India - States' Road Infrastructure Development Technical Assistance Project

Document of The World Bank Report No. T-7007-lN TECHNICAL ANNEX ON A PROPOSED LOAN TO INDIA FOR A STATES' ROAD INFRASTRUCTURE DEVELOPMENT TECHNICAL ASSISTANCE PROJECT November 11, 1996 Energy & Infrastructure Operations Division Country Department II South Asia Region  - ii- CURRENCY EQUIVALENTS (as of November 1, 1996) Currency Unit = Rupees (Rs) One Rupee = US$0.03 (approx.) US$1.00 = Rs 35.68 WEIGHTS AND MEASURES The metric system is used throughout this report ABBREVIATIONS AND ACRONYMS CAS - Country Assistance Strategy DE - Detailed Engineering DEA - Department of Economic Affairs DPR - Detailed Project Report EA - Environmental Assessment EAP - Environmental Action Plan EC - Empowered Committee GOI - Government of India GPN - General Procurement Notice km - Kilometer MOST - Ministry of Surface Transport PCC - Project Coordinating Consultant PIPF - Project Identification & Preparation Framework PPF - Project Preparation Facility PQ - Prequal ification (of contractors) PWD - Public Works Department R&R - Resettlement and Rehabilitation RAP - Rehabilitation Action Plan SG - State Government TA - Technical Assistance FISCAL YEAR April I - March 31 Vice President: D. Joseph Wood Director: Heinz Vergin Division Chief: Jean-Francois Bauer Task Manager: Ernst Huning  - 111 - INDIA STATES' ROAD INFRASTRUCTURE DEVELOPMENT TECHNICAL ASSISTANCE PROJECT TECHNICAL ANNEX Table of Contents PagNo. Loan and Project Summary .................................................... iv I. Institutional Setting ....................................................1l II. Project Description ....................................................2 III. Project Cost and Financing ....................................................6 IV. Project Implementation and Administration .....................................................7 ATTACHMENTS Attachment 1: Project Identification and Preparation Framework (model) .............11............. 1 Attachment 2: Initial Project Funds Allocation .................................................... 16 Attachment 3: Project Activity Outline .................................................... 17 Attachment 4: Project Design Summary .................................................... 18 Attachment 5: Project Performance Indicators ...................... .............................. 21 Attachment 6: Proposed State Highways I (Andhra Pradesh) Project: Public Information Document (PID) ......................................... 24 SCHEDULES A. Estimated Costs and Financing Plan .................................................... 27 B. Procurement and Disbursement .................................................... 28 C. IBRD Loans and IDA Credits, and 'India At A Glance' .................................................... 30 The project was prepared by Messrs. Ernst Huning (Task Manager, SA2EI), Fabio Galli (Financial Analyst, SA2EI), Christopher Hoban (Senior Highways Engineer, SA2EI), Chandra Godavitarne (Consultant, SA2EI) and Jose Pedro Da Silva (Legal Counsel, LEGSA). Messrs./Mmes. Angela Armstrong (Project Assistant, SA2EI), Moncef Chaabouni (Project Assistant, SA2EI), Joelle Chassard (Senior Financial Analyst, SA2EI), R L Kapoor (Local Consultant, SA2RS), Reidar Kvam (Anthropologist, ASTHR), Peter Long (Highways Engineer/Consultant, SA2EI), David Marsden (Chief, Social Development Unit, SA2RS), Malaine Manzo (Senior Operations Officer, SA2EI), Peter Midgley (Senior Urban Planner, ASTEN), I U B Reddy (Social Development Officer, SA2RS), Vivi Scott (Senior Staff Assistant, SA2EI), Gladys Stevens (Senior Staff Assistant, SA2EI) and Kazuko Uchimura (Project Adviser, SA2DR) have all made valuable contributions in this context. The peer reviewers were Dieter Schelling (Senior Highways Engineer, AF4IN), Hatim Hajj (Senior Transport Specialist, EA2TP) and Jaffar Bentchikou (Senior Highways Engineer, MN1PI). The report has been endorsed by Messrs. Heinz Vergin (Director, SA2) and Jean-Francois Bauer (Division Chief, SA2EI).  I  - iv - INDIA STATES' ROAD INFRASTRUCTURE DEVELOPMENT TECHNICAL ASSISTANCE PROJECT Loan and Project Summary Borrower: India, acting by its President Implementing Agency: Department of Economic Affairs Beneficiaries: State governments and their road management agencies and other road transportation sub-sector stakeholders Poverty Category: Not Applicable Environmental Category: C Loan Amount: US$51.5 million equivalent Terms: LIBOR-based variable lending rate and repayable over twenty years, including a five year grace period Commitment Fee: 0.75 percent on undisbursed loan balances, beginning 60 days after signing, less any waiver. Onlending Terms: Standard terms and conditions applicable to GOI's central assistance to states at the time, fully additional to each State's Plan assistance, with GOI bearing the foreign exchange and interest rate risks. Project Objectives: To strengthen individual states' capacity for the provision, financing, maintenance and management of road transport infrastructure, and to assist individual states to comprehensively prepare sound road infrastructure investment projects. Project Description: Financing of comprehensive Technical Assistance (TA) through GOI to states for: (i) implementation of sustainable roads sector institutional and financing reforms and (ii) comprehensive preparation of road infrastructure investments. Risks and Safeguards: Principal risks are limited implementation by states of essential project preparations and sector reforms. TA project participation is conditional on each State taking policy-based actions towards sustainable reforms in roads planning, financing, maintenance and management. Project TA will support states' implementation of such reforms and the preparation of planned investment projects. Financing Plan: See table in Schedule A. Staff Appraisal Report: Not applicable.  I  INDIA STATES' ROAD INFRASTRUCTURE DEVELOPMENT TECHNICAL ASSISTANCE PROJECT Technical Annex I. Institutional Setting 1. The Government of India (GOI)'s strategy of supporting priority road infrastructure investment proposals by the states (alongside those for National Highways needs) was initiated in 1992/93, as part of the evolution of India's program of economic reforms and liberalization. In this context, the GOI's Department of Economic Affairs (DEA) played a strategic role in the establishment in September, 1993 by the Bank of a Project Preparation Facility (PPF) for the State of Haryana to assist with the costs of preparing a major highways upgrading and rehabilitation project aimed at eventual Bank financing (the first such PPF initiated for India). The strategy's overall objectives are, as agreed between GOI and the Bank from the outset, to combine preparations for major improvements in state-level road infrastructure with measures designed to achieve significant sectoral institutional strengthening and future sustainability of road network assets. 2. The preparations in Haryana and subsequently in Andhra Pradesh have taken longer than originally anticipated, however, DEA and the Center's nodal ministry for the sector, the Ministry of Surface Transport (MOST), have continued their explicit support for and promotion of this strategy. Several states have now responded with their own substantive proposals for similar Bank-assisted investment project preparation and implementation. 3. While the overall strategy has been established and promoted through the central government, the responsibility for actually implementing the strategy (through the medium of suitable Project vehicles and/or various sector policy interventions) rests with the individual states, as road transport is a field of concurrent constitutional responsibility between Center and states. In this sector, the main implementing and execution capacities have historically been located in the states' roads agencies (mostly still termed Public Works Departments, or PWDs, on the basis of their diverse works and services functions as 'Engineer to the State'). 4. Apart from their substantial administrative and field-labor echelons, these PWDs are staffed by career engineering officials whose career mobility is generally limited to the particular state PWD context and whose advancement is determined largely by seniority. Their skills base rarely includes non- engineering expertise (e.g. in economics, law, environmental or social sciences) and the resources and opportunities for staff development are generally limited. Their internal technical resources are frequently outdated and there is little effective computerization of processes and information. At the same time, there is still only limited usage of available private sector engineering, construction and maintenance resources, with considerable in-house provision of such services remaining. 5. Most aspects of the PWDs' project and program management activities suffer from a lack of up- to-date in-depth capacities, inappropriate technology and/or inadequate finances, resulting in significant inefficiencies, quality and performance problems in key areas such as road maintenance, investment planning and implementation. The financial and technical policies and practices determining the PWDs' activities in roads planning, construction and maintenance are, in principle, based on contemporary norms and standards promulgated India-wide by bodies such as MOST, the Finance Commission and/or the  Indian Road Congress. In practice, however, these norms and standards are often unrealistic for the actual circumstances and needs in the sector and thus do not result in effective design, construction or maintenance outputs. The pervasive financial constraints in the sector and the PWDs' limited capacity for effective quality control, financial and performance accountability in works implementation and maintenance operations also undermine the quality otherwise possible under the existing norms and policies. 6. Most state governments and their PWDs have recognized their difficulties in meeting current demands for financing, provision and maintenance of major road network infrastructure, and have begun to implement some policy reforms and institutional strengthening measures. However, their efforts have so far been limited in scope and impact, and inhibited by the lack of wider institutional support and by major ongoing financial constraints. 7. The roads sector in India is facing a crucial threshold, where the undoubted need for major physical investments in road infrastructure is matched by the widespread appreciation of the need for major sector policy and institutional reforms and capacity building. Both the Center and the States now show a broad commitment to change in the key institutional, operational and financing aspects of the sector. However, without the impetus of GOI's strategic support and without external financial assistance which explicitly targets these areas of 'institutional investment', major performance constraints and weaknesses will prevail in this sector. 8. Accordingly, under this project, the Bank-financed TA for a State's road infrastructure investment preparations would be paralleled by Bank-financed TA supporting the State's efforts to develop and implement policy-based reforms aimed at future sustainability in the State's capacities for road infrastructure financing and facilitation, asset maintenance and overall sector management. The TA- supported interventions and capacity-building measures needed to achieve this will be identified as early as possible, for action in parallel with the planned TA-supported road infrastructure investment preparations. H. Project Description 9. The project will enable financing of TA support to individual States' road infrastructure investment preparations via two main components: (a) The project preparation and implementation support component under which financial assistance will be provided by GOI to individual States for investment project preparations, and in particular to help meet the costs of: (i) preparation of techno-economic feasibility studies, all preliminary engineering, sufficient final engineering designs to enable commencement of at least the first two years' construction program immediately upon a future Loan's effectiveness, and all associated procurement preparations, to meet Bank project appraisal and approval requirements; (ii) comprehensive preparation of the associated Environment and Social Impact screenings and assessments, appropriate R&R Action Plans and policy measures, to GOI and Bank project appraisal and approval requirements; (iii) assistance with initial capacity-building in the project management and implementation capacities and resources of the PWD/roads agencies, including for roads-related social and environmental responsibilities; and  - 3 - (iv) facilitation of and support for appropriate workshops, inter-state networking, training, study tours and/or pilot studies, projects and/or programs to demonstrate and/or resolve: * 'best practice' in approaches to critical areas of project preparation, (e.g., social or environment matters), and * new methods, practices and/or technology to be used in preparation of the planned project works. (b) The policy support and institutional development component under which financial assistance will be provided by GOI to individual States for TA support to substantive actions on planning and implementation of measures for policy-based reforms and institutional strengthening in each State's roads maintenance, road network management, roads sector financing, investment planning and implementation functions. In particular, this TA financing will help meet the costs of: (i) development of strategies and time-bound action plans, based on relevant 'best practice' in this field, for major sustainable improvements in the main policy, financial, organizational and skills aspects of the State's road infrastructure development, maintenance and management capacities; (ii) TA-supported networking, staff exchanges/secondments, domestic and/or overseas study initiatives and workshops within and between the participating states, aimed at accelerating, exchanging and consolidating the experiences and skills being gained in the States during this project in institutional and financial reform and capacity-building for the roads sub- sector; and (iii) financial, legal and/or other expert services for development of policy and other enabling measures by the State(s) for more effective private sector investment and participation in road infrastructure provision. There will be a small, separate project management component to finance the consultancy services required to assist DEA in its carriage of overall project implementation management. 10. All TA-supported activities in these two main components would be implemented within an agreed Project Identification & Preparation Framework (PIPF), which comprehensively outlines the various Bank requirements for sound project preparation, the mutual Bank/GOI aims for reforms and improvements in sector capacities and performance to be addressed in institutional strengthening components of such project preparations, and the necessary preliminary actions to be taken by individual states to facilitate rational pre-selection and planning of proposed investments during project preparations. A copy of the current 'model PIPF' is provided at Attachment 1. An early example of the PIPF approach in application is the proposed State Highway Project I (a.k.a. Andhra Pradesh State Highway Project, IN-PA-9995), for which the Project Information Document is at Attachment 6. 11. Under the project, the TA financing would be concentrated (but not limited to) on the following activities:  -4 - * preparation to Bank project appraisal standards -by the States of the technical, economic, social, environment and procurement components of their road infrastructure investment proposals, using comprehensive intemationally-experienced consulting services, aimed at resolving all pre-construction preparations, clearances and other issues for at least the first two years' construction program by the anticipated Loan approval; * implementation via the PCC services and/or other TA forms of pilot studies, demonstration projects, training and/or development programs for the application and transfer of international 'best practice' roads planning, design and construction methods, skills and technology, during the overall preparations for the State's planned subsequent investment project(s); * identification of measures to progressively shift the procurement and implementation approaches in the roads sector towards the increased privatization of engineering, construction execution and supervision services in road works and maintenance activities, from current PWD 'in-house' approaches; * preparation of relevant institutional change strategies, and implementation of early catalytic measures therein, to strengthen the states' roads maintenance and roads management policies, capacities and performance, including on environmental and social aspects, which inter alia shift the main sector agencies from a 'services provider' to 'sector manager' role in relation to the states' needs, and support for implementation of substantive 'first steps'; * identification of policy and other changes required for sustainable higher public funding for road maintenance needs and support for implementation of substantive 'first steps'; - development of policy and administrative measures for more effective facilitation of private sector investment and participation in state-level road infrastructure; - facilitation of any pilot projects/programs, studies and/or surveys to test and demonstrate key new concepts, mechanisms, techniques and/or technologies relevant to the sector, including via minor-scale civil works; * procurement and implementation of essential equipment or goods for priority capacity- building measures in sector agencies; and * facilitation of and attendance at intra-state, regional and/or overseas seminars, study tours, workshops and/or training initiatives on substantive aspects of proposed sector and institutional reforms. 12. TA Delivery Mode: The consultancy services and TA typically required by each State for investment project preparations handled in accordance with the PIPF would be integrated as a unified package of Project Coordinating Consultant (PCC) services. In these packages, internationally- experienced firms (usually with domestic associates and/or sub-contractors) will provide the full range of engineering, economic, financial, procurement, social and environment skills necessary to support individual states in planning and executing comprehensive project preparations which should satisfy Bank project appraisal requirements. The PCC firms are required to provide personnel with wide international experience and strong qualifications for all key positions in the delivery of the services. The PCC services would normally be procured in accordance with Terms of Reference (TOR) adapted by each State (with Bank review) from the 'model TOR' developed by the Bank on the basis of previous operational experience in this sector and disseminated to the states with GOI's assistance. These 'model  - 5 - TOR' at least cover the respective fields of full project feasibility analysis; preliminary and detailed engineering design; procurement preparations; project management assistance to the client PWD; Environmental Assessment (EA) and Environmental Action Plan (EAP) preparation; Social Impact assessment, R&R policy development support and Resettlement Action Plan (RAP) preparation. The respective requirements of the Bank's Operational Directives 4.01, 4.20 and 4.30 are fully addressed in these TOR. The 'model TOR' have been lodged with the Bank's Public Information Center for general public access, suitably annotated to identify their status as a 'living document' likely to evolve further. 13. The duration of such PCC services will vary according to the size and complexity of each State's planned investment preparations, but typically will be of the order of 15-18 months for the Phase I segment (covering support to the client State to the stage of Bank project appraisal). Any continuation of PCC services thereafter (into Phase 2) can be facilitated directly within the original PCC contract, but is subject to (a) the outcome of Bank project appraisal and (b) the prerogatives of the individual State, based on the client's satisfaction (or otherwise) with performance of the PCC services in Phase 1. 14. The individual states' requirements for TA support for development and implementation of sector reforms and institutional strengthening are expected to vary considerably, according to each State's sector circumstances and the status of reform initiatives there. Accordingly, the consultancy services and/or TA forms required under this project component may need to be secured from a variety of sources, not necessarily included in the PCC-style packaging of consultancy services outlined above. The scope, diversity and pace of these TA-supported reforms will need to be determined on a case-by-case basis by each State. 15. Priority Areas for Reforms: Initial reform 'targets', taking into account the combination of technical, operational and financing norms already promulgated (but generally not well applied) in India and the typical performance indicators for comparable roads sector functions overseas, should at least include: (a) improved procurement, contract and project management performance, in terms of turn-around times for decision-making and implementation, processing of payments, securing essential inter-agency clearances and actions, etc.; (b) the development of effective basic road management information (traffic counts, road condition surveys, etc.) and preparations for implementation of a suitable Road Management System which integrates this data with cost, budgeting and monitoring functions, as well as signaling objective priorities for maintenance; (c) improved road maintenance effectiveness, based initially on monitoring of annual maintenance quality and quantity against outlays and subsequent measures to improve policies, annual financing levels and sources of finance, standards, methods of execution and forms of procurement for road maintenance services; (d) strengthened road infrastructure planning and project development and implementation capacity, inclusive of roads-related social and environmental planning, within the State's road agency and in key counterpart state-level bodies; (e) improved traffic capacity management and road transport regulation for more effective utilization of available road capacity; and  -6 - (f) increased road infrastructure financing through improved cost-recovery and revenue generation, increased public budget allocations, improved output efficiency from present budgets, and greater value for money in road maintenance results. 16. Typical services for studies to help individual states to develop viable options for institutional, financing and/or road maintenance reforms and the related implementation strategies/plans would be of 4- 6 months' duration, involving a combination of international and domestic experts in the relevant technical, financial, institutional and operational fields. 17. Training and Staff Development: Proposals for project TA outlays on training and development of an individual State's staff (and where appropriate, local road engineering and construction industry representatives and stakeholders) will mainly be for short-term project-oriented skill development needs. The main focus in such TA financing will in each State be on: (a) the extension and consolidation of agency and sector capacities for key project and/or sector management functions, particularly those needed for satisfactory implementation of the planned future Bank-assisted investment project; and (b) the effective transfer and implementation of new concepts, systems, techniques and/or technologies in agency and sector activities. Such training may be conducted 'on-site' in the participating states or (as necessary) involve attendance at appropriate interstate, regional or overseas technical institutions and conferences. However, in all cases the training will be expected to be have clear project-related objectives, involve areas of high priority needs in the sector as determined between the state authorities and the Bank, and have measurable outcomes in corporate and/or individual performance terms, for subsequent monitoring by the State concerned. M11. Project Cost and Financing 18. Project Cost and Financial Allocations: The total project cost, inclusive of taxes and contingencies, is estimated to be US$68.0 million. Project financing would be as follows: IBRD Loan of US$51.5 million, a contribution by the States amounting to US$1.5 million for the financing of the necessary dedicated Project Management resources to be implemented by each participating State; and a further aggregate contribution of about US$15.0 million by the participating States, to meet the levies and/or tax liabilities due on fees and payments to foreign consultants. Retroactive financing limited to US$5.0 million for eligible payments made from July 1, 1996, will be provided where advance procurement of PCC services has been essential to enable some states to effectively initiate and/or extend the implementation of their project preparations planned for TA financing under this Project, following Bank review and agreement, where such preparations are not already covered by an existing Project Preparation Facility. The project will include US$40.5 million for Project Preparation and Implementation Support, US$12. 15 million for Policy Support and Institutional Development, and US$0.35 million for the consultancy services required by GOI to assist DEA in carrying out the abovementioned 'process management' role in the project's implementation effectively. 19. The proposed initial allocations of project funds to individual States per project component and in aggregate, pending the progressive completion by individual states of the project's entry/participation conditions, are indicated at Attachment 2. Further breakdown of the likely funding of anticipated segments and activities is not possible at this stage, as the identification of these can generally take place  -7 - only after each participating State has: (a) determined the broad scope and requirements of its particular sector reforms agenda, in consultation with GOI and the Bank; and (b) confirmed the initial size and complexity of its planned investment project preparations, as the basis for estimating the scope and value of the required PCC consultancy services. 20. Procurement and Disbursement: The financing plan for the Project is shown in Schedule A. The amounts and methods of procurement and of disbursements and the expected disbursement schedule under the Project are given at Schedule B. Except as specified, all procurement of works will be done in accordance with International Competitive Bidding (ICB) procedures and all procurement of consultant services will be in accordance with World Bank guidelines. IV. Project Implementation and Administration 21. Main Project Activities/Milestones: The sequence of key project activities typically expected between DEA, individual participating States seeking Bank TA financing ab initio via this facility and the 13ank, from the time of this TA Project's effectiveness until the aimed-at Bank Board presentation of that State's fully prepared road infrastructure investment project, is outlined schematically at Attachment 3. A summary of the agreed reporting and monitoring scope and indicators for this Project's main components is at Attachment 4. 22. Implementing and Executing Agencies: The GOI's project implementing agency will be the Department of Economic Affairs (DEA) of the Ministry of Finance. However, substantive project implementation and execution responsibilities will be carried mainly by the participating States through their PWD or road agencies, who will be responsible for preparing and implementing the TA Loan- supported components. 23. Eligibility for TA Financing: All states who commit themselves to the objectives and conditions of the Project through completion of a Participation Agreement with GOI will be eligible for financing of such Technical Assistance as is agreed between them, GOI and the Bank. The Bank will approve individual states' applications to TA financing for agreed activities under the Project on a case-by -case basis, after the State Government has: (a) committed itself to an agenda of policy, institutional and sector-financing reforms, satisfactory to GOI and the Bank; (b) undertaken to handle any project preparations, studies, works and other activities financed with TA under this project, in accordance with the agreed PIPF; and (c) accepted, for the main forms of TA-supported activities, the application of Terms of Reference (TOR) derived from the 'model TOR' provided by the Bank, suitably adapted to each State's specific requirements after Bank review. 24. The Special Category States in India (such as Nagaland, Tripura, Manipur and Himachal Pradesh, etc.) who have negligible revenue sources of their own and whose public budgets are sustained mainly through Grants from the Central Government, may also seek TA financing under this project for preparation of their roads upgrading proposals for a possible Bank-financed project, consistent with ongoing GOI policy aimed at opening up such remote areas and at all-round socio-economic integration  -8 - of these states' peoples with the rest of India. Subject to the development of appropriate project preparation strategies for combinations of these states, and following each such State's acceptance of the general principles of the Project Identification & Preparation Framework, a specially-modified approach to the typical Project Coordination Consultant (PCC) services (inclusive of some form of SOS) will be finalized with such states, perhaps as a single multi-state 'package' of PCC services. In parallel, they would jointly establish a multi-state Authorized Group of empowered officials to carry out the 'client' role in procurement and management of (e.g.) the main PCC services. 25. Participation Agreements: Proceeds of the TA Loan may be used by the participating states under a Participation Agreement established between GOI and the individual State, to be finalized once a State Government has satisfied this Project's eligibility conditions. The Participation Agreement will detail the framework and operation of the TA Loan and the obligations of the participating State, as well as the expectation of the application of the PIPF and the 'model TOR' (as available and as adapted) in TA-supported activities under this project. 26. Responsibility of the Implementing Agency (DEA): The DEA will be responsible for the overall processing and monitoring of the states' access to the proceeds of the TA Loan, and for translating GOI's support (as appropriate) for the building of a pipeline of states' road infrastructure project proposals for Bank financing, and to ensure that the commitments made in the Participation Agreements are honored. 27. Responsibility of the Participating States: The participating State Governments will be required: (i) to advise, in writing, the features and policy basis of the State's intended roads sector institutional and financing reforms; and (ii) to undertake to: (a) conduct all project preparatory studies and activities (as outlined in the PIPF) along 'best practice' lines and (as appropriate) to comply with the relevant Bank Operational Directives (OD), particularly OD's 4.01, 4.20 and 4.30; (b) promptly make appropriate budgetary allocation of funds to cover all expenditures connected with the project preparations, including any increased budgets for road maintenance and financing, if applicable; (c) obtain the Bank's 'no objection' for specific activities at specified stages; and (d) from the outset, establish dedicated Project Management resources and a suitable Secretary-level Empowered/Steering Committee (EC) to monitor and guide all aspects of the State's reform/institutional strengthening program and investment project preparations, to provide necessary approvals for the major procurement activities, and resolve any inter-departmental issues/difficulties. 28. Relationship of Each State's Executing Agency(-ies) With Other Entities: Each State's road agency (or PWD) will be expected to consult stakeholders who may be substantially affected by impacts arising out of the proposed investments that follow the studies, and take into consideration their views in project formulation. The stakeholders would include persons whose lands or livelihood would be affected by acquisition or by enhanced property valuations and taxes, environmental and social non-government organizations (NGOs) working in the area, and the state authorities responsible for forests, environment, cultural heritage, utilities and overall state economic and industrial planning. 29. Duration of TA Loan and Reviews: The TA loan facility will have a five-year life from Loan effectiveness. There will be an entry cut-off for any further state candidates for assistance at the end of  -9- three years following Loan effectiveness. A mid-term review will be carried out jointly by DEA and the Bank before June 30, 1999. Annual reviews of the funds utilization position in the Loan will commence no later than December 15, 1998, in order to respond to any cases of significant funds under-utilization and any cases of need for increased funds allocation, based on the strong performance of a state in reforms implementation and project preparations and its proven requirement for increased TA financing. 30. Role of the Bank During Project Implementation: The role of the Bank would be to: approve the candidate states for accessing the TA Loan funds; supervise the project preparation activities; provide clearances after review for the environmental and social assessments; approve the list of prioritized roads to be included for detailed feasibility studies financed under the project; provide 'no objection' for procurement of consultants and other TA services; review each State's selection of roads for final detailed engineering as the basis for project appraisal; provide advice on enhancement of road sector activities and outputs, particularly on the more generic problems of the sector and comparable international 'best practice'; and reimburse eligible expenditures from the TA Loan, on application by GOI. 31. Budget Provisions: The state governments will be required to make advance budgetary provision for all expenditures connected with the project preparation, including the tax liability in respect of the foreign fee payments. They may seek reimbursement of eligible expenditures through the Controller of Aid Accounts and Audits (CAAA), DEA. 32. Eligible Expenditures: Subject to availability of funds, the TA Loan will finance the following eligible expenditures: (a) consultant fees for feasibility studies, social and environmental preparations, detailed engineering preparation, and sector development studies; (b) fees and costs involved in agreed training, travel, consultancy advice, systems and technoiogy improvements, studies, seminars, workshops and/or other project preparation needs; (c) essential equipment, materials, services and/or capital costs for pilot/test/demonstration projects/studies/works; and (d) consultancy services for DEA's 'process management' functions in the implementation of the Project. The State Governments will be expected to use their own funds to fully meet expenditure on the tax liability arising out of foreign currency payments to consultants, and normally also to meet the costs of preparation of the preliminary Strategic Options Study (SOS). 33. Loan Reimbursements and the Special Account: All eligible expenditures will be reimbursed from the proceeds of the TA Loan. A Special Accoint of US$3 million will be established, at the Reserve Bank of India (RBI), to meet anticipated expenditures of about four months. Eligible payments greater than US$ 1,000,000 or of value greater than one third of the Special Account amount, may be paid by the Bank directly to suppliers, at the specific request of GOI. The Special Account will be replenished on the basis of reimbursement claims for eligible expenditures received by the Bank. The expenditures will be reimbursed to the states by GOI under its standard policy on release of external assistance funds to the states. 34. Project Implementation Reporting and Monitoring: For project management purposes, a detailed program of activities will be prepared by the Borrower within six (6) months of Loan  - 10- effectiveness, indicating clearly the responsibilities of the various parties, the time for commencement and completion of each individual activity and the projected completion date for all activities. The reporting based thereon will be due with the Bank quarterly and annually in formats satisfactory to the Bank, consistent with the requirements outlined at Attachment 4. This will, inter alia, be based on monitoring between the Borrower and the participating States to be facilitated by computerized means using 'critical path' project monitoring/management software. 35. The following project implementation milestones should be included in such reporting: * Finalization between DEA and each State of a Participation Agreement * Development of a procurement plan by each state covering major items to be procured, their approximate values, the method and timing of procurement * GOI and/or State budget provisions to facilitate project expenditures * Accounting and audit requirements for project expenditure * Key stages in each State's investment project preparations and sector institutional and financing reform plans * Anticipated timing of Bank project appraisal in each participating state * Annual Bank/DEA 'project allocations review', starting December 1998 * Mid-term review of the project, prior to June 30, 1999 * Loan closure, December 31, 2001 * Completion of draft Implementation Completion Report, June 2002 36. Progress Monitoring indicators: These will be applied progressively to assess the effectiveness of the TA Loan's utilization and whether the Loan objectives are being met. These will include but not necessarily be limited to the following (adapted as necessary between the Borrower and the Bank): (a) Measures of to be reported centrally on overall Project progress: * The number of states that have contracted PCC services * The number of states that initiate TA-supported studies on key sector reforms * The number of states that adopt an action plan arising from studies on sector reforms * The number of feasibility studies and environmental assessments completed * The number of detailed engineering packages completed and volume of roads covered therein for subsequent planned investment * The number of states' proposed projects appraised by the Bank * The number and value of states' projects approved for Bank financing (b) Measures to be reported per State and overall: * Percentage increase in maintenance budget relative to 1996197 * Person-days of training completed * The rate of utilization of TA funds (as a percentage of committed contracts) * Timeliness of payment (average number of days between submission of claims and payment, for all relevant claims in the reporting period) * Timeliness of procurement events (aggregate days behind or ahead of procurement schedule, averaged over all procurement actions)  Attachment 1 INDIA STATES' ROAD INFRASTRUCTURE DEVELOPMENT TECHNICAL ASSISTANCE PROJECT MODEL PROJECT EDENTIFICATION AND PREPARATION F1RAMEWORK (PIPF) Objective and Strategy I. The overall objective of the Bank's assistance is to improve the beneficiary State's road transport infrastructure (physical network, operations and management) in a sustainable manner, by efficiently removing road transport bottlenecks, lowering transport costs and improving the maintenance of road network assets. 2. The overall strategy identified between the Government of India (GOI) and the Bank for effective project-based lending assistance to States in this context, is to strengthen and shift onto a sound business management approach, the provision, management and maintenance of road infrastructure, through: - emphasis on overall network planning, with priority for the needs of high-traffic- density routes/corridors; - achievement of effective sustainable funding and management of road maintenance; - introduction of international road construction methods, quality and management standards; - demonstration of the effectiveness of independent technical consultants and contractors in project implementation, and of competition in the delivery of road infrastructure services; - implementation of sound high-return road infrastructure investments; - comprehensive preparations for management of the environmental implications and the social impacts of proposed road investments; and - strengthening and modernization of State institutional arrangements, policies, resources and capacities for the management of the sector. Identification, Preparation and Implementation Requirements 3. To be confident of achieving efficient, timely and sound project implementation, the preparation of proposals for any Bank-assisted state-level road infrastructure investment projects in India will normally need to comprise the following key elements:  - 12 - (a) Strategic Options Study The first substantive action, to be initiated by the individual State, will be a preliminary network-wide Strategic Options Study (SOS), typically using road and traffic network data already available to the State. This SOS is aimed at (i) providing an objective basis for and strengthening the selection rationale for the likely roads investrnent priorities; (ii) confirming the State's road funding history, and (iii) outlining the State's intended project financing strategy. The SOS should include verified data on relevant State-wide population size, composition and distribution; any protected 'cultural heritage' assets, and sensitive environmental features which should all be taken into account in planning for the proposed project. (b) Feasibility Study(-ies) Full economic and technical feasibility studies on the priority investments identified via the Strategic Options Study. The feasibility studies will also include a state-wide social and environmental screening, inclusive of the preparation and review of full strip maps of the proposed road sections; maps of environmentally sensitive areas such as reserves, forests, national parks, wetlands and/or sensitive habitats; and census-based population distribution maps/data indicating relevant population intensities and locations of indigenous peoples' groups near the project sites. (c) Preliminary Engineering and Environmental & Social Impact Assessments Preparation of preliminary engineering design standards for the full length of the proposed road investments under the project, to be ready by Bank appraisal stage, as a basis for and coordinated with preparation of an appropriate Environmental Assessment and preparations for any necessary Social Impact (Resettlement & Rehabilitation) action plans (see (d) and (e) immediately below). (d) Environment Assessment A Sectoral Environmental Assessment (SEA) will be required for all of the civil works components of the project, in parallel with the project feasibility studies; followed by a full Environmental Assessment (EA) wherever sensitive issues have been identified in the SEA, prior to Bank appraisal. The preparation of the SEA and EA must be in full compliance with the World Bank's Operational Directive (OD) 4.01. (e) Social Impact / Resettlement & Rehabilitation (R & R) The preparation of (i) a preliminary screening of likely Project Affected Persons (PAP) and structures along the proposed project road sections; (ii) a full Baseline Socio-Economic- Survey (BSES) for the identified impact areas of all proposed works, and (iii) a satisfactory draft R&R policy-based Resettlement Action Plan (RAP) which has been endorsed by the State Government, will each be required as part of project preparations, as per the Bank's OD 4.30 on Involuntary Resettlement. In addition, if indigenous people ('tribals') are likely to be sited within the impact areas, a full Indigenous Peoples Development Plan (IPDP) will need to be prepared, in accordance with the Bank's OD 4.20 on Indigenous Peoples. In all projects, the principle of linking completion of resettlement with any order to proceed with civil works shall apply. No physical work shall be undertaken on any stretch of road before resettlement has been undertaken in accordance with a framework of entitlements, which shall be agreed upon before appraisal. This framework shall describe categories of losses, definitions of affected and entitled persons, their entitlements in the form of compensation or other assistance, and the institutional framework for implementing a  - 13 - Resettlement Action Plan (RAP). It shall also contain mechanisms for public participation and local consultation, for monitoring and evaluation, and for coordination among the project authorities and the various local jurisdictions involved in the road infrastructure project. This framework must conform to OD 4.30 and shall apply for all components of the project, also in cases where a phased approach is being used. Based on this framework, a draft RAP shall be prepared before the project's appraisal. It shall contain an estimate of likely affected persons as described below, as well as a budget and a schedule of implementation, and other details as described in the applicable Tertns of Reference (TOR). The draft RAP shall be finalized after detailed designs are completed and exact impacts and numbers of affected persons are known, based on one or a combination of two scenarios: (i) Where the alignment is known, a full census of all likely PAPs must be included in the RAP. Detailed engineering designs must be available for at least 25% of the project roads, and preliminary design must be completed for the remaining 75% of the project roads, to identify PAPs within the entire corridor of impact. Once designs are finalized, the RAP shall be modified to incorporate any changes in impacts on PAPs, or their numbers. (ii) Where the full alignment is not known before project appraisal, a phased approach shall be used. Preliminary screening shall be undertaken before determining the alignment, and likely social impacts and losses of assets shall be weighed along with financial, technical, environmental and other screening criteria. Once that has been done, the RAP must be updated to incorporate the new information. (f) Final Engineering for Project Appraisal Requirements Preparation before the time of Bank project appraisal of a representative sample (in terms of different types and settings) of at least 25% of the total length of proposed project road investments to detailed engineering standard. At this stage, the planned civil works should also be arranged into sufficiently large contract 'packages' to attract international as well as domestic contractors with larger-scale high-quality road construction experience. (g) Institutional Strengthening As an integral part of the overall project preparations, prior to Bank appraisal, this will require the preparation of essential non-capital components aimed directly at sustainable enhancements to the State's capacity for effective road infrastructure management and financing, via (inter alia): (i) action for early strengthening of the State's capacity to manage the proposed project and ensure timely implementation through a review of procurement decision-making procedures, provision of appropriate training and upgraded resources, appropriate Technical Assistance (TA), and early establishment of a dedicated agency unit (e.g., Project Management Unit) to manage the proposed project. (ii) preparation (or updating) of a State transport sector strategy, covering the main physical, operational, financial and policy aspects of the major transport modes over the next 5-10 years (subject to the quality of the available data and  - 14- indicators), including a particular focus on the outlook for the road transport sub- sector in this context and the realistic financing strategy(-ies) for both ongoing road maintenance and road infrastructure investment priorities. (iii) review of the State's future financial and organizational requirements for more effective management of road infrastructure development and maintenance in a transport-oriented context, resulting in the preparation of specific time-bound action plans for regulatory/policy, organizational and financing improvements, inclusive of: - indicators for improved road agency and sector performance; - State-level policy/regulatory measures to improve the efficiency of road transport and of the management of road infrastructure; - measures for more effective facilitation of private sector investment and participation in the provision and management of road infrastructure; and - specifications for an effective framework for consultation with public and private sector 'stakeholder' representatives on road infrastructure plans and priorities. (iv) training and staff development action to re-orient and enhance the institutional capabilities of the State agency(-ies) and key private sector participants concerned with the provision and maintenance of road infrastructure in the State; and (v) comprehensive improvement of relevant budgeting, programming, financial and contract management, project management and monitoring/reporting systems, skills and practices, to ensure sustainability of the proposed project's benefits. (h) Project Implementation Supervision The implementation of all civil works under the project, implemented once the project has been approved by the Bank's Board, will require the services of independent Supervision consultants engaged by the Borrower and appointed with full powers as the Engineer as per FIDIC conditions. Financing and Procurement Aspects of Project Preparation 4. The initial production of an SOS which satisfactorily meets the aims and purposes described at para. 3 (a) above, will be each individual State's responsibility. The costs of any consultancy services engaged by the State for this purpose should normally also be met by the State concerned from its own finances. 5. For the action at stages (b), (c), (d), (e) and (f) above, the State should secure the services of internationally-experienced Project Coordination Consultants (PCC) to manage and coordinate the feasibility studies, other techno-economic, environmental and social preparations, preliminary and final engineering of the proposed project, resulting in the preparation of a project package suitable for Bank appraisal, as well as subsequently assisting the State with the project's implementation and supervision stages.  - 15 - 6. The costs of such PCC services for effective project preparation action up to the stage of Bank appraisal will be substantial (typically in the range of US $1.5 -3.5 million, depending on project size/complexity). The likely services for subsequent PCC services, beyond Bank appraisal, e.g. for stage (h) above, cannot be confirmed until the outcome of preparations for Bank appraisal is known. 7. The cost of the separate technical and professional services likely to be required for preparation of assessments, policy measures, action plans, etc., for the Sector Institutional and Financing Reforms/ Strengthening component(s) outlined at stage (g) above, can only be separately determined once the specific features of each State's sector circumstances and proposals are fully resolved. 8. Procurement action for all civil works funded with Bank assistance under any resultant investment project will be in strict accordance with World Bank International Competitive Bidding (ICB) and/or National Competitive Bidding (NCB) procedures. The procurement of both civil works and consultants' services will use the India-specific version of the Bank's Standard Bid Documents as promulgated by the Government of India (GOI), and where appropriate, the standard 'pre-qualification' documentation also promulgated by GOI for all externally-assisted projects.  - 16- Attachment 2 INDIA STATES' ROAD INFRASTRUCTURE DEVELOPMENT TECHNICAL ASSISTANCE PROJECT Initial Project Funds Allocation* (US$ million equivalent) (state) Project prep'n. & Policy supp't. Project Total & impl'n. supp't. & inst'l. devel't. mgt. Andhra Pradesh 3.00 0.70 3.70 Bihar ** Goa ** Gujarat 3.50 0.70 4.20 Haryana 1.50 0.70 2.20 Karnataka 2.00 0.70 2.70 Kerala ** Maharashtra 2.50 0.70 3.20 Mahdya Pradesh 2.50 0.70 3.20 Orissa 2.50 1.00 3.50 Punjab 3.50 0.70 4.20 Rajasthan 3.50 0.70 4.20 Tamil Nadu 3.50 1.00 4.50 (& Pondicherry) Uttar Pradesh 3.00 0.70 3.70 West Bengal 2.50 1.00 3.50 Special Category 4.00 1.15 5.00 States*** Unallocated 3.00 1.85 4.70 GOI Project -- -- 0.35 0.35 Implementation Total 40.50 12.15 0.35 53.00 * Excluding in-India taxes on consultants' fees, etc. * * No proposal has yet been indicated by these states *** States acknowledged by GOI as, due to their weak economic base, warranting up to 90% annual Budget assistance from GOT (Arunchal Pradesh, Assam, Himachal Pradesh, Jammu & Kashmir, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim and Tripura) NOTE: (i) TA financing assistance up to-the above indicated amounts will be made available by GOI to the respective States progressively, once they have met the conditions for participation in the Project; (ii) A cap of US$5.5 million will normally apply to a State's cumulative access to TA financing under this project; (iii) Utilization of project funds will proceed on the 'first come, first served' principle at all times.  -17- INDIA STATES'ROAD NFRASTRUCTURE DEVELOPMENT: TECHNICAL ASSI$TANCE PROJECT Project Activity Outline | State Governments' Acceptance of Strategy and Outline of Policy-based Reforms [ DEA/SG finalize Participation Agreement 1 | SG establishes multi-agency Empoweredl leading to allocation of funds f > Committee (EC) WB reviews TOR for main 'reforms' Mobilization of Project TA components SG commissions studies of Policy, Financing Coordinating Consultant services (PCC) Organizational, and Maintenance Reforms and outlines Public Information/Consultation Action PCC completes feasibility study report WB reviews Policy/Financing /Maintenance to be taken leading to final SG selection of project roads reform recommendations Decisions by SG on financial/organizational PCC completes Environmental and Social and policy recommendations of studies including Impact screenings enhanced funding for maintenance | WB reviews draft EA al Id RAP proposals I PCC prepares draft EIA report and draft SG gets clearance from MOEF for EIA R&R/RAP policy package l ~~~~~~~~~(if category A) and WB responses lI WB reviews Detailed Engineering Reports ~~~~~~~~~~Production of Detailed Engineering (DE) for atI WB reviews Detailed Engineering Reports < | ~~~~~~~~least 25% sample of project roads*l | [ ~~~~~~~SG takes initial key actions on maintenance ll SG/PCC takes key procurement actions s~~~~~~~~~~~~~~~~~~~~~ | | ~~~~~~~reforms and institutional strengthening |SG/PCtkskypocrmn,cin WI c bid documents D a(GPN/PQ)and prepares biddocuments 7r5 a) | | ~~~~~~~~WB/SG appraise the proposed State |_=PCt iaieRP ae n2%sml Sa te Highways Project P 1 f a l I >1 g~~~~~ DE and preliminary designs for other 75% |:3 | Board Presentation of proposed | |BdadAad(iiu 5 fwrs | State Highways Project Bi an Awr (mnmm2I fwrs Proposed State Highways Project Loan(s) Effectiveness * Action on remaining 75% DE follows.  INDIA STATES' ROAD INFRASTRUCTURE DEVELOPMENT TECHNICAL ASSISTANCE PROJECT PROJECT DESIGN SUMMARY Narrative Summary Key Performance Indicators Monitoring and Supervision Critical Assumptions and Risks 1. CAS Objective: I. Promote state-level reforms in road 1. I Adoption by several states of appropriate 1.1.1. Status reports on DEA and Bank policy 1. Sector reforms will lead to infrastructure sector and assist reform and investment strategies in road dialogue with the states. improved use of public increased sector investment. infrastructure sector. 1.1.2 Number of states whr complete resources and improved Participating Agreemenes under this project. provision and sustainability of states' road infrastructure. 2. Project Development Objectives 2.1 Support reforms to planning, 2.1. Reform plans established, initiating policy 2.1. Progress reports by States, DEA and Bank 2.1 Reforms will lead to financing, provision, maintenance and actions taken and improved maintenance on status of reforms implementation. sustained improvements in co management of road transport strategy, organizational and financing states in key sector capacities. infrastructure by states' road agencies. frameworks being implemented by states. 2.2 Support comprehensive 2.2 Pipeline of viable states' road infrastructure 2.2 Progress reports from states and DEA. 2.2 Investment project preparation of major road investment projects fully prepared to Bank preparation assistance will infrastructure investment proposals for lending requirements ready for and/or being achieve timely works implementation with Bank financing, implemented. implementation. aimed at improved efficiency of states' road transport network. 2.3 Assist states towards increased 2.3 Implementation by states of external services 2.3 Reports from states on implementation 2.3 States' action on 'out- privatization of roads engineering, for preparation of Bank-assisted projects. status of PCC services, and from states/DEA on sourcing' will (i) be construction, works supervision and Policies favoring substantial 'out-sourcing' of policies' impacts on PWD functions and implemented by affected maintenance services in the sector. design, construction, supervision and procurements. agencies and (ii) lead to maintenance by their PWD/road agencies upgradation of comparable implemented by states. and cost-effective private sector resources. XI  Narrative Summary Key Performance Indicators Monitoring and Supervision Critical Assumptions and Risks 3. Project Outputs 3.1 States implement sustainable road 3.1 At least 6 states implement reform 3.1 States' Empowered Committees (ECs) 3.1 States will maintain sector reform and 'institutional measures/plans, inclusive of any necessary state monitoring reports, State Government/Bank political commitment to strengthening' strategies. legislative actions, and enact policy measures to status report on overall reforms implementation, follow-through reform improve facilitation of private sector investment. actions. 3.2 States formulate and initiate 3.2 Increase in long-term maintenance funding 3.2 PCCs' project progress reports and ECs' 3.2 States and main sector major sustainable improvements in levels, increase in quantity of priority monitoring reports, plus State Governments' stakeholders will support (i) financing and performance of road maintenance works performed, and improved status reviews. additional levies/taxes for network maintenance. road maintenance 'input/output' and quality roads-specific funding and (ii) outcomes, in at least 6 states. Action plans rational prioritization of launched in 6 states for sustainable, dedicated maintenance programs. road funding mechanisms. 3.3 States prepare major investment 3.3 At least 6 states' road investment proposals 33 Progress reports by ECs and DEA/Bank 3.3 States will (i) apply project proposals to meet all Bank satisfy Bank appraisal and achieve Bank lending status report on project appraisals and Board PCCs effectively, and (ii) appraisal/ lending requirements, ready 'effectiveness' by the project's end. presentations. implement Bank's EA and for implementation. R&R project requirements. 3.4 States implement major and 3.4 Implementation of PCC services (with 3.4 PCC project progress reports, monitoring 3.4 PCC firms and the private effective 'out-sourcing' to private 'skills/technology transfer' components) in at reports by ECs and Bank/ State Government sector will deliver sound cost- sector by PWD/road agencies of 'in least 6 states, and substantive 'out-sourcing' reviews of 'out-sourcing' effectiveness. effective resources for road house' project engineering, works policy measures implemented in at least 6 states. agencies' needs. execution and maintenance services. 4. Project Components 4.1 TA for Engineering, Economics, 4.1 Feasibility studies, preliminary works 4.1 PCC reports, monitoring reports from 4.1 and 4.2 States will (i) Environment and Social (R&R) pre- designs, detailed engineering packages, sectoral states' ECs, PDAT reports on PCC contract manage TA and PCC services investment project preparations by EAs and RAPs each completed on schedule and awards status and overall Bank status reports. effectively; (ii) promptly states. to Bank specifications by at least 6 states. initiate dedicated Project Management resources; (iii) 4.2 TA for (i) states' priority needs in 4.2 Action plans established and/or being 4.2 States' ECs' reports on PCC programs, ensure available funds for ri capacity-building/training in project implemented in at least 6 states. Delivery of monitoring by DEA and Bank reviews of contract obligations; and planning and management; specified PCC 'skills/technology transfer' strategies and implementation. (iv) implement effective 9 procurement, contract and financial services completed in at least 6 states. Empowered Committees management; and (ECs) to steer TA and project (ii) transfer of 'best practice' skills, actions. methods and/or technology to road agencies and participating local industry.  Narrative Summary Key Performance Indicators Monitoring and Supervision Critical Assumptions and Risks 4. Project Components (cont'd.) 4.3 TA for states' development of 4.3.1 Detailed action plans, endorsed by State 4.3.1 and 4.3.2 States' ECs monitoring reports, 4.3 States' agencies and effective medium-term action plans Governments and satisfactory to the Bank, DEA multi-state status reports and Bank review sector stakeholders will for policy, legal, structural, undergoing implementation in at least 6 states. of states' project status. support reform strategy for organizational, staffing and/or improved network conditions, resource improvements for sustainable 4.3.2 Network-based planning introduced in at sector services and overall road sector management reforms in least 6 states. asset management. planning, financing, development and maintenance of network assets, 4.3.3 Revised private sector investment policies 4.3.3 Monitoring reports by ECs, State including facilitation of private sector implemented and positive investment results Government and Bank reviews of policy actions investment, resulting in shift of road demonstrated in at least 4 states. and impact. agencies' role from provider to manager of road infrastructure for the state. 4.4 TA for (i) states' studies and 4.4 Completed studies and endorsed action plans 4.4 Monitoring reports by ECs, 4.4 States will resist political development of action plans for for technical, operational and managerial reforms status reviews by the Bank and overall project pressures (i) for construction sustainable improvements to road for implementation in at least 6 states, and monitoring reports by DEA. funding priority versus maintenance policy and practices; initiation of revised long-term funding maintenance and (ii) from and (ii) states' implementation of arrangements / mechanisms in those states. vested interests for constraints higher sustainable funding for road on rational maintenance maintenance. priorities. 4.5 Procurement of priority 4.5 Procurement actions completed satisfactorily 4.5 PCC progress reports, PDAT reports on 4.5 States will promptly equipment and technology to improve and equipment/systems commissioned in at least status of procurement actions, and ECs identify and process essential project procurement, financial and 6 states. monitoring reports. procurements. contracts management and overall road network management capacity. > 4.6 Investment in minor civil works 4.6 Works completed and pre-investment study, 4.6 PCC progress reports, PDAT reviews of 4.6 States' PCCs will CD for pre-investment pilot study, testing and/or demonstration objectives for procurement status, ECs' monitoring reports efficiently prepare and demonstration and/or testing purposes. project preparations met in at least 2 states. and Bank reviews. implement proposals (K  INDIA: STATES' ROAD INFRASTRUCTURE DEVELOPMENT TECHNICAL ASSISTANCE PROJECT Project Performance Monitoring Indicators Au ~~~ xen c t ' ritleal DevelopMent Objective I: Support reforms to planning, financing, provision, maintenance and management of road infrastructure by States' road agencies. TA for review of - Number of states that initiate Study reports issued, States will resist Development of action plans for sustainable maintenance and complete TA-supported monitoring reports by domestic pressures improvements in road maintenance standards, policy and studies on maintenance reforms ECs and status reviews for construction practices * expected in at least 3 states at by the Bank funding priority Vs the end of 24 months after project maintenance start and in at least 6 states at project end Implementation of higher sustainable TA for review of long- -Number of states that initiate and States' ECs monitoring States will resist funding for road maintenance term funding needs, complete TA-supported studies reports and Bank review pressures from vested means and for on road maintenance reforms of states' project status interests for implementation of -Number of states that adopt constraints on rational decisions action plans to reduce shortfall of maintenance priorities maintenance funds * expected in at least 3 states at the end of 24 months after project start and in at least 6 states at project end Development of effective medium-term TA for review of - Number of states that initiate States' ECs monitoring States' agencies and action plans for policy, legal, structural, institutional needs, and complete TA-supported reports and Bank review sector stakeholders > organizational, staffing and/or resource options and resource studies to develop institutional of states' project status will support reform ^ improvements for sustainable road sector requirements for reform measures strategy for improved management reforms in planning, financing, future effectiveness -Number of states that adopt an network conditions, development and maintenance of network and for action plan for institutional sector services and assets implementation of reform/strengthening, inclusive of overall asset ^ initiating measures introduction of network-based management n roads planning * expected in at least 3 states at the end of 24 months after project start and in at least 6 states at I project end  ~~~~~~~. ...E.. X | lll...... | W. .........~~~~~~~~~~..... n. X +p........ ..... ............ . Componet. nusMntrn idiator.O ~ I . Development Objective 2 Support preparation of major road infrastructure investment proposals for Bank financing, aimed at improvedefficiency of states' road network. Engineering, Economic, Environment and TA to undertake - Number of States that have PCC reports, monitoring States' will (i) manage Social (R&R) pre-investment project feasibility studies, contracted PCC reports from states' TA and PCC services preparations by states preliminary works - Number of feasibility studies, ECs, and overall Bank effectively; (ii) initiate designs, detailed detailed engineering components, status reports dedicated Project engineering RAPs and EAs completed Management packages, sectoral -Number of Projects appraised resources promptly; EAs and RAPs -Number of projects approved (iii) ensure available * completion of all the above funds for contract expected in at least 3 states at the obligations; and (iv) end of 24 months after project implement effective start and in at least 6 states at Empowered project end Committees (ECs) to -Km of roads for which detailed steer TA and project r engineering (DE) studies actions completed * at least 3000 km DE expected by project end _ Assistance with (i) priority needs in capacity- (i) TA to improve - Number of States that have States' ECs reports on building/training in project planning and PWDs resources and contracted PCC services with relevant PCC programs, management; procurement, contract and skills for project training/development /assistance PCC progress reports financial management; and (ii) transfer of needs components and Bank reviews of 'best practice' skills, methods and/or (ii) Training and * expected in at least 3 states at strategies and impacts technology to road agencies and development via PCC the end of 24 months after project participating local industry services start and in at least 6 states at (iii) TA to identify, project end procure and - Timeliness of contract implement priority payments equipment and ..f tequipmntl and- Timeliness of procurement D technology evns2 ~ events - Rate of utilization of TA funds Average number of days between submission of claims and payment, for all relevant claims in the reporting period, relative to a target of not more than 45 days. 2 Aggregate days behind or ahead of procurement schedule, averaged over all procurement actions; target = on schedule.  - 23 - Pre-investment pilot study, demonstration TA to identify, Number of TA proposals for PCC progress reports, States' will efficiently and/or testing of methods, technologies develop and minor demonstration works ECs' monitoring reports prepare and and/or concepts to be integrated in project implement minor civil implemented and Bank reviews implement proposals preparations works - Number and impact of post- with PCC assistance demonstration reports submitted * satisfactory implementation expected in at least I state at the end of 24 months after project start and in at least 2 states at project end evel9pmeQnt Objective a: Assist States towards increased privatization of roads engineering construction, works supervision and maintenance services In the sector. (A (i) TA for review of - Number of states that initiate Monitoring reports by States' decisions on Facilitation of (i) measures for private institutional needs, TA-supported studies on relevant ECs, State Government role shift in sector sector investment, and of (ii) shift of road options and resource reforms and implement and Bank reviews of agencies will be agencies' role from provider to manager of requirements to substantive 'out-sourcing" policy policy actions and implemented by those road infrastructure for the state change the sectoral measures impact agencies and private role of road agencies * expected in at least 3 states at sector will deliver (ii)TA to develop the end of 24 months after project sound cost-effective appropriate start and in at least 6 states at resources for policy/administrative project end agencies' future measures for private - Number of states that adopt needs. sector investment in plans for improved facilitation of Private sector roads private sector roads investment investment capacity D * expected in at least 2 states at will be mobilized once the end of 24 months after project are proved start and in at least 4 states at a3 project end r_ v.l  -24- Attachment 6 PROJECT INFORMATION DOCUMENT Country INDIA Project Name Andhra Pradesh State Highway Project Region South Asia Sector Road Transport Project ID IN PA 9995 Borrower Government of India Implementing Agency Roads & Buildings Department (RBD) Government of Andhra Pradesh Hyderabad - 500 022, India Contact: Principal Secretary Transport, Roads & Buildings Telephone: 91-40-234-591 Fax: 91-40-393-197 Date Prepared October 1996 Projected Appraisal Date December 1996 Projected Board Date March 1997 1. Country and Sector Background 1. I At national and state levels, the transport scene in India is characterized by the growing importance of road transport. The demand for intercity freight transport in India is expected to double every 12 years while the demand for passenger transport is expected to double every 8-9 years. The share of total demand going to roads in India is now about 60 percent of freight and 85 percent of passenger traffic, with the railroads carrying the balance. 1.2 Since 1950, the core system of paved National roads and State roads (State Highways and state Major District Roads) has expanded over seven-fold, from about 19,800 km to about 156,000 Iam, yet comprised only 2% and 20% respectively of all roads in the 1990 national road inventory. In traffic terms, however, the National network carries about 35 % of all road traffic while the State network carries about 60 %, leaving 5 percent for the rural road network. The rapid expansion of the network, although achieving the political and social objectives of national connectivity and rural access, was only made possible by spreading resources over a great deal of single-lane (3.75 m wide) and intermnediate-lane (5.5 m) carriageway roads with thin pavements. India's arterial road system is now highly congested and of poor riding quality, causing high vehicle operating costs and low quality services for users. 1.3 A declining share for road investments in Plan funding allocations is in large part responsible for this situation. However, at least equally serious for road programs are the absorptive capacity and implementation constraints the sector agencies such the state Public Works Departments (PWDs). Sector reforms are needed to foster introduction of high-quality engineering services and technologically advanced road construction practices capable of delivering cost-effective, high-quality road infrastructure on schedule, and to foster sound, systematic road network maintenance policies to maximize road asset life. Some of India's states (led by Andhra Pradesh, Haryana and Rajasthan) have now, with national  - 25 - government support, endorsed such reforms in their context for implementation in conjunction with major road upgrading proposals involving the Bank's assistance. 1.4 The State of Andhra Pradesh with a population of approximately 70 million and an area of 275,000 square km is both the fifth most populous and fifth largest State of the Union. The highway network of the State consists of a total of 138,000 km of highways of which 2,950 km are classified as National Highways (NH), 8,750 km as State Highways (SH), and 32,650 as Major District Roads (MDR). Even though the SH/MDR network carries over 60% of the State's traffic, 53% of SH and nearly 90% of MDRs are still single lane. Vehicle registrations have increased by approximately 16% per annum during the last five years and traffic is projected to grow at least at 7-8% per annum for the foreseeable future. This indicates that for many of the road links, congestion is already a serious problem. 2. Project Objectives. The objectives of the project will be to: (a) promote a more rational and efficient approach to road investment planning, management and maintenance at the state level; (b) improve the GOAP's institutional capabilities in the sector; (c) improve longer-term resource mobilization in the sector to ensure financial sustainability of the State's SH/MDR network; (d) upgrade the capabilities of the private engineering and construction industry to meet growing demand for high quality highways, engineering and construction services; and (e) improve the riding quality and capacity of selected congested segments of the SH/MDR network to reduce vehicle operating costs, travel time, accidents and pollution. 3. Project Description. The proposed project would principally consist of: (a) civil works for widening and rehabilitation of about 1100 km of state highways; (b) financing, during the project period, of a declining share of road maintenance needs; (c) technical assistance for updating and expanding a pavement management system for state roads; (d) technical assistance for reforming and institutional strengthening of the State's road transport agencies and sustainable financing of road maintenance; and (e) consulting services for project engineering design, monitoring and coordination of implementation, and for supervision of civil works. 4. Project Cost and Financing. The total project cost including contingencies and taxes is estimated at approximately USS 350 million, which will finance the widening, strengthening and/or rehabilitation of up to 1400 km of major roads, necessary consultancy and supervision services, strengthened maintenance of Andhra Pradesh's major road network, and institutional strengthening measures. The actual project amount is subject to further review at appraisal. The World Bank will finance 70% of the estimated final total project cost with a IBRD loan of approximately US$ 254 million and the Government of Andhra Pradesh will meet the 30% counterpart funding. 5. Project Implementation. The proposed project would be implemented by the Government of Andhra Pradesh through its Roads and Buildings Department (RBD), with the comprehensive assistance of Project Coordinating Consultants (PCC) funded under the project. 6. Lessons from Previous Operations. The project implementation record of the sector has been mixed, with poor performance most often attributable to: (i) inadequate pre-qualification standards for contractors; (ii) weak project implementation and management capacities for complex civil works contracts; (iii) ineffectuality of contract performance provisions; (iv) shortage of competent mechanized road construction contractors; (v) the Bank's logistical difficulties in supervising multi-state projects; (vi) facilitation delays in land acquisition and clearance of obstructions from project roadways; (vii) poor quality of project surveys and designs; and (viii) limited assimilation by borrowers of agreed Bank procurement rules. 7. Project Sustainability. This will be addressed at two complementary levels. The project works being implemented with the PCC services will entail internationally-proven engineering standards and practices. A progressive skills transfer program for RBD staff is to be provided, and various forms of technical assistance will target the RBD's skills and systems needs to achieve more effective technical and  - 26- operational management. The quality of the project road works should themselves ensure road performance and durability considerably exceeding current norms. The longer-term sustainability of the project benefits would be ensured through: (i) strengthened processes for improved road maintenance planning and execution; (ii) the re-orientation of the RBD's roads functions increasingly involving private sector project engineering, construction and supervision services; and (iii) associated institution building measures to strengthen the organizational, policy and financial dimensions of road infrastructure management in Andhra Pradesh. 8. Poverty Category. This project is not directly aimed at poverty alleviation, although it will also produce distributed benefits progressively in that context. 9. Environmental and Social Impact. A sector-level Environment Assessment will be completed before Bank appraisal of the project, with provision for more detailed assessment if necessary. Minimum adverse environmental impacts are expected during construction operations and from the road works, as the construction of any new roads is not envisaged. All project works will be limited to the strengthening, widening and/or improvement of road pavements and shoulders within the existing right of way, minimizing the need for land acquisition and the involuntary resettlement and rehabilitation (R&R) of people en route. Where R&R aspects arise, this will be surveyed beforehand and comprehensively addressed in accordance with the relevant Bank guidelines. Beneficial environmental impacts are expected due to the improved engineering of roads leading to decreased traffic congestion, lower noise levels and improved safety. 10. Project Benefits & Project Risks. The main direct benefits expected from this project will be (i) greater efficiency in transport operations on the State's road network; (ii) more effective management and maintenance of the major road network by Andhra Pradesh authorities; (iii) enhanced road planning, financing, investment and implementation capacity in relevant State entities, and (iv) assimilation of modem high-quality road engineering and construction methods and capabilities by the PWD and local industry. The risks to the project relate directly to: (i) the State's ongoing commitment during project preparation and implementation to Bank lending conditions and requirements; (ii) the effectiveness of the state's financial planning to provide for counterpart funding obligations; (iii) the state's actions to implement appropriate long-term funding levels as required for effective road network maintenance and management; and (iv) inaction on the necessary institutional reforms and strengthening measures. Managing Division: Energy & Infrastructure Operations Division South Asia Country Department II Task Manager: Chris Hoban Telephone No.: 202-473-3783 Contact Point: Public Information Center The World Bank 1818 H Street, N.W. Washington, D.C. 20433 Telephone: 202-458-5454 Fax: 202-522-1500 Note: This is information based on an evolving project. Certain components may not necessarily be included in the final project.  -27- Schedule A INDIA STATE'S ROAD INFRASTRUCTURE DEVELOPMENT TECHNICAL ASSISTANCE PROJECT ESTIMATED COSTS AND FINANCING PLAN (US$ million equivalent) ....... - oa oeg7.............................................. ..........T.....................iai.................................. Items Local Foreign Total ESTIMATED PROJECT COSTS Consultant Services and Training, 5.0 42.8 47.8 (including Project Management costs) Civil Works 2.0 2.2 4.2 Equipment 0.5 0.5 1.0 Taxes and Duties 15.0 0.0 15.0 Total Project Cost 22.5 45.5 68.0 Total Financing Required 22.5 45.5 68.0 ......................I................................................................................ . ................................................................................................................... FINANCING PLAN IBRD 7.1 44.4 51.5 State Governments 14.9 1.1 17.0 Government of India 0.5 0.0 0.5 Total 22.5 45.5 68.0 a/ Tax of about 30 percent is payable in India for foreign currency payments to foreign consultants/firms.  - 28- Schedule R Page 1 of 2 INDIA STATE'S ROAD INFRASTRUCTURE DEVELOPMENT TECHNICAL ASSISTANCE PROJECT Procurement and Disbursement A. Summary of Procurement Arrangements (US$ million equivalent) ............................................................................................................................................................................................ iv .................... Procurement Methods Project Element ICB NCB OTHER TOTALa' ......................................................................................................................................................................................................................... Consultant Services and Training 47.8 b 47.8 (including Project Management costs) (46.7) (46.7) Civil Works 4.0 0.2 4.2 (3.62) (0.18) (3.80) Equipment 0.8 0.2 1.0 (0.8) (0.2)c' (1.0) Total "' 4.8 0.2 48.0 53.0 (4.42) (0.18) (46.9) (51.5) a Figures in Parentheses are the respective amounts financed by the Bank b/ World Bank Guidelines for the Use of Consultants c/ Local shopping d/Excludes provision for Taxes and Duties  - 29 - Schedule B Page 2 of 2 INDIA STATE'S ROAD INFRASTRUCTURE DEVELOPMENT TECHNICAL ASSISTANCE LOAN B. Disbursement Arrangements US$ million equivalent Category Amount Expenditure to be Financed .................................... . ................ ... .............. . ........... ... ........... ............................. ........ ............... ....I................................................ ..................................... Consultant Services 46.7 100% of expenditures and Training Civil Works 3.8 90% of expenditures Equipment 1.0 100% of Foreign expenditures, 100% of local expenditures (ex-factory cost), and 80% of local expenditures for other items procured locally Total 51.5 Estimated Disbursements (US$ million) .............................................................................................................................................................. IBRD Fiscal Year 97 98 99 00 01 ....... ... ..................................................................................................................................................... Annual 10.0 12.0 15.0 8.0 6.5 Cumulative 10.0 22.0 37.0 45.0 51.5  -30- Schedule C Page 1 of 4 Status of Bank Group Operations in India IBRD) Loans and IDA Credits in the Operations Porffolio (as of September 30, 1996) Original amount in Difference USS millions between expected Project Loan or Fiscal Cancel- Undis- and actual ID redit N Year Purpose IBRD IDA lations bursed disbursements? Number of Closed Loans/Credits: 353 Active Loans IN-PA-10361 IN-PA-10369 C21730 1991 ICDS I (ORIS & A.P.) 96.00 21.65 29.97 35.34 IN-PA-10381 C22340 1991 MAHARASHTRA RURAL WS 109.90 70.35 65,42 IN-PA-10390 L33640 1991 GAS FLARING REDUCTION 450.00 29.16 29.16 IN-PA-10391 C23280 1992 MAHARASHTRA FORESTRY 124.00 91.31 31.32 IN-PA-10393 C23410 1992 WEST BENGAL FORESTRY 34.00 13.15 4.47 IN-PA-10400 C23500 1992 AIDS PREVENTION & CONTROL 84.00 48.88 35.14 IN-PA-10407 L34980 1992 MAHARASHTRA POWER II 350.00 247.75 188.75 IN-PA-10408 C24330 1993 ADP - RAJASTHAN 106.00 60.54 12,43 IN-PA-10410 C24390 1993 BIHAR PLATEAU 117.00 99.23 46,26 IN-PA-10411 C24490 1993 RENEWABLE RESOURCES 115.00 99.19 173.36 IN-PA-10416 C24500 1993 JHARIA MINE FIRE CONTROL 12.00 7.39 6.85 IN-PA-10418 L35770 1993 PGC POWER SYSTEM 350.00 229.30 122.50 IN-PA-10422 C24830 1993 KARNATAKA WS & ENV/S 92.00 80.63 34.87 IN-PA-10423 L36300 1993 PRIVATE POWER DEVT T.A. 20.00 19.60 19.60 IN-PA-10424 L36320 1993 NTPC POWER GENERATION 400.00 343.32 318.32 [N-PA-10448 C25280 1993 NATL LEPROSY ELIMINATION 85.00 63.06 28.07 IN-PA-10449 C25720 1994 FORESTRY RESEARCH ED 47.00 39.02 15.39 IN-PA-10455 C25730 1994 ANDHRA PRADESH FORESTRY 77.40 70.34 14.61 IN-PA-10457 C261 10 1994 BLINDNESS CONTROL 117.80 110.66 12.68 IN-PA-10461 C26300 1994 POPULATION IX 88.60 83.57 8.21 IN-PA-10461 L39070 1995 MADRAS WATER SUP 11 6.00 0.01 19.61 IN-PA-10463 L39076 1995 MADRAS WATER SUP 11 269.80 269.80 IN-PA-10463 C26450 1995 INDUS POLLUTION PREVENT. 25.00 25.60 24.99 IN-PA-10463 L37790 1995 INDUS POLLUTION PREVENT. 93.00 88.00 -3.51 IN-PA-10464 L37806 1995 INDUS POLLUTION PREVENT. 50.00 50.00 IN-PA-10476 C26610 1995 DISTRICT PRIMARY ED 260.30 231.09 18.69 IN-PA-10480 C27450 1995 TAMIL NADU WRCP 282.90 250.23 22.45 IN-PA-10480 C27630 1996 BOMBAY SEWAGE DISPOSAL 25.00 6.95 8.88 IN-PA-10484 L39230 1996 BOMBAY SEWAGE DISPOSAL 167.00 167.00 10.00 IN-PA-10485 L40560 1996 UP RURAL WATER 59.60 59.60 0.60 IN-PA-10489 C27740 1996 HYDROLOGY PROJECT 142.00 126.06 -4.00 IN-PA-10503 C26630 1995 AP IST REF. HEALTH 133.00 128.42 13.32 IN-PA-10506 C26990 1995 AGRIC HUMAN RES DEVT 59.50 55.05 9.06 IN-PA-10522 C27000 1995 MADHYA PRADESH FORESTRY 58.00 50.23 -0.92 IN-PA-10529 C27330 1995 ASSAM RURAL INFRASTRUCTURE 126.00 114.97 5,31 IN-PA-10563 C28010 1996 ORISSA WRCP 290.90 263.71 -10.64 IN-PA-10563 L38560 1995 FINANCIAL SECTOR DEV 350.00 200.00 -150.00 IN-PA-34162 L38576 1995 FINANCIAL SECTOR DEV 144.00 144.00 IN-PA-35170 C25940 1994 MAHARASHTRA EARTHQUAKE 246.00 166.92 75.17 IN-PA-35821 L40140 1996 ORISSA POWER SECTOR 350.00 350.00 IN-PA-35825 C28760 1996 DISTRICT PRIM EDUC 2 425.20 420.98 IN-PA-36062 C28330 1996 STATE HEALTH SYSTEMS II 350.00 331.47 6.25 IN-PA-39935 C291160 1997 ECODEVELOPMENT 28.00 28.14 IN-PA-39935 C28380 1996 ILFS-INFRAS FINANCE 5.00 4.91  -31- Schedule C Page 2 of 4 Original amount in Difference USS millions between expected Project Loan or Fiscal Cancel- Undis- and actual ID redit N Year Purpose IBRD IDA lations bursed disbursements' IN-PA-43310 L39920 1996 ILFS-INFRAS FINANCE 200.00 200.00 IN-PA-9860 C28620 1996 COAL ENV&SOCIAL MIT. 63.00 59.49 -3.00 IN-PA-9869 C21310 1990 WTRSHED PLAINS 55.00 27.96 8.65 IN-PA-9870 L30240 1989 NATHPAJHAKRI HYDRO 485.00 266.33 238.13 IN-PA-9872 L37530 1994 CONTAINER TRANSPORT 94.00 82.79 34.79 IN-PA-9877 C19230 1988 TAMILNADU URBAN 300.20 45.47 57.56 99.85 IN-PA-9882 C22410 1991 DAM SAFETY 130.00 110.64 104.43 IN-PA-9885 C21000 1990 WTRSHED HILLS 75.00 37.96 31.19 IN-PA-9885 L32580 1991 PETROCHEMICALS 12.00 4.92 4.71 IN-PA-9888 L32590 1991 PETROCHEMICALS 233.00 70.30 36.44 -126.26 IN-PA-9890 L34360 1992 POWER UTIL EFFIC IMPROVE. 265.00 151.30 103.00 IN-PA-9895 C21150 1990 HYDERABAD W/S 79.90 40.18 27.20 IN-PA-9895 C20640 1990 TECHNOLOGY DEVELOPMENT 55.00 36.31 28.11 IN-PA-9898 L31190 1990 TECHNOLOGY DEVELOPMENT 145.00 10.00 38.59 48.59 IN-PA-9898 C20100 1989 UPPER KRISHNA PHASE 11 160.00 16.40 8.91 IN-PA-9906 L30500 1989 UPPER KRISHNA PHASE 11 165.00 120.00 45.00 165.00 IN-PA-9906 C22520 1991 IND POLLUTION CONTROL 31.60 28.48 26.35 IN-PA-9910 L33340 1991 IND POLLUTION CONTROL 124.00 45.29 1.44 IN-PA-9921 C20570 1989 FAMILY WELFARE TRG 113.30 40.54 22.07 63.45 IN-PA-9925 C23290 1992 SHRIMP & FISH CULTURE 85.00 81.46 54.37 IN-PA-9932 L28450 1987 TALCHERTHERMAL 375.00 79.90 28.34 108.24 IN-PA-9940 C21580 1990 SECOND TN NUTRITION 95.80 28.28 21.48 29.43 IN-PA-9941 C21330 1990 POP. TRG (VII) 86.70 22.74 18.00 36.42 IN-PA-9946 L30960 1989 MAHARASHTRA POWER 400.00 46.00 169.26 200.06 IN-PA-9946 C23650 1992 NAT. HIGHWAYS 11 153.00 104.02 33.18 IN-PA-9955 L34700 1992 NAT. HIGHWAYS 11 153.00 153.00 IN-PA-9956 C25090 1993 UTTAR PRADESH BASIC ED. 165.00 99.02 1.30 IN-PA-9958 L30930 1989 ELECTRONICS 8.00 2.12 204.12 IN-PA-9958 C22150 1991 AGR.DEV.I (TN) 92.80 36.01 18.19 IN-PA-9959 L33000 1991 AGR.DEV.I (TN) 20.00 20.00 1.25 IN-PA-9961 C24090 1993 RUBBER 92.00 83.79 35.85 IN-PA-9963 C25100 1993 UP SODIC LANDS RECLAM. 54.70 41.95 9.60 IN-PA-9964 C23940 1992 POPULATION Vil 79.00 77.85 40.53 IN-PA-9965 C25920 1994 WATER RES. CONS. HARYANA 258.00 227.40 33.29 IN-PA-9973 C20760 1990 PUNJAB IRR & DRAINAGE 150.00 4.72 56.59 29.76 IN-PA-9977 L29940 1989 STATE ROADS I 170.00 55.00 22.43 157.43 IN-PA-9981 C24700 1993 ICDS 11 (BIHAR & MP) 194.00 186.73 60.05 IN-PA-9982 L31960 1990 CEMENTINDUSTRYRESTRUC. 300.00 6.82 43.60 50.42 IN-PA-9988 L32370 1990 NORREGTRANSMISSION 485.00 346.71 318.51 IN-PA-9989 C22230 1991 TECHNICIAN EDUC If 307.10 51.37 162.02 135.89 IN-PA-9990 C21300 1990 TECHNICIAN EDUC 1 235.00 24.26 94.51 85.31 IN-PA-9993 C20080 1989 VOCATIONAL TRAINING 250.00 86.15 80.34 176.16 IN-PA-9996 L33440 1991 PRIVATE POWER UTIL I 200.00 23.40 22.40 C20220 1989 NATIONAL SERICULTURE 147.00 21.95 30.39 71.72 TOTAL 7093.4 7457.1 735.2 9195.4 3963.1 Total disbursed (IBRD and IDA) Closed Loans Total Of which repaid 28395.83 33112.03 Total now held by IBRD and IDA 7817.43 8031.16 Amount sold 20007.98 33223.09 Of which repaid 133.77 133.77 Total undisbursed 54.11 8941.84 133.77 133.77  -32- Schedule C Page 3 of 4 India - Statement of IFC Investments Committed and Disbursed Portfolio As of September 30, 1996 (In USS Millions) Committed Disbursed IFC IFC FYApproval Company Loan Equity Quasi Partic Loan Equity Quasi Partic 1964/75/79/90 MUSCO 0.00 1.47 0.00 0.00 0.00 1.47 0.00 0.00 1978/87/91/93 HDFC 40.00 2.29 0.00 0.00 40.00 2.29 0.00 0.00 1980/82/89 Deepak 0.25 0.00 0.00 0.00 0.25 0.00 0.00 0.00 1981/86/91/93/96 ITW Signode 0.00 1.55 0.00 0.00 0.00 1.55 0.00 0.00 1981/90/93 M&M 1.17 6.49 0.00 4.67 1.17 6.49 0.00 4.67 1981 Nagarjuna Steel 0.00 0.07 0.00 0.00 0.00 0.07 0.00 0.00 1981/86/89/92/94 TISCO 13.80 15.37 0.00 0.00 13.80 15.37 0.00 0.00 1982 Modi Cement 19.64 0.00 0.00 0.00 19.64 0.00 0.00 0.00 1984/91 Bihar Sponge 15.23 0.68 0.00 0.00 15.23 0.68 0.00 0.00 1984/90/94 IndiaLease 1.75 0.86 0.00 0.00 1.75 0.86 0.00 0.00 1986 EXB-Bannari 0.08 0.00 0.00 0.00 0.08 0.00 0.00 0.00 1986 EXB-City Mills 0.48 0.00 0.00 0.00 0.48 0.00 0.00 0.00 1986 EXB-CECL 0.01 0.00 0.00 0.00 0.01 0.00 0.00 0.00 1986 EXB-NB Footwear 0.19 0.00 0.00 0.00 0.19 0.00 0.00 0.00 1986 EXB-Paharpur 0.30 0.00 0.00 0.00 0.30 0.00 0.00 0.00 1986 EXB-STG 0.50 0.00 0.00 0.00 0.50 0.00 0.00 0.00 1986 EXB-TAN 0.03 0.00 0.00 0.00 0.03 0.00 0.00 0.00 1986 EXB-Wires & Fab. 0.14 0.00 0.00 0.00 0.14 0.00 0.00 0.00 1986/92/93/94 GESCO 1.54 13.05 0.00 9.91 1.54 13.05 0.00 9.91 1986/93/94/95 India Equipment 0.65 0.77 0.00 1.60 0.65 0.77 0.00 1.60 1987 Hindustan 10.80 0.00 0.00 0.00 10.80 0.00 0.00 0.00 1987/88/90/93 Titan Watches 6.08 1.03 0.00 0.00 6.08 1.03 0.00 0.00 1988/94 GKN Invel 0.00 1.40 0.00 0.00 0.00 1.40 0.00 0.00 1988/90/92 Keltron 0.00 0.56 0.00 0.00 0.00 0.56 0.00 0.00 1989 AEC 17.53 0.00 0.00 0.00 17.53 0.00 0.00 0.00 1989/91 Gujarat State 17.81 0.00 0.00 0.00 17.81 0.00 0.00 0.00 1989/95 JSB India 0.00 1.21 0.00 0.00 0.00 1.21 0.00 0.00 1989/90/94 Tata Electric 104.64 0.00 0.00 0.00 104.64 0.00 0.00 0.00 1989 UCAL 0.00 0.63 0.00 0.00 0.00 0.63 0.00 0.00 1990/92 CESC 51.71 0.00 0.00 67.00 51.71 0.00 0.00 30.00 1990 HOEL 0.00 0.28 0.00 0.00 0.00 0.28 0.00 0.00 1990/94 ICICI-IFGL 0.00 1.06 0.00 0.00 0.00 1.06 0.00 0.00 1990/95 ICICI-SPIC Fine 0.00 1.88 0.00 0.00 0.00 1.88 0.00 0.00 1990/93/94 IL& FS 28.50 3.11 1.81 10.00 28.50 3.11 1.81 10.00 1990 TDICI-VECAUS II 0.00 1.94 0.00 0.00 0.00 1.94 0.00 0.00 1991 Block KG-OS-IV 0.00 0.02 0.00 0.00 0.00 0.00 0.00 0.00 1991 BSES 50.00 0.00 0.00 0.00 50.00 0.00 0.00 0.00 1991/93 Triveni 0.00 1.11 0.00 0.00 0.00 1.11 0.00 0.00 1991/96 VARUJN 14.42 1.35 0.00 6.00 14.42 1.35 0.00 6.00 1992/93 Arvind Mills 0.00 17.10 0.00 0.00 0.00 17.10 0.00 0.00 1992/95 Creditcapital VF 0.00 1.05 0.00 0.00 0.00 1.05 0.00 0.00 1992 Indus VC MgtCo 0.00 0.01 0.00 0.00 0.00 0.01 0.00 0.00  -33- Schedule C Page 4 of 4 Committed Disbursed I I I IFC IFC FYApproval Company Loan Equity Quasi Partic Loan Equity Quasi Partic 1992 Indus VCF 0.00 1.00 0.00 0.00 0.00 1.00 0.00 0.00 1992 Info Tech Fund 0.00 0.64 0.00 0.00 0.00 0.64 0.00 0.00 1992/94 Nippon Denro 61.43 5.77 0.00 60.00 31.43 5.77 0.00 0.00 1992/96 NICCO-UCO 2.25 0.37 0.00 0.00 2.25 0.37 0.00 0.00 1992 SKF Bearings 7.66 0.00 0.00 0.00 7.66 0.00 0.00 0.00 1993/94/96 Indo Rama 23.44 11.98 0.00 9.38 23.44 11.98 0.00 9.38 1993 20TH Century 1.09 0.80 0.00 7.11 1.09 0.80 0.00 7.11 1994 Centurion Growth 0.00 2.39 0.00 0.00 0.00 2.39 0.00 0.00 1994 Chowgule 15.00 4.58 0.00 27.00 0.00 4.58 0.00 0.00 1994 Crdcap Asset Mgt 0.00 0.32 0.00 0.00 0.00 0.32 0.00 0.00 1994 DLF Cement 15.34 0.00 0.00 17.00 15.34 0.00 0.00 17.00 1994 Global Trust 0.00 3.19 0.00 0.00 0.00 3.19 0.00 0.00 1994 Gujarat Ambuja 0.00 8.23 0.00 0.00 0.00 8.23 0.00 0.00 1994 GVK 40.00 8.30 0.00 0.00 0.00 8.30 0.00 0.00 1994 Taurus Starshare 0.00 7.17 0.00 0.00 0.00 7.17 0.00 0.00 1994 TCAMC 0.00 0.16 0.00 0.00 0.00 0.16 0.00 0.00 1995 Centurion Bank 0.00 3.87 0.00 0.00 0.00 3.87 0.00 0.00 1995 EXIMBANK 25.00 0.00 0.00 0.00 16.00 0.00 0.00 0.00 1995 ISIC 0.00 0.32 0.00 0.00 0.00 0.32 0.00 0.00 1995 Prism Cement 15.00 5.02 0.00 15.00 12.50 5.02 0.00 12.50 1995 Rain Calcining 19.25 5.40 0.00 0.00 0.00 4.72 0.00 0.00 1995 RPG Communicat 0.00 8.30 0.00 0.00 0.00 0.00 0.00 0.00 1995 Sara Fund 0.00 7.04 0.00 0.00 0.00 1.10 0.00 0.00 1995 SRF Finance 15.00 5.00 0.00 0.00 15.00 4.39 0.00 0.00 1996 CVF Oil Gas-AL 8.00 8.00 0.00 0.00 0.00 0.00 0.00 0.00 1996 India Direct Fnd 0.00 7.50 0.00 0.00 0.00 0.13 0.00 0.00 1996 Indus II 0.00 5.00 0.00 0.00 0.00 1.00 0.00 0.00 1996 Indus Mauritius 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 1996 Moser Baer 5.70 0.60 0.00 0.00 5.70 0.00 0.00 0.00 1996 United Riceland 10.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Total Portfolio: 661.41 187.29 1.81 234.67 527.66 151.77 1.81 108.17 Approvals Pending Commitment Loan Equity Quasi Partic 1994 NEYVELI POWER 30.00 18.00 0.00 150.00 1994 NIPPON DENRO ISP 0.00 6.00 0.00 0.00 1995 IB VALLEY POWER 50.00 20.00 0.00 0.00 1995 SPIC-RGHTS ISSUE 0.00 0.86 0.00 0.00 1996 CESC II -BLINC 0.00 0.00 0.00 37.00 1996 DEV CREDIT BANK 0.00 1.89 0.00 0.00 1996 TARUN SHIPPING 0.00 0.80 0.00 0.00 1997 NIPPON EXPANSION 15.00 6.00 0.00 25.00 1997 WIPRO 10.00 0.00 0.00 0.00 Total Pending Commitment: 105.00 53.55 0.00 212.00  -34- India at a glance POVERTY and SOCIAL South Low. India Asia Income Oevelopment diamond' Populatbon mid-1995 (illions) 929.4 1,243 3,188 Lte expectancy GNP per capita 1995 (USS) 350 350 460 GNP 1995 (billions USS) 325.3 435 1,468 Avege annual growth, 1990-95 Popuintionr%) 1.8 1.9 1.8 Laborforce(%) 2.1 2.4 1.9 GNP Gm per pnm Moast rcxnt estimat latest year avaible since 1989) capita enrolim Poverty: headcount index (% of popuxtson) Urban population (% of tot population) 27 26 28 Life expectancy at birth (yeaws) 62 61 63 . Infant mortaity (per 1,000 #lve bilts) 68 73 68 Chid mainutntion (% of childrdn under S) 63 62 38 Access to safe water Arss to safe water (r of popuLtabon) .. 70 66 illiteracy (% ofpopidabon ago 15.) 48 51 35 Groas primsry enroilment (% of school-ae population) 102 98 105 I-ndia Male 113 110 112 1 -Low-income goup Femals 91 87 98 ! KEY ECONOMIC RATIOS and LONG-TERM TRENDS 1975 1985 1994 1995 Economic ratios GOP (biNlons USS) 91.0 214.3 301.2 328.2 Gross domestic investrnmntGDP 20.8 23.9 23.2 24.2 Openness of economy Exports of goods and non-factor servicestGOP 6.2 6.0 11.3 12.4 | G-m domestic savinga/GDP 20.4 20.8 21.5 22.1 Gms national savingsaGDP 20.8 21.1 22.3 22.6 T CtAent account balancelGDP 40.1 -2.8 -1.0 -1.7 Savings Investment interest paymentstGDP 0.3 0.6 1.5 1.4 Sa4-n Totl debtVGDP 15.1 19.1 32.9 30.2 Total debt servicketxporta 13.1 22.7 26.9 25.1 Presnt value of debt/GOP .. .. 23.4 Present value of debtlexports .. .. 176.7 .. Indebtedness 197-84 19S5-95 1994 1995 1996-04 (averge annual growth) -India GDP(factorcost) 4.0 5.1 6.3 7.0 6.2 -Low-income group GNP per capita 1.7 3.1 6.1 5.7 4.7 Exports ofgoodsandnfs- 11.5 11.1 18.0 19.7 11.9 STRUCTURE of the ECONOMY 1975 1985 1994 199_ (% of GOP) Growth rates of output and nvestmont (%) Agriclature 40.5 33.0 31.1 29.8 20 Industry 23.7 28.1 28.0 29.1 l Manufacuring 16.7 17.9 17.4 18.2 Swvcs 35.8 38.8 40.9 41.1 so \