Nepal and supports growing industries in agriculture and related processing, services (education and health), trade, and tourism. Narayanghat is one of the fast growing cities where a large number of business and trading houses are based, and Bhairahawa is a major trading city located in the country's first special economic zone to increase trade between Nepal and India. This area also encompasses the Lumbini Zone which is a Buddhist pilgrimage site and was accorded World Heritage Site status by the United Nations Educational, Scientific and Cultural Organization (UNESCO). Its main gateway, the Gautam Buddha Airport, is currently being upgraded to international standards under ADB financing.
The proposed project is integral to the government's Transport Sector Strategy (2016 2021) with a focus on improving the country's strategic road network and progressively expanding the capacity of the East West highway and its feeder roads. The upgraded project roads will help ease growing traffic congestion and improve transport connectivity internally and with India. It will bring significant advantages to the overall social economic development and support Nepal's goal to graduate from the status of least developed country to a developing country by year 2022. The proposed project is in line with the strategic objective of increasing connectivity and access to basic services and markets, and promoting tourism as described in ADB's country partnership strategy, 2013-2017. It is included in ADB's country operations business plan, 2016 2018 for Nepal.
The project roads are integrated with an international and regional road network system that connects Nepal to the state of Uttar Pradesh in India. The main benefit will be improved connectivity to Bhairahawa and its inland clearance depot and land custom station. Collectively, the proposed project will facilitate increased trade with India and other countries in the region, and help contribute to Nepal's export competitiveness. This is consistent with the objectives of ADB's support for the South Asia Subregional Economic Cooperation.
|Impact||Transport connectivity within Nepal and with neighboring countries enhanced|
|Description of Outcome||Road transport system improved|
|Progress Toward Outcome||
Contract for Bhairahawa-Lumbini-Taulihawa Road awarded in June 2017 to M/s Gawar Construction. Contractor commenced work in July 2017. As of Jul 2018, physical progress is 10.73%.
Civil works packages for Narayanghat-Butwal Road (NB-01 & NB-02) are for rebidding.
|Description of Project Outputs||
Road network rehabilitated and upgraded
Road safety and maintenance improved
|Status of Implementation Progress (Outputs, Activities, and Issues)||
Contract for Bhairahawa-Lumbini-Taulihawa Road awarded in June 2017.
As of Jun 2018, physical progress is 10.73%.
Civil works packages for Narayanghat-Butwal Road (NB-01 & NB-02) are for rebidding; EA to submit FBER.
Not yet due
Not yet due
|Geographical Location||Bhairahawa, Butwal, Lumbini, Narayangarh, Taulihawa|
|Summary of Environmental and Social Aspects|
|Environmental Aspects||Since 24 km of the Narayanghat-Butwal road is adjacent to the buffer zone of Chitwan National Park, wildlife cross the road at a number of points. Species include the Bengal tiger (endangered) and greater one-horned rhinoceros (vulnerable), which are protected under the National Parks and Wildlife Conservation Act of Nepal. The draft environmental impact assessment for this road was disclosed on the ADB website in June 2016. Potential significant impacts of the Narayanghat-Butwal road will be the obstruction of wildlife movement during construction and operation. To mitigate this risk, a minimum of five wildlife underpasses will be constructed and a biodiversity conservation plan and a compensatory afforestation program will be implemented to ensure that there are no measurable adverse impacts, no net loss of biodiversity, and that all lesser impacts are mitigated. A first stakeholders' consultation workshop on wildlife impact mitigation and environmental and social safeguards was held in Nepal in August 2017, with representatives of Department of National Parks and Wildlife Conservation (DNPWC), World Wildlife Fund for Nature (WWF) Nepal, United States Agency for International Development (USAID) Nepal, Chitwan National Park (CNP), National Trust for Nature Conservation (NTNC), and Buffer Zone Community Forestry Management Groups (BZCFMG). Semi-annual consultations will continue throughout project implementation.The Bhairahawa-Lumbini-Taulihawa road is classified category B in accordance with ADB's Safeguard Policy Statement (2009). Though the road is located near the UNESCO World Heritage site of Lumbini, the Department of Archaeology confirmed that the project will not affect the site because the road will not be widened at the section passing near the site. An initial environmental examination was disclosed on the ADB website in July 2016.|
|Involuntary Resettlement||The land acquisition and resettlement impacts were adequately assessed and the social due diligence confirms that impacts are moderate. A total of 49 households (271 persons) are expected to be affected, among which 32 households (189 persons) will be significantly affected (i.e., physical relocation; household losing 10% or more of its land). Most of the structures affected are commercial (60%) and belong to non titleholders. The project is expected to require acquisition of minor strips of land (160 square meters), affecting 18 households, most of whom will lose less than 10% of their plot.|
|Indigenous Peoples||The project will improve existing corridors and thus will not have any impact on the culture, human rights, or livelihood systems. No tribal, ancestral, or customary land exists in the project areas.|
|Stakeholder Communication, Participation, and Consultation|
|During Project Design||Consultations for the poverty and social assessment, resettlement plan and environmental assessment took place in November 2015, February 2016, and April 2016, respectively, during which 595 people including 139 women participated. The poverty and social analysis and resettlement plan preparation also involved the survey of 5,635 and 271 persons, respectively. The extensive consultation process ensured the views and concerns of local communities along the alignment were taken into account in the project design. Overall, they demonstrated a high level of support for the project. Around 18 NGOs and civil organizations were consulted during project preparation, including by ADB. Their expertise in human trafficking awareness and prevention was particularly valuable to ensure this aspect was properly assessed and taken into account in the project design.|
|During Project Implementation||NGOs will be consulted during implementation, in particular for the design and conduct of the various community awareness campaigns to be undertaken under this project.|
|Consulting Services||All consultants will be recruited according to ADB's Guidelines on the Use of Consultants (2015, as amended from time to time).|
|Procurement||All procurement of goods and works will be undertaken in accordance with ADB's Procurement Guidelines (2015, as amended from time to time).|
|Responsible ADB Officer||Bhupendra Bhatt|
|Responsible ADB Department||South Asia Department|
|Responsible ADB Division||Nepal Resident Mission|
Ministry of Physical Infrastructure and Transport
Nepal Project Directorate (ADB) - Department of Roads
|Concept Clearance||13 May 2016|
|Fact Finding||06 Jun 2016 to 17 Jun 2016|
|MRM||23 Aug 2016|
|Approval||01 Dec 2016|
|Last Review Mission||-|
|Last PDS Update||23 Sep 2018|
|Approval||Signing Date||Effectivity Date||Closing|
|01 Dec 2016||18 Jan 2017||02 Feb 2017||31 Jul 2022||-||-|
|Financing Plan||Loan Utilization|
|Total (Amount in US$ million)||Date||ADB||Others||Net Percentage|
|Project Cost||256.50||Cumulative Contract Awards|
|ADB||186.80||01 Dec 2016||152.77||0.00||83%|
|Cofinancing||0.00||01 Dec 2016||27.94||0.00||15%|
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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
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ADB Approves Loan to Improve Transport Connectivity in NepalADB has approved a $186.80 million loan to upgrade 160 kilometers (km) of Nepal’s strategic road network and improve the country’s domestic and regional transport connectivity.
|Tender Title||Type||Status||Posting Date||Deadline|
|External Monitor Environmental Safeguard||Individual - Consulting||Closed||30 May 2019||13 Jun 2019|
|External Monitor Environmental Safeguard||Individual - Consulting||Closed||28 May 2018||11 Jun 2018|
|Loan No. 3478-NEP: South Asia Subregional Economic Cooperation (SASEC) Roads Improvement Project [SRIP/ICB/NB 01 and SRIP/ICB/NB 02] REBIDDING||Invitation for Bids||Closed||20 Apr 2018||07 Jun 2018|
|NEP: South Asia Subregional Economic Cooperation Roads Improvement Project||Advance Notice||Archived||16 Aug 2016|
|Contract Title||Approval Number||Contract Date||Contractor||Contractor Address||Executing Agency||Contract Description||Total Contract Amount (US$)||Contract Amount Financed by ADB (US$)|
|Bharahawa-Lumbini-Taulihawa Road (Km 0 000 To Km 41 130)||Loan 3478||27 Jun 2017||M/S Gawar Construction Ltd.||Sf-01, JMD Galleria, Sector-48, Sohna Road, Gurgaon 122001 (Haryana), India||Ministry of Physical Infrastructure and Transport||Construction||18,692,139.00||15,789,659.00|
|Construction Supervision Consultant||Loan 3478||05 Jun 2017||Korea Engineering Consultants Corp||KECC Bldg, 21 Sangil-Ro, 6 Gil Gangdong-Gu, Seoul 05288, Korea, Republic of||Ministry of Physical Infrastructure and Transport||Consulting Services||8,676,843.00||8,672,768.00|