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World Bank Document The World Bank Capacity Augmentation of the National Waterway- 1 (JAL MARG VIKAS) Project (P148775) REPORT NO.: RES42905 Public Disclosure Authorized RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF CAPACITY AUGMENTATION OF THE NATIONAL WATERWAY- 1 (JAL MARG VIKAS) PROJECT APPROVED ON APRIL 12, 2017 Public Disclosure Authorized TO DEPARTMENT OF ECONOMIC AFFAIRS, GOVERNMENT OF INDIA TRANSPORT SOUTH ASIA Public Disclosure Authorized Regional Vice President: Hartwig Schafer Country Director: Junaid Kamal Ahmad Regional Director: Guangzhe Chen Practice Manager/Manager: Shomik Raj Mehndiratta Task Team Leader(s): Arnab Bandyopadhyay, Charles Kunaka Public Disclosure Authorized The World Bank Capacity Augmentation of the National Waterway- 1 (JAL MARG VIKAS) Project (P148775) ABBREVIATIONS AND ACRONYMS DEA Department of Economic Affairs, Ministry of Finance EoT Equip Operate and Transfer GoI Government of India IWT Inland Water Transport MMT Multi Modal Terminal NW1 National Waterway 1 OMDA Operation Management and Development Agreement PDO Project Development Objective USD United States Dollar Mn Million The World Bank Capacity Augmentation of the National Waterway- 1 (JAL MARG VIKAS) Project (P148775) Note to Task Teams: The following sections are system generated and can only be edited online in the Portal. BASIC DATA Product Information Project ID Financing Instrument P148775 Investment Project Financing Original EA Category Current EA Category Full Assessment (A) Full Assessment (A) Approval Date Current Closing Date 12-Apr-2017 31-Dec-2023 Organizations Borrower Responsible Agency Department of Economic Affairs, Government of India Inland Waterways Authority of India Project Development Objective (PDO) Original PDO The Project Development Objective is to enhance transport efficiency and reliability of National Waterway- 1 and augment institutional capacity for the development and management of India's inland waterway transport system in an environmentally sustainable manner. OPS_TABLE_PDO_CURRENTPDO Summary Status of Financing (US$, Millions) Net Ln/Cr/Tf Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed IBRD-87520 12-Apr-2017 02-Feb-2018 23-Mar-2018 31-Dec-2023 375.00 99.20 275.80 Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No The World Bank Capacity Augmentation of the National Waterway- 1 (JAL MARG VIKAS) Project (P148775) Note to Task Teams: End of system generated content, document is editable from here. I. PROJECT STATUS AND RATIONALE FOR RESTRUCTURING A. PROJECT STATUS 1. The project is supporting the Government of India’s (GoI) ambitious plan to realize the potential of inland waterways as an alternative and sustainable mode of transport. The GoI wants to develop feasible inland waterway routes on priority and the National Waterway-1 (Jal Marg Vikas) is being augmented as first of its kind, flagship project. Passing through four resource-rich but low-income states (West Bengal, Jharkhand, Bihar, and Uttar Pradesh) NW-1 is the longest of the 111 existing National Waterways; it is a natural river system linking the seaport gateway at Kolkata (including Kolkata Docks and a deep-water dock at Haldia) to Allahabad, some 1,620kms inland, via the Hooghly / Bhagirathi and Ganga rivers. 2. The project has been designed to implement the two components: (i) Component A: Improving the Navigability of NW-1 (Haldia to Varanasi) (ii) Component B: Strengthening Institutional Capacities and Improving the Investment Climate, Vessel Design, and the Construction Framework 3. Component A: Improving the Navigability of NW-1 (Haldia to Varanasi) at originally estimated cost of USD770 million; and forms about 95% of the total project cost, which has achieved a financial progress of about 38%. The overall implementation progress continues to be satisfactory with about 66% of currently programmed works already committed. 4. Component B: Strengthening Institutional Capacities and Improving the Investment Climate, Vessel Design, and the Construction Framework at an estimated cost of USD 30 million. Vessel design prototype is ready and already available on implementing agency website. Procurement process for private operations on equip, operate and transfer (EOT) model for Varanasi and Haldia MMTs is initiated and OMDA for Sahibganj is in preparation. Disaster Management Framework for the entire ecosystem is finalized. A strategic training plan is being prepared for the institution to meet the growing demand of the IWT sector. 5. The overall loan commitment is currently about USD 172 million and it is estimated that the remaining components, until completion, would consume about an additional loan amount of about USD 85 million. The project, therefore, is expected to have a loan savings of USD 118 million, which corresponds to total savings of about USD 220 million in the overall project cost. To utilize about half of the loan savings (USD 60 million), GoI has recently decided to include navigation related parts of the recently launched Arth Ganga program. B. RATIONALE FOR RESTRUCTURING 6. Request for Restructuring: This restructuring is based on the request of Department of Economic Affairs of the Ministry of Finance letter No. F. No. 04/01/2014-Infra & Rural dated June 17, 2020, requesting for Cancelation of The World Bank Capacity Augmentation of the National Waterway- 1 (JAL MARG VIKAS) Project (P148775) USD 57.78 million out of USD 375 million from Jal Marg Vikas Project (or Capacity Augmentation of NW-1 Project) and utilizing part of the loan (about USD 60 million) for implementing the navigation related elements of Arth Ganga. 7. The partial loan cancellation is on account of exchange rate fluctuation and savings accrued due to variety of scope change and procurement efficiency measures. The proposed inclusion from Arth Ganga program, largely focused on benefiting the socio-economic needs for the riverside community through enhanced navigation facilities are fully congruent with the original project development objective. No changes, therefore, will be required in the original project development objective and some marginal modifications / inclusions will be necessary in the intermediate outcome indicators in the results matrix. It is noted that even after the subject cancelation, the remaining funds and the project time would be adequate to implementation period and the expenditure towards the activities that are committed and being financed under the project. II. DESCRIPTION OF PROPOSED CHANGES 9. Cancellation of loan amount of USD 57.78 million. After the cancellation the revised IBRD loan amount will be USD 317.22 Million. 10. Change in components and cost: The definition of the component A and B will undergo minor changes to include the specific features of the Arth Ganga program, as listed below. The current and revised loan allocation across the various sub-components would be as below. Please note that all components would undergo change in cost either on account of scope plus currency rate change or due to a combination of scope plus currency rate change and introduction of Arth Ganga elements. It is further clarified that the costs are fungible across various sub-components, as all these costs are captured under a single category in the loan agreement. Component Original Component description Revised Component description Original Revised allocation allocation USD mn USD mn Component A: Improving the Navigability of National Waterway – 1 770 665 A1 (a) Carrying out detailed topographic No change 10 14 and bathymetric surveys of Project sites; (b) preparing technical feasibility and detailed engineering studies for Project investments as well as approximately eighteen (18) passenger terminals to be constructed and operated by the Participating States; and (c) carrying out social and environmental impact assessment studies and ancillary mitigation plans therefor. The World Bank Capacity Augmentation of the National Waterway- 1 (JAL MARG VIKAS) Project (P148775) Component Original Component description Revised Component description Original Revised allocation allocation USD mn USD mn A2 Improving the fairway of National Improving the fairway of National 372 283.4 Waterway – 1 by carrying out dredging, Waterway – 1 by carrying out river conservancy piloting a dredging, river conservancy and river combination of performance-based training works piloting a combination assured depth contracts and input- of performance-based assured depth based dredging contracts. contracts and input-based dredging and river training works contracts. A3 Constructing permanent protections Constructing permanent protections 17 2.6 works for erosion-prone riverbanks in works for erosion-prone riverbanks in selected locations selected locations, including approaches to terminals and community jetties. A4 Rehabilitating the existing National No change 57 57 Waterway – 1’s navigational lock at Farakka and building a new parallel navigational lock to allow concurrent two-way passage. A5 Constructing: (a) six (6) multi- Constructing: (a) four (4) multi-modal 303 280.4 modal/inter-modal freight terminals; (b) freight terminals; (b) about forty new two (2) vessel repair and maintenance and twenty rehabilitated community facilities; and (c) five (5) pairs of roll- jetties; and (c) ten (10) pairs of roll- on/roll-off crossings. on/roll-off crossings. A6 (a) Installing navigational aids/facilities No change 11 27.6 and channel marking to enable night navigation; (b) developing and implementing
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