India: Multisector Project for Infrastructure Rehabilitation in Jammu and Kashmir

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Lessons

The sector loan modality is most appropriate as an immediate rehabilitation project.

During project appraisal, the state of Jammu and Kashmir was gradually recovering from setbacks due to more than a decade of security−related issues. The need to deliver quality infrastructure while managing public expectations was paramount. To address immediate infrastructure gaps in the urban and transport sectors and deliver basic services as soon as possible, the project was quickly formulated using the sector loan modality. It was designed to adapt to the very specific and special situation in the state. The sector loan modality proved most appropriate, as it provided the flexibility to design, prioritize, and select subprojects, following the prescribed eligibility criteria and frameworks prepared during appraisal, which is critical for any emergency and reconstruction project. It also helped develop water supply master plans, which guided subsequent investment decisions in the state.

Capacity building of a new executing agency or institution requires sustained effort.

The project represented the first direct intervention by any multilateral funding agency in a longer-term endeavor in Jammu and Kashmir. As such, there was an absolute need for sustained effort to develop the capacities of the key agencies involved in the project. The technical assistance provided by the Asian Development Bank (ADB) to establish a project support unit and deliver sustained advisory assistance to the executing agency (EA), the Economic Reconstruction Agency (ERA), was very useful. A strong project management unit with a clear mandate, a high level of state ownership, adequate staffing, and retention of trained staff for at least 3 years ensured the completion of most subprojects despite the intermittent recurrence of security−related issues.

Advance actions facilitate timely startup.

ADB approval of advance action on procurement, 4 months before loan approval, enabled timely project startup. However, project completion required an additional 4 years, mainly because of (i) unforeseen difficulties beyond ERA’s control, including severe security−related disruptions in 2008−2010, and then again in 2011; (ii) the time needed for the newly created EA to become fully functional; and (iii) the time needed to build confidence among different stakeholders, including contractors, to work in the state. Other factors that caused implementation delays were substantial utility shifting, poor performance of a few contractors, and land acquisition issues that may be addressed in future projects through advance preconstruction activities.

Innovations can strengthen project implementation.

The project was successful in introducing several innovative practices that were effective in achieving their target outcomes. These practices, which included linking contractor payment to the implementation of the environmental management plan, using mobile environmental monitoring units and labs, and using a geographic information system for mapping utilities, helped ensure adherence to ADB safeguards and strengthen project implementation. On the other hand, however, design-as-you-build contracts were used to quickly mobilize contractors for the transport component, during early implementation stage. EAs and implementing agencies in future projects should be sensitized on the inherent risks posed by this type of contracts to project implementation, including unanticipated cost variations, procedural issues, and delays.

Background

Limited financial resources for upkeep and more than 10 years of security issues in the lead−up to this program resulted in deteriorating roads, bridges, and water supply facilities in the state of Jammu and Kashmir in northeastern India. The situation was worsened by a significant migrant influx into the state’s key urban centers, exerting tremendous pressure on existing infrastructure and adversely impacting the health and sanitation, income opportunities, and general welfare of the population.

The Multisector Project for Infrastructure Rehabilitation in Jammu and Kashmir, approved by the Asian Development Bank (ADB) in December 2004 for a loan of $250 million to the government of India, aimed to expedite the rehabilitation of the road infrastructure and urban utilities in the state. Its expected outcomes were increased quality of life in the state’s 2 main cities of Srinagar and Jammu, improved rural connectivity and intrastate trade, and enhanced capacity of the executing agency ─ the Economic Reconstruction Agency (ERA) ─ in planning, policy formulation, and project management. It had 3 components: (i) an urban sector component consisting of water supply, drainage, and environmental sanitation improvements; (ii) a transport component comprising the rehabilitation of roads and bridges in 14 districts; and (iii) capacity development of the ERA that had no prior experience in externally−funded projects.

Key accomplishments under component 1 included (i) the construction/rehabilitation of 425 kilometers (km) of old water pipes; (ii) an increase in the quantity of potable water supply by 135,000 cubic meters (m3) per day, against a target of 129,000 m3; and (iii) the rehabilitation of 93 km of drain lines, against a 97 km-target. Water reservoirs, public toilets, and flood pumping stations were constructed. Solid waste management equipment were also provided. Under component 2, 604 km of roads and 22 bridges were rehabilitated and/or constructed. Under component 3, on-the-job advice from an ADB project support group and workshops, seminars, and training sessions strengthened ERA’s institutional and human resource capacities. The preparation of water master plans and capacity−building of the state’s Public Works Department were also assisted.

Project outputs at completion reflected underachievement in roads and bridges, and drainage. While most outcome targets were achieved and those related to improved rural connectivity and access to safe drinking water were surpassed, the number of beneficiaries of drainage improvement was less than the appraisal target. Nevertheless, improved urban infrastructure had enhanced the quality of life in Jammu and Srinagar, benefiting 1.8 million people with safe drinking water and 0.43 million people with better drainage facilities. The drainage pumping stations in Srinagar played a crucial role of disposing flood waters during the severe 2014 floods. Better road conditions led to a 50% increase in vehicle speed and consequently substantial savings in vehicle operating costs and travel time.

Because of underachievement in some output and outcome targets, ADB’s South Asia Department rated the project less than successful. The ERA was the executing agency. 4 regional project implementation units, supervised by a project management unit within EA, implemented the project on a day−to−day basis.

Project Information

Project Name:

Multisector Project for Infrastructure Rehabilitation in Jammu and Kashmir

Report Date:

September, 2016

Main Sector:

Multisector

Country:

India

Project Number:

38136-013

Project/Modality: