Document of The World Bank FOR OFFICIAL USE ONLY c R. / s->-xgr Report No. 5799-IN STAFF APPRAISAL REPORT INDIA GUJARAT RURAL ROADS PROJECT December 23, 1986 Transportation Division South Asia Projects Department This document bas a restricted distribution and may be used by recipients only in the performance of their oflicial duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCY EQUIVALENTS Currency Unit = Indian Rupee (Rs) USS 1.00 = Rs 13.00 US$ 0.077 = Rs 1 WEIGHTS AND MEASURES: METRIC Metric US System 1 meter (m) 3.281 feet 1 square meter (m2) 10.760 square feet 1 kilometer (km) 0.621 mile I square kilometer (km2) 0.386 square mile i ton-km 0.621 ton-mile 1 passenger-km (pass-km) 0.621 pass-mile ACRONYMS AND ABBREVIATIONS CD = Cross Drainage cWC = Central Water Commission (GOI) CE(RR) = Chief Engineer (Rural Roads) DEE = Deputy Executive Engineer DEA = Department of Economic Affairs (of Ministry of Finance, GOI) DRD = Department of Rural Development, Ministry of Agriculture EE = Executive Engineer ERR = Economic Rate of Return ESC = Engineering Staff College (Gandhinagar) FYP = Five-Year Plan GERI = Cujarat Engineering Research Institute COG = Government of Gujarat GoI = Government of India MF = Ministry of Finance MNP = Minimum Needs Program MOST = Ministry of Shipping and Transport NDO = New Delhi Office (of the World Bank) PPMC Project Planning and Monitoring Cell (R&B) R&BD = Roads and Buildings Department (of COG) SE = Superintending Engineer SOE = Statement of Expenditure WBM = Waterbound Macadam FISCAL YEAR April 1 - March 31 INDIA FOR OMCIAL USE ONLY GUJARAT RURAL ROADS PROJECT STAFF APPRAISAL REPORT Table of Contents Page Number I. INTRODUCTION ............................................. 1 II. THE TRANSPORT SECTOR ..................................... 2 A. Economic Setting and the Transport Sector .... ........ 2 B. Bank Group Strategy in the Transport Sector .... ...... 2 C. Role of Rural Roads in Gujarat's Dairy Farming ....... 3 D. The Road Subsector .................................. 4 (a) Road Network ................................... 4 (b) Road Administration and Financing .... .......... 4 (c) Building Construction .......................... 5 (d) Planning of State Highways and Rural Roads ..... 5 (e) Rural Roads .................................... 6 gf) Road Maintenance ............................... 6 (g) Training ....................................... 7 (h) Construction and Contracting ..... .............. 8 E. Previous Bank Group Involvement in the Transport Sector 8 (a) Previous Lending. 8 (b) Lessons from Previous Rural Roads Projects 9 III. THE PROJECT . . .10 A. The Rationale for Bank Group Involvement .10 B. Project Objectives .10 C. Project Description .11 (a) Road Works .11 (b) Equipment ... 12 (c) Building Construction .12 (d) Engineering and Administrative Services .12 (e) Training .12 (f) Studies .13 (g) Road Safety. .............................. 13 This report was prepared by Mr. C. Jeremy Lane, Highway Engineer and Mrs. Inai Bradfield, Transport Economist. The bulk of the word processing and COSTAB operation was done by Mrs. Margaret Carter and Ms. Angela Ning, who also assisted with the calculations. This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. -Li- Page Number D. Cost Estimate .............. ...................... . 14 E. Financing .......................................... 0.......... iS F. Land Acquisition ...................o.....8 15 G. Procurement and Contracting ......................... 16 H. Status of Project Preparation, Execution & Supervision 17 r . Disbursements .. ....... . ...... . 18 J. Accounting and Auditing .............................. 19 K. Environmental Impact ...... ........................ .19 L. Reporting .....19...................................... 19 IV. ECONOMIC JUSTIFICATION AND RISKS ......................... 20 A. Main Benefits and Beneficiaries ......... .. ........... 20 B. Economic Analysis ....... .................. 20 C. Risk Analysis .................... .................... 21 V. AGREEMENTS TO BE REACHED AND RECOMMENDATIONS ..... 21 ANNEXES Annex I - The Transport Sector ............. .... ............. 23 Annex 2 - The State of Gujarat ............ .. .............. 34 Annex 3 - Terms of Reference for Maintenance Planning Study .. .......... 41 Annex 4 - Procurement and Contracting .......... .......... 44 Annex 5 - Terms of Reference for Project Monitoring System.. 47 Annex 6 - Economic Evaluation Methodology ................. . 50 Annex 7 - Documents in the Project File .................... 59 TABLES Table 2.1 - Estimated GOG Resources for the Seventh Plan ..... 60 Table 2.2 - Planned Expenditures During The Seventh Plan ..... 61 Table 2.3 - Road Expenditures . ............................... 62 Table 3.1 - Road Pavement Design and Geometric Standards ..... 63 Table 3.2 - Road Construction Program .......... .... o ......... 64 Table 3.3 - Procurement of Equipment ........... .. ............ 67 Table 3.4 - Training Program ...... .......... . ....... . ..... 68 Table 3.5 - Detailed Cost Table .-........................... 69 Table 3.6 - Estimated Schedule of Disbursements .o............ 70 -i.i- Page CHARTS Number Chart 1 - R&BD Organization ................................. 71 Chart 2 - Implementation Schedule .... ...................... 72 MAP Map IBRD 18877 This report is based on information suppLied by GOG and GOI during preparation missions. The project was appraised in November 1984 by Mr. C. Jeremy Lane, Highway Engineer, Mrs. Inai Bradfield, Transport Economist, and Mr. C.S. Nawathe, Highway Engineer, New Delhi Resident Mission. INDIA GUJARAT RURAL ROADS PROJECT CREDIT AND PROJECT SUMMARY Borrower: India, acting by its President Beneficiary: The State of Gujarat Amount: IDA Credit: SDR 101 million (US$119.6 million equivalent) Terms: IDA Credit: Standard Relending Terms: As part of Central assistance to States for development projects on terms and conditions applicable at the time. GOI would bear the foreign exchange and interest rate risks. Project Description: The project's main objectives are to provide additional all-weather roads to the rural poor, and to improve rural road construction and maintenance, road planning, and road maintenance management in the State of Gujarat. The project comprises: (i) a program of construction, reconstruction, and improvement of about 4,042 km of village roads connecting 1,900 villages; (ii) the procurement of construction equipment, vehicles, and laboratory equipment; (iii) the construction of office buildings, warehouses, workshops, and housing; (iv) engineering and consulting services for project planning, design, supervision, and monitoring, and for staff training; (v) technical assistance for a road maintenance study and (vi) the preparation of a road safety program. The risks are those normally associated with this type of project. Since most project components involve proven technology, technical risks are minimal. The State Roads and Bridges Department has demonstrated satisfactory technical capabilities in the implementation of a previous Bank-financed irrigation project which included construction of rural roads. Training and supervision activities will minimize risks associated with new equipment, contracting procedures, maintenance operations, and project management. -ii- Estimated Cost: 1/ (US$ milLions) Item Local Foreign Total Civil works 75.5 16.9 92.4 Engineering, supervision, 11.1 - 11.1 training Equipment procurement 6.8 7.4 14.2 Buildings and Housing 2.0 - 2.0 Studies, Road Safety, STC 0.9 0.9 1.8 Total Baseline Costs 96.3 25.2 121.5 Physical contingencies 9.1 2.1 11.2 Price contingencies 35.5 2.6 38.1 Total Project Costs 140.9 29.9 170.8 1/ Excluding taxes and duties, which are insignificant. Financing Plan: (US$ millions) Local Foreign Total GOI/GOG 51.2 - 51.2 IDA 89.7 29.9 119.6 Total 140.9 29.9 170.8 Estimated Disbursements: (Millions of SDR) Bank/IDA FY FY88 FY89 FY90 FY91 FY92 FY93 FY94 FY95 Annual 7.0 15.0 20.0 20.0 17.0 12.0 8.0 2.0 Cumulative 7.0 22.0 42.0 62.0 79.0 91.0 99.0 101.0 Rate of Return: About 28Z INDIA CUJARAT RURAL ROADS PROJECT STAFF APPRAISAL REPORT I. INTRODUCTION 1.01 In 1983, the Government of India (GOI) requested Bank Group assistance for a rural roads project in Gujarat in recognition of the importance of adopting modern project management and execution techniques at the state level by the Roads and Buildings Department (R&BD), and at the same time resolving difficult access problems in potentially produc- tive areas in the state through the provision of improved rural roads. The project was prepared by R&BD, assisted by Bank Group staff, and is intended to give support to the Government of Gujarat (GOG) in: (i) providing all-weather road connections to the rural poor, who are largely dependent on incomes from dairy farming and agricultural product4on; (ii) promoting institutional development in the areas of planning, management, and execution of road construction and maintenance programs; and (iii) modernizing the contracting industry through the application of higher technical standards. The proposed project is the second rural roads project in India, following the Bihar Rural Roads Project (Credit 1072-IN). 1.02 The project, estimated to cost US$171 million, would connect about 1,900 villages to the state's road system and provide improved access to about 2 million people in the most backw-ard areas of Gujarat by constructing and/or upgrading some 4,000 km of rural roads and thus directly benefitting the rural poor who would be able to increase marketable milk supplies to the dairies as a result of the project. Building upon the experiences gained during implementation of the Bihar Rural Roads Project, the project would focus on achieving expanded institutional development by supporting improved management and opera- tional efficiency in the roads sector through technical assistance and training. In view of the commitment shown by GOI/GOG during project preparation to key institutional issues under the project, an improved policy framework for rural road development and a model technical package, which could be replicated in other states iL India under similar projects, is expected to be established during project implementation. -2- II. THE TRANSPORT SECTOR A. Economic Setting and The Transport Sector 2.01 India's 3.3 miLlion square kilometers present a wide range of topography and climate, including parts of the Himalayan mountain range, the Indo-Gangetic plain, and the Deccan plateau of peninsular India. The total population is about 780 million (mid-1986 estimate), with 24X living in urban areas and the remainder dispersed in over half-a-million smaLl villages throughout the country. The Indian economy is dominated by agriculture, which employs more than two-thirds of the labor force and provides about 36% of Gross Domestic Product (GDP), but also has a large industrial sector, which accounts for 24% of GDP. Economic growth has averaged about 3.6% per year since 1950. Annual per capita income cur- rently stands at US$260 and has been rising by about 1.4Z per year since 1980. Growth in GDP during the 1980s has averaged about 5.4% per year, substantially higher than the long-term average. 2.02 India's vastness has shaped its transport system, which is both extensive and diversified, comprising about 61,000 route km of railway lines, 1.5 million km of roads, 10 major ports and 178 intermediate or minor ports, 14 major airports, 6 of which handle internatio.al flights, 2,570 km of pipelines, and limited inland waterways and coastal shipping. The system provides a satisfactory level of service in many respects, but there remains considerable potential for reducing transport costs and improving the quaLity of services. In addition, a large proportion of the transport infrastructure, in all modes, needs to be renewed or upgraded to meet future transport requirements more efficiently, and many remote rural areas must be provided with improved access and be connected with main highways. Details of India's transport sector are contained in Annex 1. B. Bank Group Strategy in the Transport Sector 2.03 The Bank Group strategy in the Indian transport sector emphasizes: (a) expansion of transport capacity, through greater operational efficiency, investments in rehabilitation of existing capacity and streamlining of maintenance and project execution practices; (b) modernization of transport infrastructure, equipment and operat- ing conditions; (c) introduction of cost-based pricing principles and reduction of subsidy levels; and -3- (d) strengthening of COI capabilities of traffic forecasting, main- tenance engineering, safety and investment planning engineering, safety and investment planning. The proposed project is designed to support the selected aspects of the Bank Group's strategy listed above through the provision of increased transport capacity in rural areas, impr3vements in road maintenance plan- ning and operation, and identification of road use costs and charges necessary for resource mobilization in Gujarat. C. Role of Rural Roads ia Gujarat's Dairy Farming 2.04 The rural roads policy in India is defined in the context of the Minimum Needs Program (MNP), which envisages providing by 1990 basic infrastructure, including all-weather roads, to all villages with a population of over 1,500, and to 50% of the villages with popuLations ranging from 1,000 and 1,500. Many states, including Cujarat, have ongoing MNPs, which form part of the five-year plans. In the State of Gujarat over 4,000 villages or 22% of a total of 18,000 villages have no road connection at all, and only about 55% of the villages are connected by all-weather roads. The road aspects of MNP are briefly described in Annex 1. 2.05 Lack of adequate road access to many existing and potential milk producers is the main constraint impeding further development of the dairy industry, which is the mainstay of the rural economy of northern and western Gujarat. Much of the land where the project roads are located is unsuitable for commercial agriculture, allowing only subsistence farming where many farmers find it possible to augment their marginal income by keeping a milch animal or two, which are fed by gathering fodder or graz- ing at the roadside. Where good all-weather transport exists, a dairy industry has successfully developed, helped by the National Dairy Development Board and numerous dairy cooperatives which provide various extension and veterinary services, credit facilities and dry-weather milk chilling centers. Where only rudimentary dry-weather road access exists, however, the dairy developmental potential has not been realized since viable dairy operations depend very heavily on rapid and reliable tran- sport between collection and chilling centers or the main dairies. Losses increase rapidly if the milk is not chilled within two and half hours of production, and producers are unwilling to increase their herds or commit themselves to better, but more expensive, feeding and care of their animals, if milk collectinn cannot be ensured during the monsoon period. Moreover, the farmers in these isolated villages cannot make use of free or low-cost veterinary and extension services provided by the village cooperatives, and consequently experience a higher incidence of cattle deaths due to inadequate care. Poor access or isolation also means reduced opportunities for education, primary henlth care and other socio-economic development. The proposed project is designed to respond -4- to the needs of these isolated farmers. Details of Gujarat's rural economy and transport are contained in Annex 2. D. The Road Subsector (a) The Road Eletwork 2.06 Roads in India comprise: national highways, state highways, district roads and village roads. The latter group connects villages to the nearest district road, main highway, or railway, and is the class of road with which the proposed project is concerned. Details of India's road subsector are contained in Annex 1. The network has experienced an almost fourfold expansion since 1950, growing from 0.4 milLion km in 1950 to 1.5 million km in 1980, or at an average annual rate of 4.5Z. Growth has been partly due to the emphasis given to linking villages to the network. India's density of roads, which stood at 0.46 km per sq km in 1980 compares favorably with densities in other developing countries. Nonetheless, because of a high population density throughout the country, India's road transport requirements are considerable and call for further expansion and strengthening of the road network. :raffic in India's total road system has been growing at an average annual rate of about 5.4% in the last six years. (b) Road Administration and Financing 2.07 With the exception of the national highway system, all roads in India are the responsibility of State Government. In the case of Gujarat, the road sector is administered by COG through R&BD and the Department of Transport. The Planning Department coordinates investment planning and the allocation of resources. The State and its transport sector are discussed in Annex 2, which also gives details of highway investment. At present, it is believed that road user charges are not equitable as between different vehicle classes and that insufficient revenue is col- lected from the transport sector as a whole. In order to provide data to policy makers, it was agreed during negotiations that in consultation with the A-sociation, the scope of the Road Use Charge Study being carried out under the National Highway Project (Loan 2534-IN) would be expanded to include a review of the existing taxation system and levels of road use charges for different tvpes of road vehicles in Cujarat, with the objec- tive of improving the availability of resources for road maintenance. It was also agreed that such a study covering Gujarat would be completed by December 31, 1988, and thereafter Gujarat will discuss the findings with the Association. 2.08 GOG's Seventh Five-Year Plan balances resources and expenditures at Rs.60 billion for the 1985-1990 period, of which 6.3% (Rs.3.77 billion) is for transport (including Rs.2.58 billion for road construction, a reduction from earlier estimates of Rs.4.25 billion); out of the Rs.3.77 -5- billion, Rs.1 billion is reserved for the proposed project (Tables 2.1 and 2.2). A large part of the remainder is composed of spill-over works from the previous plan consisting of surfacing, widening and strengthening of state highways, district and village roads, and some 350 km of new con- struction already approved. About Rs.1 billion is made up of similar works to be taken up for the first time. However, these new works are not authorized until previous commitments are met, and therefore, they would be deleted from the plan if there is a funding shortfall. This fact is c:ted by COG officials as a security for project funding, which would receive priority. 2.09 Gujarat is a relatively prosperous state, which is now benefit- ting from a growing industrial base. COG's revenue from all sources, including its share of central taxes and grants, has grown from Rs 3.7 billion in 1974/75 to Rs 16.8 billion in 1984/85 (in current Rupees), out of which 24% was the Center's contributions to the State in the form of shared central tax revenues. The major part of the State's revenues comes from sales tax (36%) and road user charges (9Z), which are to be reviewed under the proposed project (para. 2.07). Based on the Sixth Plan perfor- mance, the State's Finance and Planning Departments have conservatively estimated the State's budgetary resources for the Seventh Plan. For instance, GOG estimated average annual budgetary resources at Rs 12 bil- lion during the plan period as against over Rs 16 billion which was avail- able in 1984/85. On the expenditure side, certain downward adjustments have been made for the transport sector (excluding the Baroda Expressway which is financed by GOI) which has traditionally accounted for 7X - 10% of the State's previous plans, compared with the allocation of 6% for transport in the current plan. Such reduction in the allocation of expen- ditures for transport appears to be reasonable in view of Gujarat's other heavy commitments to irrigation (Rs 16 billion) and power (Rs 14 billion) projects during the plan period (Table 2.2). Increases in maintenance allocations will be met from the expected growth in general revenue on current account under the recurrent budget. It is reasonable to assume, therefore, that GOI could finance the project and afford to increase mai'<enance allocations gradually to a level commensurable with needs. Even if the Seventh Plan falls short of its goals by the same amount as its predecessor, sufficient funds should still be available for project completion, if GOG carries out its stated policy of not undertaking new road schemes outside the project. (c) Builuing Construction 2.10 R&BD maintains offices, workshops, laboratories, and staff quarters throughout the state. Although every effort has been made to use existing buildings, in many areas where project works will be carried out additional permanent buildings are required. Some additional build- ings for housing are included in the project to encourage qualified staff -6- to accept field assignments. The total cost of buildings amounts to 1.4X of project cost. (d) Planning of State Highways and Rural Roads 2.11 Planning of state highways and rural roads has thus far largely been limited to the compilation of desired roads for improvement or new construction, based on perceived needs in the case of state highways, and on the Minimum Needs Program in the case of rural roads (Annex 1). In neither case did the state systematically collect data necessary for adequate road planning. During project preparation, COG, for the first time, collected socio-economic, traffic, and vehicle operating cost data to undertake economic analyses to determine the economic viability of the roads selected for inclusion in the prcject. Under the project, technical assistance will be provided to assist GOG in achieving improved road planning and programing by applying economic evaluation methodology to the selection of road investment projects (paras 3.04 and 4.05). (e) Rural Roads 2.12 The development of rural roads was included for the first time in India's Fifth Plan of 1974-79 as nn important part of the Minimum Needs Program. During this Plan period, less than half of the targetted 29,000 villages throughout India were provided with all-weather roads. Thus, the subsequent Sixth Five-Year Plan of 1980-85 included many of these villages to be connected with all-weather roads. For the Seventh Plan of 1985-90, the Department of Rural Development (DRD), Ministry of Agriculture required each state to propose a master plan for its rural roads covering a 15-20 year horizon. This project is based on the Kaster Plan for Rural Roads in Gujarat. The Gujarat State road network consists of some 55,000 km of road, of which over 45,000 km is surfaced. Village roads make up 21,500 km of the total. Full details of the reads subsector in Cujarat and of the Roads and Buildings Department, the body charged with their planning, construction and maintenance, are given in Annex 2. (f) Road Maintenance 2.13 Road maintenance is the responsibility of R&BD, a Gujarat State agency. Funds for maintenance of national highways are provided by GOI and the work is carried out under the supervision of the Chief Engineer (National Highways). State road maintenance is carried out by contract and force account, under the supervision of the Chief Engineer (RMB) and Chief Engineer (Panchayats) (Chart 1). Funds are provided under Govern- ment Resolutions, the current one being dated 1979 (Table 2.3), which establishes norms in Rupees per km for each class of road, and the cor- responding amounts are released to ROBD throughout the year by the State Finance Department. The norm amount is expected to cover both periodic and routine maintenance in the ratio 67:33. The kilometer totals and their -7- status are revised annually during the budget review to take account of new construction and upgrading during the FY just ending. No difficulty is expected in assuring funds under this system for the roads upgraded or created by the project. Recently, the GOI Finance Commission recommended increases in maintenance funds of 150-200Z above current Governmen'. Resolution levels which would be marginally above the intervening rate of inflation (Table 2.3). However, the norm system takes little account of current road conditions or traffic, resulting in inefficient planning of periodic maintenance and in the build-up of a maintenance backlog. As a start to the introduction of a more logical and needs-based system, the project will include a maintenance planning study consisting of traffic counts, a road condition inventory, and the preparation of a ten-year periodic maintenance plan. This is in concert with a similar approach for national highways incorporated in the recently approved National Highway Project (Loan 2534-IN). Draft outline terms of reference for the proposed Maintenance Planning Study are given in Annex 3. During negotiations, it was agreed that during the first review mission detaiLed terms of r:'erence for the study would be prepared by the Association in consult- ation with DRD, COG and the Planning Commission and would be finalized by June 30, 1987. It was also agreed that the maintenance -study would be completed by December 1988, and GOG would discuss with the Association the study findings, recommendations, and a time-phased program of implementa- tion. 2.14 It is unlikely that the norm system, which is in use throughout the subcontinent can be changed overnight. Therefore, in the meantime, COG was asked to discuss its new norms which are expected to reflect the Eighth Finance Commission recommendations. During negotiations, assurances were obtained from GOG that budgetary resources to be allocated for road maintenance would be at the level necessary to meet the technical norms established by the Eighth Finance Commission and adopted in principle by COG for the roads beinl built and im2roved under the roect. For the remainder of State roads, GOG expressed its intention to endeavor to allocate resources for road maintenance which would approach the Eighth Finance Commission's recommended norms. 2.15 On completion, all roads built or improved under the project will be maintained under the supervision of the Executive Engineer (R&B) in whose district they fall. Funds will be automatically provided under Government Resolutions. Bituminous maintenance is currently rather primi- tive, and R&BD personnel and equipment (Table 3.3) used in the project will be progressively transferred to the Executive Engineers (R&BD), assuring maintenance of the project roads and bringing a much needed strengthening to maintenance methods on the network as a whole. -8- (g) Training 2.16 The proposed project will create a training need in a number of fieLds, notably new technology and project management which will be covered under the project. R&BD and GOG's Irrigation Department jointly operate an Engineering Staff College (ESC) in Gandhinagar, which is a well-equipped facility having hostel accommodations for up to 78 students. ESC has built up a 'stable' of visiting lecturers, mostly current prac- titioners in their field, to suppler-nt its permanent staff. ESC staff, in close consultation with the Chief Engineer (Rural Roads), have prepared a series of courses designed for staff appointed to the project, which will also be open to contractors' personnel. 2.17 To expose R&BD engineers to new techniques and equipment in the appropriate institutional context, a series of overseas visits is being arranged. Mechanical training will be provided for mechanics and operators initially by equipment suppliers under the supply contract. Training for the operation or repair of existing equipment will be given at R&BD's mechanical branch training center at Odhav, near Ahmedabad. The Maintenance Planning Study and the introduction of a computerized monitor- ing system will involve on-the-job training, to be given by the consult- ants carrying out the studies (para. 3.11). (h) Construction and Contracting 2.18 The project aims to bring changes to current practices in the road construction industry. New equipment (Table 3.3, lists A, B and C) is being introduced, and training will be offered in its use. The new equipment will introduce a number of innovations including vibrating rollers. The crushing plant is being obtained to enable R&BD to produce machine-broken, as opposed to the traditional hand-broken stone, in order to meet tighter grading requirements for 1-1/2 inch aggregate. The bitumen heater/sprayers will bring a dramatic improvement in the applica- tion of bitumen, which currently is heated in the drum over a wood fire and distributed as a lukewarm liquid from a bucket. 2.19 The project also aims to improve contracting practice by encouraging larger contracts and reducing "horizontal slicing" (Annex 4). Two reforms will be necessary to allow this to happen: (i) the use of bank guarantees in place of the present earnest money deposits; and (ii) sub-contracting. Both these practices are provided for in the Central Water Comission model tender document being used as the basis for the proposed project's contract documents. Prior to negotiations GOG agreed to incorporate technical improvements in bidding douments by: (i) accepting bank guarantees, if offered, for contractors' security deposits; (ii) allowing sub-contracting of part of any contract from the start of the project; (iii) horizontal slicing of works; and (iv) by achieving a mini- mum bid package size of Rs 10 million from the second year of the project. -9- E. Previous Bank Group Involvement in the Transport Sector (a) Previous Lending 2.20 The Bank Group's involvement in India's transport sector dates back to 1949 and has consisted of eight loan/credits and ten credits for Indian Railways (IR) totalling more than US$1.8 billion; five port projects, and one shipping project totalling US$410 million; and one rural roads project and two highway projects totalling US$295 miLlion. Whereas the Bank Group involvement with IR has been almost continuous since 1949, lending to the road and ports subsectors was discontinued in 1962 mainly because of GOI's preference for local competitive bidding for civil works in projects in these sectors. In 1980, however, the Bank Group undertook a rural roads project in the State of Bihar (Credit 1072-IN, 1980) albeit with no ICB provisions, given the relatively small size (US$29 million) and remoteness of the project area. This situation has now changed with the approval of the Nhava Sheva Port Project (Loan 2387-IN) in 1984, and the National Highway Project (Loan 2534-IN) in 1985, both of which require ICB procedures. (b) Lessons from Previous Rural Roads Projects 2.21 There have been two previous projects in India relevant to the proposed project: The Bihar Rural Roads Project (para. 2.20), and the comnand area roads component of the Gujarat Irrigation II Project (Credit 1011-IN, May 1980, US$175 million). The Bihar Rural Roads Project has gone reasonably smoothly, after start-up delays and modifications to procedures and documentation. The roads component of the Gujarat Irriga- tion II Project suffered initially from poor quality construction, due to outdated methods and materials, and delays in the release of funds. In the early years, GOG had difficulty in scheduling this complex project, but this problem was corrected by the formation of a Project Plarnning and Monitoring Cell and by the addition to the project of an input by the Operations Research Group, a Cujarat-based consultant, which developed and introduced computerized methods of project planning. The lessons learned, and most of the staff who learned them, have been incorporated into the proposed project. Assurances were obtained from COG on the timely release of funds (para 3.21) and the same consultants who worked on the Gujarat Irrigation II Project will be developing the monitoring system for the proposed project. Other agriculture projects since 1975 have included roads components. These have been reviewed in a comprehensive report (ref 4, Annex 7), and the conclusions drawn have influenced the planning of the project. -10- III. THE PROJECT A. The Rationale For Bank Group Involvement 3.01 The project grew out of COI's desire to replicate and improve upon the achievements of the Bihar project (para 2.20), which in its turn had been a result of the impact of IDA assistance in other areas of Bihar's rural development spreading into the transport sector. Accord- ingly, in 1982 DRD endorsed the preparation by COG of a rural roads project for possible IDA financing. IDA officers first visited Gujarat in June 1983 to advise on preparation methodology. Further visits in 1983 and 1984 led to appraisal in November 1984. 3.02 The proposed project, by providing a vehicle for the Associa- tion's invoLvement in the Cujarat road subsector, will permit the pursuit of important inistitutional deveLopment and technical objectives. Under the project, improved techniques of prcject preparation, management, construction and maintenance wilL be introduced. In addition, pos- sibilities of improved cost recovery by higher road use charges would be expLored to identify means to increase financial resources available for implementation of road maintenance and the minimum needs roads program. 3.03 In the past, village road construction has often been a by-product of rural employment creation schemes, built to poor specifica- tions with inadequate supervision, and seldom well planned or economically justified. The application of higher technical standards to this project will benefit future rural road projects in India. The project will also begin modernizing the contracting industry, and bring important changes in sector management through the road use charges and maintenance planning studies proposed. B. Project Objectives 3.04 The objectives of the proposed project are: (a) provision of all-weather roads to the rural poor, largely dependent on incomes from milch animals and agricultural production; (b) improved road pLanning and programming through proper economic analysis; (c) improved rural road construction and maintenance practices by embracing new concepts; (d) improved management of COG's road maintenance programs; -ll- (e) identification of resource mobilization potential through a road use charges study; (f) development of a higher level of road safety; and (g) training of local staff concerned with the administration and operation of the road subsector at the state level. C. Project Description 3.05 To achieve these objectives, the proposed project would include: (a) a six-year program of improvement, reconstruction or construc- tion of village roads connecting 1,900 villages; (b) the provision of construction equipment, vehicles, and equipment for laboratories; (c) construction of office buildings, depots and housing accomnodations; 'd) engineering and other services for project planning, design, supervision and monitoring, training of project staff; and (e) a program of road safety (Annex 1) and studies of road main- tenance, road use charges and associated technical assistance, with provision for an exchange of views between the Association and the borrower on the implementation of study recommendations. (a) Road Works 3.06 Following planning studies of the spatial distribution of vil- lage populations and their relation to the all-weather road network, R&BD has identified a program of consttuction, reconstruction or improvement of 4,042 km village roads (Map IBRD 18877, Tables 3.1, 3.2 (a) and (b)): (a) new construction (1,031 km) consists of construction on existing right-of-way, or new alignment where no previous engineering exists, and involves embankment, sub-base, crushed stone base and bituminous surfacing; (b) reconstruction (988 km) consists of placing a bituminous surface and a crushed stone base (water-bound macadam base) and sub-base on an existing embankment, usually with essential drainage structures in place; varying amounts of re-shaping of the exist- ing embankment will be required, together with improvements to drainage, as necessary; and -12- r (c) improvement (2,023 km) consists of placing a new base course and surfacing on an existing water-bound macadam road, with neces- sary repairs to the existing structure. All work would be done by contract to the standards shown in Table 3.1. (b) Equipment 3.07 To carry out the work program, road construction equipment (Table 3.3) will be provided under the project. The amount of equipment purchased will depend on the type of contractor chosen for civil works. If enough contractors with their own equipment win bids, less equipment will be purchased by R&BD. The equipment will be used either by R&BD force account or by contractors on hire from R&BD, which has proper proce- dures for fixing and collecting hire charges. 3.08 Vehicles for R&BD supervisory staff and field personnel will be provided, as will mobile workshops and laboratories. Equipment will be supplied for offices and drawing offices, materials testing, vehicle testing, and for the maintenance study. (c) Building Construction 3.09 The buildings required comprise circle, district and subdivi- sional offices (36 locations), housing accommodations (416 units), workshops (5) and warehouses (5). All buildings required are being designed by R&BD's architecture division to departmental norms, and will be built by small local contractors. (d) Engineering and Administrative Services 3.10 Except for certain studies, implementation of the project will be entirely in the hands of R&BD, who will, by transfer or direct recruit- ment, make available design and construction staff specifically for the project. The incremental cost of this staff will be a project cost. A number of key staff currently administering the roads component of Gujarat Irrigation Project will shortly be available for transfer. (e) Training 3.11 Training of professional and technical level staff will be given at the Engineering Staff College (ESC) in Gandhinagar (para. 2.16). Cour- ses will be given by the four full-time lecturers and those selected from ESC's visiting lecturers. Mechanical training will be provided by equip- ment suppliers and by the staff of R&BD's mechanical training center at Odhav. Consultants for the road use charges and maintenance studies will give on-the-job training as required. Efforts are underway for groups of -13- engineers to visit Australia and possibly Kalaysia for three-month assign- ments to district engineers' districts in state highway departments. The training program is shown in Table 3.4. (f) Studies 3.12 Draft outline terms of reference for the Maintenance Planning Study are shown in Annex 3. (g) Road Safety - In a report published in March 1983, the Government Committee on Planning Road Safety identified the major causes of high accident rates in India, and recoamended corrective measures, including: (i) periodic inspection of vehicles; (ii) enforcement of traffic regulations; (iii) driver training and licensing; and (iv) improvement of road condi- tions. Pilot schemes to implement some of these measures have begun in Cujarat as a part of the national program through the establishment of five inspection stations along the Abmedabad-Surat corridor, which is proposed for upgrading under the National Highway Project (Loan 2534-IN). To suppor_ the pilot schemes in Gujarat and to complement the assistance provided ander the National Highway Project, the project includes funds for procurement of specialized equipment for vehicle testing stations. The Bank Group obtained GOG assurances that it would, in consultation with MOST, prepare a road saiety program consistent with the recommendations of the Government Con.,ittee on Planning Road Safety, and submit the program for coments to the Association by December 31, 1988. -14- D. Cost Estimate 3.14 The project cost is summarized below and is shown in greater detail in Table 3.5. Rs millions US$ millions Z Z Total Foreign Base LocaL Foreign Total Local Foreign Total Exchange Costs Civil works 982.1 218.2 1,200.3 75.5 16.9 92.4 18 76 Engineering, supervision, 144.0 - 144.0 11.1 - 11.1 - 9 training Equipment procurement 88.6 96.6 185.2 6.8 7.4 14.2 52 12 Buildings and Housing 25.5 - 25.5 2.0 - 2.0 - 2 Studies, Road Safety, 11.1 12.1 23.2 0.9 0.9 1.8 52 1 Total BaseLine Costs 1,251.3 326.9 1,578.2 96.3 25.2 121.5 21 100 Physical contingencies 118.9 27.3 146.2 9.1 2.1 11.2 19 9 Price contingencies 461.8 34.3 496.1 35.5 2.6 38.1 7 31 Total Project Costs 1,832.0 388.5 2,220.5 140.9 29.9 170.8 17 141 Civil works costs are based on COG's Schedule of Rates which is com- puterized and updated annually on the basis of prices actually paid for work during the year. Equipment costs (c.i.f.) are based on current manufacturers' prices (June 1986). Direct taxes are not levied on GOG works; indirect taxes are minimal and can be ignored. Duties may be levied on any imported equipment, but all costs quoted in this report are net of these duties. Local consultant costs, excluding traveL costs, are estimated at Rs 1,250 per day. 3.15 Price escalation of the foreign exchange and local cost com- ponents have been calculated, based on Bank Group estimates as follows: Fiscal Year 87/88 88/89 89/90 90/91 91/92 92/93 93/94 94/95 Foreign escalation Z 1.2 1.0 1.0 2.2 3.5 3.5 3.5 3.5 Local escalation Z 6.8 6.8 6.8 7.0 7.0 4.0 4.0 4.0 3.16 The bulk of the civil works will be executed between January 1988 and January 1994 (see Chart 2 for Implementation Schedule). The period January 1994 to December 1994 is allowed to complete the works and finalize disbursements. Tne credit is expected to be closed on December 31, 1994, a disbursement period of 7-1/2 years corresponding to the appropriate historical profile (Table 3.6). Price contingencies have been applied over this period. If the project were to be implemented in -15- exactly six years, starting in July 1987 and six months were allowed before loan/credit closure, the total project costs might be reduced by US$7.5 million or 5Z. Physical contingencies have been included in cost calculations at the rate of 10% on road works, supervision and administra- tion, and at 5% on equipment, the building program and the studies. During negotiations, the project cost estimates were discussed and agreed with Government. E. Financing 3.17 The borrower would be the Government of India. The financing Plan is shown below: US$ Million Eauivalent Source of Finance Foreign Local Total GOI/GOG - 51.2 51.2 IDA 29.9 89.7 119.6 Total: 29.9 140.9 170.8 The proposed IDA credit of US$119.6 million, would finance about 70% of total project costs, i.e., all the foreign exchange costs (US$29.9 million and about US$90 million of local costs). The credit agreement will allow for retroactive financing from March 31, 1985 of up to US$5.6 million, being the cost of design services, down payments on certain essential items of equipment, technical assistance for the establishment of a project monitoring system, and initial payments on works contracts begun before credit signature. The sum of Rs 1,000 million has been included in GOG's Seventh Five-Year Plan for meeting the entire cost of the project up to April 1, 1990, and a further Rs 1,220 will be required in the following plan. On the basis of current cost estimates (Table 3.5) Rs 800 million is expected to be spent by April 1990, and a further Rs 1,420 million will be required in the next plan to complete the project. F. Land Acquisition 3.18 Any land acquisition required for new construction and a few cases of realignment will be done by R&BD and no credit proceeds will be used for this purpose. Although final settlement of claims takes some time, in most cases, following a strengthening of the law in October 1978, possession of the land to allow work to begin is easily obtained. Never- theless, a review by the Committee on Agency System for National Highways, GOI in February 1982 identified land acquisition delays. Therefore, during negotiations, the importance of obtaining timely acquisition of land was discussed. The Association was informed that land acquisition is -16- a prerequisite to granting of administrative approvals which COC agreed to undertake (para 3.21). G. Procurement and Contracting 3.19 Procurement is planned as shown below: Procurement Method (US$ million) a/ Project Component ICB LCB Other Total Cost Road and bridgeworks by contract 125.0 5.0 c/ 130.0 (94.3) ( 0) (94.3) Land acquisition 2.6 d/ 2.6 0 0) ( 0) Road construction equipment, vehicles, laboratory and office 6.3 9.7 bI 1.2 e/ 17.2 equipment, computers, etc. (6.0) (8.7) (0.9) (15.6) Buildings for offices and housing 2.4 2.4 (1.0) (1.0) Engineering services 16.5 16.5 (6.6) (6.6) Technical assistance and studies 2.1 2.1 (2.1) (2.1) 6.3 137.1 27.4 170.8 (6.0) (104.0) (9.6) (119.6) a/ The amounts in brackets are expected to be financed out of the credit. b/ Some items may be purchased under DWSID rate contracts. c/ Force account. d/ Direct purchase by GOC. e/ Local/international shopping. Note; Prior review thresholds civil works US$700,000 equipmnt US$ 50,000 -17- Individual road contracts will be grouped into packages according to geographical and technical criteria, to give the most economical size of package. Because the 1,025 road jobs are small (average Rs 1.5 million), and are dispersed over some 70,000 sq km of territory, contract packages are not expected to exceed the equivalent of US$ 5 million each. Accord- ingly, aLl project civil works would be procured under local competitive bidding procedures (LCB) using procedures developed with the Association's New Delhi Office and in current use in Bank Group projects in Cujarat (Annex 4). Equipment purchase will be through ICB (Table 3.3, List A) except for items manufactured in India (Table 3.3, List B). Items required for their demonstration effect and the technology they introduce will be purchased by prudent shopping (Table 3.3, List C). Procurement is discussed in more detail in Annex 4. H. Status of Project Preparation, Execution and Supervision 3.20 Except for the Road User Charge Study and preparation of a road safety program, execution of the project will be the responsibility of M&BD. Design, contracting and supervision of road works will all be under- taken by R&BD staff. Survey and design work is currently under way using an improved document format and the Indian Roads Congress (IRC) specifica- tions. About 902 of the first-year schemes are already complete, but all jobs in the first year program will have been designed by the time of Board presentation; the remainder will be prepared in annual lots cor- responding to the budget allocations. Bids will be invited for a number of contracts immediately following negotiations and work will begin shortly after Board presentation. Work has also begun on construction of offices and accommodation in remote areas. Retroactive financing is allowed for this purpose (para 3.17). Bidding documents for equipment have been prepared by R&BD's mechanical branch. Land requisition is being handled by GOG's Revenue Branch (para 3.18). An important feature of project management will be a computer-based monitoring system, which will be designed and put into operation by consultants doing similar work for the Bank Group New Delhi Office and GOG. Terms of Reference for these consultants are given in Annex 6. Prior to negotiations, these terms of reference were discussed and agreed with Government. The Road Use Charges Study will be carried out by the MOST, and the road safety component will be handled by the COG Department of Transport. Contracting arrangements are described in Annex 4, and the proposed project management structure is shown in Chart 1. Contractors have the option of hiring equipment from R&BD for certain tasks, or of having the work done by RSBD force account. In the latter case, the item is removed from the contract. No reimburse- ment will be made to COG for force account works. 3.21 Before execution, all COG projects must receive technical sanc- tion and administrative approval. Technical sanction, essentially a review of plans, estimates and contract documents will be given by the Chief Engineer (Rural Roads) (CE(RR)), effectively head of the project -18- administration. Administrative approval is a prior and longer process and in essence merely confirms that the project has been planned and budgetted for; nevertheless, this approval stage often leads to delay. Previous Bank Croup financed projects have been severely hampered by the untimely reLease of COG funds. Furthermore, COG funds are released by the Finance Department under many budget heads and are handled through a single bank account. To avoid these potential delays, during negotiations assurances were obtained from GOG that it would grant umbrella administrative approval to each year's construction program, and to provide adequate funds in their annual budgets. The granting of administra::ive approval to the first year's program was a condition of credit effectiveness. However, during negotiations the evidence of such approval was submitted to the Association. Consequently, this condition was dropped. I. Disbursements 3.22 Disbursements frcm the credit would be made on the following basis: Allocation /a Application Item $ '000 Road and bridgework by contract 86,000 702 of total cost Road construction equipment, vehicles, 16,000 100% of foreign or ex-works cost laboratory and office equipment 50% of local cost Buildings 1,100 40% of total cost Engineering services and training 6,400 40% of local cost 100 of foreign cost Technical assistance and studies 2,100 100% of total cost Unallocated 8,000 119,600 /a Figures in the credit agreement will be lower to account for initial deposit into the special account and to allow for an unallocated amount. Withdrawal applications in respect of R&BD staff expenses and small civiL works contracts for the equivalent of US$100,000 or less and individual payments of US$10,000 or less in respect of contracts of less than US$100,000 will be made against statements of expenditure (SOE) certified by the Chief Engineer (Rural Roads) and the Project Accountant, and the supporting documentation will be retained at a central location and made -19- available for the Association's representatives to review on request. Expenditures disbursed against SOE's and transactions under the Chief Engineer's (Rural Roads) account will be audited annually by independent auditors acceptable to the Association. All other items will be fully documented. The project is expected to be actively disbursing over seven and a half years and the disbursement schedule (Table 3.6) has been drawn up according to the appropriate historical profiLe. To speed the flow of foreign exchange to the Borrower and to reduce the large number of smaLl applications for withdrawals from the credit being passed to Washington for processing, COI will establish in the Reserve Bank of India a special account through which disbursements will be made by the Controller of Aid Accounts (Ministry of Finance, COl) to GOG. This account will receive an initial deposit of US$ 5.3 million as soon as the credit is declered effective and COI shall have informed the Association of the account number. J. Accounting and Auditing 3.23 India has long established procedures for financial control and COG is fully.conversant with them, as they apply to Bank/Association projects. The principal control is the permanent presence in every EE's office of the Dintrict Accountant, a GOI official from the Ministry of Finance, who verifies a percentage of civil works progress measurements and countersigns all running bills. Each executive engineer's office is also fully audited once a year. During negotiations, GOG agreed to keep separate accounts for the project and to submit financial reports to the Association within nine months of the close of each financial year for each year of project implementation. K. Environmental Impact 3.24 There may be an adverse effect on the environment during the construction phase, but once completed, the proposed roads will have a beneficial effect on the local environment. For road users and roadside dwellers, dust and noise will be greatly reduced, with concomitant improvements in riding comfort; properly designed earthworks and drainage structures will reduce ponding of water and soil erosion. L. Reporting 3.25 COG will prepare quarterly reports on the progress of all aspects of the project, annexing, where appropriate, reports by the various consultants to the project. On substantial completion of the project, Government should prepare a comprehensive report on the execution of the project and the benefits derived from it. -20- IV. ECONOMIC JUSTIFICATION AND RISKS A. Main Benefits and Beneficiaries 4.01 The economic justificacion for the proposed project is based on: (i) the expected reduction in milk sourage; (ii) reduced deaths of milch animal population; (iii) increased miLk supply during the rainy season in areas where only dry weather roads now exist; and (iv) savings in vehicle operating costs of traffic not related to dairy activities. Due to the absence of an accurate correlation between improved roads and increased agricultural production in the seve., districts included in the project, other agricultural benefits were not quantified even though such benefits far some roads could be substantial, based on the experiences of the command area road proiects outside the seven districts in Gujarat. 4.02 The project roads would directly benefit small milk farmers, many of them women, who are now unable to take advantage of ready availability of services such as veterinary services, artificial insemina- tion, animal insurance, and easier marketing facilities provided free or at low cost by the dairy cooperatives. The project would result in con- siderable reduction in milk sourage, cattle deaths, and transport costs throughout the year, thereby increasing the incomes of the rural poor. The project's benefits would accrue to 2,608 villages, with a total population of 3.5 million. The average number of people benefitted by one kilometer of the proposed road works is 871 while the average per capita construction cost is Rs 303 (US$25). Additional benefits include achiev- ing institution building objectives of improved road planning, economic evaluation and project execution capabilities; improvements in road safety; modernization of the road subsector (para 3.02); improved road quality; and further development of domestic road contractor capabilities. The road transport industry in Gujarat, as well as in India as a whole, is highly competitive and it is expected, therefore, that the benefits of the project, which initially will accrue mostly to road users, will be passed on to the economy in gene-aL. B. Economic Analysis 4.03 An economic analysis of 260 individual roads, representing 30X of the total project roads, yielded high returns ranging from 19% to 42%, indicating the project's economic viability (see Annex 6 for the route selection and economic evaluation methodology). The weighted average ERR for the project, based on the analysis of 260 roads, is 28%. According to sensitivity analyses, there is little risk that the ERR for any of the subprojects would fall below 12%, which is the estimated opportunity cost of capital for India. 4.04 A sensitivity analysis was made of all 260 roads by testing the following cases: (i) costs up 15%; (ii) benefits down 15%; (iii) cost up -21- 15% and benefits down 15X. The results of sensitivity analyses conducted on 14 typical roads, representing two from each district, are shown as Tables 4.1 to 4.14. In only one example (case (iii)) did the internal rate of return fall below 14X, to 12.7Z. The full analysis with cor- responding switching values is in the project file. 4.05 The economic returns of the remaining roads would be calculated after credit approval, using the methodology and criteria adopted for the project, to appraise the technical and economic feasibility of the individual roads. Only economically viable roads would be accepted for financing as long as they fall within the capacity of the borrower to implement each year. During negotiations, GOG agreed to undertake an economic evaluation for the remainder of the project roads and seek the Association's aporoval before implementation. C. Risk Analysis 4.06 Since most project components involve proven technology, techni- cal risks connected with the Project are minimaL. R&BD has already demon- strated satisfactory technical capabilities in the implementation of Gujarat II Irrigation Project, which has a substantial road component. A degree of risks connected with maintenance operations, use of new con- tracting procedures and eGuipment, project management and economic evalua- tion of future road projects would be minimized by the provision of train- ing, studies and intensive supervision during implementation proposed under the project. V. AGREEMENTS TO BE REACHED AND RECOMMENDATIONS 5.01 During negotiations, the following agreements were reached: (a) The Road Use Charges Study being carried out under the National Uighway Project (Ln 2534-IN) wou'd include a review of such charges in Gujarat, to be completed by December 31, 1988, and thereafter, COG would d!.scuss the study findings with the Association (para. 2.07); (b) COG would complete, by December 1988, the Maintenance Planning Study in accordance with agreed terms of reference, and discuss its findings, recommendations, and time-phased program of implementation with the Association (para 2.13); (c) GOG would allocate sufficient budgetary resources for main- tenance of the project roads at the level necessary to meet the technical norms established by the Eighth Finance Commission (2.14); -22- (d) GOG, in consultation with MOST, would prepare a road safety program to be implemented in Gujarat, based on the March 1983 report by the Government Committee on Planning Road Safety, and send to the Association by December 31, 1988 for the Associa- tion's comments and suggestions (para 3.13); (e) COG would grant umbx.?tla administrative approval to each year's construction program (para 3.21); (f) COG would keep separate accounts for the project and to submit financial reports to the Association within nine months of the close of each financial year for each year of project implemen- tation (para 3.23); (g) GOG would undertake an economic evaluation for the remainder of project roads and seek the Association's approval before implementation (para 4.05); 5.02 During the processing of the project, the granting of administrative approval to the first year's program was proposed as a condition of credit effectiveness but during negotiations GOG submitted to the Association evidence of the administrative approval accorded for implementation of the first year's construction program. Accordingly, the Association accepted the evidence submitted as having fulfilled the proposed condition of effectiveness (para 3.21); and 5.03 The project constitutes a suitable basis for a credit of US$119.6 million, on standard IDA terms, including US$5.6 million of retroactive financing (para 3.17). -23- Annex 1 Page 1 of 11 INDIA GUJARAT RURAL ROADS PROJECT The Transport Sector A. General 1. Rail and road are the dominant modes of transport in India. Railways provide trunk services for bulk movement, and road transport provides long distance service for other commodities as well as most of the feeder and distribution activities. Since it is estimated that rail and road carry about 95 percent of total domestic passenger and freight movement, the role of other modes is relatively insignificant. Nonetheless, these other modes (air transport, pipelines, coastal shipping, and inland waterways) have an important role to play in providing specialized transport services. 2. The Indian Railways (IR) is the world's second largest railway system under one management. IR is the nation's Largest undertaking with an investment of Rs 88.8 billion, a route kilometrage of 61,385 and 1.6 million employees as of March 1983. Freight traffic has increased steadily since 1950/51, growing at an average rate of 3.1% per annum in terms of total tonnage and 4.5Z in terms of ton-kilometers. In 1981/82 freight traffic in IR was 174 biLlion ton-kms. Passenger traffic has also shown sustained growth, particularly suburban traffic which grew at 5.4% p.a. for passengers and 6.3Z p.a. or passenger-kilometers between 1950/51 and 1981/82. Passenger and freight traffic by rail is expected to continue to grow during the 1980s. In order to meet forecast levels of future transport demand, IR will have to continue its current emphasis on modernization of assets and management practices aimed at increasing operational efficiency. 3. The ten major ports serviced 9,315 and 6,639 vessel, carrying an aggregate of 88 and 69 million tons of cargo in 1981/82 and 1982/83, respectively. The lower traffic volume in 1982/83 reflected the impact of the world's recession and decreased trade. The principal cargo handled at the major ports include crude oil and petroleum products, iron ore, fertilizers (including raw materials), coal, and containerized and break-bulk general cargo. Since the mid-1970s India's foreign trade has been marked by a rapid growth of containerized traffic. Within a short period of six years between 1975/76 and 1981/82, the volume of container cargo increased manifold at Bombay, Cochin, and Calcutta despite draft limitations and inadequate shore facilities to handle containers at these ports. GO is undertaking changes in the maritime transport system, -24- Annex 1 Page 2 of 11 including transformation of port terminal facilities to accomplish high-speed cargo handling and the development of inter-modal networks for onard movement o' containers to and from inland destinations. These changes are necessary in order to improve handling of import-export traffic while avoiding congestion in the major ports. B. Transport Administration, Planning and Coordination 4. Transport responsibility in India is shared between Government and the private sector. The private sector controls the trucking industry, a small portion of the shipping industry, and about 40X of non-urban passenger road transport. Government entities own the railways, state road transport undertakings, the ports, the major shipping companies, and all the institutions involved in civil aviation, as well as responsibilities for the construction and maintenance of all roads. Some of the responsibilities concern only the Central Government while others are shared with the States. 5. Transport is under the jurisdiction of various ministries: roads, ports and shipping are under the Ministry of Shipping and Transport (HOST); railways are under the Ministry of Railways; civil aviation under the Ministry of Tourism and Civil Aviation; and pipelines under the Ministry of Petroleum. In addition, the Planning Commission is in charge of overall transport investment planning in close cooperation with Central Ministries and the State Governments. Transport coordination is undertaken within the context of the following institutional framework: (a) Cabinet Committee on Transport and Tourism; (b) Secretaries' Committee on Transport, Tourism and Aviation; (c) Transport Development Council and Inland Water Transport Board; (d) Interstate Transport Committee, which regulates interstate road transport; and (e) a Transport Coordination Committee which includes members from the Planning Commission and all agencies responsible for the transport sector. C. Transport Investment 6. The official long-term policy objectives for the transport sector in India are to: (a) remove major transport bottlenecks; (b) increase capacity; (c) conserve energy; (d) improve transport coordination; (e) complete ongoing works; (f) maximize asset utilization; (g) evolve a national transport pricing policy; and (h) give special attention to transport need. of remote areas. In the roads subsector, the most secure five-year plan emphasized continuation of rural roads construction program and removal of deficiencies in the national highways system, through physical as well as institutional improvements. The proposed project is conceived in line with these objectives. 7. Transport investment represents an important part of total investment in India, due to the crucial role that transport plays in overall economic development, but its share in total public investment has -25- Annex 1 Page 3 of 11 gradually declined from 22% in the fifties to 12% in the eighties, as shown in the following table: Annual Average Actual Expenditures per Period First Second Third Annual Fourth Fifth Sixth Plan Plan Plan Plan Plan Plan Plan /a 1951-56 1956-61 1961-66 1966-69 1969-74 1974-78 1980-85 (constant 1970/71 Rupees billionT Railway 0.95 2.70 4.11 1.98 1.67 2.21 4.47 Road & Road Transport 0.64 0.91 1.45 1.41 1.77 2.15 4.06 Ports 0.12 0.13 0.31 0.24 0.47 0.62 0.64 Shipping 0.08 0.20 0.12 0.12 0.28 0.52 0.66 Civil Aviation 0.10 0.19 0.16 0.26 0.32 0.30 0.75 Total Transport 1.89 4.13 6.15 4.01 4.51 5.80 10.58 Total Plan 8.54 17.43 26.64 25.77 28.28 40.67 85.45 Transport in Total Plan (Z) 22.10 23.70 23.10 15.60 15.90 14.30 12.40 Price Deflator (1970 = 100) 45.90 53.60 64.40 85.70 111.60 178.20 228.20 aI Planned investment. Source: Association estimates on the basis of Development Plans. 8. The subsectoral allocation of public transport investment also varied over time. During the initial five-year plans, railway investment accounted for 50X-67Z of total investment but declined to about 40Z of the total in the later years. The share of roads ranged between 34% and 40% of the sector's outlays in most Plan periods, and public road passenger transport, which had received 1.4% in the Third Plan, accounted for almost 10% of the total in the Sixth Plan. The relative balance of investment funds between rail and roads has changed in line with the rapidly expanding role of road transport. D. Transport Pricing and Taxation 9. General policy in India is tending toward the pricing of transport services as closely to economic cost as possible, which when fully implemented would permit a more efficient utilization of assets, higher cost recovery, and better allocation of resources. However, due to social considerations, some specific services such as movement of urban -26- Annex 1 Page 4 of 11 passengers by rail and road, haulage of coal, foodgrains, and fertilizers by rail, and provision of some port services considered of social interest are subsidized. Cost-based transport pricing, particularly for railway services, has been increasingly applied in recent years as a result of the partial implementation of various recommendations of the National Transport Policy Committee (NTPC) and of the Rail Tariff Enquiry Committee. Nevertheless, there is scope for further improvements, particularly in pricing public road passenger transport and railway passenger services. In particular, road user charges will have to be reviewed to ensure that they reflect appropriately the costs of developing and maintaining the road system, and as part of this project, the GOI will carry out such a study. E. The Road Network 10. Roads in India are divided into three categories on a functional basis: (a) the primary system consisting of national highways; (b) the secondary system consisting of state highways and major district roads, and (c) the tertiary system, namely the rural roads consisting of "Other District Roads" and "Village Roads". In addition, there are so-called "Project Roads", administered by various technical departments, as well as urban roads. National highways are under the jurisdiction of the Central Goverment, which meets the entire expenditure of construction, maintenance, and improvement. All other roads are essentially the responsibility of state authorities, although construction and maintenance of district and village roads are often delegated to local bodies and rural communities in the States. 11. The national highways are the main highways in the country connecting major ports, adjoining counties, and linking States' capitals and include strategic roads required for national security. The State highways are the main trunk roads of the States (other than nationaL highways) connecting important cities and districts with nationaL highways or highways of adjacent States. District roads traverse each district, serve areas of production and markets, and connect districts with highways or railways. Village roads connect villages and groups of villages to the nearest district road, main highway, or railway. The road system in India by road category is shown below as of 1981, which is the latest year for which comprehensive data are available (in 1,000 km). -27- Annex I Page 5 of 11 Surfaced Total Cement Bituminous Water-bound Unsur- Category Total Length Surfaced Concrete Surface Macadam faced National Highways 31.7 2.1 31.6 0.3 31.2 0.1 0.1 State Highways 95.5 6.4 91.2 1.5 83.7 6.0 4.3 Other PWD Roads 427.3 28.4 307.1 0.5 219.5 87.1 120.2 RuraL Roads Administered by Local authorities 638.4 42.5 155.0 1.1 29.6 124.3 483.4 Urban Roads 123.6 8.2 86.2 7.2 55.2 23.8 37.4 Project Roads 186.2 12.4 21.1 0.1 4.9 16.1 165.1 Total Length 1,502.7 100.0 692.2 10.7 424.1 257.4 810.5 Source: Directorate of Transport Research, Ministry of Shipping and Transport. 12. The road network length has experienced an almost four-fold expansion since 1950/51. The road length increased from 0.4 million kms in 1950/51 to 1.5 milLion in 1980/81, growing at an average annual rate of 4.3%. The growth of surfaced roads was 5.1% per annum during the same period. Under the Minimum Needs Program (HNP) the Government is undertaking development of rural roads and at the present time, 70Z of all villages with a population of 1,500 or more and 49% of all villages with a population of 1,000-1,500 are served by all-weather roads. F. Road Transportation Demand 13. A uniform set of consistent road freight traffic figures is not available and, depending on method, estimates range from 88 billion ton-km to 134 billion ton-km in 1980/81 and annual growth rates from about 3% to about 4.3% over the past five years. 14. Data on passenger traffic carried by road transport is more reliable since nearly 60Z of the public transport services are operated by public sector undertakings and data on tickets sold, schedule on buses, load factors, and others are available. Passenger movements on the road network (including buses, cars, and other motorized vehicles) are estimated at 480 billion passenger-km in 1980/81, with an annual growth rate of about 6% over the past five years. 15. Traffic on Indian roads comprises both fast and slow-moving vehicles with virtually no segregation of the two, except in a few cases. Another distinctive feature of traffic on Indian roads is the large proportion (about 70%) of trucks in total motorized traffic. The present traffic mix on Indian highways, the high proportion of trucks, combined -28- Annex 1 Page 6 of 11 with significant volumes of slow moving traffic, are the main factors causing road congestion and early saturation of capacity. 16. Adequate information on traffic carried by road transport is essential to plan the development of the road network, to estimate the requirements of fuel oil for the sector, and to plan for the manufacture of road vehicles. HOST is aware of current deficiencies in gathering and processing transport demand data and is implementing steps to improve the data base, for example, through the computerization of data or. traffic counts. Highway planning improvements to be implemented under the National Highway Project (Credit 2534-IN) will include a review by MOST and the Bank of current methodologies used in estimating aggregate road transport demand aimed at streamlining the process and improving the data base. C. Motor Vehicle Fleet and Industry 17. Motor vehicle registration statistics in India indicate that there are at present 4.1 million registered vehicles, 112 of which are trucks, 3.1% buses, an 24% cars. The fleet has grown at 10.0% per annum since 1973 with trucks growing at 5.1%, c&rs at 3.9%, and buses at 4.9%. Two and three wheelers have been the fastest growing segment of the fleet (14.1% per annum). The table below shows total registered motor vehicles in India (in thousands): Two and Light Conuer- Year (as of All Three cial Vehicles March 31 Vehicles Wheelers Cars Buses Trucks and Others 1951 306 27 160 34 82 4 1956 426 41 203 46 119 16 1961 664 95 310 5i 168 36 1966 1,099 242 456 73 259 69 1971 1,865 613 684 94 343 134 1976 2,679 1,131 776 114 348 309 1980 4,106 1,990 975 133 436 521 Source: Ministry of Shipping and Transport. NOTE: Since 1973 the data base has improved due to efforts by State Governments to eliminate scrapped vehicles from their registers. ke 18. Since 1982 India has undertaken a major program of updating vehicle technology to increase the fuel efficiency of vehicles and to meet -29- Annex 1 Page 7 of 11 a groving, unmet demand for reasonably priced vehicles of acceptable quality. For that purpose, GOI has authorized technical and financial collaborations with foreign automotive firms, especially from Japan. GOI also has licensed substantial capacity additions to enable manufacturers of all types of vehicLes to modernize and expand. As a result, competition at all levels is expected to be strong, which should serve as a potent catalyst for Indian vehicle industry to improve productivity and quality. 19. With 90,000 vehicle units produced in 1982, India was the twelfth largest producer of commercial vehicles in the world and the third largest in Asia after Japan and Australia. Half of Indian manufactured commercial vehicles are trucks in the medium to heavy range with the bulk of the production in the medium duty range (7-1/2 to 8-1/2 metric tons) and with an insignificant number of heavy units. 20. The Bank is supportive of current Government policies designed to encourage modernization and expansion of the automotive fleet, but considers that further efforts may be required with the objective of defining the optimum mix for the country. Therefore, under Ln 2534-IN the Government is required to undertake a study of the Road Vehicle Fleet. H. Highway Planning 21. The Roads Wing of MOST is responsible for planning the development of the nationaL highway system whLle performing an advisory role in the case of State highways and other minor roads. The Roads Wing performs everyday planning of the national highway system, assists the Planning Commission in the preparation of its annual and five-year plans, and in addition prepares long-term road development plans. 22. Highway planning in India, although improving, is still at an early stage due to: lack of an adequate data base, inadequate planning techniques, slow introduction of modern equipment for monitoring road conditions and usage, and lack of staff adequately trained in economic analysis. MOST is committed to improving highway planning and has already undertaken various important steps, including: (a) computerizing traffic data; (b) contracting the preparation of a computerized management information system to be located in the Roads Wing and which will facilitate the task of administering the national highway system; (c) assigning the Central Road Research Institute the task of carrying out an inventory of the conditions of the national highway system using modern vehicle-mounted instruments (the work which started in August 1984 and is expecced to be completed in one year); (d) preparing a computer program to provide economic evaluations of highway investments; (e) proparing a manual for highway planning to be used in the field; and (f) retaining consultants to prepare four regional transport modelling studies to be used in the assessment of future transport demand on the trunk route system of each region. -30- Aunex 1 Page 8 of 11 23. To complement the efforts directed at improving highway planning efforts at the narional level, the project includes a training component which would provide technical assistance to the Gujarat State Government and courses in highway planning and economic analysis of projects in order to institutionalize planning functions. I. Road Safety 24. The standard of road safety on Indian roads is poor and has deteriorated steadily. In 1980 there were 147,651 accidents which caused 24,095 deaths and injured 113,670 people. Road safety was recently reviewed by the Government Committee on Planning Road Safety, which analyzed the causes contributing to the high accident rate and issued a report in March 1983 which included various measures to improve the situation. Some of the major recommendacions pertain to driver training and licensing, stricter enforcement of traffic regulations, adoption of engineering-related measures to improve the condition of the roads, and periodic inspection of vehicles. Pilot schemes have already commenced in some 45 posts by instituting such innovations as highway patrols, first-aid facilities, and driver training schools. In addition, MOST is preparing an action plan to equip testing stations which would check the condition of trucks, buses and cars and other action plans to implement selected recommendations contained in the report. The proposed project will provide funds to purchase equipment needed to inspect vehicles at selected testing stations in Gujarat. J. Rural Roads (Other District Roads and Village Roads) Role of Rural Roads 25. In the functional heirarchy of roads in the country, other District Roads and Village Roads occupy the lowest position. These are generally known by the common terminology "Rural Roads". They serve the purpose of providing accessibility to a large number of villages in the country. Being an agrarian and rural-oriented economy, India has about 580,000 villages of various sizes (based on the 1981 census). An estimated 80% of the rural population is below the poverty line, as defined by the Government. Since all sectors of development in rural areas depend on good road accessibility, the recent Five Year plans have pLaced greater emphasis on the provision of improved rural roads than in the past. This emphasis stems from the experiences encountered under certain agricultural development schemes which provided irrigation, improved seeds, fertilizer inputs and tubewells, but inadequate all-weather roads. GOI/GOG are attempting to fill this gap. Moreover, construction of rural roads requiring a highly labor intensive technology would generate gainful employment to millions unemployed and underemployed rural population. -31- Annex 1 Page 9 of 11 26. A Working Group on Rural Roads set up by NTPC in June 1978 examined in detail requirements of rural roads and suggested that by the turn of the century a village should not be more than 1.6 km from a road of some type. This meant an approximate average road density of 60-75 km per hundred sq km. In the hill areas, however, where sizeable differences in the altitudes exist, and the Length of road required to serve such clusters may be very large. The group, therefore, suggested that in hill areas a village should be within a walking distance of 30 minutes from a road. A rough assessment of the resource requirements on this basis amounted to about Rs 110,000 million of investment to bring 800,000 km of fair weather roads to all-weather standard. 27. The Working Group on Rural Roads further recommended the following approach to the formulation of rural roads programs: (a) integration cf a rural roads program w:h Integrated Rural Development Programs (IRDP); (b) tapping supplementary sources of finance in addition to the State Plan resources; and (c) formation of a network and provision of cross-drainage and culverts, and improvement of low grade sections of kacha roads aimed at providing all-weather comnunication to smaller villages rather than linking them with pucca roads. 28. The recommendations of the NTPC have been accepted by GOI and commended to the States/Union Territories and the concerned Central Ministries for implementation. 29. Minimum Needs Program (MNP). According to the national norms under the Minimum Needs Program, aLl villages with a population of 1,500 and above and 50 percent of the villages with a population of 1,000-1,500 are to be linked by all-weather roads by 1990. Under MNP connection of villages by paved roads has been accorded a high priority as a part of the socio-economic development program included in the five-year plans. During the Fifth Five-Year Plan (1974-79), 500 crores were expended for the improvement of rural roads and during the subsequent Five-Year Plan (1980-85), the expected expenditures for rural roads under MNP are Rs 1,165 crores. The outlays provided in the State Plans for rural roads under MNP are earmarked provisions and as such the States cannot divert such funds for other purposes without prior approval of the Planning Comission. 30. With a view to adopting some revisions to norms for rural roads under MNP in difficult areas, an expert group was set up by the Department of Rural Development (DRD) consisting of representatives of the DRD, Shipping and Transport, Home Affairs and the Planning Commission. The group has recommended the fGLlowing norms for the difficult areas: -32- Annex 1 Page 10 of 11 (a) HiLl Areas: (i) 100 percent linkage during 10-year time-frame to villages with population over 500; (ii) 50 percent linkage during 10-year time-frame to villages with population 200 to 500. (b) Tribal, Coastal and Desert Areas: (i 100 percent linkage during the 10-year time-frame to villages with population over 1000; (ii) 50 perc .nt linkage during 10-year time-frame to villages with populatio.; between 500-1000. 31. Rural Road Length. It is planned that by 2001, the road network would connect or provide access to all the villages in the country under MNP. In order to achieve chis target, the total length of Rural Roads would have to be 2,189,000 km. A total of 912,684 km already existed in 1981 and additional 186,216 km is accounted for in the category of "Project Roads". 32. To achieve the targetted level of accessibility, the pace of rural road construction would have to be accelerated. However, in view of the resource constraint, such accelerated execution is not feasible. Thus stage construction of rural roads is being adopted. Initially, the roads may be formed as earth roads or at best as gravel roads, but would be provided with minimum cross-drainage structures to keep them trafficable. This approach is followed in areas where the natural soil is gravelly and good and where the soil in the hill cuts is either rocky or gravelly. In such cases the COI policy is to explore the possibility of providing earthen roads as the first stage, low-cost alternative. Earthen tracks are also recommended where bullock-cart traffic is predomiinant and motorized vehicles are few. As funds become available, the roads can be further improved by providing water-bound macadam and black-topped surfaces. SimilarLy causeways and submersible bridges are recommended in lieu of permanent bridges on "Other District" and "Village Roads" until sufficient traffic develops. On this basis, it is planned that the connectivity of villages of various popuLation would be phased in the following manner: Annex 1 Page 11 of 11 Percentage of villages to be connected Population 1980-1990 1990-1995 1995-2001 Above 1500 100 100 100 1000-1500 50 75 100 Less than 1000 25 50 100 33. Administration of Rural Roads. In order to provide effective coordination of rural road develQopment programs in the State, GOI has recommended a consolidation of various schemes, such as the National Rural Employment Program, Rural Landless Employment Guarantee Program, Integrated Rural Development Program, command area development programs under which rural roads are being improved and constructed. GOI has recommended that funds for rural roads be channelled through a single agency to ensure cc.sistancy in terms of determining priorities and design standards. Thus large states, including Gujarat, are considering the establishment of a cell composed of Chief Engineer and supporting staff for planning, project preparation, execution, monitoring and maintenance. In small states the rural road development program may be kept under the charge of an independent Superintending Engineer with supporting staff. 34. Master Plan for Rural Roads. As a first step towards achieving planned and systematic development of rural roads, State Governments are required to prepare a Master Plan for rural roads and draw up district and taluka road maps, showing the villages of various population groups, roads constructed so far, roads under construction and, in the interim, to be constructed by the various Departments, such as PWD, Zilla Parishad, Rural Development and Command Area Development in accordance with economically justifiable criteria. However, a review of the Master Plan for Rural Roads prepared by the State of Gujarat indicates that the plan Ls basically a compilation of the list of desired roads for upgrading or construction without supporting documents or analysis. Under the project, Gujarat will be receiving training to strengthen planning. -34- Annex 2 Page 1 of 5 INDIA CUJARAT RURAL ROADS PROJECT State of Gujarat Background 1. The State of Cujarat, located in the northwestern part of India, is the seventh largest of the 20 Indian states, and its population of 36 million is the tenth largest. The most important economic activities are agriculture and industry, which in 1982 accounted for 32% and 20.5Z of the State's domestic product, respectively. Gujarat's average per capita income in 1982 was Rs 2,192 (US$170 million) but this overall average income figure hides the much lower incomes estimated at US$80-120, earned by the large number of rural poor who live in the project areas. 2. Cujarat is the third most urbanized State in India with 31% of its populAtion living in cities compared with 24Z for all-India. About 57% of the State's urban population dwell in the corridor stretching south from Ahmedabad towards Bombay, which contains the State's three largest cities: Ahmedabad, Vadodara, and Surat. Economic Setting 3. As elsewhere in the country, agriculture is the most important sector in terms of employment, accounting for 68% of the working popula- tion and yet its share in the State's income is only 32%. The main agricultural products are: groundnuts (about 30% of nationel production) and cotton (about 24Z of national production). Other important crops are foodgrains and potatoes. The important industries in Gujarat are cotton textiles, vegetable oils, dairy products, chemicals (including fer- tilizers) matches, cement, and metal manufacturing. 4. Dairy Industry. The state's main agricultural production is its dairy industry which has received world-wide publicity and Bank sap- port (Credit 842-IN) for its commercial success and social achievements attained through the dairy coopeiative movement. Most milch herds in Cujarat are small, and many farmers have only a single animal. 5. Dairy Cooperatives. This was established in the 1960s to supply milk to the main dairies, which have over the years expanded their capacity to handle and process milk under the GOI-financed Operation Flood Program of the Indian Dairy Corporation. The National Dairy Development -35- Annex 2 Page 2 of 5 Board (NDDB) established in 1965 has been carrying out the expansion work of dairy and cattle feed plants on a turn-key basis. The milk coopera- tives in turn have established or expanded numerous chilling centers. 6. The milk cooperatives provide very important services: (i) mobile veterinary units are established in areas with easy access for veterinary officers to visit villages for treating sick animals free of charge to the animals of milk producers; (ii) special emergency visits are also being provided to treat the sick animals at a token fee; (iii) farmer education is provided on animal health and disease prevention; (iv) VHF radio communications; (v) a cross breeding program has been established under the technical guidance of NDDB; (vi) animal husbandry complexes provide facilities for freezing, storing and transportation of semen to village milk cooperatives where insemination is done by trained personnel; and (vii) with the assistance of NDDB/Indian Dairy Corporation, dairy demonstration farms are established to upgrade animal husbandry at the village level, for example, through supply of improved variety of fodder shoots and lucerne seeds for growing fodder. 7. Credit Facilities to Dairy Farmers. There are several forms and sources of funds for credit facilities to farmers, marginal farmers, milk co-operative societies, and landless laborers in Gujarat. The credit is extended under some Government schemes to milk producers' unions, cooperative banks, and dairies. The rate of interest charged on the credits, grace and repayment periods, and ceiling limits vary from scheme to scheme depending upon both the purpose and the income level of beneficiaries. The network of credit facilities is found to be effective and responsive to the needs. Further expansion in the area of credits wilL follow where and when needed tc -atch improved accessibility provided by the project. 8. Chilling Centers. The seven districts covered under the project have established dairies with adequate capacity to handle additional milk supply. The number of milk collecting and chilling centers in the area of operation of each dairy is primarily related to travel time and of acces- sibility for transporting milk. The expansion of milk collection and chilling center networks is expected to be within the financial capabilities of the dairies, but the dairy authorities have pointed out the need for improved transport facilities to help them expand the dairy infrastructure on their own. Transport Sector 9. Gujarat has a fairly deveLoped transport network comprised of railways, roads, ports, and airports. The railway system, 5,633 km long within the State borders, is operated by Western Railways. This system has three gauges: broad, meter, and narrow. Railway route length per -36- Annex 2 Page 3 of 5 square km and per capita is significantly higher than all-India averages. Salt, cotton, cloth, cement, oil, oilc,2e, and oilseeds, sugar and iron and steel are the major items transported by rail. 10. Gujarat also has an extensive road network, although not as developed as the railway. The State has 55,500 kms of roads, 70X of which are surfaced and 2.5% are national highways. The road length per sq km and per capita is below the all-India average. The national highways system in the State has 1,424 km - a large proportion of which is in NH 8 which links New Delhi and Bombay. Gujarat's national highways are in a relatively good state compared to the country as a whole: in 1981 only 17.8% of the NH length in the State had a width below standard double lane, compared with 42.5Z at the national level. Gujarat has a relatively large registration of motor vehicles, 694,507 in 1982/83 (Table A2-1), second only to Kaharashtra's. The number of vehicles per 100 persons, which stood at 1.3 in 1980, is also substantially higher than the all-India figure of 0.6. Giujarat Motor Vehicle Statistics Average 1971/72 1975/76 1982/83 Annual Increase Motor Cycles and Scooters 61,589 129,768 399,557 50% Auto Rickshaws bI 8,806 16,090 40,945 33% Cars, Taxis and Jeeps 41,772 50,506 91,278 10% Stage Carriages a/ 6,362 8,215 14,428 11X Lorries 26,301 34,764 62,197 12% Tractors 15,161 24,911 47,387 19% Trailers 99368 18,569 38,715 27% TOTAL 169,359 282,823 694,507 27% a/ Includes buses also. b/ Includes trucks, tempos and three-wheeler good vehicles. Source: Director, Bureau of Economics and Statistics, Gujarat January 1984 -37- Annex 2 Page 4 of 5 Road Users Revenue 11. The State Covernment recovers taxes on the sale of HSD, gasoline and vehicle spare parts and accessories through the Commissioner of Sales Tax. The transport authority of the State Government recovers vehicle taxes, registration and license fees and public and passenger vehicle road taxes. The revenue from these taxes is credited to the State's general revenue account from which appropriate allocations are made by the State Government for developmental activities. Details of revenue received from road users during the past four years are shown below (in Rs million): Motor Motor Registra- Vehicle Sales Tax Vehicle- tion and Taxes on Vehicles Road License Goods and and Spare Year Taxes Fees Passengers Parts Total 1980/81 203.6 18.2 363.2 125.0 710.0 1981/82 238.6 20.8 183.1 231.2 673.7 1982/83 287.7 26.3 536.5 247.4 1,097.9 1983/84 322.6 36.1 833.3 272.1 1,464.1 Source: Department of Transport and Sales Tax, State of Gujarar Construction Techniques and Contracting 12. Current practice in village road construction uses hand labor and side borrow for earthwork construction which is compacted with a static 8/10-ton steel wheel roller. There is usually no possibility of using imported material. Cross drainage works usually consist of "hume" pipe culverts, laid on prepared beds with masonry end walls. Because the rollers cannot work parallel to the culverts, compaction in the crucial area adjacent to the culvert is often poor, and pavement failure is com- mon. The universal use of waterbound macadam often ignores naturally occuring, continuously graded materials, which are available more cheaply in areas far from deposits of stone, while the lack of cutback bitumen or bitumen emulsion or their use in "spray and chip" surface dressing limits the range of options available to the engineer. There are furthermore many areas in the state where both lime and cement stabilization could be used to advantage. The opportunity to introduce innovations in equipment, materials and specifications will be pursued during the project. Paver-laid, machine-crushed stone will be used throughout in the top -38- Annex 2 Page 5 of 5 100 mm of base course, and will be mostly topped by a 20 m asphalt car- pet, but experimental lengths of surface dressing will be laid and monitored. Research Institutes 13. The Gujarat Engineering Research Institute (GERI), located at Vadodara, is the main institution in the State performing tests and inves- tigations. rt is headed by a Director of Chief Engineer rank. In addi- tion to laboratory work, the institute also has a separate cell for traf- fic engineering. GERI has agreed to cooperate in a monitoring program of some innovations to be implemented under the project. Quality Control Organization 14. There is a separate organization for quality control headed by a Chief Engineer and assisted by four executive engineers posted at dif- ferent places in the State for more effective supervision of works and by additional lower level engineers. Training 15. R&BD maintains the Engineering Staff College (ESC) in the state capital, Gandhinagar. All its engineers attend introductory courses in their early years, and subsequently throughout their careers, as interest and time permit. Mechanical Department personnel are trained in a train- ing unit at Central Workshops Odhav. Training for cor.cractors personnel is informal and on the job. Training in the technical and administrative aspects of the project will be given to all project personnel. Works under the project will use the MOST Specification for Road and Bridgeworks, (International Road Congress 1983), and this will be formally introduced via courses at ESC, and differences from the current Gujarat specification will be explained. Influence Areas of Project Roads 16. The project roads are located in the seven districts of Ahmedabad, Sabarkantha, Mehsana, Banaskantha, Rajkot, Junagadh and Bhav- nagar which are poorer areas of the State. The rural economy is predominantly agricultural. Groundnuts and cotton are grown in some of the project areas but milk and milk products are the principal means of livelihood in all the influence areas. The total number of villages to be affected by the provision of improved rural access is 2,608, benefitting some 3.5 million farmers. -39- Annex 3 Page 1 of 5 INDIA GUJARAT RURAL ROADS PROJECT Maintenance Planning Study Draft Terms of Reference A. Background 1. The State of Gujarat has a road network comprising some 55,481 km as follows: Surfaced Unsurfaced Total National Highways 1,421 - 1,421 State Highways 9,098 187 9,285 Main District Roads 10,023 1,235 11,258 Other District Roads 9,074 2,976 12,050 Village Roads 15,532 5,935 21,467 Total 45,148 10,333 55,481 2. At present, road maintenance funds are allocated under the State's annual or non-plan budget according to norms which are established by Government Resolution based on the recommendations of the Finance Comission. Norms take account of road type and terrain, and are sums of money allocated on a per kilometer basis, to cover routine and periodic maintenance. The amounts actually released are not frequently adequate, and releases do not conform to the norms. Consequently, the lack of financial resources allocated to road maintenance has led to the deteriorated condition of roads. B. Objectives 3. With a view to improving identification and planning of main- tenance requirements for the Gujarat state road network, the Department of Roads and Buildings (R&BD) now wishes to carry out: (i) a state-wide road condition inventory and traffic survey to serve as a data base; (ii) the preparation of a ten-year periodic maintenance program; and (iii) the introduction of a modern system of maintenatce planning. In this context -40- Annex 3 Page 2 of 5 and through these terms of reference, the term "periodic maintenance" may include overlaying, strengthening, rehabilitation or reconstruction, as the need dictates. C. Scope of Services Reguired Road Inventory 4. Using the existing inventory as a starting point, a systematic inventory of every road should be made breaking the system down into homogeneous road sections of similar physical and traffic characteristics. The inventory should record the following parameters: (a) Permanent data: - length of section, starting point, finishing point; - width of pavement, shoulders, right of way; - encroachments and encumbrances; - Curves, gradients and other geometric features; - bridges, culverts; - intersections and support characteristics; - road construction profile (from surfacing to subgrade); and (b) Condition data: - road surface condition: (i) by subjective visual examination; (ii) by road roughness measurements; and (iii) by deflection measurements. Traffic Survey 5. The traffic survey will consist of the following elements: (a) consolidation of existing data base - existing traffic data should be consolidated on to a state wide map to show historic levels and growth rates and seasonal variation patterns; (b) establishment of a 50 point census for annual counts; (c) establishment of a small number of permanent counting stations; and -41- Annex 3 Page 3 of 5 (d) an axle load survey and determination of the axle load spectrum for each class of road. All counts should be classified to show vehicle types as follows: (i) pedestrian and animal drawn vehicles; (ii) 2 and 3-wheel pedal powered vehicles; (iii) 2 and 3-wheel motorized vehicles; (iv) cars, taxis, pickups; (v) lorries with 2 axles; (vi) lorries with 3 axles or more; and (vii) buses. Minimum Road Maintenance Standards 6. Based on the road inventory and traffic survey, desirable mini- mum maintenance standards and frequencies for each class of road, related to traffic, will be established. A number of maintenance strategies should be examined and selection made, based on lowest total transport cost. Based on the desirable minimum maintenance standards and frequency, and using the current R&BD Schedule of Rates, the unit costs per kilometer of common periodic and routine maintenance operations, will be estab- lished. Analysis 7. It is expected that data will be presented partly graphicaLly and partly by computer, and that the analyses will be made by computer so that it may be easily updated and revised. The data should be tabulated and analyzed to show, for each road section: (a) the geometric and construction standard; (b) the existing condition; (c) an estimate of: (i) design equivalent standard azles (ESA), (ii) the proportion of design ESAs already elapsed and, at predicted traffic growth rates, to permit the calculation of (iii) the year in which design ESAs will have expired (ESA date); and -42- Annex 3 Page 4 of 5 (d) a deficiencies report, describing the difference between prescribed maintenance standard and existing condition, defini- tion of the work required, and its cost. 8. The analysis may also show up areas of high roughness or high Benkelman deflection where more detailed investigation is required. Periodic Maintenance Program 9. By combining the results of the deficiency analysis and the ESA date, the study will recommend a ten-year maintenance program. The aim should be to remove the maintenance backlog in five years, and to have no road section more than two years overdue for overlaying by the end of year ten. Years one to three should be a detailed program of maintenance schemes for which there is a clear and present need and which can serve as a basis for preparing plans and estimates for putting maintenance of individual sections of road to contract. Years four to six should be in the form of an indicative program and should contain maintenance schemes which will probably reach the detailed work program in that time period, but which may be advanced or retarded depending on physical behaviour of the road sections in question in the coming three years. Years seven to ten should be presented in the form of a tentative program and show road sections which, from consideration of design life and traffic, (ESA date) should be strengthened or resurfaced during that period. 10. Desirable maintenance standards must be realistic, in that they must combine a minimization of total transport cost with a sustainable maintenance effort and must be fixed in close consultation with the high- way authority. The study should produce present serviceability index, and their relation to measurable parameters, deflection, and roughness, appropriate to Gujarat's Network. For this work, proprietary computer software, such as BSM or Pennstamp, may be adapted for the analysis while determining the level of detail appropriate to each class of road. Updating 11. Updating of the data base and the ten-year program shall be conceived as an annual event. The data base should be designed to be easily updated to show changes in pavement condition and changes in status due to the works executed in the periodic maintenance program during the year, changes in traffic, etc. As each year of the program is translated into physical works, a new outer year should be added and the operation repeated. The method of analysis developed (or adapted) must provide for great flexibility. As maintenance funds are always likely to be scarce, the method must allow, e.g., for a rapid calculation of the effects of altering a particular maintenance standard, of changing a traffic growth -43- Annex 3 Page 5 of 5 assumption, or of shoving the new works program possible with a change in the available funds. Training 12. Once a satisfactory methodology has been developed for maintain- ing the data base and updating the maintenance program, R&BD personnel will be trained for computer operation, to ensure that the systems developed can be updated and used on a continuing basis. Execution 13. The consultant selected for the study will be responsible for the overall strategy of the study, the method of analysis and the format of the program, but will rely heavily on Executive Engineers for the collection and supply of data, and on GOG's materials laboratories for trenching and testing of existing pavements. The study is expected to take about one year to complete, using a maximum of 30 man months of consultant time. Services and Equipment to be Supplied by GOG 14. In the event that the consultant advises the use of microcom- puters, the necessary hard and software will be purchased by R&BD, whose property it will remain. R&BD will supply field data collection staff, drawing office facilities, all materials testing staff and equipment. If a program of roughness and deflection measurements is agreed upon, B&BD will purchase the equipment which will be operated through the Gujarat Engineering Research Institute (GERI). A similar arrangement will apply to traffic counters. Reporting 15. The following reports should be submitted to COG: (a) inception report after four months; (b) progress reports every two months; (c) draft final report after eight months; and (d) final report after COG and the Association commented (within 30 days) on the draft report. -44- Annex 4 Page 1 of 3 INDIA GUJARAT RURAL ROADS PROJECT Procurement and Contracting 1. Civil works and procurement is planned as shown in Table 3.2, and cover 1,025 separate roads, of 4 km average length, and each road with its associated cross drainage works forms a job or slice; bridges over 10 K span will be separate contracts. Slices are grouped into packages. Current practice is to execute road works in two stages, each as a separate contract: Stage I covers earthworks, cross drainage works, sub-base and the lower base course, and Stage II consists of a machine-laid top base course and a pre-mix asphalt carpet. Stage I works are usually opened to traffic during at least one monsoon season before Stage II works begin. However, there are disadvantages with this horizon- tal slicing approach - disputed responsibility for subsequent failures between Stage I contractors (usually small and unmechanized and Stage II contractors (larger, equipment-oriented, paving oriented specialists), the lack of any large firms equipped for the whole job, and difficult supervi- sion caused by a multiplicity of small contracts. One objective of the project is to try to reduce horizontal slicing and encourage larger con- tracts. Two aspects of current practice need to be reformed to allow this to happen, viz. (i) the use of bank guarantees for contractorst security deposits, and (ii) subcontracting. Slice values have been chosen to allow Cujarat's currently registered small and medium-sized contractors to participate, but also to encourage larger firms to bid and bring about economies of scale and benefits of professional management. Under pack- age-and-slice rules a contract will only be awarded for a package if the price bid is less than the sum of the lowest bids received for the individual slices in the package. 2. Buildings for offices and living acco modation are being designed by the R&BD Building Department, using state standards and will be built under contracts let through state LCB procedures, which use registered contractors and satisfactory public bid opening procedures. 3. Prequalification. GOC maintains a register of contractors who are allowed to bid for works at various levels as shown below: -45- Annex 4 Page 2 of 3 Contract Value Minimum up to Liquidity Yearly Turnover Class Rs '000 Rs '000 over Rs '000 AA No limit 3,000 5,000 A 15,000 1,000 4,000 B 5,000 600 2,500 C 2,500 400 1,500 D 1,500 200 250 Registrations are renewed annually. Contractors from other Indian states may apply for temporary registration if they are registered in their own state. Foreign contractors will be prequalified. However, because of the different contracting conditions of this project, prequalification will be required for all firms. Foreign firms will be eligible for prequalification. 4. Bidding. Road contracts will be grouped into packages as large as their geographical dispersion and other factors such as land acquisi- tion, timing and annual budget allocations by district will allow. Pack- ages are expected to be under US$5 million and therefore, will be bid under LCB procedures, using the Central Water Commission model document, which was used by R&BD for the roads component of the Bank-financed Gujarat Irrigation Project (Credit 1011-IN). A number of sets of plans, estimates, and contract documents have been examined by the Association and their form and content have been agreed during appraisal. There will be no prior review of single slice contracts, but package contracts valued at the equivalent of US$700,000 or more would be subject to prior review. It has been accepted that the works are small and widely scattered and that LCB is generally appropriate for their execution. 5. Equipment purchases will be made under LCB and ICB rules (see Table 3.3, lists A and B). Bidding documents have been prepared using Bank Group-approved model documents for both the LCB and ICB lists; docu- ments for all equipment purchases will be subject to prior review. DGS&D rate contracts are regarded as LCB for the purpose of executing the present project and purchases may be made through this system but only after bids have been called nationally. Certain items forming lots of low value, but which nevertheless need to be introduced for the technological transfer they represent, will be purchased through local and international shopping. Contracts above US$50,000 in value will be subject tc prior review. 6. Technical assistance for setting up a computer-based project monitoring system will be obtained from a local firm, Operational Research -46- Annex 4 Pagg 3 of 3 Group, which has done similar work on previous Bank-financed projects in Cujarat, and currently is helping the Bank to develop a similar program for use India-wide. The Maintenance Planning Study will be contracted to a firm chosen on the basis of proposals invited from a shortlist of firms. -47- Annex 5 Page 1 of 3 INDIA GUJARAT RURAL ROADS PROJECT Technical Assistance for Project Monitoring Draft Terms of Reference Background 1. The Government of Gujarat (GOG) wishes to implement a project involving the construction or upgrading of some 4,000 km of village roads, involving some 1,000 construction jobs. The project will be financed with IDA assistance, and one objective of the project will be to strengthen GOG's Roads and Buildings Department (R&BD), the executing agency for the project, in the field of project management and monitoring. It is now intended to engage a consultant to design and install a comprehensive project management and monitoring system. Objectives 2. The objectives of the technical assistance would be to: (a) develop a system of monitoring physical and financial progress of the road construction and upgrading project; (b) install this monitoring system into operational use giving all necessary training to R&BD employees at all levels; and (c) make periodic tuning and refinements to the system based on operating experience for a period of one year. Characteristics of the System 3. It is assumed that the consultant will develop a computer-based system, in which case any software developed would become the property of R&BD. A system based on, or developed from, existing proprietary software will be acceptable. Although the contracts will be numerous, the opera- tions within each contract are simple and serial and the same operations are involved in each contract for road works of the same type, of which there are three: construction, reconstruction and improvement. Thus, there is no requirement for determining the critical path through a comr plex network. The basic unit of record will be the road "job". For -48- Annex 5 Page 2 of 3 contracting purposes "jobs" may be assembled into a Larger package forming one contract. One contract may therefore consist of a number of road "jobs". The system will be centered on the office of the Chief Engineer (Rural Roads), where data from the seven district level offices will be collated. A crucial decision will be whether the district offices' con- tribution to the data input should be manual or computerized. Equipment cost should not constrain this decision, but the Logistics of equipment maintenance and data transmission should. The Association is currently developing its own project monitoring system and while the focus of this system would be different from that of Cujarat's system, it may be neces- sary to standardize the format of common data. 4. The system shall be able to: (a) provide a framework for programming of the road works and for producing physical and financial targets at the outset and during execution of the project; (b) show the progress of each road job, through the procedures of design, sanction and approval, tendering, review and contract award; Cc) show the physical progress of the civil works for each road; (d) show the financial progress of each contract payment by payment; and (e) show for the project as a whole, the status of the project compared to projections; contracts approved and disbursing, physical completion, funds committed, funds disbursed, and other summary data. 5. RBD will purchase computer hard and software and associated equipment based on the consultant's recommendations. R&BD will make available personnel from the Project Monitoring Cell (PMC) established for supervision of the irrigation command area roads project, (it is suggested that the manual monitoring methods developed by the PKC be used as a starting point for the proposed computer-based system) and personnel from each district where the system will be installed. Conduct of the Assignment and Reporting 6. (a) Inception Report: After two months, the consultant will discuss the system's data input and output requirements with its poten- tial users and with current employees of PfC and project manage- ment staff. The inception report will present the outcome of these discussions in a precise format, showing what information needs to be supplied by whom, the input format, the processing -49- Annex 5 Page 3 of 3 flow chart, titles and format of all reports and other output. Equipment, hardware and software requirements must also be detailed at this stage. (b) Implementation Report. After five months, this report will present the software developed for the job, draft system opera- tion manual, sample output and a detailed implementation and training plan. Upon review by R&BD and IDA within 30 days from receipt of the report, implementation would begin. (c) Final Report. After twelve months, this report will describe the success of the training program and the introduction of the system into operational use. It will present a final operating manual and the coding of the debugged pzograms. -50- Annex 6 Page 1 of 9 INDIA GUJARAT RURAL ROADS PROJECT Economic Evaluation Methodology A. Dairy and Agricultural Benefits 1. The Buildings and Communications Department (B&CD) of the State Government of Cujarat (GOG) has proposed 1,031 km of new construction, 998 km of reconstruction and 2,023 km of improvement, a total of 4,042 km estimated to cost about US$170 million. Since the full program cannot be implemented all at once, a route screening methodology was devised to determine the timing of investment. The methodology was devised on the basis of interviews held with farmers, dairymen, dairy cooperative managers and GOG professional staff concerned with the project. 2. While conditions vary widely throughout Gujarat, dairying is common to most areas and is a principal activity. In some areas, there is also parallel agricultural activity at a commercial level. Typical cases for rural road construction, therefore, have been considered in two types of areas, one type with only dairying activity and the other with both dairy farming and comercial agricultural activity. These two scenarios were again subdivided to allow for new road construction with no existing traffic, and road improvement where existing traffic would be affected. A sample was made in each case with and without an alL weather road to assess typical benefits and costs. Data were collected for individual roads by means of a simple questionnaire form (Attachment), which was used to assess the economic viability of the route by application of adjustment factors to the typical cases. The typical cases are described belcw. Case 1: A Primarily Milk Production Area With No Road 3. The typical scenario for Case 1 is as follows: agricultural production is mainly for local consumption or for cattle feeding only, and the area is connected with only rudimentary tracks or no roads at alL. The nearest all-weather road is 4 km or more from this area. Population is as low as 100 persons per sq km, with milch animals (cows or buffaloes) owned at the rate of about 1.4 per family, that is, about 28 animals per sq km. During lactation, milk production is at a rate of 7.0 liter per day for eight monc%s, thereafter dropping to zero after a further six months, followed by a dry period. Calving is said to be at two year intervals on the average. Hence, over a two-year period, milk production averages about 3.2 liter per day per animal, of which one liter per day -51- Annex 6 Page 2 of 9 would be consumed by the family or locally and 2.2 liters per day would be available for sale either in local markets or at a cooperative miLk collecting center. Costs of keeping one animal over a period of 720 days are estimated as follows: Green Fodder: 20 kg/day during lactation, 420 days @ 20 kg = 8,400 kg 15 kg/day during dry period, 300 days e 15 kg = 4,500 kg Less own fodder during monsoon period, 120 days Q 20 kg per day -2,400 kg Total green fodder @ Rs 0.1 per kg = 10,500 Rs 1,050 Dry Fodder: 7 kg per day for 720 days @ Rs 0.2 per kg 1,060 It is assumed thst no concentrates are given Medicines, etc. 100 Animal depreciation Q 122 of Rs 300 in two years 360 Interest on value of animal at 12% over two years, say 720 Total over 2 years Rs 3,290 4. The price paid for milk varies according to the butter fat content, and this may be lower in the case of animals not in contact with veterinary services. However, taking the average prices paid by coopera- tives, and after allowing for expenses and wastage, the price is Rs 2.25 per liter. Where communications are bad, there is increased loss due to sourage, and collection costs are higher. With poor or no roads, sourage is about 11%, some with the farmer and some with the dairy cooperative. With good roads, this is reduced to about 5.5% sourage, again split between the farmer and the cooperative. Sour milk can be used, but its value is reduced by about Rs 1.8 per liter, representing a loss of 5.5% of Rs 1.8 on each liter of milk marketed, or about Rs 0.1 per liter. The price received by the farmer when there are no or poor roads is thus Rs 2.15 per liter of milk marketed, which at 2.2 liters per day, gives a total of Rs 3,405 per animal over a two year period. Deducting Rs 3,290, representing the cost of inputs, there is a net profit of Rs 115 per animal per lactation period which, at 28 animals per sq km, amounts to about Rs 3,220 per sq km per year. -52- Annex 6 Page 3 of 9 Case 2: A Primarily Milk Producing Area with a Surfaced All-Weather Road 5. The typical scenario of Case 2 is as follows: in this area, the locaL milk collecting centers and dairy cooperatives make available veterinary services, artificial insemination, animal insurance and low interest loans. The population density will remain virtually unchanged over the short term, but the existence of an assured and available market throughout the year increases average animal holdings to two per family, that is, 40 animals per sq km. This estimate is based on the actual experience gained after the provision of an all weather road in milk producing areas in the State. The Lactation period will be about 300 days with production of 6.5 liters of milk per day, of which 6 liters is sold. This is followed by a dry period of 120 days, with calving every 14 months. With the cost of an average animal remaining at Rs 3,000, main- tenance costs are estimated as follows: Creen Fodder: During lactation 20 kg per day for 300 days = 6,000 kg During dry period, 15 kg per day for 120 days = 1,800 kg Less own fodder during monsoon period, 120 days @ 20 kg per day -2,400 kg Total green fodder @ Rs 0. per kg 5,400 = Rs 540 Dry Fodder: 7 kg per day for 420 days e Rs 0.2 per kg 588 Concentrates - 4 kg per day during lactation, 300 days @ Rs 1.1 per kg 1,320 Medicines, etc. over 14 months 100 Depreciation e 100% over the period 350 Animal Insurance e 3% a year (part paid by cooperative) 105 Intereut on value of animal e 12Z per year 420 Total outgoings over 14 months Rs 3,423 Sale of milk over the period will bring in Rs 4,050 from 6 liters per day for 300 days at Rs 2.25 per liter. Profit to the farmer is therefore Rs 627 per animal over 14 months, or about Rs 25,080 per sq km per year at 40 animals per sq km. -53- Annex 6 Page 4 of 9 Case 3: A Mixed Dairying and Agricultural Area with no Road 6. PopulAtion densities tend to be higher in areas of mixed activity than in purely dairying areas, reaching 300 persons per sq km or more, as compared with 170 per sq km for the State as a whole. Ownership of miLch animals is at about 1.4 per family, or 56 per sq km, and this ownership rate is not expected to rise as a result of road construction. However, it is expected that milk production, and hence profits from dairying, will increase in the same manner as Case 2. Benefits from improved dairying activities will therefore be due to an increase from Rs 115 per animal per lactation period of two years to Rs 627 per animal in 14 months, or Rs 28,672 per sq km per year. As in the previous case, improvement is assumed to be only 70% effective and to take place over seven years. The benefits were assumed to accrue to the area covering a 4 km band affected on either side of the road. 7. For eleven main crops grown in the seven districts covered by the project, COG agriculr*iral statistics show a weighted average profit of Rs 1,260 per hectare per year, ranging from Rs 872 to Rs 1,674, after deducting the value of inputs but not allowing for land rental value, interest on fixed capital and family labor. Although it is very likely that agricultural incomes would increase due to introduction of improved farming methods, made possible by the improved roads, potential agricul- tural benefits were not qantified. Case 4: A Mixed Dairying and Agricultural Area with a Surfaced All-Weather Road 8. Only traffic related benefits were assumed to accrue in this case. Assumptions Regarding Calculation of Benefits 9. Milk Supply. The full increase in milk production will be achieved in seven years and then it will stabilize. Met economic value of benefit accruing to milk supplying households per liter of increased supply of milk to Dairy will be Rs 1.50. This value reflects the dif- ference in average sale value after deducting milk production cost. One animal will provide a continuous average surplus of 3.0 liters of milk per day for supply to dairy in the seventh year after all-weather paved road is provided. The total increase in the seventh year will be uniformly distributed annually. In the existing situation, no further increase over the present supply of surplus milk would take place. This premise is linked to the increase mentioned above. The incremental reduction in sour and curd milk will take place in the present quantity of milk supplied to Dairy after proposed roads are completed, and such incremental reduction wiLl have following empirical relation with the distance of Milk Collect- ing Center from the dairy or the Chilling Center: -54- Annex 6 Page 5 of 9 Center and Collection Center in Milk Supplied Up to 20 km 1 Z Between 20 km and 30 km 1.5 Z Between 30 km and 40 km 2 Z Between 40 km and 50 km 2.5 Z More than 50 km 3 X The above reduction in sourage will take place in the first year and will remain constant over the ten-year period. The incremental economic value of reduced quantity of sour and curd milk is Rs 1.25 per liter. The milk which could not be at present sent to a dairy because of closure of route in monsoon would be sent to a dairy after completion of the road, and the incremental value of such milk will be at Rs 1.25 per liter. At present the average rate of death among the milch animaL population is 6Z. With the project, the reduction in deaths of cattle in milk will take place to the extent of 32 for new roads and 2% for roads under improvement category. The benefits due to reduction in cattle deaths would occur in the first year and will grow at annual rate of 3% for a period of 10 years. The annual increase in benefits due to reduced deaths is roughly based on the growth rate of animals in the project area in "without the project" case. 10. Reduction in Sour and Curd Milk. The current dairy routes used for collecting milk from milk collecting centers in the villages were represented on Taluka Maps to ascertain the extent of utilization of the links proposed in the project. It was observed from this study that almost all the roads proposed form part of the dairy routes. Most of the current routes followed by dairies are intervened by poor or no road links. Discussions with dairy authorities revealed that kutcha or deteriorated water-bound macadam road link in the dairy route contributes largely in the soured quantity of milk as a result of longer travel time on a bad road resulting in heavy churning in milk. The value of loss due to sourage of milk works out to be Rs 1.86 per liter. After taxes, the economic value of the loss due to sourage is estimated at Rs 1.25 per liter. The data required in the questionnaire provided a certain amount of cross-checking and they were used to test the basic assumptions made. For example, the amount of milk lost during collecting center closure per day was checked against overall average daily amounts, and average produc- tion of milk per milch animal per year was checked against the assumptions made herein. The distance from the nearest dairy or chilling center was important in marginal cases, since if the distance required over two hours of travel time, marked dairy improvement is less likely. -55- Annex 6 Page 6 of 9 11. Increased Milk Production. The volume of milk supply in the five selected villages in the project area ranged from 2.97 liters to 4.42 liters per day per cattle. These figures are significantly lower than the average 4.5 liter supply obtained by Amul Dairy in Kaira District. An analysis of cross section of participating farmers supplying milk to dairies reveals that 17% are landless and 39% are marginal farmers, most of whom have been rearing the milching cattle as their primary occupation. In this situation, therefore, the cost of production would be relatively lower than the average. 12. Reduction in Cattle Deaths. The National Dairy Development Board has carried out "A Benchmark Survey on Disease Profile and Mortality with the Resultant Financial Losses in Sabarkantha Milkshed in Gujarat" in July 1981. The Study was limited to 91 villages and 2708 households which constituted 2.35% of animal population and 11% of vilLages which were covered by veterinary routes, providing facilities for reguLar, weekly and emergency visits by veterinary doctors. The Study revealed that the rate of disease prevalance is of the order of 12.5Z of animal population, 14Z for buffaloes, 5 for cross breed and 7.32 for local cattle, and these rates are higher for the animals of landless and marginal farmers. As per the Study, the death rate is 4.7Z in buffaloes, the target animal popula- tion for this project. The Study relates to an area where normal veteri- nary services are available; it can, therefore, safely be presumed that for the project area which is generally in the interior and less developed, the mortality rate of buffaloes will be 7% of the population. The completion of the proposed project roads will enable penetration and expansion of the current veterinary services to a significant extent, resulting in a reduced number of milch cattle deaths. Based on the inter- views conducted with veterinary officers responsible for the villages included in the project and in undeveloped areas, it is estimated that the reduction in milch cattle deaths could be achieved to the extent of 2% and 32 of the present milch cattle population respectively. As the normal growth in animals even without the proposed roads will take place, it is estimated that benefits due to reduction in deaths of animals in milk will grow at 5% for the NC-RC road influence area (poor veterinary services) and at 3% for the improvement category influence area (medium veterinary services). B. Traffic Benefits 13. The Central Road Research Institute (CRRI) at Delhi, in coopera- tion with the Bank, has recently completed an extensive study of vehicle operating costs in India, and the results obtained were used to estimate vehicle operating cost savings due to road improvement. Typically, traffic on rural roads in Cujarat consists of about 70% buses and trucks, and 30% cars and jeeps. From the total traffic counts on the sample roads, dairy-related traffic was deducted to take into account only the non-dairy related traffic. With the relatively low levels of traffic at present and -56- Annez 6 Page 7 of 9 likely throughout the analysis period, the proposed carriageway width of 3.75 m is appropriate. Present vehicle operating costs on the existing roads are taken as those for a single lane, unpaved road which is appropriate for katcha and deteriorated water-bound macadam roads, but underestimates present costs of field tracks which are now the only means of access. Under these conditions, the discounted benefit for a ten-year period arising from the proposed improvement for one average vehicle per day per kn, allowing 3Z annum traffic growth, is Rs 3,620 at a 12Z dis- count rate. Hence, the net present value of traffic benefits per km of road under these conditions will be given by the present average daily non-agricultural traffic multiplied by Rs 3,620. No benefits are assumed for generated traffic. C. Costs 14. Road Improvement Cost. The estimated cost of road improvement excludes taxes and duties, and is based on detailed engineering and cur- rent Schedule of Rates. Construction costs will vary over the seven districts but the following average base costs in Rs million/km (1985) have been assumed for estimating purposes: new construction .350, recon- struction .274, and improvement .205. Bitumen surfacing has been adopted as the standard because of silty soils throughout the state and poor experience with unsurfaced roads during heavy monsoon rains. It is also easier to assure infrequent periodic maintenance than the regular routine maintenance required by an unsurfaced road in remote areas. Rates of return amply justify this decision. In undertaking an economic analysis, 15% physical contingency has been added to the estimated cost. In addi- tion, the estimated maintenance costs in rupees per km are based on the table below: Economic Present Current Maintenance value of surface mainte- expenditure Incremental incremental Classification of the nance required financial expenditure of the proposed proposed expen- after it is expenditure 90 X of road road diture completed for M & R col. 5 NC Cart - 6000 6000 5400 track RC Earth 1500 6000 4500 4050 work Imp. One layer 5700 6000 300 270 of metal -57- Annex 6 Page 8 of 9 15. Estimates of Vehicle Operating Cost Savings (VOC). The costs of operating different vehicles on different types of road surfaces in Gujarat were estimated based on the following factors. Bank Staff working paper No. 610 shows relative VOC in different countries on different surfaces. The average cost from this study for-good and bad conditions of different surfaces is in the following proportion: Earth Earth Gravel Gravel Paved Paved road road road road road road Bad Good Bad Good Bad Goad 100 70 65 56 52 45 Based on these relationships, VOC on existing surfaces of NC-RC category of the proposed roads would be double and on improvement category would be about 35 to 40% higher than the VOC on a paved surface in good condition. In Economic Analysis of Highways, Robley Winfrey has developed factors to convert motor vehicle running cost on high-type pa.iement to cost on gravel and earth roads. The approsimate values relevant to this project for vehicles running at 35 mph on a paved road are: Light Motor Vehicle Trucks Gravel 1.358 1.381 Earth 1.716 1.76 It will be observed from the table that VOC on gravel or partial WBM would be 35 to 38% more and on an earth road 71 to 76% more than the VOC on B.T. surface. The Road User Cost Study undertaken by CRRI, New Delhi in 1982, has developed tables for different relationships of VOC of different vehicles on paved and unpaved roads. Rough calculations revealed that diiiereneiai cost of operating buses, trucks and light motor vehicles on unpaved roads would be respectively of the order of Rs 1.20, 1.00 and 0.90 relative to paved roads per vehicle km. Roughly, the VOC savings on katcha or ungraded earth roads would be about 50% higher compared to unpaved roads. The local market survey provided the following current freight/fare charges: -58- Annex 6 Page 9 of 9 Rs per vehicle-km Type of BT Poor Earth or (RC) Vehicle (Paved) WBM(I) cart track (NC) Trucks 3.00 4.000 5.00 Taxi-Cabs 1.75 2.60 3.50 Tractor 1.50 2.25 2.75 The public transit buses are operated by the State Transport Corporation. According to its operating statistics, the cost of operating a bus-km on BT road is Rs 5.20 per bus-km. The average operating cost of a transit bus on deteriorated WBM is Rs 3.85 per bus-km. In view of the above, values shown in the following table are adopted for computation of VOC savings for the project. VOCS are computed on the basis of average daily traffic of different categories and the route length excluding dairy vehicle trips as shown below (in Rs per vehicle-km): BT-VS BT-VS Type of NC-RC Imp. Vehicle Category Category Bus 2.70 1.35 Trucks 2.00 1.00 Light Motor 1.75 0.85 Vehicles Traccors 1.25 0.75 -59- Annex 7 INDIA GUJARAT RURAL ROADS PROJECT Documents in Project File 1. Manual on Route Location and Design of Rural Roads, Indian Roads Congress Special Publication No. 20. 2. Specifications for Rural and Bridge Works, MOST, Indian Roads Congress 1983. 3. Rural Roads Project, Gujarat State. Preparation Document. Building and Communications Department, Gandhinagar. 4. Review of Roads Components in Irrigation Projects 1975-82, Philip Borrowman (consultant), New Delhi Office, World Bank, 1983. 5. Report of the National Transport Policy Committee, Planning Commission, GOI, May 1980. 6. Annual Administration Report 1981-82, Motor Vehicles Department, Gujarat State, Ahmedabad. 7. Report of the Eighth Finance Commision, 1984. 8. Draft Seventh Five-Year Plan (1985-1990) and Annual Plan (1985-1986), Road Development, Roads & Buildings Department, Government of Gujarat, Gandhinagar, November 1984. 9. Master Plan for Rural Roads, Building & Communication Department, Gandhinagar, Government of Gujarat. 10. Road Development Plan for India (1981-2001), Ministry of Shipping & Transport (Roads Wing), Indian Roads Congress, New Delhi 1984. 11. Details for Post-appraisal, Roads & Buildings Department, Government of Gujarat, March 1985. -60- Table 2.1 INDIA CUJARAT RURAL ROADS PROJECT Estimated COG Resources for the Seventh Plan Rs billion 1. Balance from current revenue including additional resource mobilisation 25.08 2. Contribution from public enterprises 1.74 3. Loans from market (net) 4.80 4. Share of small savings 12.20 5. State provident fund 1.10 6. Miscellaneous capital receipts 1.46 7. Negotiated loans a. by State Government 0.42 b. by State enterprises 2.19 c. other agencies 0.51 8. Central assistance a. Normal 69.37 b. Additionality on account of externally aided projects* 35.87 9. Adjustment of overdraft _ Total 60.00 * Excluding proposed rural road project. Table 2.2 INDIA GUJARAT RURAL ROADS PROJECT Planned Expenditures During The Seventh Plan Allocation Main Headings of Expenditure Rs Billion 1. Agriculture and related services like research and training, land and water conservation, animal husbandry, fisheries, forests and public contribution system, etc. 3.50 2. Rural development, relief to scarcity prone areas, desert areas and loans to schedule castes and tribes 1.24 3. Co-operation 0.36 4. Irrigation and flood control * 16.74 5. Power and development of non conventional energy sources 14.50 6. Industries and mines 2.58 7. Transport (Rs.257.84 cr. exclusively for road development sector i.e., highway construction only) 3.77 8. Science and technology research and development 0.08 9. Social and public services, like general education, health, medical services, water supply, drainage, housing, urban development, labour, social welfare 9.00 10. Financial services, like planning statistical bureau, weights and measures, administration of tribal sub plan 0.16 11. General services like, decentralized district planning, civil supply 2.56 12. Mid-day meals for school children 5.50 Total 60.00 * Includes Narmada -62- Table 2.3 INDIA CUJARAT RURAL ROADS PROJECT Road Maintenance Norms Rs/Km Actual 1/ Recommended 2/3/ Z 1980/81 1985/86 increase State Highways Paved - single lane 9,000 18,500 203 - double lane 12,600 23,500 186 Main District Roads - Paved 7,900 16,000 203 - WBM 4/ 7,900 11,500 .53 - Murrum 5/ 2,000 8,000 400 Other District Roads and Village Roads - Paved 6,000 16,000 6/ 267 - WBM 4/ 5,700 11,500 192 - Murrum 51 1,500 8,500 533 Gujarat State Highway Expenditures (excluding National Highways) Rs Million Under State -~~-------------~---- Maintenance FY Plan Non Plan Km 1978/79 225 178 4,183 1979/60 312 217 4,367 1980/81 515 246 4,600 1981/82 523 358 4,843 1982/83 584 379 5,120 1983/84 496 453 5,406 1/ 1979 Government Resolution. 2/ By Eighth Finance Commission. 3/ These amounts are applied to periodic and routine maintenance in the ratio 67:33. 4/ Water-bound macadam. 5/ Gravel or earth. 6/ Category "local body roads" does not differentiate main district roads, other distrizt roads and village roads. Source: Government of Gujarat, Government of India, 1985 -63- Table 3.1 INDIA CUJARAT RURAL ROADS PROJECT Proposed Pavement Design 1/ MOST Spec. Improve- Recon- New Con- Clause No. ment struction struction Surfacing Machine mixed asphalt hot mix 509 20 m 20 nm 20 mm Base Upper layer machine-crushed 404 stone paver-laid Grading 3 100 m 100 am 100 mm Lower layer handbroken stone, 404 hand-laid Grading 2 - 150 mm 150 m- Sub-base Selected material 401 - - 200 mm 2/ Shoulders, earthworks 305 - - 1,000 m- 3/ Summary of Geometric Design Standards 41 New Construction Flat Rolling Design Speed kph 50 40 Minimum Curve Radius M 90 60 Right of Way N 18 18 Formation Width M 7.5 7.5 Base Course Width M 3.75 3.75 Sub base Width M 4.0 4.0 Asphalt Carpet Width M 3.75 3.75 Side Slopes IV : 2H 1V : 2H Shoulder Width M 1.0 1.0 1/ From Specification for Road and Bridge Works, MOST/IRC, 1983. 2/ Minimum: depends on CBR of subgrade. 31 Minimum: depends on geometry and water table. 4/ From Manual on Route Location & Design of Rural Roads, IRC, Sp. Pub.20, 1979 Source: Roads & Buildings Department, COG -64- Table 3.2 (a) Page 1 of 2 D1IA GUJARAT RlRAL ROADS PROJUCT Taluka-viuo Sumary - Road Contruction and Improvement Progr Langth of Road I/ 2/ by Construction T;Ps tatimted Coat Contracts District Toluka N C R C IP Stag 1 Stage 2 Total Groups Jobs -=- -Ro [ illionlon AHMEDABAD Viramg_ 59.0 11.4 51.5 10 27 Sanand 5.7 0.6 15.0 2 6 City & Daecroi - - 10.3 1 3 Dehgm 5.5 5.5 48.9 4 12 Dholka 4.0 6.8 55.8 6 24 Dbandhaka 11.5 _ -19.1 3 8 TOTAL 85.7 23.8 200.6 17.3 62.0 79.3 26 80 SABARKAINTA Khoedbr.ha 12.0 - 36.0 2 9 vijayuegar 3.0 - 3.0 2 3 Idar 52.5 52.5 51.5 10 52 Bbilods 21.5 21.5 63.5 6 32 Himatnagar 18.0 18.0 38.5 9 39 Neghraj 24.9 24.9 61.1 6 23 todaoa 35.5 35.5 36.0 5 32 Malpur 27.5 27.5 5.0 3 17 Prantij 37.2 37.2 71.7 12 52 Bayad 43.0 43.0 35.0 7 46 TOTAL 239.0 260.1 15. 401.3 75.2 148.6 223.8 62 305 MEHSANA Rberula 40.5 54.5 10.5 8 36 Viiapur 15.2 13.5 28.0 5 23 Kalol 4.0 12.0 10.0 5 10 Kadi 12.0 29.0 17.0 4 20 Naesana 17.0 18.5 43.5 5 27 Visnagar 16.0 12.5 11.5 4 16 Siddhpur 24.0 2.5 26.5 4 12 Patan 28.0 7.5 6.0 5 15 Chanasoa 34.5 15.0 13.0 5 26 Harij 17.0 13.0 25.5 4 14 Sami 60.5 22.0 31.0 - - 9 28 TOTAL 268.7 200.0 222.5 99.8 127.9 227.7 58 727 Y1 C:nstruction type: NC - n construction RC = reconstruction Imp. = improvment 21 Without conuingencies. with land acquisition cost. Source: Roads &uilding Department. GCr -65- Table 3.2 (a) Page 2 of 2 Length of Road I/ 2/ bv tTyn Ratiasted Coat Contrects District Taluka N C R C IP Ste I Stem. 2 Total GrouDa Jobs - . -K Rs Million DAXASKANrA UWav 13.5 45.0 102.0 8 23 Tharad 32.0 69.0 72.0 9 22 Dhnoera 30.5 34.5 64.0 6 22 Pelanpur 22.0 70.0 56.0 8 28 Dabta 20.0 3.0 68.0 4 16 Vadgma 33.0 35.0 36.0 6 18 Deana 38.0 13.0 62.5 6 18 Deodar &0.0 30.0 72.0 9 25 Kankaroj 16.5 14.0 64.0 6 18 Redhaupur 1.0 16.0 48.5 3 10 SantaXpur 23.0 38.5 59.0 7 17 TOTAL 269.5 365.0 704.0 137.5 126.1 365.6 72 217 RAJKIOT Veakaer 11.0 15.0 29.5 6 19 Paddhari 8.5 15.5 11.5 2 6 Lodhika 2.0 - 21.0 i 4 Ra-kot - - 13.0 1 3 Jasdan 21.0 38.0 46.5 7 25 Kotada Sangauj 3.0 9.5 9.0 1 2 Condal 12.5 1 4 TorAL 45.5 77.5 143.0 14.9 41.2 56.1 19 63 JUNAGADH Kan ader 10.0 5.0 36.0 3 15 Vanthali 3.0 - 20.0 2 6 Bh*ran 2.0 - 14.0 2 3 Visevadar 10.5 2.0 6.0 2 4 Mnudarada - 8.5 13.0 2 5 Keshod 10.0 4.0 50.0 3 12 Mangrol - - 19.5 1 6 Maliy Satiua 1.0 0.5 10.0 2 3 Talala - - 24.5 2 8 Vergval 5.0 - 11.5 2 6 Porbandar - - 14.0 1 3 Ranavav - - 9.5 1 3 Kutiyen 3.0 '.5 27.5 2 9 Una - 1.5 6.0 2 3 J8-unadh 7.5 1.5 19.0 - 3 7 TOTAL 52.0 26.5 290.5 13.2 56.0 69.2 30 93 BHAVANGAR Botad - 3.0 13.2 2 4 Gadhada 46.5 16.0 14.3 a 16 Telaja 8.5 4.5 12.5 2 6 eaUZya 1.5 3.0 13.8 3 4 Vallabhipur 14.0 6.0 17.0 5 _ 10 TOTAL 70.5 32.5 70.8 17.5 27.8 45.3 20 0 GRAND TOTALS 1.030.9 998.4 2.022.7 375.4 691.6 1.067.0 1 Construction type: NC = new construction RC = reeonstruction Imp. improwe_mt 21 Nithout coutingeucim. with lad acquisition coat. Source: Roed* & Bui1dlA Depactast.C Gr INDIA GUJARAT RURAL ROADS PROJCT District-vise Summary - Road Construction and Improvement Program Km Rs million Length of Road 17 2/ by Construction Type Estimated Cost Contracts Total I of District ( s N C R C Ilp. Stage I Stage 2 Coat Program Groups Jobs Ahmedabad (A) 85.7 23.8 200.6 17.3 62.0 79.3 7.4 26 80 Sabarkantha (a) 239.0 260.1 401.3 75.2 148.6 223.8 20.9 62 305 Hehusna (M) 268.7 200.0 222.5 99.8 127.9 227.7 21.3 58 227 Banaskentha (B) 269.5 368.0 704.0 137.5 228.1 365.6 34.4 72 217 Rajkot (R) 45.5 77.5 143.0 14.9 41.2 56.1 5.3 19 63 Junagadh (J) 52.0 26.5 280.5 13.2 56.0 69.2 6.5 30 93 Bhavanagar (H) 70.5 32.5 70.8 17.5 27.8 45.3 4.2 20 40 1,031.9, 988.4 2,022.7 375.4 691.6 1.067.0 100.0 267 1.025 1/ Construction type: NC = New Construction RC = Reconstruction top. = Improvement 2/ Without contingencies. with land acquisition costs. Source: Roads & Buildings Departments GOG I- -67- Table 3.3 INDIA CUJARAT RURAL ROADS PROJECT Procurement of Equipment Unit Total Total Price Cost Cost Quantity -Rs '000 - US$ 000 List A - ICB Items 1. Pneumatic tyred roLlers 10 1,000 10,000 2. Vibrating rollers 20 1,500 30,000 3. Stone-erushing plants 5 3,000 15,000 Subtotal: Rs 55,000 $4,231 List B - LCB Items I. Bulldozers with rippers (140 hp) 4 1,800 7,200 2. Front end loaders 7 1,000 7,000 3. Craders 120 HP 7 1,400 9,800 4. Water tankers 100 250 25,000 5. Tippers 70 250 17,500 6. Trucks 25 250 6,250 7. 8 to 10-ton rollers 40 225 9,000 8. Pick-up vans 15 100 1,500 9. Mobile concrete mixers 10 40 400 10. Concrete vibrators 10 10 100 11. PD supervision vehicles: (a) Saloon cars 18 80 1,440 (b) Jeeps 56 90 5,040 12. Mobile laboratory vehicles 4 400 1,600 13. Paver finishers 5 400 2,000 Subtotal: Rs 93,830 $7,218 List C - Local and International Shopping 1. Double drum pedestrian-controlled rollers 20 150 3,000 2. Bitumen distributors 20 140 2,800 3. Field service units 7 500 3,500 4. Miscellaneous safety equipment - - 220 5. Field laboratory equipment - - 900 6. Survey and drawing office equipment - - 750 Subtotal: Rs 11,170 $ 859 Crand Total: Rs 160,000 $12,308 a/ ai ExcLuding contingencies and price changes (since 1984) of US$5 million equivalent Source: Roads & Buildings Department, Government of Gujarat, COI November 1984 -68- Table 3.4 INDIA CUJARAT RURAL ROADS PROJECT Training Program Course Duration Numbers Days Attended By At Engineering Staff College, Candhinagar Project Management for Senior Staff 1 x 25 1 Superintending and Executive Engineers (EEs) Introduction to MOST Specifications 3 x 40 9 Deputy EEs and Junior Engineers Contractors' Staff Rural Road Survey and Design 2 x 30 9 Survey & Design Staff Contract Management Project Monitoring 2 x 20 5 EE's & DEE's 4 x 40 9 Junior Engineers and Accounting Staff Contract Management 2 x 40 3 Contractors' Staff At Gujarat Engineering Research Institute, Baroda Katerials Testing and Quality Control 4 x 25 9 Quality Control Engineers and Technicians At Mechanical Training School, Odhav New Equipment Familiarization Course As required Mechanical Engineers Refresher Course 2 x 20 5 Mechanics Refresher Course 10 x 40 5 Operators 1/ Number of times course wilL be given x number of students per course. Source: COG June 1985 GUJAMAT RURAL ROADS PRCJEC! Detailed Coat Table Save Colts Totals Including Coatingencia -------------------------- (Rupees Million) ------------------------- ------ - -(Rupes Nillioa) Unit 87/88 88/89 89/90 90/91 91/92 22LL3 93/94 94/95 Total 67/a8 88/,8 89/90 90/91 91/92 92/93 21L.2 W2n Total I. IwzsmlIENT COSTS A. Civil Works New COMS 20.3 60.8 60.8 60.8 60.8 60.8 60.8 20.3 405.4 23.9 75.8 80.3 65.3 90.0 95.5 99.2 34.4 585.2 Improvement 23.4 70.3 70.3 70.3 70.3 70.3 70.3 23.4 46a.
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India - Gujarat Rural Roads Project
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