India-ADB Development Partnership 2013 India-ADB Development Partnership 2013 © 2013 Asian Development Bank All rights reserved. Published 2013. Printed in India ISBN 978-92-9254-151-4 (Print), 978-92-9254-152-1 (PDF) Publication Stock No. BKK135571-2 Cataloging-In-Publication Data Asian Development Bank. IndiaʹADB Development Partnership 2013. Mandaluyong City, Philippines: Asian Development Bank, 2013. 1. Partnerships. 2. India. 3. Asian Development Bank. I. Asian Development Bank. The views expressed in this publication are those of the authors and do not necessarily reflect the views and policies of the Asian Development Bank (ADB) or its Board of Governors or the governments they represent. ADB does not guarantee the accuracy of the data included in this publication and accepts no responsibility for any consequence of their use. 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Note: /ŶƚŚŝƐƉƵďůŝĐĂƚŝŽŶ͕͞$͟ƌĞĨĞƌƐƚŽh^ĚŽůůĂƌƐ͘ Asian Development Bank 6 ADB Avenue, Mandaluyong City 1550 Metro Manila, Philippines Tel +63 2 632 4444 Fax +63 2 636 2444 www.adb.org For orders, please contact: Fax +63 2 636 2648 [email protected] Printed on recycled paper ii INDIA-ADB DEVELOPMENT PARTNERSHIP 2013 MESSAGE iii Preface The growing partnership between the Asian Development Bank (ADB) and India is a matter of great satisfaction and SULGHIRUXV)RU$'%LWKDVEHHQDSULYLOHJHWRSDUWQHUZLWK,QGLDDQGVXSSRUWWKH*RYHUQPHQWRI,QGLD·VHQGHDYRU to achieve growth that is high, inclusive, and sustainable. Since the commencement of lending operations in India in 1986, ADB has continually sought to tailor its operations WRVXSSRUWWKHJRYHUQPHQW·VHYROYLQJGHYHORSPHQWDJHQGD$'%KDVEHHQZRUNLQJLQFORVHFRRSHUDWLRQZLWKWKH government to enhance the reach and effectiveness of its program. 7KLVSXEOLFDWLRQFDSWXUHVWKHZLGHEUHDGWKDQGGHSWKRI$'%·V,QGLDSURJUDPDQGVKRZFDVHVWKHV\QHUJLHVZLWKWKH government that have enabled ADB to incorporate thematic concerns such as inclusive growth, environmental sustainability, gender equity, private sector development, and capacity development into its operations. A case in point is the recent partnership between the India Infrastructure Finance Company Limited and ADB to develop credit enhancement products that support local bond issuances by infrastructure project special-purpose vehicles. Given India's burgeoning infrastructure financing requirements, innovative financing instruments that leverage private sector funds has become a development imperative. It gives me pleasure to note that the publication has materialized at a time when India is the gracious host of the 46th $QQXDO0HHWLQJRI$'%·V%RDUGRI*RYHUQRUV,WLVDQDSWWULEXWHWRWKHHYHUVWUHQJWKHQLQJ,QGLD-ADB collaboration. ,ZLVKWRWKDQN$'%·VVWDNHKROGHUVDQGSDUWQHUVRQWKLVRFFDVLRQDQGKRSHZHZLOOFRQWLQXHRXUSURGXFWLYH partnership to strengthen the effectiveness and sustainability of our development efforts. iv INDIA-ADB DEVELOPMENT PARTNERSHIP 2013 Foreword The 46th Annual Meeting of the Board of Governors of the Asian Development Bank (ADB), being held in Delhi, provides an excellent opportunity for ADB to celebrate a very constructive and mutually enriching development partnership with the Government of India. The theme of the Annual Meeting³Development through Empowerment³also symbolizes the core concern of Indian policy makers for growth that is high, inclusive, and VXVWDLQDEOH$'%·VSDUWQHUVKLSZLWK,QGLDVXSSRUWVWKHVHVWUDWHJLFJRDOVRIWKHJRYHUQPHQW ADB remains committed to helping India strengthen its core infrastructure requirements in the energy, WUDQVSRUWDWLRQXUEDQDQGDJULFXOWXUHDQGQDWXUDOUHVRXUFHVVHFWRUV$'%·VLQWHUYHQWLRQVLQWKHVHVHFWRUVDUH improving connectivity and helping create new growth centers leading to better livelihood opportunities as well as improving lives of people. They are also catalyzing private sector financing of infrastructure and supporting state- level public resource management reforms. Planned interventions in the human development sector are intended to VXSSRUWWKHJRYHUQPHQW·VHQGHDYRUWRWDFNOHWKHVNLOOVVKRUWDJHDPRQJWKHZRUNIRUFHLQ,QGLD6XSSRUWIRUUHJLRQDO cooperation and private sector development, including public private partnerships, has been growing over the years. Support for environmental sustainability is being extended through development of clean and renewable sources of energy, interventions in integrated water resource management, and improving civic amenities in urban areas, among others. ,QDOOLWVZRUNLQ,QGLD$'%LVJXLGHGE\WKHJRYHUQPHQW V´,QQRYDWLRQ,PSXOVHZLWK,QYHVWPHQWµDSSURDFK whereby external assistance must leverage international experience and its own knowledge base to support systemic transformations. 7KLVSXEOLFDWLRQFDSWXUHVWKHGHSWKDQGUDQJHRI$'%·VRSHUDWLRQVLQ,QGLDDQGDOVRSURYLGHVDJOLPSVHRIKRZ $'%·VFORVHHQJDJHPHQWZLWKWKHJRYHUQPHQWLVKHOSLQJ$'%LPSURYHWKHRYHUDOOUHOHYDQFHRILWVDVVLVWDQFH program. Building on the enthusiastic response to the first edition from various stakeholders, the second edition has been developed incorporating new approved projects and case studies. The publication includes project briefs and FDVHVWXGLHVFRYHULQJDWRWDORISURMHFWVDFURVV$'%·VVHFWRUVRIRSHUDWLRQLQ,QGLD7KHEULHIVIRFXVRQSURMHFW outputs and outcomes as well as their innovative elements, giving a holistic overview of currently ongoing projects. I would like to thank the Government of India for its continued encouragement and guidance that has helped ADB improve the development results of its assistance program. I hope the publication serves its purpose in disseminating NH\HOHPHQWVDQGOHVVRQVIURP$'%·VRSHUDWLRQVLQ,QGLD³lessons that will be useful not just for development practitioners in India, but also for other developing member countries as well. Hun Kim Country Director, India Resident Mission, ADB FOREWORD v Acknowledgments This report was prepared by the India Resident Mission (INRM), South Asia Department, Asian Development Bank (ADB) under the overall guidance of Hun Kim. Rana Hasan and Kanupriya Gupta of the Programs and Development Results Unit managed the preparation of the report, with contributions from a core team that included Rajesh Deol, Kavita Iyengar, and Bhisma Rout, and supported by ADB consultants Ashmita Gupta and Raginee Baruah. In addition to the core team, contributions were made by ADB staff at INRM and headquarters, and spanning various sectors and areas, as follows: Agriculture and Natural Resources: Yasmin Siddiqi, Ahsan Tayyab, Natsuko Totsuka, and Harish Varma Energy: Jyotirmoy Banerjee, Satoshi Fukushima, Andrew Jeffries, Vallabh Rao Karbar, and Tika Limbu Finance: Abhijit Sen Gupta, Cheolsu Kim, Hiranya Mukhopadhyay, Vivek Rao, and Shalini Singh Gender: Prabhjot R. Khan Portfolio Management Unit: Vikram Annamraju Harsha Private Sector Operations: Siddhartha Shah Public-Private Partnerships: Paolo Spantigati Regional Cooperation: Dong Kyu Lee, Cuong Minh Nguyen, and Keiichi Tamaki Transport: Arun Bajaj, Anil Motwani, Ravi Peri, Prabhash Sahu, Tsuneyuki Sakai, Lee Ming Tai, and Witoon Tawisook Urban: Saugata Dasgupta, Tatiana Gallego-Lizon, Atsushi Kaneko, David Margonsztern, Sourav Majumdar, Ashok Srivastava, Pushkar Srivastava, and Vivek Vishal The team at PricewaterhouseCoopers Pvt Ltd, led by Ranen Banerjee, provided commendable support in the preparation of the report. Gautam Chikermane provided timely and proficient support in the final stages of the publication. vi INDIA-ADB DEVELOPMENT PARTNERSHIP 2013 Contents 1. Introduction ...........................................................................................1 2. Transport ....................................................................................................13 Sector Overview .........................................................................................................................................................15 Case Studies .............................................................................................................................................................23 Rural Roads Sector II Investment Program ...............................................................................................23 Bihar State Highways Project I & II ............................................................................................................27 Project Briefs .............................................................................................................................................................32 Madhya Pradesh State Roads III ..................................................................................................................32 North Eastern State Roads Investment Program ......................................................................................34 Bihar State Highways II: Additional Financing ..........................................................................................36 Rural Connectivity Investment Program .....................................................................................................38 Uttarakhand State Road Investment Program............................................................................................40