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World Bank Document Document of The World Bank Public Disclosure Authorized Report No: 24004-IN PROJECT APPRAISAL DOCUMENT ONA PROPOSED LOAN Public Disclosure Authorized IN TEHE AMOUNT OF US$ 463.0 MILLION AND A CREDIT IN THE AMOUNT OF SDR62.5 M]LLION (US$79.0 MILLION EQUIVALENT) TO INDIA FOR THE MUMBIAI URBAN TRANSPORT PROJECT Public Disclosure Authorized May 21, 2002 Energy and Infrastructure Sector Unit India Country Management Unit South Asia Region Public Disclosure Authorized CURRENCY EQUIVALENTS (Exchange Rate Effective April 30, 2002.) Currency Unit = Indian Rupee (INR) 1 INR = US$0.020 US$1 = INR 48.00 FISCAL YEAR April I -- March 31 ABBREVIATIONS AND ACRONYMS BEST Brihan Mumbai Electric Supply and Transport Company MCGM Municipal Corporation Greater Mumbai CEMP Community Environment Management Plan CR Central Railway Zone of India Railways CTS Comprehensive Transport Study (1994, PHRD funded) FMR Financial Monitoring Report FOP Financial and Operating Plan, MCGM GOM Government of Maharashtra HLRC High Level Review Committee HDFC Housing Development Finance Corporation HPSC High Powered Steering Committee IMP Independent Monitoring Panel IR Indian Railways, Ministry of Railways MCGM Municipal Corporation of Greater Mumbai MMR Mumbai Metropolitan Region MMIRDA Mumbai Metropolitan Regional Development Authority MRVC Mumbai Railway Vikas Coorporation Limited MSRDC Maharashtra State Road Development Corporation MUTP Mumbai Urban Transport Project MOU Memorandum of Understanding NGO Non-Governmental Organization NSDF National Slum Dwellers Federation PAP Project Affected Persons PAH Project Affected Household PCC Project Coordinating Committee PMR Project Monitoring Report PMU Project Management Unit at MMRDA RAP Resettlement Action Plan RIP Resettlement Implementation Plan R&R Resettlement and Rehabilitation SPARC Society for Promotion of Area Resource Centre TMU Traffic Management Unit, MCGM WR Western Railway Zone of Indian Railways Vice President: Mieko Nishimizu Country Director: Edwin R. Lim Sector Director: Vincent J. Gouarne Task Team Leaders: A. K. Swaminathan and Edward Dotson INDIA MUMBAI URBAN TRANSPORT PROJECT CONTENTS A. Project Development Objective Page 1. Project development objective 3 2. Key performance indicators 3 B. Strategic Context 1. Sector-related Country Assistance Strategy (CAS) goal supported by the project 3 2. Main sector issues and Government strategy 3 3. Sector issues to be addressed by the project and strategic choices 6 C. Project Description Summary 1. Project components 10 2. Key policy and institutional reforms supported by the project 11 3. Benefits and target population 12 4. Institutional and implementation arrangements 13 D. Project Rationale 1. Project alternatives considered and reasons for rejection 15 2. Major related projects financed by the Bank and other development agencies 17 3. Lessons learned and reflected in the project design 18 4. Indications of borrower commitment and ownership 19 5. Value added of Bank suppolt in this project 20 E. Summnary Project Analysis 1. Economic 21 2. Financial 22 3. Technical 23 4. Institutional 24 5. Environmental 25 6. Social 29 7. Safeguard Policies 31 F. Sustainability and Risks 1. Sustainability 32 2. Critical risks 32 3. Possible controversial aspects 34 G. Main Conditions 1. Effectiveness Condition 34 2. Other 34 H. Readiness for Implementation 35 I. Compliance with Bank Policies 36 Annexes Annex 1: Project Design Summary 37 Annex 2: Detailed Project Description 41 Annex 3: Estimated Project Costs 50 Annex 4: Cost Benefit Analysis Summary, or Cost-Effectiveness Analysis Summary 51 Annex 5: Financial Summary for Revenue-Earning Project Entities, or Financial Summary 57 Annex 6: Procurement and Disbursement Arrangements 58 Annex 7: Project Processing Schedule 74 Annex 8: Documents in the Project File 76 Annex 9: Statement of Loans and Credits 77 Annex 10: Country at a Glance 81 Annex 11: Assessment of the Financial Capacity of MCGM and BEST 83 Annex 12: Environmental Assessment 88 Annex 13: Resettlement and Indigenous Peoples 96 MAP(S) IBRD 31931 Rail and Road Components IBRD 31949 Resettlement Component INDIA Mumbai Urban Transport Project Project Appraisal Document South Asia Regional Office SASEI Date: May 21, 2002 Team Leader: A.K. Swaminathan Country Manager/Director: Edwin Lim Sector Director: Vincent J. Gouarne Project ID: P050668 Sector(s): TU - Urban Transport Lending Instrument: Specific Investnent Loan (SIL) Theme(s): Transport Poverty Targeted Intervention: N Project Financing Data [X] Loan [XpCredit [ ] Grant [ ] Guarantee [ ] Other: For Loans/Credits/Others: Amount (US$m): US$542.Om (Loan US$463.0m/Credit SDR 62.5m) Borrower Rationale for Choice of L.oan Terms Available on File: 1 Yes Proposed Terms (IBRD): Variable-Spread Currency Loan (VSL) Grace period (years): 5 Years to maturity: 20 Commitment fee: 0.75% Front end fee (FEF) on Bank loan: 1.00% Proposed Terms (IDA): Standard Credit Grace period (years): 10 Years to maturity: 35 Commitment fee: Standard Service charge: 0.75% Financing Plan (US$m): Source Local Foreign Total BORROWER 397.00 6.00 403.00 IBRD 139.62 323.38 463.00 IDA 75.20 3.80 79.00 Total: 611.82 333.18 945.00 Borrower: GOVERNMENT OF INDIA Responsible agency: MUMBAI METROPOLITAN REGION DEVELOPMENT AUTHORITY MMRDA Address: Bandra-Kurla Complex, Bandra (E), Mumbai - 400051. Contact Person: Mr. U. P. S. Madan, Project Director, MUTP. Tel: 91-22-6591235 Fax: 91-22-6591264 Email: [email protected] Other Agency(ies): Mumbai Railway Vikas Corporation Limited Address: 2nd Floor, Churchgate Station Building, Mumbai - 400020. Contact Person: Mr A. K. Varma, M:anaging Director Tel: 91-22-2080015 Fax: 91-22-2096972 Email: [email protected] Municipal Corporation of Greater Mumbai and Brihan Mumbai Electric Supply and Transport Undertaking Address: MCGM: Mahapalika Marg, Fort, Mumbai - 400020. BEST: Parivahan Bhavan, Mumbai - 400001 Contact Person: MCGM: Mr Gautam Chatterjee, Additional Municipal Comrnissioner BEST: Mr Rahul Asthana, General Manager Tel: MCGM: 91-22-2620149 & BEST: 91-22-2856262 Fax: 91-22-2626437/91-22-2851244 Email: TBA Estimated Disbursements ( Bank FY/US$m): FY 2003 2004 2005 2006 2007 2008 Annual 50.00 85.00 95.00 105.00 120.00 87.00 Cumulative 50.00 135.00 230.00 335.00 455.00 542.00 Project implementation period: 5 years Expected effectiveness date: 10/31/2002 Expected closing date: 06/30/2008 Om PAD -2 - A. Project Development Objective 1. Project development objective: (see Annex 1) To facilitate urban economic growth and improve quality of life by fostering the development. of an efficient and sustainable urban iransport system including effective institutions to meet the needs of the users in the Mumbai Metropolitan Region (MMR). 2. Key performance indicators: (see Annex 1) The achievement of the project development objective would be measured through the ability of the project to (i) meet user needs; (ii) iunprive system efficiency; (iii) bring about sustainable improvements; and (iv) make institutions more effective. The key performance indicators for these project-specific objectives are listed below. More details are provided in Annex 1. (i) rail travel comfort ,substantially improved; incidence and severity of pedestrian traffic accidents reduced; (ii) suburban rail service frequency and train availability enhanced; road journey times and junction delays reduced; (iii) improvement in public transport cost recovery; poor households resettled satisfactorily from hazardous slum/squatter areas to permanent housing with improved living condition; and (iv) increased technical capacity for planning, traffic management, road safety, road maintenance, air quality monitorng and vehicle emission control. B. Strategic Context 1. Sector-related Country Assistance Strategy (CAS) goal supported by the project: (see Annex I) Document number: 21852-IN Date of latest CAS discussion: April 5, 2001 The CAS identified infrastructure bottlenecks as one of the major constraints to faster poverty reduction. Designed to be the first of a series of programmatic interventions, this project attempts to help MMR start a process of inmproving urban transport conditions in an environmentally and financially sustainable manner by supporting urgently needed physical investment and strengthening the institutional capacities required for this process. The project supports the important CAS goals by: (a) reducing transport bottlenecks; and (b) improving the performance of the public sector in urban transport. Through resettlement of a large number of poor households from hazardous squatter areas to permanent housing with adequate access to jobs and social services, the project is expected to directly improve the living condition for these households and contribute to urban poverty reduction. Resettlement would also reduce accident fatalities and injuries to squatters and commuters. 2. Main sector issues and Government strategy: The main sector issues facing urban transport in India and the Government Strategy are discussed in Background Paper No.6 to the Bank's Paper "Challenges for India's Transport Sector". The main national issues are summarized below. Urbanization: India's populalion is fast urbanizing. The urban population is expected to grow from the current level of 300 million to 410 million by 2010. The role of cities in the national economy is - 3 - increasingly important, as the share of urban GDP over national total has grown from 50 percent in the early 1990s to 60 percent in 2000. However, urban growth is also accompanied
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