Announcement of IDA Lends Eighty-Seven Million Dollars for Calcutta Urban Development on December 15, 1977

,. :.World Bank ·1818 H Street, N.VV., \\'ashington, D.C. 20433, U.S.A. • Telephone: (202) 393-6360 IDA NEWS RELEASE NO. 78/26 DECEMBER 15, 1977 IDA LENDS $87 MILLION FOR CALCUTTA URBAN DEVELOPMENT The International Development Association (IDA) has approved a credit of $87 mill ion to l~dia for the Second Calcutta Urban Development Project. The Calcutta Metropolitan District is one of the most crowded areas 1n the world. Population density in the Calcutta Corporation averages 33,000 persons per square kilometer, rising to 44,000 persons per square kilometer in the heart of the city. \vith a population of 9.7 mil 1 ion, the Calcutta Metropolitan District has an urgent need for improved urban services. Sixty percent of the District's population (5.5 mill ion) do not have sewerage or drainage facilities. Water • supply and garbage collection are also inadequate. Proper housing is beyond the reach of 3.3 mill ion people who live in make-shift structures in crowded colonies. The Distri~t is provided with primary schools only for two-thirds of the children. The $183.71 mill ion project will assist the administrative authori- ties in the District to deal with the problem of improving urban services by strengthening the financial base of the District, and extending and rehabilitating the city's urban service systems, particularly those of critical importance to the urban poor. Included ;n tbe project is a program of organizational, managerial fiscal reform for the District's administrative agencies as well as a technical assistance and service program including area development and slum improvement schemes serving about 900,000 of the city's poor people. . .. / • NOTE: Money figures are expressed in U.S. dollar equivalents .  .r - 2 - The District's water supply, sewerage and sanitation facilities will also be improved extensively under the proj ·t; and a pilot health program serving about 175,000 low-income people will be established. The project also includes measures to rehabilitate the system of sol id waste management in the -~ area, the provision of credit and expanded extension services to about 4,800 very small enterprises, and traffic and transportation improvements. The project also includes the construction or remodeling of 440 primary schools to allow an additional enrollment of some 60,000 children 1 iving mostly in slum areas. An important feature of the project is the low per capita cost of the service program: $125 for sites and services infrastructure on- and off- site; $41 for slum improvement; and $1 .50 for health services. Such service designs will serve as models for similar development efforts. The project wi 11 be implemented by the Calcutta Metropolitan Development Authority established in 1970. The Authority has already been assisted with an IDA credit of $35 mill ion approved in 1973. The Netherlands is contributing $1 .8 mill ion to the cost of the pro_iect. The IDA credit to the Govern~ent of India is for 50 years, includ- ing 10 years of grace. It is interest free, except for a service charge of 3/4 of l percent to meet administrative costs. • - 0 - •  FORM Np. 1121 (5-7t3*r' T E C HN I CA L D A T A ie PROJECT: Second Calcutta Urban Development COUNTRY: India TOTAL COST: $18 3. 71 mi 11 ion IDA FINANCING: $87 million, standard IDA terms OTHER FINANCING: $1.8 million from the Netherlands Government of India and of West Bengal, open market borrowings and commercial banks. IMPLEMENTING ORGANIZATION: The Calcutta Metropolitan Development Authority (CMDA) 3-A, Auckland Place Calcutta-17, West Bengal, India. PROJECT DESCRIPTION: The project includes a program of organizational, managerial, and fiscal reform for the CMD's administrative agencies as well as a technical assistance and service program including area development and slum improvement schemes; extensive improvements to the CMD's water supply, sewerage and sanitation facil i- ties; and a pilot health program. The project also includes measures to rehabilitate the ~ system of sol id waste management in the CMD, the provision of credit and expanded extension services to about 4,800 very small enterprises, traffic and transportation improvements, and construction or remodeling of 440 primary schools. PROCUREMENT: Contracts for equipment with an estimated value of $13 million (net of contingencies and taxes) will be awarded on the basis of inter- national competitive bidding in accordance with IDA guidelines. A margin of preference of 15% or the current import duty, whichever is lower, will be granted to local manufacturers in evaluating bids for these contracts. Contracts for equipment with an estimated value of $8.5 mill ion will be awarded on the basis of local (all-India) competitive bidding. These contracts involve either small items unlikely to draw bids from foreign suppliers or equipment unsuitable for international bidding because of high transport costs and/or high risk of damage in transit. The total value of civil works is estimated at $85.5 million, excluding contingencies, the cost of land, and in many cases the cost of heavy equipment issued to contractors by CMDA. Contracts for two large road projects (i.e. the Barrackpore- Kalyani Expressway and the Eastern Metropolitan Bypass, total cost $7.5 million) will be awarded on the basis of international competitive bidding (ICB), the remainder of the civil works subprojects will be awarded on the basis of local (all-India) competitive bidding or executed by force account. A margin of preference of 7.5% will be granted to local contrac- tors on subprojects submitted to ICB. CMDA will "slice and package" civil works contracts into bid packages of not less than $1.1 million, wherever feasible, and will refrain from employing force account labor for civil works subproject components whose cost exceeds $200,000 without obtaining prior agreement from IDA. CONS1.iLTANTS: About 2,000 man-months of consultant services, mostly local, will be required . • ECOMOM IC RATE OF Kl:TURN: 20 percent. ESTIMATED COMPLETION DATE: 1982 - 0 -