Sri Lanka - Third Roads Project

Document of The World Bank FOR OFFICIAL USE ONLY F / f 8 3 Repon No. 8816-CE STAFF APPRAISAL REPORT SRI LANKA THIRD ROADS PROJECT OCTOBER 3, 1990 Infrastructure Operations Division Country Department I Asia Regional Office Thi docment as a restdcted dbuibudon and may be used by repiens ady in the pedromnau nf their oflicda duies. Its contents may not oerwise be disdosed wihoat Wodd Bank authrdzaion.  CURRENCY AND EOUIVALENT UNITS (As of April 1990) Currency Unit - Sri Lanka Rupee (SL Rs) SL Rs 40.0 - US$1.00 SL Rs 1,000 - US$25.00 WEIGHTS AnD MEASURES 1 meter (m) - 3.28 feet (ft) 1 kilometer (km) - 0.62 mile (mi) 1 hectare (ha) - 2.48 acres (ac) 1 ton - 2,208 pounds 1 ton-km - 0.62 ton-mile 1 passenger-km - 0.62 passenger-mile ABBREVIATIONS ADB - Asian Development Bank CM&C - Construction Management and Contracts EDCF - Economic Development Cooperation Fund (Republic of Korea) GOSL - Government of Sri Lanka INC-CPT - Inter-Ministerial Committee for Coordination and Planning of Transport mOp - Ministry of Finance MPPI - Ministry of Planning and Policy Implementation MTH - Ministry of Transport and Highways OECF - Overseas Economic Cooperation Pund ODA - Overseas Development Administration PMMU - Project Management and Monitoring Unit PPF - Project Preparation Facility RCDC - Road Construction and Development Co. Ltd. RDA - Road Development Authority RTBs - Regional Transport Boards SLCTB - Sri Lanka Central Transport Board TSPS - Transport Sector Planning Study (January 1988) FISCAL AR January 1 - December 31  FOR OMCIAL USE ONLY SRI LANK THIRD ROADS PROJECT STAFF APPRAISAL R2PORT Table of Contents CREDIT AND PROJECT SUHARY .......................................... i I. TOE TRANSPORT SECTOR .......................................... 1 A. Introduction 1.............................................. B. Transport Institutions, Planning and Coordination .... ..... 1 C. Sector Objectives ............ ............................. 2 D. The Transport System .......... ............................ 2 E. IDA's Sector Role and Assistance Strategy .................. 4 II. THE ROAD SUBSECTOR ............................................ 5 A. The Network . .............................................. 5 B. Traffic ................................................... 6 C. Administration and Organization ....... .................... 7 D. Planning, Design and Construction ...... ................... 9 '1. Road Expenditures and Financing .11 -II. THE PROJECT ........................................ 12 A. Background . ........................................ 12 B. Project Objectives ........ ......... ...................... 13 C. Project Description ........... .................. 13 D. Cost Estimates ............................. 17 E. Project Financing ......... .................... 17 F. Implementation ............................. 18 G. Procurement and Contracting ............................. 19 H. Disbursements ............................. 20 I. Accounts and Audits ....................................... 21 J. Monitoring and Reporting .............................. 21 IV. JUSTIFICATION AND RISKS .............................. 22 A. Economic Evaluation ............ .................. 22 B. Risks .............................. 24 C. Environmental Impact .............. ................ 25 D. Special Considerations ............................... 25 V. A MREEMENTS REACHED AND RECONNENDATION ......... ................ 25 This report is based on the findings of an appraisal mission to Sri Lanka in April 1990. Mission members included Mr. B. Assimakopoulos (Principal Engineer/Planner and Task Manager), Mies. I. Bradfield (Senior Transport Economist), J. Williams-Palenzuela (Operations Assistant) from the International Development Association, and Mr. R. Leonard (Highway Engineer), Consultant. The report has been endorsed by Messrs. S. Asanuma (Director, Country Department I, Asia Region), and I. T. Christie (Chief, Infrastructure Operations Division). The peer review team comprised Messrs. W. Paterson and S. Sigfusson, who focussed their review on highway engineering; R. Zagha/ti. Shishido who focussed their review on economic aspects; and C. Rees, who reviewed ecological and environmental aspects. The report has been cleared by Messrs. H. Darmawi (Senior Counsel) and R. Wiratunga (Senior Disbursement Officer). This document has a restricted distribution and may be used by recipients only in the performance of theit official duties. Its contents may not otherwise be disclosed without World Bank authorization.  Annex 1 Rcad Development Authority: Organization and ResponsibilitSes ...... .................. 27 Annex 2 Detailed Description of Works (Roads and Bridges) ........... 33 Annex 3 Study on Road User Charges, Terms of Reference .... ......... 39 Annex 4 Domestic Contracting Industry Study in the Road Subseator, Terms of Reference ........................................ 44 Annex 5 Project Management and Monitoring Unit Advisor, Terms of Reference ......... .............................. 47 Annex 6 Supervising Consultant, Terms of Reference ..... ............ 51 Annex 7 Schedule of Estimated Disburse3ments ......................... 58 Annex 8 Project Reporting Requirements ............................. 59 Annex 9 Economic Evaluation--Assumptions and Methodology ............ 60 Annex 10 Selected Documents and Date Available in the Project File... 90 TABLES Table 1.1 Passenger and Freight Traffic . 92 Table 1.2 Vehicle Registrations by Class of Vehicle . 93 Table 2.1 Road Network by Province/Juristiction and Road Surface Type . 94 Table 2.2 Public Investment in Transport (1981-1993) . 95 Table 2.3 Summary of Provisions/Expenditures on Roads . 96 Table 2.4 Road Development Authority - Proposed Five-Year Expenditures . 97 Table 3.1 Road Rehabilitation Program . 98 Table 3.2 Bridge Rehabilitation Program . 99 Table 3.3 Cost of Vehicles and Equipment . 100 Table 3.4 Estimated Cost for Roads . 101 Table 3.5 Estimated Cost for Bridges . 102 Table 3.6 Estimated Project Costs (Roads and Bridges) . 103 Table 4.1 Traffic Forecasts .. 104 Table 4.2 Estimated Construction Costs and Schedule . . 1 Table 4.3 Results of Economic Evaluation .. 107 Table 4.4 Vehicle Operating Costs: Toppu-Dankotuwa-Giriulla Roads . 108 Table 4.5 Vehicle Operating Costs: Kalutara-Ambalangoda Roads . 109 Table 4.6 Vehicle Operating Costs: St. Joseph Street . 110 Table 4.7 Switch Value Analysis .. 111 Chart 1 Organization of Road Development Authority . 112 Chart 2 Implementation Schedule . 113 IBRD No. 22434  .L_ TnIRD RQADS PROJECT Credit and Projest Sumiarv lormuryff: Democratic Socialist Republic of Sri Lanka Ben ficlaxi: Road Development Authority hAM=: SDR 30.6 million (US$42.5 million) TerAs: Standard, with 40 yeats maturity On-L.endLn Terms: N/A Prolect Descriution: The project's objectives are to: (a) reduce the road transport cost and delays of passengers and goods by restoring major trunk roads to better operational condition; (b) help to restore priority road infrastructure damaged by flooding and landslides in H4ay/June 1989; (c) enhance the institutional capabilities to increase the quality and extent of road maintenance and rehabilitation; and (d) upgrade RDA's capacity to supervise and execute rehabilitation works and to identify actions needed to develop the local road contracting industry. The project to be implemented over an eight-year period would focus on: (a) rehabilitation of about 420 km of primary and secondary trunk routes (Class A and B roads); (b) repair, rehabilitation and replacement cf 24 bridges; (c) repair and rehabilitation of road sections and associated structures damaged as a consequence of floods and landslides; (d) procurement of vehicles, equipment and supplies to strengthen contract administration and management; and (e) consultant services, technical assistance and on-the-job training to improve contract monitoring and cost control capabilities. Benefits and Risks: Transport savings made pos3ible by the project would be passed on to the users in the form of lower operating costs and increasod product availability. The Sri Lankan population is highly mobile and the benefits of the project are expected to be widely distributed among all segments of the population, including poverty groups. The flood rehabilitation component is expected to directly assist rural low income families by restoring access for agricultural inputs/outputs. The project supports privatization through assistance to the local contracting industry and it is expected to generate labor- intensive employment opportunities for all dwellers in the vicinity of project works. A predominant risk is the possible breakdowin of the fragile political stability in the country which could affect implementation and costs. Flexibility has been incorporated into the implementation schedule to allow for the initial contracts to be in areas unaffected by political unrest. Works will be initially awarded at annual intervals in order to monitor the situation and enable the timing of the later contracts to be adjusted to prevailing conditions. Other risks are the possible weakening of Government's commitment to the project and over-extension of RDA's implementation capacity.  - ii- Estimated Costa; Local Foreign Total -----US$ million--------- Civil Works (Roads and Bridges) 20.9 27.9 48.8 Road Flood Rehabilitation 1.7 0.6 2.3 Equipment 0.1 0.1 0.2 Technical Assistance Project Support 2.3 2.4 4.7 Policy Development 0.2 0.6 0.8 Project Preparation Facility 0.0 0.5 0.5 Total Base Costs Z= 32.1 5.3A Physical Contingencies 2.1 2.6 4.7 Price Contingencies 2.9 _.. 8.5 ::ubtotal Contingencies 5.0 8.2.13.2 Total Project Costs J/ 30.2 40.3 70.5 1/ The total cost, net of taxes and duties (US$8.3 million), is US$62.2 million. Figures may not total because of rounding. .:^nancim Plan: Local Fgreign Total --US$ million-------- Government 13.5 0.0 13.5 EDCF (Republic of Korea) 4.3 10.2 14.5 IDA ILA NU 42. Total 30.2 40.3 70.5 Estimaped Disbursements: IDA Fiscal Year PY91 FY92 FY93 F im FY9S 1122 112Ft ------------------US$ million----------------- Annual 2.4 2.5 4.9 7.4 9.0 8.2 6.0 2.1 Cumulative 2.4 4.9 9.8 17.2 26.2 34.4 40.4 42.5 Econmoic Rate of Return: 33.1% NO: IBERD No. 22434  SkI LANKA THIRD ROADS PROJECT I. THE TRANSPORT SECTOR A. Introduction 1.1 The island of Sri Lanka (66,000 kW2) has a topography which is flat in the coastal areas and mountainous toward the center of the island. The maximum geographical distances of the island are about 400 km from north to south and 240 km from east to west. Rivers flow in a radial pattern from the mountains and have no navigational significance. The road network traverses a land contour rising from mean sea level to over 2,000 meters and through areas with iainfall as high as 3,500 mm per year and average temperatures ranging from 110C in the mountainous areas toward the center of the island to 32