Additional Financing for Islamic Republic of Afghanistan: Road Asset Management Project (RRP AFG 50062-002) SUMMARY OF PROJECT PERFORMANCE A. Background 1. Under Transport Network Development Investment Program Tranche 4,1 ADB provides $5 million to finance a pilot O&M subproject which aims to (i) assess MPW’s overall O&M capacity, and (ii) develop a methodology that best suits Afghanistan and will be used in future road O&M projects. The maintenance works include overlay in some sections, pothole patching, crack sealing, surface sealing, mill and fill, and roadside maintenance. The pilot subproject addressed basic O&M issues on the first 50 km of the Kabul–Jalalabad Highway (from Kabul to Surubi) by improving the international roughness index (IRI) from 8–12 to 4–5. 2. In early 2016, ADB estimated about $55.0–60.0 million will be needed to address the maintenance work on Afghanistan’s national ring road section between Kabul and Kandahar; and the strategic highway section between Kabul and Jalalabad. ADB approved the current project of $25.5 million from ADB’s Special Funds resources on 31 October 2016 with a grant effectiveness date of 5 January 2017.2 The current project was designed to (i) initiate the establishment of a sustainable road maintenance system for the country’s major highways and (ii) develop MPW’s O&M capacity. The project’s two major components are road maintenance and a road asset management system (RAMS). Two sections of national highways were selected for maintenance because of their economic and strategic importance: (i) Kabul–Jalalabad Highway from Surubi to Jalalabad and (ii) the Kabul–Kandahar Highway from Kabul to Ghazni. The project will also develop a RAMS as the primary decision-making support tool to help MPW plan and manage road O&M. ADB financed the current project through a grant of $25.5 million from its Special Funds resources. The government provided $500,000 in counterpart support in the form of office space and staff. B. Performance of the Project 3. The original project is performing well based on the following assessment: (i) Delivery of expected outputs. The current project is on track to meet the intended outputs: (a) national highways in the southern region maintained and (b) O&M and road management capacity enhanced. The condition survey for the Kabul– Jalalabad Highway and Kabul–Ghazni Highway has been completed. The engineering designs for an 85-km section of the Kabul–Jalalabad Highway and a 50-km section of the 135 km of the Kabul–Ghazni Highway have been completed. (ii) Implementation progress. The project is progressing as scheduled. Three individual consultants for road asset management system (RAMS) namely the team leader, deputy team leader, and transportation engineer have been recruited and mobilized in June 2017. The inception report was submitted in August 2017. Recruitment of the remaining RAMS consultants is in process. The bidding documents for procurement of civil works package 1, which covers 35 km of the Kabul–Jalalabad Highway have been reviewed and tendered. The contract award is expected by September 2017. The bidding documents for civil works package 1 ADB. 2014. Report and Recommendation of the President to the Board of Directors: Proposed Multitranche Financing Facility to the Islamic Republic of Afghanistan for the Transport Network Development Investment Program, Tranche 4. Manila. 2 ADB. 2016. Report and Recommendation of the President to the Board of Directors: Proposed Grant to the Islamic Republic of Afghanistan for the Road Asset Management Project. Manila (Grant 0508-AFG). 2 2, which covers 50 km of the Kabul–Jalalabad Highway, have been completed and submitted to ADB for review. The total contract amount expected to be awarded by November 2017 is about $15.0 million. (iii) Compliance with safeguard policy requirements. The project is category C for the environment, involuntary resettlement, and indigenous people. It focuses on road maintenance within the boundaries of the right-of-way of existing carriageway of the Kabul–Jalalabad and Kabul–Ghazni highways. The project does not have any adverse social or environmental impacts because of the limited scale and scope of the maintenance works, and the use of small machinery and equipment for the activities. The project complies with the ADB’s safeguard requirements. (iv) Management of risks. The project has measures to manage risks. ADB has supported the program management office (PMO) in preparing bidding documents and bid evaluation reports, and in supervising contract execution. In addition, by contracting out work in small packages for national competitive bidding, ADB has supported the development of the local market in Afghanistan. This follows the ADB and the government‘s agreed approach on enhancing project delivery in Afghanistan. ADB conducted recruitment of consultants in accordance with ADB’s Guidelines on the Use of Consultants (2013, as amended from time to time), while the government negotiated and signed the contracts with the consultants. (v) Project performance rating. The current project was rated on track in the project performance rating from grant effectiveness up to Q2 2017. C. Conclusion 4. The pilot RAMS addressed basic O&M issues on the first 50 km of the Kabul–Jalalabad Highway by improving the international roughness index from 8–10 to 4–5. The original Road Asset Management Project intends to provide MPW with a RAMS that will support objective planning, improve road serviceability, and ensure cost-effective use of available resources. The prospect of additional financing was raised in the report and recommendation of the President for the current project. The additional financing is needed to (i) fill the financing gap of $30.0 million resulting from changes in USAID’s financing arrangement; and (ii) include an additional 240 km of roads in southeastern Afghanistan, which were part of the appraised project and are still in dire need of basic road maintenance. 5. The additional financing will support the scaling up of O&M practice. This will include addressing overloading issues, which MPW identified as one of the main causes of deterioration of the Southern National Ring Road of Afghanistan. It will help consolidate development outcomes by establishing sustainable road asset management and road maintenance practices. Overall, the project meets eligibility criteria for additional financing. The additional financing will enhance the intended impact of the original project by utilizing the existing implementation arrangements, achieving results quickly. 6. The overall project is in line with the strategic objectives, as described in ADB’s country operations business plan (COBP), 2017–2019, of ensuring continual support for road O&M in the short term and developing the government’s O&M capacity in the long term.3 The COBP identifies investments in developing a safe, reliable, and efficient transport network connecting urban and rural centers as priorities for the transport sector, which are also in line with the government’s strategies for development of the sector. 3 ADB. Afghanistan: Country Operations Business Plan (2016–2018) .