The project will support capacity, quality, and safety improvements of the East -West Highway (EWH), which is the main domestic and international trade corridor of Nepal, and which forms part of the South Asian Association for Regional Cooperation (SAARC) corridor 4 linking Kathmandu to Dhaka and Chittagong through India. The project will (i) rehabilitate and widen about 87 kilometers (km) of the EWH between Kanchanpur and Kamala in southeastern Nepal; (ii) improve road safety, asset management, and gender equality and social inclusion (GESI) on the 1,027 km EWH; and (iii) strengthen the road safety and GESI capacity of road sector agencies. The project will promote economic growth and contribute to improving the competitiveness of Nepal's exporting industries by enhancing the efficiency of the transport system, strengthening national and regional connectivity, and improving the safety of the road network.
|Project Name||South Asia Subregional Economic Cooperation Highway 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
|Sector / Subsector||
Transport / Road transport (non-urban)
|Gender Equity and Mainstreaming||Effective gender mainstreaming|
|Description||The project will support capacity, quality, and safety improvements of the East -West Highway (EWH), which is the main domestic and international trade corridor of Nepal, and which forms part of the South Asian Association for Regional Cooperation (SAARC) corridor 4 linking Kathmandu to Dhaka and Chittagong through India. The project will (i) rehabilitate and widen about 87 kilometers (km) of the EWH between Kanchanpur and Kamala in southeastern Nepal; (ii) improve road safety, asset management, and gender equality and social inclusion (GESI) on the 1,027 km EWH; and (iii) strengthen the road safety and GESI capacity of road sector agencies. The project will promote economic growth and contribute to improving the competitiveness of Nepal's exporting industries by enhancing the efficiency of the transport system, strengthening national and regional connectivity, and improving the safety of the road network.|
|Project Rationale and Linkage to Country/Regional Strategy||
Country context. Nepal is landlocked and bordered to the north by the People''s Republic of China (PRC), and to the south, east, and west by India. Consequently, Nepal relies heavily on its direct neighbors for international trade particularly India, with which it shares 19 official trading posts. In fiscal year (FY) 2017, 65% of Nepal''s imports were from India, and 13% from the PRC; India received 57% of Nepal''s exports, and the PRC 2.3%. Biratnagar, located 68 km east of Kanchanpur, is Nepal''s largest export gateway, handling 29.5% of its exports, while the port of Kolkata is the primary transit point for seaborne freight.
Economic rationale. The gross domestic product of Nepal grew at an average annual rate of 4.5% during FY2007 -FY2017 and is forecast to grow at 5.9% in FY2018 and 5.5% in FY2019. The economy of Nepal suffers from a structural lack of competitiveness; exports have alarmingly decreased at an average annual rate of 6.1% in real terms during FY2007 -FY2017, while the agriculture sector still employs 69.4% of the labor force. The trade deficit is widening, as foreign remittances have sustained import growth, which increased by 21.3% annually during FY2007 -FY2017. The economy is hampered by deficient domestic and cross-border infrastructure networks, which increase transport costs and impede regional integration and trade with indirect neighbors: excluding India, trade with other SASEC and SAARC member countries accounts for just 0.8% of Nepal''s total trade.
Transport sector context. Road transport carries over 90% of passengers and goods in Nepal. The strategic road network (SRN) totals 12,494 km, 51% of which is paved, and is developed and maintained by the Department of Roads (DOR) of the Ministry of Physical Infrastructure and Transport (MOPIT). The SRN provides vital linkages to major economic centers and neighboring countries, and features eight north south and three east west corridors, including the 1,027 km-long EWH which carries the highest traffic volumes. The local road network totals 57,600 km, 3.5% of which is paved. The road density of Nepal, at 2.5 km of road per 1,000 people, is low, and there are few alternatives to road transport. Although projects supported by development partners are expected to increase the capacity and density of airport, railway, and inland waterway networks, road transport will continue to have a major role in the economic development of Nepal.
Road safety. Vehicle ownership remains low, with only 0.08 vehicles per capita, but vehicle sales increased by 17.5% annually during FY2007 -FY2017, and the number of registered vehicles is expected to quadruple in the next decade. Motorcycles account for 79.7% of sales, which further increases road safety risks, particularly on deteriorated or wet pavements conditions. The traffic fatality rate is estimated at 302 fatalities per 100,000 vehicles, one of the highest rates in Asia, and reported traffic accidents increased from 3,800 in FY2002 to 13,580 in FY2013.
Transport connectivity within Nepal and with neighboring countries improved
Physical connectivity and multimodal linkages for land-based transport along major trade routes enhanced
|Description of Outcome||Efficiency and safety of the road transport system improved|
|Progress Toward Outcome||Achieving the targets needs full completion of the project.|
|Description of Project Outputs||
Road network upgraded and maintained
Planning and management for road safety strengthened
Facilities and project readiness of Project Directorate (ADB) improved
|Status of Implementation Progress (Outputs, Activities, and Issues)||Procurement of 2 civil works contracts ongoing.Selection of construction supervision and project preparatory consultants are ongoing.|
|Geographical Location||Kamala River, Kanchanpur|
|Summary of Environmental and Social Aspects|
|Environmental Aspects||Environmental impacts will be mainly restricted to the construction stage with no expected irreversible impacts.|
|Involuntary Resettlement||Land acquisition and resettlement impacts are expected to be limited as the project is developed in the current right-of-way of DOR.|
|Indigenous Peoples||There are no indigenous people in the project area.|
|Stakeholder Communication, Participation, and Consultation|
|During Project Design||Consultations with the local communities, including women, were conducted to ensure that they were involved in the preparation and analysis of the project design. Consultations on poverty and social assessment, resettlement plan, and environmental assessment are currently being carried out, and overall highlight a high level of support for the project.|
|During Project Implementation||Stakeholders will be consulted during project implementation, particularly for the design and conduct of community awareness campaigns to be undertaken under the project.|
|Consulting Services||All consultants and nongovernment organizations will be recruited according to ADB''s Procurement Regulations (2017, as amended from time to time). All firms will be recruited using ADB's quality- and-cost-based selection (QCBS) under full technical proposal (FTP) and a standard quality -cost ratio of 90:10.|
|Procurement||All procurement of goods and works will be undertaken in accordance with ADB''s Procurement Policy (2017, as amended from time to time) and Procurement Regulations for ADB Borrowers (2017, as amended from time to time). Open competitive bidding (OCB) procedures will be used for all civil works contracts with provision for domestic preference. Requests for quotations will be used for procurement of works and goods estimated to cost less than $100,000.|
|Responsible ADB Officer||Chong, Sin Wai|
|Responsible ADB Department||South Asia Department|
|Responsible ADB Division||Transport and Communications Division, SARD|
Ministry of Physical Infrastructure and Transport
Nepal Project Directorate (ADB) - Department of Roads
|Concept Clearance||05 Apr 2018|
|Fact Finding||21 May 2018 to 01 Jun 2018|
|MRM||13 Jul 2018|
|Approval||03 Oct 2018|
|Last Review Mission||-|
|Last PDS Update||02 Aug 2019|
|Approval||Signing Date||Effectivity Date||Closing|
|03 Oct 2018||20 Nov 2018||05 Dec 2018||30 Jun 2024||-||-|
|Financing Plan||Loan Utilization|
|Total (Amount in US$ million)||Date||ADB||Others||Net Percentage|
|Project Cost||256.40||Cumulative Contract Awards|
|ADB||180.00||03 Oct 2018||0.04||0.00||0%|
|Cofinancing||0.00||03 Oct 2018||0.00||0.00||0%|
|Approval||Signing Date||Effectivity Date||Closing|
|03 Oct 2018||27 Oct 2018||27 Oct 2018||31 Jan 2022||-||-|
|Financing Plan/TA Utilization||Cumulative Disbursements|
|750,000.00||0.00||0.00||0.00||0.00||0.00||750,000.00||03 Oct 2018||133,854.57|
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.
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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|
|South Asia Subregional Economic Cooperation Highways Improvement Project: Resettlement Due Diligence Report||Safeguards Due Diligence Reports||Jun 2018|
|South Asia Subregional Economic Cooperation Highway Improvement Project: Kanchanpur - Kamala Road Initial Environmental Examination||Initial Environmental Examination||Jun 2018|
|South Asia Subregional Economic Cooperation Highway Improvement Project: ADB Project Directorate Office Building Subproject Initial Environmental Examination||Initial Environmental Examination||Jun 2018|
|South Asia Subregional Economic Cooperation Highway Improvement Project: Kanchanpur-Kamala Road Resettlement Plan||Resettlement Plans||Jun 2018|
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.
ADB Providing $180 Million to Improve Nepal's Main East–West HighwayADB's Board of Directors has approved a loan of $180 million to support improvements to Nepal’s East–West Highway, the country’s main domestic and international trade route also known as the Mahendra Highway.
No contracts awarded for this project were found
|Title||Document Type||Document Date|
|South Asia Subregional Economic Cooperation Highway Improvement Project: Procurement Plan||Procurement Plans||May 2018|