Maharashtra Rural Connectivity Improvement Project (RRP IND 52328) Project Administration Manual Project Number: 52328-001 Loan Number: LXXXX July 2019 India: Maharashtra Rural Connectivity Improvement Project ABBREVIATIONS ADB – Asian Development Bank CAG – Comptroller and Auditor General EFP – environmental focal person EMoP – environmental monitoring plan EMP – environmental management plan GAP – gender action plan GRC – grievance redress committee GRM – grievance redress mechanism IEE – initial environmental examination MMGSY – Mukhya Mantri Gram Sadak Yojana (Chief Minister’s Rural Road Scheme) MRRDA – Maharashtra Rural Road Development Association km – kilometer PAM – project administration manual PISC – project implementation support consultant PIU – project implementation unit PMGSY – Pradhan Mantri Gram Sadak Yojana (Prime Minister’s Rural Road Development Program) PMU – project management unit RDD – Rural Development Department SBD – standard bidding document SDDG – Social Safeguard Due Diligence Guideline SDDR – Social Safeguard Due Diligence Report SOE – statement of expenditure SPS – Safeguard Policy Statement CONTENTS I. PROJECT DESCRIPTION 1 II. IMPLEMENTATION PLANS 5 A. Project Readiness Activities 5 B. Overall Project Implementation Plan 6 III. PROJECT MANAGEMENT ARRANGEMENTS 7 A. Project Implementation Organizations: Roles and Responsibilities 7 B. Key Persons Involved in Implementation 8 C. Project Organization Structure 9 IV. COSTS AND FINANCING 12 A. Cost Estimates Preparation and Revisions 12 B. Key Assumptions 12 C. Detailed Cost Estimates by Expenditure Category 13 D. Allocation and Withdrawal of Loan Proceeds 14 E. Detailed Cost Estimates by Financier 14 F. Detailed Cost Estimates by Outputs 15 G. Detailed Cost Estimates by Year 16 H. Contract Award and Disbursement S-Curve 17 I. Fund Flow Diagram 18 V. FINANCIAL MANAGEMENT 19 A. Financial Management Assessment (FMA) 19 B. Disbursement 22 C. Accounting 23 D. Auditing and Public Disclosure 24 VI. PROCUREMENT AND CONSULTING SERVICES 26 A. Procurement Capacity Assessment of MRRDA 26 B. Advance Contracting and Retroactive Financing 26 C. Procurement of Goods, Works and Consulting Services 27 D. Procurement Plan 29 E. Consultant's Terms of Reference 29 VII. SAFEGUARDS 30 A. Environment Safeguard 30 B. Road Safety 33 C. Social Safeguards: Involuntary Resettlement and Indigenous Peoples 34 D. Grievance Redress Mechanism 36 VIII. GENDER AND SOCIAL DIMENSIONS 38 IX. PERFORMANCE MONITORING, EVALUATION, REPORTING, AND COMMUNICATION 44 A. Project Design and Monitoring Framework 44 B. Monitoring 46 C. Evaluation 47 D. Reporting 47 E. Stakeholder Communication Strategy 47 X. ANTICORRUPTION POLICY 49 XI. ACCOUNTABILITY MECHANISM 49 XII. RECORD OF CHANGES TO THE PROJECT ADMINISTRATION MANUAL 49 List of Attachments Attachment A Procurement Plan Attachment B Summary Reporting Form on Technical Bid Evaluation Attachment C Summary Reporting Form on Financial Bid Evaluation Attachment D Sample Summary Sheet of Bid Evaluation and Contract Award Attachment E Certified Summary Sheet Reporting on the Main Aspects of the Bid Evaluation and Contract Award Attachment F Terms of Reference for Consulting Services of Project Implementation Support Consultant (PISC) Attachment G Terms of Reference for Technical Assistance for Institutional Strengthening of the Maharashtra Rural Road Sector for Sustainable Development Attachment H Gender Action Plan Progress Report Attachment I Maharashtra RCIP Road List Attachment J Financial Management Manual Project Administration Manual Purpose and Process 1. The project administration manual (PAM) describes the essential administrative and management requirements to implement the project on time, within budget, and in accordance with the policies and procedures of the government and Asian Development Bank (ADB). The PAM should include references to all available templates and instructions either through linkages to relevant URLs or directly incorporated in the PAM. 2. The Maharashtra Rural Road Development Association (MRRDA) is wholly responsible for the implementation of the ADB-financed project, as agreed jointly between the borrower and ADB, and in accordance with the policies and procedures of the government and ADB. ADB staff is responsible for supporting implementation including compliance by MRRDA of their obligations and responsibilities for project implementation in accordance with ADB’s policies and procedures. 3. At loan negotiations, the borrower and ADB shall agree to the PAM and ensure consistency with the loan agreement. Such agreement shall be reflected in the minutes of the loan negotiations. In the event of any discrepancy or contradiction between the PAM and the loan agreement, the provisions of the loan agreement shall prevail. 4. After ADB Board approval of the project's report and recommendation of the President (RRP), changes in implementation arrangements are subject to agreement and approval pursuant to relevant government and ADB administrative procedures (including the Project Administration Instructions) and upon such approval, they will be subsequently incorporated in the PAM. I. PROJECT DESCRIPTION 1. Maharashtra economy. Maharashtra is India’s leading state in terms of its contribution to the national economy. In FY2017 the state accounted for 14.8% of India’s national gross domestic product.1 Driven by robust growth in financial and other services and manufacturing, Maharashtra’s economy has been growing steadily. The state’s gross domestic product averaged 7.4% growth per year from 2012 to 2017. However, economic development is concentrated around the urban centers of Mumbai, Pune and Thane. Mumbai alone accounts for 20% of the gross district value added,2 while 4 of the state’s 34 districts generate 52% of the gross district value added. Similarly, the state’s human development index shows imbalances across districts, with 27 of the 34 districts recording below-average values. Consequently, income inequality in Maharashtra is one of the highest among all states in India. Despite the state’s impressive and sustained economic growth, about 20 million people, or 17% of the state’s population, still live below the national poverty line.3 Poverty is pronounced in rural areas, where on average about 24% of the population lives below the poverty line (in some districts the figure is as high as 40%). 2. Agriculture in Maharashtra is in distress. Agriculture accounts for about 47% of employment, engages as much as 79% of the rural labor force, and contributes about 11% of Maharashtra’s gross state domestic product. However, agriculture’s contribution to gross state domestic product is in decline, and recorded negative annual growth during four of the past seven years4. Crop losses are a persistent problem, caused mainly by climate variability, and limited access to infrastructure (for processing and storage) and marketing facilities.5 Smallholders, who make up 60% of all landholders in the state, are particularly vulnerable. Continuous crop losses result in high farmer indebtedness and higher suicide rates.6 Women are particularly disempowered in at least two main areas: access to resources, and representation and leadership in groups.7 Improving rural road infrastructure can help overcome these setbacks and address the causes of persistent poverty and inequality among remote rural communities. 3. Overview of the road subsector. Maharashtra has an extensive network of roads consisting of national and state highways and other district roads and village roads. More than 80% of passengers and 60% of freight traffic use roads as the dominant mode of transportation. Rural roads, which comprise “other district roads” and “village roads,” make up 67% of the state’s road network. About 55% of these rural roads are unsealed making them unsuitable for motorized traffic and impassable during the rainy season.8 Many rural community members, including 1 State Government of Maharashtra, Planning Department, Directorate of Economics and Statistics. March 2018. Economic Survey of Maharashtra, 2017–2018. Mumbai. 2 Gross value added is the value of output less the value of intermediate consumption; it is a measure of the contribution to GDP made by an individual producer, industry or sector. Organisation for Economic Co-operation and Development. 2001. OECD.Stat Glossary of Statistical Terms. 3 Government of India, Planning Commission. June 2014. Report of the Expert Group to Review the Methodology for Measurement of Poverty. Delhi. 4 State Government of Maharashtra, Planning Department. 2018. Economic Survey of Maharashtra 2017–2018. Mumbai. ,perception of drought impacts ׳P. Udmale, Y. Ichikawa, S. Manandhar, H. Ishidaira, and A. Kiem. 2014. Farmers 5 local adaptation and administrative mitigation measures in Maharashtra State, India. International Journal of Disaster Risk Reduction. 10 (Part A). pp. 250−269. 6 V. Arya et al. 2018. Trends and Socio-Economic Determinants of Suicide in India: 2001–2013. Social Psychiatry and Psychiatric Epidemiology. 53 (3). pp. 269–278. 7 S. Gupta, P. Pingali, and P. Pinstrup-Andersen. 2017. Women’s Empowerment in Indian Agriculture: Does Market Orientation of Farming Systems Matter? Food Security. 9 (6). pp. 1,447–1,463. 8 Government of Maharashtra. Rural Development Department. November 2018. Policy on Maintenance of Rural Roads. Mumbai. 2 women, children, and seniors, rely on these roads to access health care and educational facilities. Road safety is also a growing concern; in 2017, Maharashtra