Completion Report
Project Number: 34569 Loan Number: 2062-TAJ August 2010
Tajikistan: Dushanbe–Kyrgyz Border Road Rehabilitation Project (Phase 1)
CURRENCY EQUIVALENTS
Currency Unit – Tajik somoni (TJS)
At Appraisal At Project Completion 15 November 2003 31 December 2009 TJS1.00 = $0.3274 $0.22988 $1.00 = TJS3.0544 TJS4.3500
ABBREVIATIONS
ADB – Asian Development Bank CAREC – Central Asia Regional Economic Cooperation EIRR – economic internal rate of return GDP – gross domestic product ICB – international competitive bidding M&E – monitoring and evaluation MOTC – Ministry of Transport and Communication NCB – national competitive bidding OFID – OPEC Fund for International Development OPEC – Organization of the Petroleum Exporting Countries PIU – project implementation unit PRC – People’s Republic of China TA – technical assistance VOC – vehicle operating cost
NOTES
(i) The fiscal year (FY) of the government ends on 31 December. (ii) In this report, "$" refers to US dollars.
Vice-President X. Zhao, Operations 1 Director General J. Miranda, Central and West Asia Department (CWRD) Director H. Wang, Transport and Communications Division, CWRD
Team leader F. Nuriddinov, Project Implementation Officer, CWRD Team members L. Chernova, Assistant Project Analyst, CWRD N. Kvanchiany, Senior Project Assistant, CWRD
In preparing any country program or strategy, financing any project, or by making any designation of or reference to a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.
CONTENTS
Page BASIC DATA MAP OF PROJECT LOCATION
I. PROJECT DESCRIPTION 1
II. EVALUATION OF DESIGN AND IMPLEMENTATION 2 A. Relevance of Design and Formulation 2 B. Project Outputs 3 C. Project Costs 5 D. Disbursements 5 E. Project Schedule 6 F. Implementation Arrangements 6 G. Conditions and Covenants 7 H. Related Technical Assistance 7 I. Consultant Recruitment and Procurement 8 J. Performance of Consultants, Contractors, and Suppliers 9 K. Performance of the Borrower and the Executing Agency 9 L. Performance of the Asian Development Bank 9
III. EVALUATION OF PERFORMANCE 10 A. Relevance 10 B. Effectiveness in Achieving Outcome 11 C. Efficiency in Achieving Outcome and Outputs 12 D. Preliminary Assessment of Sustainability 12 E. Environmental, Sociocultural, and Other Impacts 13
IV. OVERALL ASSESSMENT AND RECOMMENDATIONS 14 A. Overall Assessment 14 B. Lessons 14 C. Recommendations 15
APPENDIXES 1. Project Framework 2. Summary of Socioeconomic Impact Assessment 3. List of Road Maintenance Equipment Purchased under the Project 4. Project Costs and Financing Plan 5. Annual Disbursements 6. Comparison of Appraisal and Actual Project Implementation Schedule 7. Chronology of Major Events 8. Organization Chart 9. Status of Compliance with Loan Covenants 10. Technical Assistance Completion Report 11. Summary of Project Packages 12. Summary of Road Subsector in Tajikistan 13. Traffic Analysis and Revised Forecast 14. Economic Reevaluation
BASIC DATA
A. Loan Identification
1. Country Tajikistan 2. Loan Number 2062-TAJ(SF) 3. Project Title Dushanbe–Kyrgyz Border Road Rehabilitation Project (Phase 1) 4. Borrower Tajikistan 5. Executing Agency Ministry of Transport and Communication 6. Amount of Loan SDR10,476,000 7. Project Completion Report Number PCR:TAJ 1172
B. Loan Data
1. Appraisal – Date Started 7 June 2003 – Date Completed 16 June 2003
2. Loan Negotiations – Date Started 12 November 2003 – Date Completed 14 November 2003
3. Date of Board Approval 18 December 2003
4. Date of Loan Agreement 5 March 2004
5. Date of Loan Effectiveness – In Loan Agreement 3 June 2004 – Actual 15 April 2004 – Number of Extensions 0
6. Closing Date – In Loan Agreement 31 December 2008 – Actual 31 December 2008 – Number of Extensions 0
7. Terms of Loan – Interest Rate 1.0% per year during grace period and 1.5% per year thereafter – Maturity 32 years – Grace Period 8 years
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8. Disbursements a. Dates Initial Disbursement Final Disbursement Time Interval
19 January 2005 21 April 2009 51 months
Effective Date Original Closing Date Time Interval
15 April 2004 31 December 2008 57 months
b. Amount (SDR million) Last Category or Subloan Original Revised Amount Undisbursed Allocation Allocation Disbursed Balancea C/W Dushanbe–Kyrgyz Border Road 7,811,273 7,811,273 7,385,989 425,284 C/W Rural Roads 779,727 779,727 660,073 119,654 Equipment 687,349 687,349 687,187 162 Consulting Service 988,651 988,651 972,564 16,087 IDC 209,000 209,000 169,188 39,812 Contingency 0 0 0 0 Total 10,476,000 10,476,000 9,875,001 600,999 C/W = Civil Works. IDC = interest during construction, SDR = special drawing rights. a The undisbursed loan amount of SDR600,999 was canceled on 21 April 2009.
9. Local Costs (Financed) – Amount ($ million) 1.72 – Percent of Local Costs 59.93% – Percent of Total Cost 7.38%
C. Project Data
1. Project Cost ($ million) Cost Appraisal Estimate Actual
Foreign Exchange Cost 16.8 20.43 Local Currency Cost 6.8 2.87 Total 23.6 23.30
2. Financing Plan ($ million) Cost Appraisal Estimate Actual Implementation Costs Borrower Financed 2.6 2.42 ADB Financed 15.0 14.90 OPEC Fund 6.0 5.98 Total 23.6 23.30 IDC Costs Borrower Financed 0.3 0.00 ADB Financed 0.3 0.26 OPEC Fund 0.0 0.00 Total 0.6 0.26 ADB = Asian Development Bank, IDC = interest during construction, OPEC = Organization of the Petroleum Exporting Countries.
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3. Cost Breakdown by Project Component ($ million) Component Appraisal Estimate Actual A. Base Cost 1. Civil Works a. Dushanbe–Darband Road 15.2 18.91 b. Rural Roads 2.0 1.46 2. Maintenance Equipment 1.0 0.99 3. Consulting Services 1.6 1.68 B. Contingencies 1. Physical Contingency 2.0 0.00 2. Price Contingency 1.2 0.00 C. Interest During Construction 0.6 0.26 Total (A+B+C) 23.6 23.30
4. Project Schedule Item Appraisal Actual Estimate Date of Contract with Consultants September 2004 24 December 2004 Completion of Engineering Designs September 2003 Civil Works Contract for Dushanbe–Kyrgyz Border Road Date of Award September 2004 20 January 2005 Completion of Work December 2007 24 September 2008 Civil Works Contract for Rural Roads Date of Award 14 October 2006 Completion of Work 29 August 2008 Equipment and Supplies March 2005 Dates First Procurement January 2006 Last Procurement August 2006 Completion of Equipment Installation September 2005 August 2006 Start of Operations Completion of Tests and Commissioning December 2007 31 December 2008 Beginning of Start-up January 2008 1 January 2009
5. Project Performance Report Ratings Ratings Development Implementation Objectives Progress Implementation Period From 18 Dec 2003 to 17 Oct 2009 Satisfactory Highly Satisfactory
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D. Data on Asian Development Bank Missions No. of No. of Specialization Name of Mission Date Persons Person-Days of Membersa
Fact-Finding 11/02/2003– 5 30 d,t,I,c,b 21/02/2003
Appraisal 07/06/2003– 4 30 d,t,h,g 16/06/2003
Inception 09/06/2004– 2 12 t,g 14/06/2004
Review 1 29/11/2004– 2 6 t, 01/12/2004
Review 2 20/06/2005– 2 8 t,g 23/06/2005
Review 3 05/06/2006–
Midterm Reviewb 21/08/2006– 2 12 d,g 26/08/2006
Review 4 07/02/2008– 14/02/2008
Review 5c 17/11/2008– 5 30 d,I,g,j,k 26/11/2008
Project Completion Review d 17/09/2009– 4 30 a,b,d,f,k 31/12/2009 a a - engineer, b - financial analyst, c - counsel, d - economist, e - procurement consultant or specialist, f - control officer, g - project officer, h - poverty reduction specialist, l - environmental specialist, j - resettlement specialist, k - project analyst, t - transport specialist. b The mission was mainly for the midterm review of the project, and also for fact-finding for technical assistance for the transport sector masterplan. c The mission was the midterm review mission for the Dushanbe–Kyrgyz Border Road Rehabilitation Project (Phase 2) but the mission also had discussions with the executing agency on several issues regarding other projects. d The mission comprised the Project Implementation Officer, Senior Project Assistant, Assistant Project Analyst from the Central and West Asia Department, and transport economist / staff consultant.
I. PROJECT DESCRIPTION
1. The Dushanbe–Kyrgyz Border Road Rehabilitation Project (Phase 1) 1 aimed to rehabilitate part of the Central Asia Regional Economic Cooperation (CAREC) corridors 3 and 5 and Tajikistan’s key national and international transport corridor that provides the primary link between Dushanbe and the Rasht Valley to the northeast and, during winter, between the northern Sugd region and the rest of Tajikistan. Heavy fighting during Tajikistan’s civil war in the mid-1990s took place in the project area, which has a poverty incidence of 91%. By improving transport facilities in the area, the project supported the realization of the full potential of numerous agriculture and other poverty alleviation projects being implemented in the project area by other international organizations. The project facilitated national development and regional cooperation by rehabilitating the corridor connecting Afghanistan and Tajikistan to the People’s Republic of China (PRC) and other countries in the region. The project also aimed to address the national problem of road maintenance by increasing financing for maintenance of national roads and developing a maintenance system for rural roads. Finally, the project supported the strategy of the government and the Asian Development Bank (ADB) to rehabilitate infrastructure and develop international transport corridors.
2. The main objectives of the project were to reduce poverty by reducing the cost of road transport and improving access to markets, and to increase regional trade and cooperation by rehabilitating the road linking Dushanbe to Nurobod (Darband) in the Rasht Valley and on to the Kyrgyz Republic and the PRC. The project would (i) reduce transport costs on the Dushanbe– Kyrgyz border road; (ii) provide agricultural and industrial enterprises with all-weather access to markets within the country, and eventually abroad; (iii) improve access of the rural poor population to market opportunities, other economic activities, and social services by improving rural roads; and (iv) strengthen the government’s institutional capacities for efficient management of the national road network. The project would also generate employment in construction activities for local residents.
3. At appraisal, the project comprised (i) improvement of about 140 kilometers (km) of the mostly two-lane highway from Dushanbe to Nurobod, through a combination of rehabilitation of the Km 22–95 section, minor rehabilitation of the Km 95–150 section, and minor works on the Km 9–22 section; (ii) improvement of 77 km of rural roads in the project area; (iii) consulting services for construction supervision, monitoring and evaluation, and implementation of measures to improve road safety, auditing, and project management; and (iv) procurement of equipment for maintenance of the improved road sections.
4. An advisory technical assistance (TA) grant was provided in association with the project to strengthen implementation of road maintenance, improve road sector performance, and mobilize a sustainable level of financing for road maintenance in Tajikistan.2
1 ADB. 2003. Report and Recommendation of the President to the Board of Directors on a Proposed Loan and Technical Assistance Grant to the Republic of Tajikistan for the Dushanbe–Kyrgyz Border Road Rehabilitation Project (Phase 1). Manila (Loan 2062–TAJ, for $15,000,000, approved on 18 December). 2 ADB. 2003. Technical Assistance for Strengthening Implementation of Road Maintenance. Manila (TA 4294–TAJ, for $600,000, approved on 18 December).
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II. EVALUATION OF DESIGN AND IMPLEMENTATION
A. Relevance of Design and Formulation
5. Guided by the first country strategy and program for 2004–2008 and its updates, ADB assistance to Tajikistan was extended to help improve economic situation, reduce poverty, and rehabilitate infrastructure in the country. As of the end of 2008, Tajikistan had received $372.54 million in loans, $33.89 million in TA, and $100.77 million in grants from ADB. Promoting regional cooperation through improving transport and energy infrastructure remains a priority of ADB assistance. These interventions are also in line with the country’s poverty reduction and national development strategies.
6. Tajikistan’s road subsector is the most important mode of transport and dominates the domestic transport of goods and passengers. To support the recovery and development of the road subsector, ADB’s transport portfolio consists of the Post-Conflict Infrastructure Program3 ($20 million loan, completed) that supported reforms in the transport and power sectors; the Dushanbe–Kurgan–Tyub–Dangara–Kulyab road rehabilitation project (completed); 4 the Dushanbe–Kyrgyz Border Road Rehabilitation Project (Phase 1, completed) and two ongoing projects for phases 2 and 3 (a total of $97.9 million loan and grant);5 and a number of TA and grant projects funded by the Japan Fund for Poverty Reduction. The project rehabilitated the 140 km road from Dushanbe to Nurobod, which is part of the key international transport corridor connecting Dushanbe with the Kyrgyz Republic and the PRC. In addition, 77 km of rural roads were rehabilitated to help reduce poverty in the project area. To strengthen road maintenance and improve road sector performance, advisory technical assistance was also included in the project. The design and formulation of the project conformed to ADB’s country strategy and the government’s development objectives, and were generally suited to the existing situation in Tajikistan. The project framework is in Appendix 1.
7. However, the initial design/ feasibility study work was inadequate due to lack of attention to engineering considerations and lack of involvement of senior ministry staff, which led to substantial changes in engineering scope during implementation (see para. 8). The inadequate project design may also have brought serious risks to the sustainability of the transport corridor development.
3 ADB. 1998. Post-Conflict Infrastructure Program: Tajikistan. 4 ADB. 2000. Report and Recommendation of the President to the Board of Directors on a Proposed Loan and Technical Assistance Grant to the Republic of Tajikistan for the Road Rehabilitation Project. Manila (Loan 1819– TAJ for $20,000,000, approved on 20 December). 5 ADB. 2005. Report and Recommendation of the President to the Board of Directors on a Proposed Loan and Asian Development Fund Grant to the Republic of Tajikistan for the Dushanbe–Kyrgyz Border Road Rehabilitation Project (Phase 2). Manila (Loan 2196–TAJ for $29,500,000, approved on 17 November); ADB, 2007. Report and Recommendation of the President to the Board of Directors on a Proposed Loan, Asian Development Fund Grants, and Technical Assistance Grant to Kyrgyz Republic and Republic of Tajikistan: CAREC Regional Road Corridor Improvement Project. Manila (Loan 2359–TAJ(SF) for $40,900,000, approved on 24 October); and ADB. 2009. Report and Recommendation of the President to the Board of Directors on a Proposed Supplementary Asian Development Fund Grant to the Republic of Tajikistan for the Dushanbe–Kyrgyz Border Road Rehabilitation Project (Phase 2). Manila (Grant 0154–TAJ for $20,000,000, approved on 24 July).
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B. Project Outputs
1. Civil Works
a. Dushanbe–Nurobod Road
8. At appraisal, the project was to cover about 140 km of the transport corridor from Dushanbe to the Kyrgyz border. At completion, four sections of the corridor had been rehabilitated: (i) 74 km of two-lane category 3 road (Km 22–95) with asphalt overlay for 40 km and reconstruction for 34 km; (ii) minor rehabilitation of 45 km (Km 95–140) with simple asphalt surface restoration for some sections and gravel sheeting and patching for some sections; (iii) minor rehabilitation of 1.348 km (Km 20.000–21.348), restoring the geometric profile of existing road through Vakhdat town; and (iv) construction of a new 7.5 km emergency bypass at Km 110–112 of the road. The major revisions to the civil work during implementation were as follows:
(i) Addition of an emergency bypass road at Km 110–112. During project implementation, a major landslip occurred at Km 109–110 on 26–27 June 2005. As requested, a team of national and international geotechnical experts made a detailed examination and identified a significant level of cracking and instability in the road slopes. The government requested a reallocation of loan proceeds to construct an emergency bypass road around the landslide area. ADB approved the government’s request in September 2005 through a minor change in project scope by reallocating the loan of $300,000 (57% of the total cost for the bypass road) to construct a 7.5 km bypass road. (ii) Maintenance of road at Km 20.000–21.220. At appraisal, it was anticipated that there would be minor works on the Km 9–22 section, comprising routine maintenance activity only. During implementation, a section of the road was selected to be rehabilitated. At completion, about 1.2 km of the road was rehabilitated, restoring the geometric profile of the existing road through Vakhdat town. A total of $240,000 was allocated to this work. (iii) Substantial revision of the engineering scope, mainly on (i) cutting of old asphalt, (ii) adding about 20% of asphalt surface quantity, (iii) doubling the quantity of retaining walls, (iv) doubling the drainage quantity, and (v) expanding efforts and quantity of bridge enforcement. However, such revisions were generally within the original budget.
9. Civil works on the main road started on 20 January 2004 and were completed on 31 December 2008. Quality control of construction was carried out by the contractors as the contracts required. The consultants inspected and assessed the works to ensure that the specifications had been met. The project completion review mission observed that the rehabilitated roads were of good quality; the road surface roughness was within international roughness index for a comfortable ride (for the rehabilitated sections); the drainage system, slope protection, and safety facilities were built and installed as designed; four new bridges were built and nine bridges were rehabilitated; and an emergency bypass road was constructed. The mission also found that routine maintenance of the project road was in place, but some sections of the main road (Km 22–95) were sinking due to unstable geological conditions, and that the Km 95–140 section would need rehabilitation soon.
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b. Rural Roads
10. The project included rehabilitating 77 km of rural roads, which were selected based on geographic location, poverty and social considerations, economic and traffic criteria, sustainability, and cooperation. The rural roads selected were 9.3 km in Vakhdat, 42.6 km in Fayzobod, and 25.1 km in Rogun. Upon completion, 77.73 km of rural roads were rehabilitated (Appendix 2). The key rehabilitation works were bridge replacement, road pavement, retaining walls, landslide treatment, drainage, and minor realignment.
11. Three contracts (contract 06a, 06b, and 06c) were procured through local competitive bidding in September–December 2006, and the works were completed in the middle of 2008. The project completion review mission visited several selected rural roads rehabilitated under the project and noticed the fair quality of the rehabilitated rural roads and the significantly improved transport conditions of the villages in the project area.
2. Equipment
12. The contract for the procurement of road maintenance equipment was awarded on 20 September 2005 to Zeppelin International and Lonestar Corporation. All equipment was delivered to Tajikistan and distributed before August 2006. The equipment purchased under the project was mainly for road maintenance and consisted of four backhoe loaders, one wheeled excavator, two front-end loaders, and two motor graders. At the time of the project completion review mission, all of the equipment had been deployed to the road maintenance units along the project road. The review mission investigated some of the equipment installed at road maintenance units and found it to be in good condition. The road maintenance equipment procured, including unit cost, is listed in Appendix 3.
3. Consulting Services
13. At appraisal, international consulting services totaling 44 person-months were to be provided under the project for construction supervision, project impact monitoring and evaluation, and implementation of measures to improve road safety, auditing, and project management. In association with the international consultants, domestic consulting services totaling 300 person-months would also be provided for construction supervision, and contract management, as well as for helping the international consultants to monitor the social and poverty impact of the project through household surveys and data analysis. SMEC International was selected in accordance with ADB’s Guidelines on the Use of Consultants (2002, as amended from time to time).
14. During implementation, the scope of the consulting services was amended to include survey, detailed design, and contract document preparation for the Dushanbe–Kyrgyz Border Road Rehabilitation Project (Phase 2). This led to a rearrangement of expertise required in the team and did not cause an overall increase in the contract value. The consultants worked closely with the project implementation unit (PIU) on the tasks required in the terms of reference. The consultants also helped the PIU prepare the quarterly project progress reports and three independent reports.6 As instructed by ADB, the consulting services were completed by the end of 2008. At project completion, a total of 68.5 person-months of international consulting services and 289 person-months of domestic consultant services had been provided.
6 Draft Completion Report for International Contracts (December 2008), Draft Completion Report for Local Contracts (December 2008), and Project Benefit and Monitoring Analysis Report (October 2008).
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C. Project Costs
15. The project cost at completion was $23.30 million, $0.30 million (1.3%) lower than the $23.60 million estimated at appraisal. This comprised $20.43 million in foreign currency (compared with $16.8 million at appraisal), and $2.87 million equivalent in local currency (versus $6.80 million at appraisal). The actual cost of civil works was $20.36 million, against $17.2 million (excluding physical and price contingencies) at appraisal. The higher cost for civil works was mainly caused by changes in project scope, adding an emergency bypass road, and price escalation of construction material during project implementation. Price adjustment became a major issue during implementation, as price escalation reached 77% in March 2008. However, the total cost was well controlled within the original budget. Appendix 4 compares in detail the project cost totals at appraisal and at completion.
16. Under the financing plan envisaged at appraisal, ADB was to provide a loan of $15 million (73.6% of the total project cost) to finance 85.7% of the foreign exchange costs and 8.8% of the local costs. The remaining costs were to be financed by the government and the Organization of the Petroleum Exporting Countries (OPEC) Fund for International Development (OFID). At completion, the ADB loan amounted to $14.90 million, which covered 64.5% of the foreign currency costs ($13.18 million) and 59.87% of the local currency costs ($1.72 million). The government financed $2.43 million (10.4%) of the project cost and OFID financed $5.97 million (25.6%). The share of financing from various sources was almost unchanged. The appraisal and actual financing plans are in Appendix 4.
D. Disbursements
17. The disbursement of the ADB loan started in 2005 and peaked in 2007. By the time of loan closure, SDR9,875,001 ($14,899,210 equivalent) had been disbursed from the ADB loan (Appendix 5). The first disbursement of the ADB loan was made on 19 January 2005. MOTC requested several times to extend the loan closing date, but it was deemed not to be justified by ADB and was finally rejected by the ADB mission in November 2008.7 Consequently, the ADB loan was closed as originally scheduled on 31 December 2008. However, ADB granted a grace period of 3 months after the loan closing date to cover the expenses incurred up to 31 December 2008. The last disbursement was made on 21 April 2009 and the undisbursed amount of SDR600,999 ($896,558.27 equivalent) was cancelled in November 2009.
18. The OFID loan of $6.00 million was administered by ADB. The loan agreement was signed on 2 September 2004 and became effective on 11 October 2004, while the letter of administration between ADB and OFID was signed on 22 October 2004. The original closing date for the OFID loan was 30 June 2007, but it was extended to 31 December 2008 and subsequently to 30 June 2009 to complete disbursements The first withdrawal of the OFID loan was in 2005 and the last one was in 2009, with an accumulated total of $5,977,610. Due to a shortfall of funds for the OFID-financed component, MOTC requested a reallocation of the ADB loan to cover part of the OFID-financed component, but it was deemed not to be justified by ADB. The disbursements were based on the actual progress of implementation, according to the implementation schedule and the contract award and disbursement projections made in January each year.
7 The aide-memoire of the midterm review mission for the Dushanbe–Kyrgyz Border Road Rehabilitation Project (Phase 1), 17–26 November 2008.
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E. Project Schedule
19. It was envisaged at appraisal that the project would be implemented in 3.3 years from September 2004 to December 2007 including mobilization but excluding the defects liability period. The civil work was scheduled to begin in October 2004. The contract for the main civil work (Km 22–95) was signed on 10 November 2004, but the notice to commence work was issued on 20 January 2005. Despite the mobilization delay, progress was satisfactory and the main work was completed on 24 September 2008, followed by a 365-day defect liability period. For the other two sections of the main road, the civil work started in March 2006 and was completed in December 2008. The original completion date for contract 05 (Km 95–140) was 30 September 2007. Given the complexity and amount of work involved in the project, the request to extend it to 30 June 2008 was approved by the executing agency. Approval from ADB for construction of the emergency bypass road was given in September 2005, and it was completed before 31 December 2008. Implementation of the rehabilitation of rural roads started in October 2006 and was completed in the middle of 2008. In general, the civil work started as originally scheduled, but mobilization was slow. About 4 years was spent on the civil works, mainly due to substantial changes in engineering scope and addition of the emergency bypass road.
20. The contract for international consulting service between MOTC and SMEC International was signed on 24 December 2004 with the completion date of 19 March 2009. The team leader arrived on site on 18 January 2005. The international and domestic consultants completed their work before 31 December 2008, consistent with the date of ADB loan closing. The bidding documents for road maintenance equipment were approved by ADB on 3 May 2005 and the contracts were awarded on 20 September 2005. The equipment from Lonestar Corporation was delivered in January 2006 and the equipment from Zeppelin International was delivered in August 2006 according to the schedule in the contracts. The contract for strengthening implementation of road maintenance was signed in March 2006 and the work was completed in January 2008. The TA was implemented in 22 months, about 2 months less than planned at appraisal. The comparison of project schedule at appraisal and actual is set out in Appendix 6. The chronology of major project events is in Appendix 7.
F. Implementation Arrangements
21. MOTC was the executing agency, with responsibility for overall project administration. An updated organization chart of MOTC is in Appendix 8. The PIU, originally established in October 2001 for the ADB-financed Dushanbe–KurganTyube–Dangara–Kulyab road rehabilitation project, continued to be responsible for project management and implementation. In the PIU, the executive director was supported by a group of professional and support staff with expertise and experience in financial accounting, road engineering, contract management, and land acquisition and resettlement. As requested in the report and recommendation of the president, four technical persons were recruited to enhance the management capability of the project. At the time of the project completion review mission, there were about 30 staff members working in the PIU. Currently, the PIU has implemented, or is implementing, about 10 road projects, including phases 2 and 3 of the ADB-financed Dushanbe–Kyrgyz Border Road Rehabilitation Project.
22. For strengthening project supervision and management, an international consulting firm in association with a large number of national consultants was recruited. The international consultants were primarily responsible for construction supervision and assisting the PIU in preparing project progress reports and implementing monitoring and evaluation programs. Such a project implementation arrangement—comprising MOTC, the PIU, the consultants, and the
7 contractors—ensured satisfactory implementation of the project and the achievement of the outputs and outcomes designed.
G. Conditions and Covenants
23. The government generally complied with most of the loan covenants. The status of compliance with key loan covenants is summarized in Appendix 9.
24. The Loan Agreement required that the government rehabilitate the project roads in accordance with the technical specifications of the design and ensure a safe road network in the project area (paragraphs 5 and 6 of Schedule 6). During implementation, MOTC, PIU, and the consultants established and applied a sound mechanism to ensure that the project roads were of good quality, and included civil work design for installing all road safety signs, warning signs, line marking, traffic signs, and road pavement markings, which are in accordance with current safety design requirements of the country.
25. The Loan Agreement required that, under the project, adequate measures to protect the environment be implemented and regular inspections carried out (paragraphs 7 and 12 of Schedule 6). MOTC included in the civil work contracts a mandatory requirement for environment protection. The contractors conducted monthly monitoring of air, water, soil, and noise at key locations and reported the results monthly against the baseline survey conducted in June 2005. A final environmental monitoring report was prepared and issued in October 2008; it indicated that no serious environment impacts occurred during project implementation.
26. Three monitoring and evaluation surveys were conducted by MOTC and the consultants during project implementation. The survey results showed that all of the social impact requirements in the Loan Agreement (paragraphs 9–11 of Schedule 6) were complied with, including limiting the rehabilitation work within the existing right of way and encouraging contractors to use local labor. As estimated in the survey reports, about 9,000 person-months of local labor, including 7,000 person-month of unskilled labor (with a substantial number of women), were utilized during project implementation.
27. The Loan Agreement required that the borrower provide all counterpart funds and resources necessary for rehabilitation, operation and maintenance, and management of the project roads on a timely basis (paragraph 4 of Schedule 6). Upon completion, the government had provided total counterpart funds of $2.43 million for the project. The PIU told the project completion review mission that all required counterpart funding for the project were received on time. A separate financial account for the project was opened on 1 December 2004. Audit reports for financial year (FY) 2005, FY2006, and FY2007 were prepared and submitted to ADB. The audited special financial statement for FY2008, with the management letter, was submitted to ADB on 1 July 2009.
H. Related Technical Assistance
28. In conjunction with the project, advisory TA was designed and implemented with $600,000 equivalent from a grant financed by ADB’s Technical Assistance Special Fund and $106,000 from the government. The TA was intended to develop a strategy and system of maintenance for national and secondary roads, including a system of community-based maintenance for rural roads. The TA would require approximately 20 person-months of international consulting services and 60 person-months of domestic consulting services. It was planned that the TA would be implemented in 24 months.
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29. This advisory TA was approved by ADB on 18 December 2003. A contract was awarded to International Consultants and Technocrates on 13 March 2006. The first consultant was fielded on 14 May 2006 with a short delay. At completion in January 2008, the consultants had provided 25.37 person-months of international services and 28.90 person-months of domestic consulting services. The scope of the TA was revised before signing of the contract to avoid duplication of activities with an ongoing ADB TA project,8 and to focus on the national road network in Tajikistan in terms of its maintenance needs and establishing priorities for a planned maintenance strategy. As agreed to by the government, the terms of reference were revised to include (i) developing a strategy and program for road maintenance, (ii) modifying the road maintenance manual for national roads, and (iii) training MOTC road maintenance personnel.
30. According to the TA completion report (Appendix 10), the advisory TA achieved its intended purpose by providing a basis for MOTC and the government to plan road maintenance activities and financing within a more efficient and better defined framework. Furthermore, additional training and computer facilities provided under the technical assistance supported the newly implemented highway information system. The TA was rated successful.
I. Consultant Recruitment and Procurement
31. All procurement financed under the ADB loan conformed to ADB’s Procurement Guidelines (1999, as amended from time to time). Contracts valued at more than $500,000 were procured through international competitive bidding (ICB). All project packages, with contract values, are listed in Appendix 11. ADB approved advance procurement action for civil works packages and consulting services on 14 May 2003.
32. The recruitment of the supervision consultants using quality and cost-based selection was delayed by about 3 months from what was planned at appraisal. An agreement for international consulting services was initialized on 24 December 2004 with a completion date of 19 March 2009. The original scope was amended to include survey, detailed design, and contract document preparation for the Dushanbe–Kyrgyz Border Road Rehabilitation Project (Phase 2). However, the scope changes only required rearranging experts within the team without an overall increase in the contract value. An external auditing firm from the Kyrgyz Republic, Marka Audit Bishkek,9 was also procured through ICB to undertake financial auditing of the project account.
33. The civil works for rehabilitating the main road were packaged into three contracts—one international contract and two local contracts. The international contract was awarded through ICB. The local contracts were awarded through national competitive bidding (NCB) to two domestic firms from the Gupsad and Nurobod regions. After approval from ADB in September 2005, during implementation an emergency bypass road was added and the contract was awarded to the Gayur Company through NCB. Other than a small delay, there were no serious problems in the procurement for civil works of the main road. The three contracts for rural road rehabilitation were also awarded through NCB and no problem occurred during procurement. The procurement for maintenance equipment was implemented smoothly and the required equipment was delivered accordingly.
8 ADB. 2005. Technical Assistance to Tajikistan for the Community–Based Road Maintenance Project. Manila (TA 9078-TAJ for $1,800,000, approved on 4 November, financed by the Japan Fund for Poverty Reduction). 9 Marka Audit Bishkek was also the external auditing firm for the first ADB-financed road project in Tajikistan.
9
J. Performance of Consultants, Contractors, and Suppliers
34. The supervision consultant, SMEC International, completed all the services required in the original terms of reference, and additional services required through the variation orders cleared by ADB. Overall, MOTC rated the performance of the supervision consultant satisfactory. SMEC, with assistance from the domestic consultants, also conducted three monitoring and evaluation surveys in 2005, 2006, and 2008 according to the project performance management system designed at appraisal. Corresponding reports were prepared and submitted to ADB. It was found that the surveys were adequate and the reports were comprehensive. The external auditor implemented all the auditing of the project’s financial statements (including for FY2008) in accordance with International Public Sector Accounting Standards and ADB requirements. The project completion review mission rated the performance of the consultants satisfactory.
35. The performance of Sinohydro Corporation, the international contractor for the main road rehabilitation (Km 22–95), was rated satisfactory by MOTC and the supervision consultant in respect of the quality of the completed works and, in general, the capacity to carry out works of the size and complexity required for the project. The take-over certificate to the international contractor was issued on 24 December 2008. However, MOTC and the supervision consultants complained that the contractor was slow in mobilizing equipment and establishing crusher sites. Despite several warnings from the engineer, the contractor remained slow and, as a result, no asphalt or pavement works were completed in 2005. Due to failure of the contractor to meet contract milestones, MOTC applied for liquidated damages of $2,080,997.30 from the contractor. All the domestic contractors performed satisfactorily. During implementation, the domestic contractors gained substantial work experience.
36. The performance of the equipment suppliers was satisfactory. The equipment was delivered and installed on time, and no serious conflict or problem happened during the procurement process.
K. Performance of the Borrower and the Executing Agency
37. The performance of MOTC, as the executing agency, was satisfactory. Considering that the project was the second project of such a magnitude implemented by MOTC, MOTC and the PIU performed creditably. MOTC provided required counterpart funds and all necessary support in a timely manner. The PIU was fully staffed, proactive, and speedy in resolving implementation issues, including recruiting new staff and revising engineering components according to real needs. The PIU, with assistance from the consultants, prepared all quarterly project progress reports. For the project completion review, the PIU assisted in arranging meetings and site visit, and provided substantial data as required.
L. Performance of the Asian Development Bank
38. The administration and supervision of the project was originally done from ADB headquarters, but was transferred to the Tajikistan Resident Mission on 8 August 2008. During implementation, ADB conducted five review missions including the midterm review mission in 2006. The missions visited the project site and had meetings with MOTC, the PIU, other relevant government agencies, and the consultants. The role performed by the ADB missions in providing advice on technical issues, the preparation and evaluation of bid documents, and loan administration was well recognized by MOTC.
10
39. However, ADB project officer for the project was replaced several times and the transfer of project administration to the Tajikistan Resident Mission was at the late stage of project implementation, which caused discontinuity of project administration. It seems that no ADB review mission was fielded for the project in 2007. Despite these weaknesses, the overall performance of ADB was rated satisfactory.
III. EVALUATION OF PERFORMANCE
A. Relevance
40. The project was highly relevant to the government’s development strategy and ADB’s country assistance strategy as well as its objectives at appraisal.
41. ADB’s long-term strategy is to pursue its vision and mission by focusing on three strategic agendas: inclusive growth, environmentally sustainable growth, and regional integration.10 Developing infrastructure is one of ADB’s five core areas of operations. In the recent country partnership strategy for Tajikistan, the first support area is “support for broad- based economic growth – by increasing productivity in agriculture, realizing export potential in energy, improving connectivity in transport, and strengthening other physical infrastructure required to enable growth”.11 The government’s strategy for the road subsector is to rehabilitate and maintain road infrastructure and develop an efficient road transport industry. The road subsector is the most important component of domestic transport in Tajikistan. Currently, there are eight international corridors connecting the country with the neighboring countries of Afghanistan, the Kyrgyz Republic, PRC, and Uzbekistan. Most of the main roads in Tajikistan were built before 1970. These roads were inadequately maintained, and experienced damage from civil conflict and natural disasters. At the beginning of the project, about 80% of the national road network was in poor (or worse) condition. The deteriorated state of the road network severely affected international traffic and regional development (Appendix 12). The project road, located in the northeast of Tajikistan, is part of CAREC corridors 3 and 5, which connects the country with the Kyrgyz Republic and the PRC. The improvements made on the project road have considerably improved transport corridor conditions. They have brought, and will continue to bring, enormous benefits to international trade and regional development. Along with the socioeconomic development in the country, the total foreign trade value increased from $1.46 billion in 2002 to $4.02 billion in 2007. International road freight traffic, including transit traffic, has also increased sharply.
42. The project road is one section of the international transport corridor connecting the nation’s capital of Dushanbe to the Kyrgyz border through the Rasht Valley, and eventually to SaryTash in the Kyrgyz Republic and the PRC. The project section traverses three rayons (districts—Vakhdat, Fayzobod, and Rogun) with 390,700 inhabitants (as of 2008), most of whom live within 10 km of the road. Of these people, 70% live in the rural area, where poverty is severe. The rehabilitation of the project road and associated rural roads has significantly improved transport conditions in the project area and promoted local socioeconomic development. The outcomes have proved the close relevance of the project to ADB’s long-term strategy and the government’s development objectives.
10 ADB. 2008. Strategy 2020: The Long-Term Strategic Framework of the Asian Development Bank 2008–2020. Manila. 11 ADB. 2010. Country Partnership Strategy: Tajikistan, 2010–2014, Manila.
11
B. Effectiveness in Achieving Outcome
43. The project was effective in achieving its purposes. Most of the objectives stated in the project framework were achieved through the designed activities (Appendix 1). The main objectives and purpose of the project were to (i) reduce poverty and promote sustainable economic growth in the project area, (ii) increase regional trade and cooperation, and (iii) improve transport efficiency through reduced transport costs and improved access to markets and social services for people in the project area.
44. The project rehabilitated 140 km of the main road and 77.7 km of rural roads, which had a large impact on socioeconomic development in the project area. 12 The monitoring and evaluation surveys show that there was a substantial increase in traffic (about 20% per annum on average) on the project road, especially in 2007–2008. On the rehabilitated Km 22–95 section, cars now travel at an average speed of 60–80 km per hour (km/h), compared with 30–40 km/h on the unrehabilitated Km 95–140 section.13 Private car ownership and transport services have grown rapidly. For the Fayzobod–Vakhdat and Rogun–Fayzobod sections, there were 32 minibuses serving local transport (14.2 buses per hour) in 2008, compared with 26 buses (10 buses per hour) in 2005. More households (24% in Fayzobod, 47% in Vakhdat, and 59% in Rogun) sold their products in market. Many centers and small villages intend to have a weekly market. Due to road improvements, local residents traveled further to markets to sell their products at higher prices. About 22 new roadside businesses were opened in the project area in 2007–2008—eight general shops in Vakhdat, seven general shops and a bank in Fayzobod, and six general shops in Rogun. According to the surveys, the total input of local staff and workers to the project was about 9,000 person-months, including about 7,000 person-months of unskilled labor. The average monthly salary for unskilled laborers was about TJS200–TJS400. As a result, the average income in the project area significantly increased to TJS218.85 per person per month in Vakhdat in 2008, TJS230.50 in Fayzobod, and TJS261.70 in Rogun.14 The poverty incidence was reduced from 82% to 37% in Vakhdat, from 85% to 35% in Fayzobod, and from 83% to 42% in Rogun during 2002–2008. About 86.7% of the households interviewed during the survey considered that their living conditions had improved, and 89.9% of them considered that the project contributed to the improvement of their life. The full impact of the project will become more evident as time goes on.
45. The advisory TA for strengthening implementation of road maintenance achieved its intended purpose by providing a basis for MOTC and the government to plan road maintenance activities and financing within a more efficient and better defined framework. Furthermore, the TA’s additional training and computer facilities supported the development of the highway information system.
12 The project was completed in 2008, but was opened to traffic by sections from 2006. 13 Maintenance work only was undertaken on the Km 95–140 section under the project, because the section will be submerged with the planned dam construction. As a result, the road surface remains in poor condition. ADB is financing upgrading of an emergency bypass road under the supplementary project. ADB. 2009. Report and Recommendation of the President to the Board of Directors on a Proposed Supplementary Asian Development Fund Grant to Republic of Tajikistan for the Dushanbe–Kyrgyz Border Road Rehabilitation Project (Phase 2). Manila (Grant 0154–TAJ for $20,000,000, approved on 24 July). 14 This was about 6.4 times the 2002 figure for Vakhdat, 8.4 times the figure for Fayzobod, and 3.4 times the figure for Rogun.
12
C. Efficiency in Achieving Outcome and Outputs
46. The following analysis shows that the project was highly efficient in achieving its outputs and purposes.
47. The monitoring and evaluation surveys in 2005, 2006, and 2008 showed that there was substantial increase in traffic (about an average of 20% per year), especially in 2007–2008. The average traffic volume was about three times that estimated at appraisal, reaching 6,464 vehicles per day in 2008 (about 2,222 vehicles were predicted at appraisal). The average increase in traffic was about 14% per year in 2005–2008, much higher than 6% estimated at appraisal. Of the total traffic, the induced traffic was at least 30%–40%. The survey results and traffic analysis also indicated major changes in vehicle distribution: (i) a large increase in the share of cars, pick-ups, and small buses, from 59% to 79% for cars and from 3% to 13% for pick-ups and small buses in 2002–2008; and (ii) a dramatic reduction in the share of large buses and trucks. Such changes were mainly caused by privatization of passenger transport enterprises and services and restructuring of industry and agriculture production. The project completion review mission observed that the average vehicle speed was about 60–80 km/h on the rehabilitated Km 22–95 section. The mission also noted that the traveling time from Dushanbe to Fayzobod decreased to about 40 minutes compared with 1.5 hours before the project. However, the survey did not show a sharp increase in international traffic, possibly because other sections of the corridor remain under rehabilitation. As a general rule, long- distance traffic shows a sharp increase after the whole corridor is improved. On the basis of the traffic analysis and consultation with the local design institute, a revised traffic forecast was made for the project road (Appendix 13). The direct economic benefits of the project were be mainly (i) reduced vehicle operating costs (VOCs) due to higher speed and less damage to vehicles during operation, and (ii) reduced passenger travel time due to less time spent on the project road.
48. The project completion review mission reevaluated the economic internal rate of return (EIRR), using similar methodology adopted at appraisal and updated data. For accuracy, the recalculation was done only for the main rehabilitated road (Km 22–95). The project completion review mission held discussion with the local design institute on the transport forecast and economic evaluation. As a result, the recalculated EIRR was 20.9%, much higher than 15.8% at appraisal, reflecting much higher traffic levels on the project road. The recalculated EIRRs for the base case and all testing cases were much higher than the ADB-recommended EIRR cutoff rate (12%). (Appendix 14 presents the economic reevaluation.) Because the project road is not a toll road and has no revenue provision, no financial reevaluation was made.
D. Preliminary Assessment of Sustainability
49. In general, the project is deemed to be sustainable to meet the needs of traffic development and socioeconomic development in the project area. However, follow-up actions and investment should be in place to keep the project sustainable.
50. The level of traffic on the project road and corridor has shown, and will continue to show, significant increase, mainly because of socioeconomic development in the project area and an increase in trade between Tajikistan and the PRC. Economic development in Tajikistan has been high in the last few years. The gross domestic product (GDP) growth rate for the country was 7.9% in 200815. High economic development needs support from transport infrastructure,
15 ADB. 2009. Asian Development Outlook 2009 (Tajikistan, Central Asia)
13 and also generates large traffic volumes. Trade with the PRC increased 10-fold during 2006– 2009. Freight from and to the PRC currently goes along several routes,16 but the project corridor provides the shortest route (about 800 km to Kashgar), which is much shorter than the southern route). When rehabilitation of the entire corridor is complete, most of the international traffic between Tajikistan and the PRC will use the project road.
51. However, several issues concerning sustainability should be considered in future development:
(i) The project road should be adequately maintained to keep it in good condition. (ii) Some locations (Km 30, Km 59–64, Km 86, and Km 87) have started to sink dramatically due to unstable geological conditions; this needs urgent rehabilitation. (iii) Rehabilitation of the Km 95–140 section is being financed by an ADB grant, which needs to be completed as soon as possible to complete rehabilitation of the whole corridor. (iv) Development of local transport services should be promoted to better distribute the benefits of the project to local residents, particularly the poor, and support socioeconomic development in the project area. (v) Countries along the transport corridor need to work together to promote regional trade and use road infrastructure efficiently.
E. Environmental, Sociocultural, and Other Impacts
52. The majority of rehabilitation works is on the existing alignment, and consequently caused minimal environmental damage. However, environmental mitigation measures identified at the project feasibility stage were incorporated in the bid and contract documents. Close attention was paid to scour and landslip areas to control run-off water and prevent erosion. During implementation, the supervision consultants were responsible for ensuring that the contractors complied with these mitigation measures. The consultants, in cooperation with the contractors, produced monthly environmental reports. The final environmental monitoring report issued in October 2008 showed that there were no severe environment impacts during implementation. The project had no resettlement effects, mainly because it was implemented within the existing alignment and required no land acquisition. No indigenous people issues were encountered during implementation.
53. The project road and associated rural roads rehabilitated have had a significant impact on socioeconomic development in the project area. Apart from improving transport conditions, the project led to a dramatic increase in the income of local inhabitants by stimulating economic activities in the project area. The project has (i) generated employment opportunities for both men and women during and after implementation, (ii) improved access to health and education facilities by shortening travel time and promoting an increase in car ownership, (iii) given local farmers and businesses easier access to markets where they can get better prices for their products, and (iv) encouraged the growth of businesses along the project roads. However, unemployment in the project area remains high, especially in 2009 due to the impact of the global financial crisis. Efforts need to be made to widen the project’s reach, particularly among the poor, and promote local business development and increase job opportunities. Better public transport should be developed to provide the low-income population with more reliable transport
16 Currently, the main transport corridors between Tajikistan and the PRC are (i) through Irkistam (on the PRC– Kyrgyz border), (ii) through the Kulma pass in southern Tajikistan, and (iii) through the Alaaw Shan pass (on the PRC–Kazakhstan border).
14 services at reasonable costs. Overall, the project’s impact on the socioeconomic development of the country has been significant.
IV. OVERALL ASSESSMENT AND RECOMMENDATIONS
A. Overall Assessment
54. The project realized its main objectives of increasing incomes by reducing transport costs, providing all-weather roads for transit and local traffic, improving access roads to rural poor populations for obtaining social services, and strengthening the government’s institutional capacity in maintaining national roads. The rapid socioeconomic development in the project area, increased traffic on the project road, and the project’s remarkable social impact, particularly on the poor, proved that the project impact, outcome, and outputs anticipated at appraisal were achieved. The recalculated EIRR was higher than estimated at appraisal. Overall, the project was rated highly successful.
55. However, the project was implemented more slowly than planned at appraisal. In addition, the project road is facing challenges to its sustainability. Due to inadequate engineering design at appraisal, substantial engineering scope changes occurred during implementation. After 2–3 years of operation, some locations started deteriorating due to unstable geological conditions. Although there was minor work on the Km 95–140 section, the road remains in bad condition and it has became a bottleneck for the whole international transport corridor—serious rehabilitation is urgently required. Public transport services should be developed to ease the volume of traffic on the main road, and provide low-cost and more reliable transport services to the local people, especially the poor.
B. Lessons
56. The technical assistance for preparing the project was inadequate. Project preparatory TA was designed and implemented similarly for all countries in terms of budget, scope, and expertise. However, Tajikistan needs more technical support from ADB, especially in engineering aspects. Due to inadequate engineering survey and design, as well as little involvement of government officials, numerous changes in quantity and methodology were required during implementation. ADB should provide suitable technical assistance according to need (which will differ from country from country) and select suitable consultants.
57. The project was the second ADB-financed road project in Tajikistan. Therefore, MOTC and the PIU need to be familiarized with ADB’s policies and procedures. However, the familiarization effort was inadequate. ADB should continue to train MOTC on its policies and procedures and PIU staff for existing and future projects. In addition, frequent changes in ADB project officers caused discontinuity in project administration. The transfer of project administration from ADB headquarters to the Tajikistan Resident Mission occurred almost at the end of the project (2008), and this made it difficult for the resident mission to take over. Transfer of the project at a late stage of implementation should be carefully considered. Frequent replacement of ADB project officers should be avoided.
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C. Recommendations
1. Project Related
58. Future monitoring. According to the project assurances, MOTC would collect the data agreed upon with ADB at the project commencement, at project completion, 1 year after project completion, and 3 years after project completion. The supervision consultants conducted the monitoring and evaluation activities in 2005, 2006, and 2008. MOTC should conduct another survey 3 years after project completion (scheduled for 2011); by then the full benefits of the project will be apparent. The next monitoring and evaluation activity should also cover an analysis of general socioeconomic development in the project area.
59. Further action or follow-up. Some parts of the project road are showing signs of damage due to unstable geological conditions and are deteriorating. This may cause closure of the project road or the whole transport corridor during adverse weather. To ensure sustainable operation, action should be taken to rehabilitate these sections and strengthen slope protection and improve drainage.
60. Timing of the project performance evaluation report. The project performance evaluation report may be prepared in 2011 or later. By that time the project will have been fully operational for more than 2 years, and rehabilitation of the whole corridor will be complete. Consequently, traffic and maintenance levels, physical condition, benefits attained, and the impact on poverty can be better assessed.
2. General
61. Considering the special situation of the country, ADB should increase project preparatory TA to enable detailed engineering survey and design to be carried out, and also consider a longer development time. Project preparation and initial work should also involve as many senior ministry staff as possible, as well as traffic police and related inspection agencies. Considering the rapid escalation in the cost of construction materials in the country, the price contingency in the project cost estimation should be well planned at appraisal.
62. Providing adequate training on ADB policies and guidelines is essential to the success of projects. Training programs, including overseas and domestic training, should be designed and implemented in future ADB projects. Due to the limited domestic capacity in road design and construction, supervision, and project management, some road projects (including this one), received inadequate domestic expert support. Future ADB assistance needs to foster domestic capacity for road subsector development.
16 Appendix 1
PROJECT FRAMEWORK Design Performance Monitoring Assumptions Results Summary Indicators/Targets Mechanisms And Risks A. Goal 1. Reduce poverty Increased per capita Economic statistics at Political and economic Average monthly income per and promote income regional, district, and stability in the region capita in 2008 was sustainable township levels TJS218.85 in Vakhdat, economic growth in Decreased rate of Continued TJS230.50 in Fayzobod, and the project area unemployment to Periodic household implementation of TJS261.70 in Rogun average level of surveys, government complementary respectively, which were Rayons of Republican statistical data development projects greatly increased from 2002. Subordination by nongovernment (excluding Dushanbe) Surveys, government organizations and Poverty incidence reduced to statistical data other agencies in the 36.6% in Vakhdat, 34.7% in Reduced poverty rate project area Fayzobod, and 41.7% in in the project area from Periodic household Rogun in 2008. present 91% to national surveys Continued government average support for poverty More households (24.1% in Analysis of reduction and Vakhdat, 47.0% in Increase of 10% in employment data development Fayzobod, and 59.1% in prices received for submitted by Rogun) intend to sell their agriculture products contractors (gender- Increased availability products in market. produced in the project disaggregated data on of transport services area person-months of following improvement Total input of local staff and local residents of roads, stable prices workers was about 9,000 Employment of local employed and wages person-months, including residents in civil works paid) Encouragement of use about 7,000 person-months and other project of local subcontractors of unskilled labor. The activities Survey, government average monthly salary was statistical data about TJS200–TJS400 for unskilled laborers.
It was estimated that international traffic would 2. Increase regional Increase in Implementation of increase by about 15% per trade and international traffic on other planned road year in 2009–2010 and 9% cooperation Dushanbe–Nurobod rehabilitation projects per year 2011–2015. (Darband) road from in the region 2012 B. Purpose Improve transport Reduction of vehicle Surveys of vehicle Rehabilitation work It was estimated that VOCs efficiency through operating costs by 5%– operators and owners, completed to adequate would be reduced by about reduced transport 10% measurement of road standard 6%–9% for different types of costs to road users roughness and other vehicles. and improved access Reduction of freight measures by Provision of adequate to markets and social and passenger tariffs supervision maintenance of the Public transport fares services for people in by 5%–10% consultants and project road in increased by 2–3 times the project area project accordance with during 2005–2008, which Increase freight and implementation units recommendations was mainly caused by passenger flows for inflation. trucks by 6.5%, buses Traffic counts and Increased availability by 4.6%, and cars by origin–destination of transport services Substantial increase in 6.3% during 2003– surveys following improvement traffic, especially in 2007– 2012, and by 4.0% for of roads; stable prices 2008 (about 20% per year), trucks, 3.5% for buses, Project administration higher than anticipated at and 4.7% for cars for missions, midterm appraisal. Revised traffic the remainder of the review, project forecast shows that traffic project period completion report increase would be 11% per
Appendix 1 17
Design Performance Monitoring Assumptions Results Summary Indicators/Targets Mechanisms And Risks year in 2009–2010 and 9% Improved availability of Increase frequency of per year in 2011–2015. transport services in public transport the project area services by 20% For public transport on the project road in 2008, there Decrease in time Periodic household were 32 buses (14.2 buses required to travel to surveys per hour), compared with 26 markets, schools, and buses (10 buses per hour) in hospitals 2005.
On the rehabilitated section, cars travel at an average speed of 60–80 km/h, compared with 30–40 km/h on the unrehabilitated section.
C. Components / Outputs 1. Civil Works: Reduced roughness of Surveys of road Timely provision of At completion (i) (i) Improvement of roads; repair of conditions, project cofinancing and rehabilitation of 74 km with Km 9–150 of landslides and erosion administration counterpart funds from asphalt overlay for 40 km Dushanbe– damage missions, midterm the government and reconstruction for 34 km; Nurobod road review, project (ii) minor rehabilitation of 45 completion report km of road with asphalt surface restoration for some sections and gravel sheeting and patching for some sections; (iii) minor rehabilitation of 1.35 km of road with restoration of geometric profile of existing road through Vakhdat town; and (iv) construction of an 7.5 km emergency bypass at Km 110–112.
(ii) Improvement of Reduced roughness of TA review missions Provision of sufficient 77.74 km of rural roads six groups of rural roads and consultants’ financing for road rehabilitated with bridge roads (77 km) reports maintenance replacement, road pavement, retaining walls, landslide treatment, drainage, and minor realignment.
At completion the TA 2. Institutional Implementation of Successful cooperation consultants provided 25.37 Strengthening: advisory technical among government, person-months of Improvement of assistance (TA) to TA consultants, and international services and maintenance system improve maintenance nongovernment 28.90 person-months of for national and rural of national and rural organizations in the domestic services. roads roads and develop a project area community-based The TA achieved its intended maintenance system purpose by providing a basis for MOTC and the Implementation of pilot government to plan road community-based maintenance activities and
18 Appendix 1
Design Performance Monitoring Assumptions Results Summary Indicators/Targets Mechanisms And Risks maintenance systems financing within a more through TA efficient and better defined framework.
Procurement of All equipment was delivered maintenance and deployed to the road equipment for roads maintenance units along the rehabilitated under the project road. project D. Activities 1. Recruitment of Contract to be awarded Project progress Timely signing of loan An agreement for consultants for in second quarter of reports agreement and international consulting project supervision 2004 achieving loan services was initialized on 24 and monitoring effectiveness December 2004.
2. Procurement of Contracts to be Project progress Effective and efficient The international civil work civil works awarded in third quarter reports review and selection of package was awarded to of 2004 successful bidders Sinohydro Corporation of the PRC through ICB; the local contracts were awarded through NCB to two domestic companies. The contract for the emergency bypass road was added and awarded to Rohcoz-7 through NCB.
3. Procurement of Contract to be awarded Project progress Effective and efficient Procurement of maintenance maintenance in second quarter of reports review and selection of equipment was implemented equipment for project 2005 successful bidders smoothly and the required roads equipment was delivered.
Environmental mitigation 4. Implementation of Mitigation measures as Environmental Existence of adequate measures identified at the necessary identified in the initial monitoring reports institutional capacity project feasibility stage were environmental environmental and project for environmental incorporated in the bid and mitigation measures examination report administration monitoring contract documents. Close memorandum attention was paid to scour and landslip areas to control run-off water and prevent erosion. ICB = international competitive bidding, IDC = interest charges during construction, NCB = national competitive bidding, MOTC = Ministry of Transport and Communication, TA = technical assistance, VOC = vehicle operating cost. Sources: Report and Recommendation of the President, the Project Implementation Unit, and ADB’s project completion review mission.
Appendix 2 19
SUMMARY OF SOCIOECONOMIC IMPACT ASSESSMENT
A. Background
1. The project was located in the middle of Tajikistan and was one section of the key international transport corridor from the country’s capital of Dushanbe to the border with the Kyrgyz Republic. The primary objective of the project was to reduce poverty in the project area and support the strategy of the government and the Asian Development Bank (ADB) to rehabilitate infrastructure in Tajikistan. To maximize the project’s poverty reduction impact, 77 kilometers (km) of rural roads that connect poor villages would be rehabilitated under the project.
2. At appraisal, key poverty and social issues were identified and analyzed for the direct impact area of the project. A preliminary set of indicators for monitoring and evaluating the performance of the project in relation to its goals and purposes,1 with an emphasis on poverty reduction, was agreed upon with the Ministry of Transport and Communication (MOTC). A benefit performance monitoring and evaluation (M&E) program was also designed under the project to measure the impacts and benefits that the project would have on local residents. During project implementation, three M&E surveys were conducted by the consultants (one each in 2005, 2006, and 2008) according to the program design.2The surveys were conducted on households selected at random from lists of households obtained from local governments. In total, 3,145 persons from 360 households were interviewed (same for all three surveys).
3. The survey and analysis results showed that the project has had a significant impact on the socioeconomic development in the project area. The project realized the original objective anticipated at appraisal. However, the surveys were conducted during project implementation. As a general rule, impacts are evident about 1–3 years after project completion. It was stipulated in the Report and Recommendation of the President that another M&E program would be carried out 3 years after project completion, when the project’s full impacts will be analyzed and presented. The following sections are the summary of the survey results and analysis, compared with the baseline survey conducted during project preparation in 2002.
B. Project Area and Rural Roads Rehabilitated under the Project
4. The project went through Vakhdat, Fayzobod, and Rogun rayons (regions), which are the regions under direct republican jurisdiction. This area has little arable land per capita and most of the agricultural land is in hillside fields of marginal land with slopes of up to 60% and subject to significant erosion. Much of the land has been used for subsistence crops since the outbreak of the civil war in the 1990s. During appraisal, the poverty incidence in the project area was estimated at 91%. Approximately 127,000 poor people would be directly affected.
5. It was anticipated at appraisal that 77 km of rural roads would be rehabilitated under the project, and these were selected based on geographic location, poverty and social considerations, economic and traffic criteria, sustainability, and cooperation. The rural roads selected were 9.3 km in Vakhdat, 42.6 km in Fayzobod, and 25.1 in Rogun. Upon completion, 77.73 km of rural roads were rehabilitated. The key rehabilitation works were bridge replacement, road pavement, retain
1 Project performance management system; and ADB. 2003. Report and Recommendation of the President to the Board of Director on a Proposed Loan and Technical Assistance Grant to the Republic of Tajikistan for the Dushanbe–Kyrgyz Border Road Rehabilitation Project (Phase 1). Manila. 2 Project benefit and monitoring analysis reports, 2005, 2006, and 2008, by SMEC International and the Project Implementation Unit of Ministry of Transport and Communication.
20 Appendix 2 walls, landslide treatment, drainage, and minor realignment. The rural roads rehabilitated under the project are shown in Table A2.1, and on the map.
Table A2.1: Rural Roads Rehabilitated under the Project Area Start End Length (km) Vakhdat Rayon 10.66 1 Junction from km 32.0 Jaljit 2.02 2 Jaljit Junction Zulfi Village 3.59 3 Main Road Zulfi Village 1.88 4 Junction Zulfi village Shukuri–Kasamdara 3.17 Fayzobod Rayon 33.13 1 Turn from school at Khaitag village Yackabed–Kalshodi village 3.18 2 Medical Centre road Yakabed village 0.43 3 Junction to school in Khaitag village Yakabed village–Kalshodi 3.50 4 Ustoshames village Mehrobod at Km 39 on main road 2.13 5 Access from km 43 Shakhakien village 1.20 6 Access from km 75 Kabkrez village 1.80 7 Junction from km 48 Old Faizobod village 2.99 8 Kabkrez Old Faizobod village 4.80 9 Old Faizobod village Chukarak village 5.10 10 Junction PK35+70 Old Faizobod village Chukarak village–Surkhadara village 1.80 11 Junction PK49+15 Old Faizobod village Chukarak village–Kalugak village 1.20 12 Access road km 55 Karsang village–Km 56 main road 5.00 Rogun Rayon 33.94 1 Access from km 74 Llok village 2.34 2 Access from km 75 Dashti Mirzo village 1.74 3 Access from km 78 Zarkamar village 2.55 4 Access from km 80 Kulabad village 2.17 5 Access from km 89 Kadiob village 1.25 6 Access off Rogun road Poru village 7.00 7 Access of Rogun road Chormagz village 1.58 8 Access Farukh village 2.41 9 Access from km 51 Sangova village 2.42 10 Access form km 51 Obi Sagbur village 1.50 11 Access form km 68 Mulo Tugma village 1.50 12 Access from km 70 Bungakien village 1.40 13 Access from km 86 Chasmai Kullo village 1.90 14 Access Kali Nav village 0.50 15 Access 1.88 16 Access 1.80 Total 77.73 Source: Project Implementation Unit.
C. General Impact of the Project Roads
6. Traffic development and accidents. In 2005, 2006, and 2008, 24-hour traffic count surveys were conducted. Four survey posts were set up on the main project road to collect cross- sectional traffic counts by six types of vehicle (car, small bus, big bus, light truck, medium truck, and large truck). The survey results showed that there was a substantial increase in traffic, especially in 2007–2008 (about 20% per year). The average traffic volume was much higher than that estimated at appraisal, reaching an average of 6,464 vehicles per day in 2008 (about 2,222 vehicle were projected at appraisal). The average traffic increase rate was about 14% per year in
Appendix 2 21
2005–2008, much higher than 6% estimated at appraisal (Appendix 13). Along with the traffic increase, accidents also increased. Sixteen accidents were recorded on the project road in 2008 resulting in seven deaths, which was much higher than before road rehabilitation.
7. Local product and market development. The project area is largely agricultural, with principal crops of cotton, wheat, potatoes, apples, carrots, onions, and grapes. Part of Rogun is suitable for goats and sheep. According to the 2008 survey, there was a significant increase in the number of households with access to more than 20 sotkas (2,000 square meters) of land, compared with in 2006. There was reduced cotton growing, but increased wheat production due to a steep rise in the price of wheat flour (about double in 12 months). In addition to being self- sufficient, about 24%, of households in Vakhdat, 47% in Fayzobod, and 59% in Rogun sold their products in markets. Many centers and small villages intend to have weekly markets. Due to the road improvement, local residents intend to go further to markets to sell their products at higher prices. It was observed that many local residents, including children, sold their products along the project road.
8. Number of new businesses opened. The 2008 survey showed that about 22 new businesses were opened in the previous 20 months—eight general shops in Vakhdat, seven general shops and a bank in Fayzobod, and six general shops in Rogun. Due to the increase in traffic, there was a sharp increase in roadside businesses. During the site visit the project completion review mission found that, at Km 87 of the main road, there were about 10 restaurants, two stores, one service station, and one paid toilet; more than half of these opened after road rehabilitation. There were about 50 permanent staff working on those roadside services. The mission was also told that a new farm market would be open soon at that location. The project completion review mission also noticed that there were many new roadside services operating or under construction along the project road, including restaurants, service stations, garages, and stores. Also, a lot of nearby villagers were selling their products at informal markets along the project road.
9. Transport services. The M&E surveys conducted during project implementation could not show the full development of public transport services, especially in rural areas. However, privately operated minibus services showed a big increase on the project roads, especially on the Dushanbe–Vakhdat section (138 minibuses per hour in 2008 compared with 50 buses per hour in 2005). For the Fayzobod–Vakhdat and Rogun–Fayzobod sections, there were 32 buses in service and about 14.2 buses per hour in 2008, compared with 26 buses in service and 10 buses per hour in 2005. It was also noticed that villagers provide informal transport services between villages and towns by taking the rural roads. For all sections, services by large buses showed a decline, mainly caused by increased operating costs. Bus fares increased by 2–3 times in the project area between 2005 and 2008, which was mainly caused by inflation. Transport services normally show a significant increase 1–2 years after project completion. The government should encourage public transport services in the project area, especially in the rural area, to provide low-cost and more reliable transport services.
D. Social Impacts of the Project Roads
10. Monthly income. The 2008 survey results showed that the average monthly income per capita was TJS218.85 in Vakhdat, TJS230.50 in Fayzobod, and TJS261.70 in Rogun. These figures were about 6.4 times the 2002 figure for Vakhdat, 8.4 times for Fayzobod, and 3.4 times for Rogun. Despite inflation in the country (about double digit in 2002–2008), monthly incomes in the project area increased significantly. The improved road condition contributed substantially to the increase in income, as accessibility to markets was much better and traveling times were
22 Appendix 2 significantly reduced. A socioeconomic survey estimated that about $31,000 per month was injected into the local economy by the construction of the project roads via salaries, and at least a similar amount was contributed via the purchase of local goods, fuel, and materials.
11. Poverty incidence. At appraisal, the amount of meat eaten per household per week was considered as an indicator for poverty incidence estimation. The survey results showed that there was a significant increase in the frequency of meat eaten in the project area. Using meat eaten three days in a week or less as the poverty line, the poverty incidence during 2002–2008 was reduced from 82% to 37% in Vakhdat, from 85% to 35% in Fayzobod, and from 83% to 42% in Rogun. About 86.7% of the households interviewed responded that their living conditions had improved in the last few years, and 89.9% of them stated that the project contributed to the improvement of their life.
12. Number of local persons employed for the project. As one item in the loan covenants and project assurances, the government was required to ensure that local laborers, including disadvantaged women, were engaged in project works. It was anticipated at appraisal that about 4,400 person-months of unskilled labor would be required for the project civil works. According to the surveys and consultation with the contractors, an average of 247 workers were hired for the project, including 6 contractor staff, 25 support staff, 6 supervisors, 20 operators, 30 skilled workers, 70 unskilled workers, 10 workers employed by engineers, and 80 workers employed by local contractors. These staff and workers were employed from April to December each year. The total input of local staff and workers was about 9,000 person-months, including about 7,000 person-months of unskilled work. The average monthly salary for these unskilled laborers was about TJS200–TJS400.
13. Households with children attending school. Due to improved road conditions and increased incomes, more students used public transport to get to school. The 2008 survey showed that students from about 22.5% of the households used public transport to get to school (mainly higher education), which was much higher than 7.3% in 2005. The percentage of students walking to school (mainly primary and secondary schools) was significantly reduced from 92.3% in 2005 to 75.1% in 2008. The average walking time for students to get to school was less than 30 minutes (about 90% of the students). Public transport was mainly used by the students attending higher education and with travel time of more than 1 hour.
14. Households seeking medical treatment at clinics or hospital. According to the surveys, more households intended to use public transport to access medical services in the project area. The surveys showed that 63.5% of the households used medical assistance at least once in 2008, compared with 57.2% in 2005. Among them, about 61.1% of the households used public transport to access clinic or hospitals in 2008, compared with 25.4% in 2005. The number of household using private vehicles decreased from 74.6% in 2005 to 30.8% in 2008. With the improved road condition and increase in minibus services on the project road, it had become easier for villagers to travel to seek medical assistance.
2 Appe ndix 23
24 Appendix 3
LIST OF ROAD MAINTENANCE EQUIPMENT PURCHASED UNDER THE PROJECT
Contract Equipment Quantity Unit Cost ($) Total Cost ($)
3a Backhoe loader 428E 4 65,000.00 260,000.00 Fuel and spare parts 67,218.12
Wheel excavator 1 138,000.00 138,000.00 Fuel and spare parts 17,602.89 Additional mechanisms 54,660.00
3b Front end loader 2 95,000.00 190,000.00 Fuel and spare parts 38,253.40
Motor grader with front 2 92,500.00 185,000.00 Push blades Fuel and spare parts 39,075.30
Total 989,809.71
Source: Project Implementation Unit.
Appendix 4 25
PROJECT COSTS AND FINANCING PLAN
Table A4.1: Project Costs ($ million)
Apprisal Estimate Actual Item Foreign Local Total Foreign Local Total
A. Base Costs 1. Civil works a. Dushanbe - Darband Road 10.60 4.60 15.20 17.71 1.20 18.91 b. Rural roads 1.40 0.60 2.00 0.00 1.46 1.46 2. Maitenance equipment 1.00 0.00 1.00 0.99 0.00 0.99 3. Consulting services Supervising and monitoring a. 0.90 0.40 1.30 1.44 0.00 1.44 and evaluation b. Auditing services 0.10 0.00 0.10 0.03 0.00 0.03 c. Project management 0.00 0.20 0.20 0.00 0.21 0.21 Subtotal (A) 14.00 5.80 19.80 20.17 2.87 23.04
B. Contingencies 1. Physical contingency 1.40 0.60 2.00 0.00 0.00 0.00 2. Price contingency 0.80 0.40 1.20 0.00 0.00 0.00 Subtotal (B) 2.20 1.00 3.20 0.00 0.00 0.00
C. Interest During Construction 0.60 0.00 0.60 0.26 0.00 0.26
TOTAL includes (A+B+C) 16.80 6.80 23.60 20.43 2.87 23.30 Sources: Report and Recommendation of the President, Asian Development Bank loan financing information system, information from the Ministry of Transport and Communication.
Table A4.2: Financing Plan ($ million)
At Appraisal Actual Source Foreign Local Total % of Foreign Local Total % of Exchange Currency Cost Cost Exchange Currency Cost Cost ADB 14.40 0.60 15.00 63.6 13.18 1.72 14.90 63.9 Government 0.30 2.30 2.60 11.0 1.50 0.93 2.43 10.4 OFID 2.10 3.90 6.00 25.4 5.75 0.22 5.97 25.6 Total 16.80 6.80 23.60 100 20.43 2.87 23.30 100 ADB = Asian Development Bank, OFID = OPEC Fund for International Development. Sources: Report and Recommendation of the President, Asian Development Bank loan financing information system, information from the Ministry of Transport and Communication.
26 Appendix 5
ANNUAL DISBURSEMENTS
Table A5.1: Annual Disbursement of ADB Loan Proceeds
Annual Disbursement Cumulative Disbursement Amount Amount Year ($ million) % of Total ($ million) % of Total 2004 0.00 0.00 0.00 0.00 2005 3.541 23.77 3.541 23.77 2006 2.874 19.29 6.414 43.05 2007 4.206 28.23 10.621 71.28 2008 2.614 17.55 13.235 88.83 2009 1.664 11.17 14.899 100.00 ADB = Asian Development Bank. Source: Asian Development Bank.
Figure A5.1: Actual Annual ADB Loan Disbursement $ million
4.50 4.00 3.50
3.00 2.50 2.00
1.50 1.00 0.50
0.00 2004 2005 2006 2007 2008 2009
Figure A5.2: Cumulative ADB Loan Disbursement
$ m illio n 16.00 14.00 12.00 10.00 8.00 6.00 4.00 2.00 0.00
2004 2005 2006 2007 2008 2009
ADB = Asian Development Bank. Source: Asian Development Bank.
Appendix 5 27
Table A5.2: Annual OFID Disbursement
Annual Disbursement Cumulative Disbursement Amount Amount Year ($ million) % of Total ($ million) % of Total 2004 0.000 0.00 0.000 0.00 2005 1.377 23.03 1.377 23.03 2006 1.112 18.60 2.489 41.64 2007 1.534 25.66 4.023 67.30 2008 1.540 25.76 5.563 93.06 2009 0.415 6.94 5.978 100.00 OFID = OPEC Fund for International Development. Source: Asian Development Bank.
Table A5.3: Annual Disbursement of Counterpart Funds
Annual Disbursement Cumulative Disbursement Amount Amount Year ($ million) % of Total ($ million) % of Total 2004 0.190 3.19 0.190 7.84 2005 0.172 2.87 0.362 14.89 2006 0.628 10.51 0.990 40.74 2007 0.759 12.70 1.750 71.98 2008 0.560 9.37 2.310 95.02 2009 0.121 2.02 2.431 100.00 Total 2.431 Source: Project Implementation Unit.
28
COMPARISION OF APPRAISAL AND ACTUAL PROJECT IMPLEMENTATION SCHEDULE 6 Appendix 2004 2005 2006 2007 2008 Activity JFMAMJJASOND JFMAMJJASOND JFMAMJJASOND JFMAMJJASOND JFMAMJJASOND
A. Civil Works D-K Border Road Km 9–22 Km 22–95 Km 110–112 Km 95–140 Rural roads Jaljit area Old Fayzobod area Obigarm area B. Equipment
C. Consulting Service
D. Technical Assisstance
Km = kilometer. Planned at appraisal Actual
Sources: Report and Recommendation of the President, and Project Implementation Unit.
Appendix 7 29
CHRONOLOGY OF MAJOR EVENTS
Table A7.1: Major Events Date Event 2003 11–21 February ADB Fact-Finding Mission 7–16 June ADB Appraisal Mission 12–14 November Loan Negotiations 18 December ADB Board consideration and approval 2004 5 March Signing of Loan Agreement between the Government of the Republic of Tajikistan and ADB 15 April Loan Agreement between ADB and government declared effective 9–14 June ADB Loan Inception Mission 2 September Signing of the Loan Agreement between the Government of the Republic of Tajikistan and OFID 11 October Loan Agreement between OFID and government declared effective 10 November Signing of the Contract between Sinohydro Company and Ministry of Transport and Communication for Civil Works 29 November–01 ADB Loan Review Mission December 24 December Signing of the Contract between MOTC and SMEC International for Consulting Services 2005 19 January First disbursement of the ADB loan was made 20–23 June ADB Loan Review Mission 20 September Signing of the contract with Zeppelin International and Lonestar Corporation for procurement of road maintenance equipment 6 December Signing of the Contract between the Gayur Company and MOTC for construction of emergency bypass road 2006 13 March Awarding of contract to International Consultants and Technocrates, India, for Strengthening Implementation of Road Maintenance 30 March 2006 Signing of the contract between the GUSAD of Nurobod district and MOTC for the maintenance of Km 95–140 21–26 August ADB Loan Midterm Review Mission 12 October Signing of Contract 6B between the OJSC Kupruksoz-32 and MOTC for repair of rural roads 13 October Signing of Contract 6A between Sokhtmoni Rohho and MOTC for repair of rural roads 29 December Signing of Contract 6C between the Rohsoz-7” and MOTC for repair of rural roads 2007 2008 8 August Transfer of project administration to Tajikistan Resident Mission 24 September Completion of civil works for Km 22–95
30 Appendix 7
Date Event 17–26 November ADB Loan Review Mission 24 December Take-Over Certificate issued to Sinohydro Corporation 31 December ADB loan closed 2009 21 April Last ADB disbursement was made 30 June OFID loan was closed 17 September–31 ADB Project Completion Review December ADB = Asian Development Bank, MOTC = Ministry of Transport and Communication, OFID = OPEC Fund for International Development. Sources: Project Implementation Unit and the ADB project completion review mission.
Table A7.2: Dates of Work Completion by Road Sections Substantial Completion of Section End of Defect Liability Period Works Dushanbe–Kyrgyz Border Road 1. Km 21.348–Km 95.759 24 September 2008 24 September 2009 2. Km 95.759–Km 140.000 30 July 2008 3. Km 9–Km 22 27 December 2008 27 December 2009 4. Emergency Bypass 31 December 2009 Rural Roads 1. 06a 29 August 2008 29 August 2009 2. 06b 8 August 2008 8 August 2009 3. 06c 8 August 2008 8 August 2009
ORGANIZATION CHART
MINISTRY OF TRANSPORT AND COMMUNICATION
Minister
Personnel Department Legal Department
Internal Security Unit
Deputy Minister First Deputy Minister Deputy Minister Deputy Minister
Analysis and Economic International Civil Aviation Road Construction Communication and Surface Transport Financial and Administrative
Forecasting Relations Central Central Information Central Central Administration Accounting Department Administration Administration Administration Administration Administration Administration
Economics and External Flying Maintenance Roads Telecomm. Automobile Financing Administrative Forecasting Unit Relations Unit and Aviation Security Construction and Department Transport Unit Unit Sector Department Maintenance Unit Informational– Collaborate Communication Air Exploitation Planning and Information Railway Accounting Paperwork with Financial Unit Department Assessment Unit Unit Transport Unit Unit Unit Institutes Unit
Rights Technical Rights Highway Administration Department Control Department Transport Unit Unit, Safety, Sector and Welfare
x8 Appendi Airports and Air Department Transport On–line Mail Service Transport Security Service Information Unit Regulation Unit 31 Department Unit
Source: Project Implementation Unit.
32 Appendix 9
STATUS OF COMPLIANCE WITH LOAN COVENANTS Reference Covenants in Loan Status of compliance Agreement
Sector
1. MOTC shall ensure that (i) the project Schedule 6, Complied with. roads are rehabilitated in accordance para. 5 with the technical specifications of The executing agency signed contracts with the design; and (ii) construction the international consultants for supervision. supervision, quality control and The consultant introduced several forms and contract management are performed procedures for the inspection, testing, and in accordance with internationally acceptance of works to ensure compliance acceptable standards. of technical specifications with appropriate contract management and quality control. The engineer's laboratory commenced operations in December 2005 and audit testing of contractor's work was carried out.
2. To ensure a safe road network in the Schedule 6, Complied with. project area during project para. 6 implementation and after project The executing agency included in civil works completion, MOTC shall install contract the provision of road safety signs, appropriate road safety facilities, warning signs, line marking, traffic signs, and such as pavement marking, warning road pavement markings in accordance with signs, traffic signs and signals, current safety design requirements. The communication facilities, hazard consultant brought in a road safety expert to barriers, and traffic monitoring conduct safety audit of the designs, including facilities. the rural roads. Under the scope of work road signs, safety fences, and line marking were installed on the project.
Environmental
1. The Borrower shall ensure that road Schedule 6, Complied with. rehabilitation and maintenance works para. 7(a) under the project are carried out in The contractor conducted monthly strict conformity with environmental monitoring of air, water, soil, and noise at laws and regulations of the Borrower key locations and reported these results on a and the Bank’s environmental policy, monthly basis against the baseline survey procedures and guidelines, in conducted in June 2005. The results were particular, the Bank’s Environmental included in the monthly progress reports. Assessment Guidelines, 2003. The engineer contractor submitted two 12- month reviews of environmental effects of work. A final monitoring report was prepared and issued in October 2008, comparing environmental conditions before the commencement of the project with conditions at the end of the project implementation process.
2. The Borrower shall ensure that all Schedule 6, Complied with. contracts related to rehabilitation of para. 7(b) the project roads require that the The contractor submitted an environmental
Appendix 9 33
Reference Covenants in Loan Status of compliance Agreement
contractors (i) take appropriate management plan covering these issues. erosion control measures; (ii) This plan was monitored by the consultant minimize any adverse impact due to and the PIU. The asphalt plant, concrete altered embankments, borrow pits, plants, and crushers were located at least 2 and other activities as set out in the km from any sensitive site. summary IEE (SIEE); (iii) take appropriate safety measures to minimize risks of landslides, soil subsidence, and related occurrences; and (iv) keep construction materials and facilities, such as asphalt and hot-mix plants, at least 500 meters away from schools, hospitals, and other sensitive facilities.
3. The Borrower shall ensure that Schedule 6, Complied with. MOTC and MENP regularly para. 7(c) undertake joint inspections of the Reports were submitted on a semiannual environmental aspects of the project, and annual basis. Significant variations in including erosion control, and include monitored results were measured, the results of such inspections in the comparing with the initial survey and project quarterly reports submitted to baseline values. A draft final report was the Bank. submitted on 20 January 2009.
4. The Borrower shall ensure that the Schedule 6, Complied with. contractors under the project para.7(d) implement environmental mitigation This is a mandatory requirement in the civil measures identified in the SIEE in works contract. The contractor for contract accordance with the Environmental 002 project-specific covenants was Monitoring Program agreed upon monitored and findings were included both in with the Bank. monthly and quarterly reports to ADB. The international consultant implemented this requirement through the monthly environmental monitoring report. The final environmental monitoring report was prepared.
5. The Borrower shall ensure that Schedule 6, Complied with. MOTC, together with the appropriate para. 12 authorities, causes contractors to The PIU and the consultant discussed this disseminate information in the issue with the contractors and an awareness Russian and Tajik languages on the program consisting mainly of posters was risk of socially transmitted diseases planned, involving local persons in the to those employed during project development of this issue. The PIU and implementation. consultant issued the contractor with published documents about the risks of HIV and the contractor held information sessions for employees and handed out the brochures.
34 Appendix 9
Reference Covenants in Loan Status of compliance Agreement
Social
1. The Borrower shall ensure that (i) all Schedule 6, Complied with. rehabilitation works under the project para. 9 shall be undertaken within the All rehabilitation works of the project were existing right of way, and (ii) any within the existing rights of way of the roads. additional land, if required under the Contractor's depots were mostly based on project, e.g., for location of MOTC land and MOTC gave approval for contraction maintenance bases, shall the use of the land. be allotted and approved by relevant authorities within the existing right of way or other unutilized state-owned land prior to the use of such land by contractors.
2. The Borrower shall take necessary Schedule 6, Complied with. actions to ensure that local labor, para. 10 including disadvantaged women, is Local laborers were employed by the engaged in project works and that contractors, totaling about 9,000 person- local material are procured. months, including about 7,000 person- months of unskilled labor. Local materials such as cement were procured for the works and concrete aggregates were procured from local suppliers.
3. The Borrower shall ensure that Schedule 6, Complied with. MOTC follows the Bank’s Policy on para. 11 Gender and Development during MOTC encouraged the contractors to utilize project implementation of the project women for the project implementation. to the extent applicable and will take MOTC monitored the effect of the project on necessary measures to facilitate the women through the monitoring and participation of women in project evaluation system throughout the course of implementation activities. MOTC the project. shall monitor effect on women during project implementation through the monitoring and evaluation system, in consultation with local governments and local women’s associations.
Financial
1. Without limiting the generality of Section 4.02 Complied with. Section 4.02 of the Loan Agreement, the Borrower The counterpart funds of $2.42 million were undertakes to provide all funds and provided to the project on a timely basis. resources necessary for rehabilitation, operation and maintenance, and management of the project roads on a timely basis. The Borrower shall cause MOTC to take all necessary measures to
Appendix 9 35
Reference Covenants in Loan Status of compliance Agreement
ensure successful rehabilitation of the project roads, and operation and maintenance thereof after the project completion. (LA,)
2. Following the project completion, the Schedule 6, Being complied with. Borrower shall (i) establish a para. 4(a) separate budget item (within the MOTC examined the procedures and overall budget), and (ii) allocate discussed the issue with senior government sufficient funds and make them officials and departments preparatory to available on a timely basis, for implementation of this covenant. The project rehabilitation and maintenance of the completion review mission found there was project Roads. The Borrower shall substantial maintenance for the project road, annually allocate the amount including maintenance unit, equipment, and equivalent to $40,000 (plus inflation budget. However, there was no detailed since 2003) for maintenance of the maintenance funds applied to the project rehabilitated sections of the project road and rural roads by the Borrower. Roads after the handover of these sections by the contractor, and ensure that the project rural roads are adequately maintained. (LA,)
3. The Borrower shall ensure that Schedule 6, Complied with. annual budget allocations and actual para. 4(b) expenditure for rehabilitation and The actual government expenditure for road maintenance (excluding new rehabilitation and maintenance was construction) of all MOTC- increased by 49% in 2005, 31% in 2006, and administered roads will be increased 109% in 2007. by no less than 15%, in 2005–2007.
4. The Borrower shall adjust the Schedule 6, Complied with. amounts of budgetary allocations para. 4(c) indicated in paragraphs (2) and (3) The allocations were adjusted for inflation. above to compensate for the effect of annual inflation of the Somoni against US dollars.
5. The Borrower shall ensure that actual Schedule 6, Complied with. expenditures for road maintenance para. 4(d) and rehabilitation will account to no Of the MOTC budget, 88% was spent on less than 80% of the total budget road rehabilitation and maintenance in 2005, allocation for rehabilitation, 94% in 2006, and 100% in 2007 and 2008. maintenance and new construction (excluding construction of the Anzob Tunnel) in 2005–2007.
6. The Borrower shall (i) include the Schedule 6, Complied with. details of actual road maintenance para. 4(e) expenditures in every other quarterly MOTC has a single account for road progress report to be furnished by maintenance which includes expenditure for MOTC to the Bank; (ii) have the road all types of transport. The project progress
36 Appendix 9
Reference Covenants in Loan Status of compliance Agreement
maintenance expenditures audited reports recorded the expenditure for annually in accordance with maintenance and rehabilitation. An external appropriate auditing standards auditing consultant was recruited for the consistently applied by independent project. All audit reports were prepared and auditors whose qualifications, submitted to ADB. experience and terms of reference are acceptable to the Bank; and (iii) furnish such audited expenditures and account to the Bank within nine months from the end of the fiscal year.
7. The Borrower shall maintain, or Section Complied with. cause to be maintained, records and 4.06(a) accounts adequate to identify the Use of services and goods were recorded in goods and services and other items measurement sheets that the contractor of expenditure financed out of the submitted with interim certificates for proceeds of the Loan, to disclose the payment. These were checked and verified use thereof in the project, to record by both the consultant and the PIU. the progress of the project (including the cost thereof) and to reflect, in accordance with consistently maintained sound accounting principles, the operations and financial condition of MOTC and other agencies of the Borrower responsible for the carrying out of the project and operation of the project facilities, or any part thereof.
8. The Borrower shall (i) maintain, or Section Complied with. cause to be maintained, separate 4.06(b) accounts for the project; (ii) have For point (i), a separate account for the such accounts and related financial project was opened on 1 December 2004. statements audited annually, in accordance with appropriate auditing For points (ii)–(iv), the external auditor standards consistently applied, by implemented all the auditing to the project’s independent auditors whose financial statements (including for FY2008) qualifications, experience and terms in accordance with International Public of reference are acceptable to the Sector Accounting Standards and ADB Bank; (iii) furnish to the Bank, as requirements. soon as available but in any event not later than nine (9) months after the end of each related fiscal year, certified copies of such audited accounts and financial statements and the report of the auditors relating thereto (including the auditors' opinion on the use of the Loan proceeds and compliance with the covenants of this Loan Agreement),
Appendix 9 37
Reference Covenants in Loan Status of compliance Agreement
all in the English language; and (iv) furnish to the Bank such other information concerning such accounts and financial statements and the audit thereof as the Bank shall from time to time reasonably request.
9. The Borrower shall enable the Bank, Section Complied with. upon the Bank's request, to discuss 4.06(c) the Borrower's financial statements for the project and its financial affairs related to the project from time to time with the Borrower's auditors, and shall authorize and require any representative of such auditors to participate in any such discussions requested by the Bank, provided that any such discussion shall be conducted only in the presence of an authorized officer of the Borrower unless the Borrower shall otherwise agree.
Others
1. Established, Staffed, and Operating PMU/PIU (a) The Borrower shall ensure that a Schedule 6, (a) Complied with. Deputy Minister of MOTC, acceptable para. 2(a), to ADB, shall be responsible for overall project management and supervision. (b) An Executive Project Director of the Schedule 6, (b) Complied with. The PIU, established for existing PIU shall be responsible for para. 2(b) the first road rehabilitation project, continued day-to-day project management, to implement this project. An executive including (i) monitoring the progress director reported directly to the minister of of project implementation, (ii) transport and communication. preparing withdrawal applications and project progress reports, (iii) maintaining project accounts and completing loan financing records for auditing the project. (c) The Borrower shall also ensure that Schedule 6, (c) Complied with. The PIU has a group of at all times throughout the project para. 2(c) professional and clerical staff members with implementation the PIU shall be expertise and experience in financial adequately staffed with professional accounting, road engineering, construction and clerical personnel with supervision, contract administration, and experience and expertise in financial implementation of resettlement plans. As accounting, road engineering, requested in the RRP, four technical staff construction supervision, contract were recruited. At the time of the mission,
38 Appendix 9
Reference Covenants in Loan Status of compliance Agreement
administration. there were about 30 staff in the PIU.
2. Fielding of Consultants in carrying out Section 4.03 Complied with. of the project, the Borrower shall (a) cause competent and qualified All procurement financed under the ADB consultants and contractors, loan conformed to ADB’s Procurement acceptable to the Borrower and the Guidelines. The consultant’s services started Bank, to be employed to an extent on 18 January 2005 and were completed in and upon terms and conditions December 2008. satisfactory to the Borrower and the Bank.
3. To ensure that the project facilities Schedule 6, Complied with. are managed effectively, and project para. 13 benefits are maximized, MOTC, with The consultants, in association with the PIU, the assistance of the project implemented the baseline survey for social consultants, shall undertake impacts of the project on local communities. monitoring and evaluation of project Three surveys were conducted according to impact. Project impact shall be the project performance management monitored and evaluated based on system designed at appraisal. the data, agreed upon with the Bank, collected at the commencement of Corresponding reports were prepared and the project, at project completion, one submitted to ADB. It was found that the year from project completion, and surveys were generally adequate and the three years from project completion. reports were comprehensive.
4. In the year 2005, the Borrower and Schedule 6, Partially complied with (and late). the Bank shall carry out a midterm para. 14 review of the project to examine the The midterm review was postponed to 2006 Borrower’s progress in implementing due to delays in project start-up activities. sector reforms and compliance with The review mission was fielded on 21–26 the provisions of this Loan August 2006 and an aid memoire was Agreement. The review will also prepared. However, it was likely that the assess the economic viability of the review did not assess the economic viability project and other aspects that may of the project and other aspects that may have an impact on project have an impact on project performance. performance.
5. Without limiting the generality of the Section Complied with. foregoing, the Borrower shall furnish, 4.07(b) or cause to be furnished, to the Bank The first progress report for Q1 2005 was quarterly reports on the carrying out received by email in May 2005. Subsequent of the project and on the operation progress reports were submitted on time. and management of the project Progress reports for Q4 2008 (final one) facilities. Such reports shall be were received. Draft final completion reports submitted in such form and in such for both international and domestic contracts detail and within such a period as the were received on 20 January 2009. Bank shall reasonably request, and shall indicate, among other things, progress made and problems encountered during the quarter under
Appendix 9 39
Reference Covenants in Loan Status of compliance Agreement
review, steps taken or proposed to be taken to remedy these problems, and proposed program of activities and expected progress during the following quarter.
6. Promptly after physical completion of Section Complied with. the project, but in any event not later 4.07(c) than three (3) months thereafter or Draft final reports on completion of such later date as may be agreed for international and domestic contracts were this purpose between the Borrower received. ADB comments were provided. and the Bank, the Borrower shall The supervision consultant left the project prepare and furnish to the Bank a before the ADB loan closing date and did not report, in such form and in such detail have time to fully complete the reports (final as the Bank shall reasonably request, report). on the execution and initial operation of the project, including its cost, the Also, the domestic project completion report performance by the Borrower of its in the ADB format was not prepared by the obligations under this Loan PIU. Agreement and the accomplishment of the purposes of the Loan.
7. EA should seek ADB's prior approval Complied with. for contract variations exceeding $100,000. ADB = Asian Development Bank, EIRR = economic internal rate of return, MOTC = Ministry of Transport and Communication, OFID = OPEC Fund for International Development, PIU = project implementation unit. Sources: Project Implementation Unit, ADB’s project completion review mission.
40 Appendix 10
Appendix 10 41
42 SUMMARY OF PROJECT PACKAGES
Actual Actual Contract Value Appendix Appendix Procurement / Contract by Source of Financing Category / Contractor / Selection Contract Value ($ million) Contract Description Supplier Method Date ($ million) ADB OFID Government A. Civil Works Dushanbe-Kyrgyz Border Road 18,908,308.43 11,164,122.12 5,977,610.51 1,766,575.80 Contract 002 km 22–95 Sinohydro Corporation ICB 10/11/2004 17,712,221.02 10,473,280.21 5,751,269.95 1,487,670.86 Contract 005 km 95–140 Gupsad of Nurabad Region NCB 30/03/2006 488,803.71 278,269.89 170,668.43 39,865.39 Contract 004 Emergency Bypass Gayur Company NCB 12/12/2005 490,241.48 281,086.36 209,155.12 Contract 007 km 9–22 Rohcoz-7 NCB 09/07/2008 217,042.22 131,485.66 55,672.13 29,884.43 Rural Roads 1,455,889.93 1,019,132.30 436,757.63 Contract 006a Vahdat Area Sotmoni Rohho NCB 14/10/2006 378,075.28 264,730.26 113,345.02 Contract 006b Faizabad Area Kupruscoz-32 NCB 14/10/2006 569,081.07 398,364.69 170,716.38 Contract 006c Obigarm Area Rohcoz-7 NCB 29/12/2006 508,733.58 356,037.35 152,696.23 Subtotal (A) 20,364,198.36 12,183,254.42 5,977,610.51 2,203,333.43 B. Equipment Contract 003a Zeppelin International AG ICB/IS 20/09/2005 537,481.01 537,481.01 Contract 003b Lonestar Corporation ICB/IS 20/09/2005 452,328.70 452,328.70 Subtotal (B) 989,809.71 989,809.71 C. Consulting Services Contract 001 Supervision and M&E SMEC International PTY Ltd. QCBS 24/12/2004 1,445,876.40 1,445,876.40 Contract 000 Auditing Service Marka Audit Bishkek Ltd. QCBS 20/04/2005 30,519.18 20,272.20 10,246.98 Contract 000 Project Management 217,259.80 217,259.80 Subtotal (C) 1,693,655.38 1,466,148.60 227,506.78
D. Interest Charges 259,997.32 259,997.32
Total 23,307,660.77 14,899,210.05 5,977,610.51 2,430,840.21 OFID=OPEC Fund for International Development, M&E=Maintenance and exploitation, ICB= International competitive bidding, NCB= National bompetitive bidding, IS=International Shopping, QSBC=Quality and Cost-Based Selection Source: Project Implementation Unit.
Appendix 12 43
SUMMARY OF ROAD SUBSECTOR IN TAJIKISTAN
A. Road Network
1. The road subsector in Tajikistan is the most important of the three transport modes: road, railway, and civil aviation; it dominates domestic freight and passenger transportation. The total length of public roads, administered by the Ministry of Transport and Communication (MOTC), is about 13,968 kilometers (km), consisting of 3,177 km of international roads, 2,121 km of national roads, and 8,670 km of local roads. More than 80% of the road category is in category IV and V. Table A12.1 gives the road network by region and category. In addition to these roads, there are about 12,791 km of department roads, which are mainly industrial, technological, and access roads to various facilities and agricultural areas. The major part of the road network was constructed before 1970 and is in poor condition due to inadequate maintenance, damage from the civil conflict, and frequent natural disasters. The poor road conditions have reduced vehicle speeds, increased fuel consumption, and raised vehicle operating costs. The capacity and condition of the road network is unable to accommodate rapid socioeconomic development. Rehabilitating the road has become one of the most urgent tasks for economic recovery and development in the country.
Table A12.1: Public Roads of the Ministry of Transport and Communication (kilometers) Khatlon Sogd Item RRS GBAO Total Oblast Oblast Total Roads 2,795 5,077 3,406 2,690 13,968 International Roads 621 642 622 1,292 3,177 National Roads 519 768 451 383 2,121 Local Roads 1,655 3,667 2,333 1,015 8,670 Category I 17 17 II 104 104 III 387 926 802 339 2,454 IV 905 867 642 978 3,392 V 1,486 3,284 1,858 1,373 8,001
Source: Ministry of Transport and Communication.
B. Road Administration and Transport Industry
2. MOTC was established in 2006 and is responsible for all transport infrastructure, including roads, railways, and airports, as well as for telecommunications. MOTC has prepared a transport sector economic program up to 2015, with a list of road construction and rehabilitation projects. Under MOTC, there is one department, the Road Construction Central Administration, administering the road subsector. It comprises the Roads Construct and Maintenance Unit, Planning and Assessment Unit, Technical Control Sector, and On-line Information Unit (Appendix 8). Five regional road departments are responsible for the maintenance of the roads and bridges in their jurisdiction. The regional road maintenance departments prepare annual plans and budgets, and MOTC allocates funds to them according to requirements and availability of funds.
44 Appendix 12
However, the funds, plant, equipment, and materials for road maintenance are not sufficient for carrying out effective road maintenance activities.
3. The department roads are not for public use and are financially supported by several ministries and departments, committees, and local authorities. In recent years, significant changes have occurred in the road transport industry, especially in commercialization and privatization. About 80% of road transport enterprises are privately owned.
C. Road Rehabilitation and Accidents
4. Roads in Tajikistan are generally classified as republican roads or local roads. Most of the republican roads serve as international roads, providing access to and from neighboring countries. There are eight international road corridors in Tajikistan, including three sections of the Asian Highway Network (AH7, AH65, and AH66) with a total length of 1,925 kilometers (km). In recent years, road traffic increased dramatically along with rapid socioeconomic and international trade development. To accommodate rapidly expanding transport demands, the government is making efforts to rehabilitate the roads with assistance from international organizations and other countries. Many road rehabilitation projects that have been or are being implemented are financed by the Asian Development Bank (ADB), Islamic Development Bank, Organization of the Petroleum Exporting Countries (OPEC) Fund, Kuwait Fund, People’s Republic of China, and Japan. These road rehabilitation projects have significantly improved transport conditions and brought substantial benefits with regard to regional development and poverty alleviation in Tajikistan, and will continue to do so. To assist road rehabilitation and development, ADB undertook several studies for the road subsector, including the transport sector masterplan.1 In the master plan, development priorities were identified: (i) in the short-to-medium term, the rehabilitation program will need to be financed almost entirely, by grants or concessional loans, from international finance institutions; and (ii) in the long term, with domestic road user charges, funding can increasingly come from domestic sources.
5. Due to poor road conditions and the level of traffic development, road accidents have increased. According to the statistics, there were 15,986 road accidents in 1998–2008, in which 4,682 persons died and 18,948 were injured.
Table A12.2: Road Accidents
Item 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Accidents 1,078 1,474 1,330 1,368 1,388 1,378 1,402 1,724 1,495 1,674 1,675 Mortality 389 420 406 396 414 421 415 483 435 497 406 (persons) Injured 1,610 1,727 1,498 1,556 1,625 1,620 1,556 2,036 1,737 2,048 1,935 (persons)
Source: Ministry of Transport and Communication.
D. Road Maintenance Budget and Expenditure
6. The state budget allocation for road rehabilitation and maintenance varies from year to year, depending on the government’s priorities and fiscal constraints. Since the road funds were
1 ADB. 2007. Technical Assistance to Tajikistan for the Transport Sector Master Plan. Manila (TA 4926–TAJ for $600,000, approved on 4 April); and ADB. 2003. Technical Assistance to Tajikistan for Strengthening Implementation of Road Maintenance, Manila (TA 4294–TAJ for $600,000, approved on 18 December).
Appendix 12 45
abolished in 2000 on the recommendation of the International Monetary Fund, funds for the road subsector are allocated through the government’s budgetary process. As a result of the fiscal constraints and allocations to new road construction projects, approved budgets for road maintenance and rehabilitation in recent years are far from what has been requested. MOTC gets supplementary budget funds during the year for any emergency responses and additional unforeseen expenditures. Total road maintenance and rehabilitation expenditures in 2004 were TJS14.3 million, and these more than tripled in 2007 to constitute 95%–100% of total expenditures in the road subsector. Despite this progress, the road subsector remains underfinanced. Only about $400 per km is spent on maintenance annually, which is low by any meaningful standards; spending should be at least four times the current level. Table A12.3 lists the budget and actual expenditure of government funds on the road subsector and the allocation to road maintenance and rehabilitation.
Table A12.3: Road Maintenance Budget and Actual Expenses (TJS million) 2004 2005 2006 2007 2008 Budget and Actual Expenses Budget Actual Budget Actual Budget Actual Budget Actual Budget Actual Tota Road SubSector 17,250 18,750 25,850 24,057 28,040 29,479 46,862 58,033 45,150 Total Maintenance and Rehabilitation 14,250 14,250 22,350 21,188 27,790 27,790 46,862 58,033 45,150 Road Maintenance 13,500 13,500 18,100 16,243 21,540 21,540 22,173 22,173 25,150 Road Rehabilitation 750 750 4,250 4,945 6,250 6,250 24,689 35,033 20,000 Source: Ministry of Transport and Communication.
46 Appendix 13
TRAFFIC ANALYSIS AND REVISED FORECAST
1. At appraisal, the traffic on the project road was forecast for 2002, 2005, 2010, 2015, 2020, and 2027 on four sections of the main road. During implementation, traffic count surveys for the project road sections were conducted in 2005, 2006, and 2008. Actual traffic counts were collected for 24-hour periods. The traffic analysis in the survey report show that there was substantial increase in traffic, especially in 2007–2008 (about 20% per year). The average traffic volume for the project road was about three times that estimated at appraisal, reaching 6,464 vehicles per day in 2008 (compared with 2,222 vehicles predicted at appraisal). The average increase in traffic was about 14% per year in 2005–2008, much higher than 6% estimated at appraisal. Of the total traffic, induced traffic was estimated at 30%–40%. The traffic counts and analysis also indicated major changes in vehicle distribution: (i) a large increase in the share of cars, pick-ups, and small buses, from 59% to 79% for cars and from 3% to 13% for pick-ups and small buses from 2002 to 2008; and (ii) a dramatic reduction in the share of large bus and truck traffic. Such changes were mainly caused by privatization of passenger transport enterprises and services as well as restructuring of industry and agriculture production. The actual traffic volume on the project road was different from what was forecast at appraisal. Table A13.1 compares actual traffic with that estimated at appraisal.
Table A13.1. Comparison of Actual Traffic and at Appraisal (Vehicles, Daily Traffic) Forecast at Appraisal Actual Sections 2005 2008 % per year 2005 2008 % per year Dushanbe–Vakhdat 5,553 6,614 6% 12,673 18,391 13% Vakhdat–Fayzobod 798 950 6% 2,506 4,421 21% Fayzobod–Obigarm 631 752 6% 1,642 1,730 2% Obigarm–Nurobod 479 570 6% 635 1,312 27% Sources: Report and Recommendation of the President, the survey report, and ADB’s project completion review mission.
2. In consultation with the local highway design institute, future traffic development of the project road was adjusted according to the actual traffic development characteristics and relevant factors such as (i) the latest socioeconomic development in the project area; (ii) traffic development speed and pattern; (iii) future traffic demand along the project road, especially international trade volume; and (iv) network completion of international transport corridors. Actual traffic data for 2008 was used as the base data. Future traffic increases, vehicle types, and key years were adjusted in consultation with local transport economists and two ADB studies.1 In the traffic analysis and forecast, focus was given to the international transport corridor development and the induced traffic on the project road. Traffic on the project road and corridor has significantly increased, along with the socioeconomic development of the project area and international trade between Tajikistan and the People’s Republic of China (PRC). Economic development in Tajikistan has been high in the last few years. The gross domestic product (GDP) growth rate for the country was 7.9% in 2008. Rapid economic development generates large traffic volumes and needs the support of transport infrastructure. Trade with the PRC increased
1 ADB. 2007. Technical Assistance to Tajikistan for the Transport Sector Master Plan. Manila (TA 4926–TAJ for $600,000, approved on 4 April); and ADB. 2003. Technical Assistance to Tajikistan for Strengthening Implementation of Road Maintenance, Manila (TA 4294–TAJ for $600,000, approved on 18 December).
Appendix 13 47
10-fold during 2006–2009. Freight from and to the PRC currently travels along several routes.2 The project corridor provides the shortest route—about 800 km from Dushanbe to Kashgar, which is much shorter than the southern route. Currently, several road rehabilitation projects are under way along this international transport corridor. Upon completion in 2011, a large amount traffic will be generated and most traffic will use the project road.
3. The project work was mainly on the Km 22–95 section. The traffic forecast also focused on this section. Table A13.2 lists the future traffic increase rates by vehicle types. In the traffic forecasting, conservative rates were applied. However, the revised future traffic rates are still much higher than the rates forecast at appraisal, and better reflect the future traffic development demand in the project area.
Table A13.2. Estimation of Future Traffic Increase Rates (annual increase rate) Light Medium Heavy Years Car Pickup Bus Total Truck Truck Truck 2009-2010 12% 10% 10% 11% 7% 8% 11% 2011-2015 10% 6% 20% 8% 6% 15% 9% 2016-2020 8% 4% 10% 5% 5% 8% 7% 2021-2025 4% 3% 5% 5% 5% 5% 4% Sources: ADB’s Project completion review mission and the Design Institute of Tajikistan.
Table A13.3. Revised Traffic Forecast for Section Km 22–95 (Vehicle, Daily Traffic) Light Medium Heavy Total Years Car Pickup Bus Truck Truck Truck (No.vehicle) 2008 1,995 456 8 140 442 35 3,076 2009 2,234 502 8 155 473 38 3,410 2010 2,503 552 9 172 506 41 3,783 2011 2,753 585 11 186 536 47 4,118 2012 3,028 620 13 201 569 54 4,485 2013 3,331 657 16 217 603 62 4,886 2014 3,664 697 19 235 639 71 5,324 2015 4,030 738 23 253 677 82 5,804 2016 4,353 768 25 266 711 89 6,211 2017 4,701 799 27 279 747 96 6,649 2018 5,077 831 30 293 784 103 7,118 2019 5,483 864 33 308 823 112 7,623 2020 5,922 898 36 323 864 121 8,165 2021 6,159 925 38 340 908 127 8,496 2022 6,405 953 40 357 953 133 8,841 2023 6,661 982 42 374 1,001 140 9,200 2024 6,928 1,011 44 393 1,051 147 9,573 2025 7,205 1,041 46 413 1,103 154 9,963 2026 7,493 1,073 49 433 1,158 162 10,368 2027 7,793 1,105 51 455 1,216 170 10,790 Note: The traffic for 2008 is the average actual traffic counts for the Vakhdat–Obigarm road section. Source: ADB’s Project completion review mission.
2 Currently, the main transport corridors between Tajikistan and the PRC are (i) through Irkistam (PRC–Kyrgyz border), (ii) through the Kulma pass in southern Tajikistan, and (iii) through the Alaaw Shan pass (PRC– Kazakhstan border).
48 Appendix 14
ECONOMIC REEVALUATION
A. General
1. The project completion review mission conducted an economic reevaluation of the project by comparing the with- and without-project cases, using similar methodology as that used at appraisal, and updated data. In the without-project case, it was assumed that the original state of the road, without significant rehabilitation, would be retained. In the with-project case, the road was rehabilitated with improved conditions so that vehicles can drive faster with lower operating costs and less travel time and more traffic was induced (generated). The methodology and parameters for economic reevaluation were discussed with the project implementation unit (PIU) and the local design institute of the Ministry of Transport and Communication (MOTC) during the mission. Due to minor improvements in the kilometer (Km) 9–22 and Km 95–140 sections, the evaluation focused on the main rehabilitated Km 22–95 section.
B. Costs
2. The project costs consisted of capital and maintenance costs. Only the construction cost for the Km 22–95 section was used, which took 88% of the total project cost. The actual capital costs were about 24.4% higher than anticipated at appraisal, mainly because of price escalation for construction materials and changes in engineering scope. The actual average maintenance cost in 2007 for similar roads in the country was used as a basis for maintenance cost estimation. In addition, it was assumed that the routine maintenance cost would increase by 10% each year as traffic increases, and periodic maintenance would be done every 8 years at an investment of about 30% of the project capital cost. Financial costs were converted into economic costs with the use of a standard conversion factor of 0.9. All economic costs were estimated in 2009 prices.
C. Benefits
3. Using the same methodology as at appraisal, the main sources of economic benefits considered were (i) vehicle operating cost (VOC) savings from normal traffic, (ii) VOC savings from induced traffic, (v) passenger travel time costs savings for normal traffic, (iv) passenger travel time cost savings for induced traffic, and (v) 10% other benefits. Existing and revised traffic forecasts were used in the calculation (Appendix 13). Only the traffic for section Km 22–95 was considered in the reevaluation. It was also assumed, according to other transport studies and the mission’s analysis, that 20%–30% of the total traffic was induced traffic.
4. The VOC savings were recalculated using unit VOC data for different road roughness, which were derived from the VOC data at appraisal with adjustment using the latest data provided by the local design institute. The VOC savings in somoni per 1,000 vehicle kilometers were estimated to be 60.4 for small cars, 21.9 for pick-ups and minibuses, 69.3 for large buses, 40.6 for light trucks, 74.5 for medium trucks, and 120.8 for heavy trucks. Average passenger vehicle speeds were assumed at 60–80 km per hour (km/h) in the with-project case and 30–40 km/h in the without-project case. Passenger travel time cost savings were recalculated by different types of passenger vehicles. The passenger time costs were derived from the gross domestic product (GDP) per capita in 2007 and were estimated to increase 6% each year to reflect future income increases. Other factors taken into account in the recalculation include average vehicle loads, percentage of work-related trips, time costs for different road users, and traveling speeds for different types of passenger vehicles. Only half of the benefits were applied to the induced traffic. Due to data unavailability, 10% was added to the VOCs and time cost savings to reflect other
Appendix 14 49 benefits, such as socioeconomic development in the project area, poverty reduction, and reduced accident costs.
5. After the recalculation, the benefits of VOC savings on the project road accounted for 49.9% of the total benefits in 2009 and 26.6% in 2027, while the benefits of passenger time cost savings accounted for 41.1.2% in 2009 and 64.3% in 2027.
D. Economic Internal Rate of Return Reevaluation
6. The recalculated economic internal rate of return (EIRR) for the project was 20.9% (Table A14.2), compared with 15.8% at appraisal. The increased EIRR was mainly caused by higher traffic than anticipated at appraisal. The recalculated EIRR is much higher than the Asian Development Bank (ADB)-recommended social discount rate of 12% and the project can be considered to be economically viable. The EIRR was subjected to a sensitivity analysis to test different scenarios, including the effects of a 20% increase in maintenance costs, a 20% decrease in benefits, and a combination of these two scenarios. The project continues to be economically viable for all scenarios. The project is much more sensitive to a change in benefits than in costs. The EIRR would be 17.2% if there was a 20% decrease in benefits, but would decrease only slightly to 20.5% if there was a 20% increase in maintenance cost. In the worst case, with a combination of both a 20% maintenance cost increase and a 20% benefit reduction, the EIRR would be 16.8% (Table A14.1).
Table A14.1: Sensitivity Analysis (‘000 TJS) Test Present EIRR Maint. Cost Benefits Value Base Case 0% 0% 20.9% 74,690 Changes (+/-) 10% 20.7% 73,225 20% 20.5% 71,760 50% 20.1% 67,366 10% 22.6% 91,519 20% 24.2% 108,349 -10% 19.1% 57,860 -20% 17.2% 41,030 10% -10% 18.9% 56,395 20% -20% 16.8% 38,101 Switching Point 510% 12.0% - -45% 12.0% - Source: Asian Development Bank’s project completion review mission.
50 Table A14.2: Economic Reevaluation (TJS ‘000)
Cost Benefit Net Appe Net VOC Saving Time Cost Saving Present Others Total Benefit Year Capital Maint. Total N. Traffic I. Traffic N. Traffic I. Traffic Value 2004 459 … 459 (459) (723) 2005 12,595 … 12,595 (12,595) (17,695) 2006 12,254 … 12,254 (12,254) (15,372) 2007 17,764 741 18,505 1,929 209 1,398 174 371 4,081 (14,424) (16,154) 2008 12,732 815 13,548 3,858 419 2,796 348 742 8,163 (5,385) (5,385) 2009 6,083 897 6,979 4,271 466 3,469 432 864 9,501 2,522 2,522 2010 … 987 987 4,730 518 4,106 511 987 10,852 9,865 7,864 2011 … 1,085 1,085 5,020 637 4,759 595 1,101 12,112 11,027 7,849 2012 … 1,194 1,194 5,480 696 5,522 690 1,239 13,628 12,434 7,902 2013 … 1,313 1,313 5,985 761 6,409 801 1,396 15,352 14,038 7,966 2014 … 1,445 1,445 6,538 832 7,441 930 1,574 17,315 15,870 8,040 2015 20,629 1,589 22,218 7,144 910 8,641 1,080 1,778 19,553 (2,665) (1,206) 2016 … 1,748 1,748 7,663 976 9,846 1,231 1,971 21,686 19,939 8,053 2017 … 1,923 1,923 8,221 1,047 11,220 1,402 2,189 24,079 22,156 7,990 2018 … 2,115 2,115 8,821 1,124 12,788 1,598 2,433 26,763 24,648 7,936 2019 … 2,326 2,326 9,466 1,206 14,577 1,822 2,707 29,778 27,452 7,892 2020 … 2,559 2,559 10,160 1,295 16,619 2,077 3,015 33,166 30,607 7,856 2021 … 2,815 2,815 10,582 1,349 18,303 2,288 3,252 35,774 32,959 7,553 2022 … 3,096 3,096 11,022 1,405 20,158 2,520 3,511 38,616 35,519 7,268 2023 20,629 3,406 24,035 11,481 1,464 22,202 2,775 3,792 41,713 17,678 3,230 2024 … 3,747 3,747 11,958 1,525 24,452 3,057 4,099 45,091 41,344 6,744 2025 … 4,121 4,121 12,456 1,588 26,931 3,366 4,434 48,777 44,655 6,504 2026 … 4,533 4,533 12,975 1,655 29,662 3,708 4,800 52,800 48,267 6,277 2027 (51,573) 4,987 (46,586) 13,516 1,724 32,670 4,084 5,199 57,193 103,779 12,049 … = not available, ( ) = negative, I = induced traffic, N = normal traffic, VOC = Vehicle operating cost Source: Project completion review mission. Net present value: 74,690 Internal rate of return: 20.9% Discount rate: 12%