India: National Capital Region Urban Infrastructure ...

National Capital Region Urban Infrastructure Financing Facility (RRP IND 41598-01)

Project Number: 41598 Updated: May 2013

India: National Capital Region Urban Infrastructure

Financing Facility (Multitranche Financing Facility)

Facility Administration Manual

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Contents

ABBREVIATIONS ...................................................................................................................................................... 5

I. FACILITY DESCRIPTION ........................................................................................................................... 6

II. IMPLEMENTATION PLANS ...................................................................................................................... 9

A. PROJECT READINESS ACTIVITIES ........................................................................................................ 9 B. OVERALL PROJECT IMPLEMENTATION PLAN ...................................................................................... 12

III. PROJECT MANAGEMENT ARRANGEMENTS ................................................................................... 16

A. PROJECT STAKEHOLDERS – ROLES AND RESPONSIBILITIES............................................................... 16 B. KEY PERSONS INVOLVED IN IMPLEMENTATION ................................................................................... 17 C. ADB STAFF ..................................................................................................................................... 17 D. FACILITY ORGANIZATION STRUCTURE ............................................................................................... 18

IV. COSTS AND FINANCING ........................................................................................................................ 20

A. DETAILED COST ESTIMATES BY EXPENDITURE CATEGORY ................................................................. 21 B. ALLOCATION AND WITHDRAWAL OF LOAN PROCEEDS ....................................................................... 21 C. DETAILED COST ESTIMATES BY FINANCIER ....................................................................................... 22 D. DETAILED COST ESTIMATES BY OUTPUTS ......................................................................................... 22 E. DETAILED COST ESTIMATES BY YEAR ............................................................................................... 23 F. USE AND ALLOCATION OF LOAN PROCEEDS ...................................................................................... 23 G. FUND FLOW DIAGRAM ...................................................................................................................... 26

V. FINANCIAL MANAGEMENT ................................................................................................................... 27

A. FINANCIAL MANAGEMENT ASSESSMENT............................................................................................ 27 B. DISBURSEMENT ................................................................................................................................ 30

VI. PROCUREMENT AND CONSULTING SERVICES ............................................................................. 35

A. ADVANCE CONTRACTING AND RETROACTIVE FINANCING ................................................................... 35 B. PROCUREMENT ................................................................................................................................ 35 C. CONSULTANT'S TERMS OF REFERENCE ............................................................................................. 35 D. PRIVATE SECTOR PARTICIPATION/ PUBLIC PRIVATE PARTNERSHIPS .................................................. 46

VII. SAFEGUARDS ........................................................................................................................................... 53

A. ENVIRONMENTAL SOCIAL MANAGEMENT SYSTEMS ............................................................................ 53 B. POVERTY DIMENSION ....................................................................................................................... 53 C. GENDER MAINSTREAMING AND GENDER ACTION PLAN ...................................................................... 55

VIII. PERFORMANCE MONITORING, EVALUATION, REPORTING AND COMMUNICATION ......... 59

A. PROJECT DESIGN AND MONITORING FRAMEWORK ............................................................................. 59 TABLE 21: PROJECT DESIGN AND MONITORING FRAMEWORK ...................................................................... 59 B. INFORMATION TECHNOLOGY ............................................................................................................. 62 C. MONITORING .................................................................................................................................... 63 D. EVALUATION .................................................................................................................................... 65 E. REPORTING ...................................................................................................................................... 65 F. STAKEHOLDER COMMUNICATION STRATEGY ..................................................................................... 66

IX. ANTICORRUPTION POLICY ................................................................................................................... 70

X. ACCOUNTABILITY MECHANISM .......................................................................................................... 71

XI. RECORD OF FAM CHANGES ................................................................................................................ 71

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XII. APPENDIXES ............................................................................................................................................. 72

APPENDIX 1: PROCUREMENT PLAN-TRANCHE 1 ............................................................................ 73 APPENDIX 2: ENVIRONMENTAL AND SOCIAL MANAGEMENT SYSTEM ....................................... 76 APPENDIX 3: KEY ADB DOCUMENT PERTAINING TO PROJECT IMPLEMENTATION ................... 77 APPENDIX 4: DESIGN AND MONITORING FRAMEWORK-TRANCHE 1…….…………………..….…79 APPENDIX 5: FORMAT OF QUARTERLY PROGRESS REPORT ....................................................... 83

APPENDIX 6: FORMAT OF MFF ANNUAL REPORT……………………………………………………..89 List of Tables

Table 1: Action Plan for Selection of Project Management Consultant FirmError! Bookmark not defined. Table 2: Project readiness at the time of loan fact finding mission in March 2010 .....................10 Table 3: Project stakeholders ....................................................................................................16 Table 4: Key persons involved in implementation ......................................................................17 Table 5: Project Investment Plan...............................................................................................20 Table 6: Financing Plan ............................................................................................................20 Table 7: Cost estimates (indicative) by expenditure category ....................................................21 Table 8: Indicative allocation of loan proceeds ..........................................................................21 Table 9: Cost estimates (indicative) by financier .......................................................................22 Table 10: Cost estimates (indicative) by outputs .......................................................................22 Table 11: Cost estimates (indicative) by year ............................................................................23 Table 12: Indicative list of subprojects for PFR1 ........................................................................24 Table 13: Road map for institutional reform of NCRPB .............................................................28 Table 14: Indicative person months breakup of project management consultants .....................36 Table 15: Indicative terms of reference of project management consultants .............................37 Table 16: Indicative terms of selected individual consultants.....................................................44 Table 17: Range of public-private partnership options...............................................................47 Table 18: Summary of Sub-project Benefits (MMTC) ................................................................54 Table 19: Summary of Sub-project Benefits (Roads).................................................................56 Table 20: Gender action plan ....................................................................................................57 Table 21: Project design and monitoring framework ..................................................................59 Table 22: Project communication plan ......................................................................................67 Table 23: Consultation and participation strategy ......................................................................69 List of Figures Figure 1: Map of the National Capital Region ............................................................................. 7 Figure 2: Project readiness activities .......................................................................................... 9 Figure 3: Project implementation plan .......................................................................................12 Figure 4: Facility Organizational Structure .................................................................................18 Figure 5: Organizational structure including project management team ....................................19 Figure 6: Fund flow diagram for imprest payment mechanism ..................................................26 Figure 7: Indicative chart for disbursement MIS ........................................................................34

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Facility Administration Manual Purpose and Process

1. The facility administration manual (FAM) describes the essential administrative and management requirements to implement the project on time, within budget, and in accordance with Government and Asian Development Bank (ADB) policies and procedures. The FAM includes references to all available templates and instructions either through linkages to relevant URLs or directly incorporated in the FAM.

2. The National Capital Region Planning Board (NCRPB) is wholly responsible for the implementation of ADB financed projects, as agreed jointly between the borrower and ADB, and in accordance with Government and ADB’s policies and procedures. ADB staff is responsible to support implementation including compliance by NCRPB and sub-borrowers (implementing agencies) of their obligations and responsibilities for project implementation in accordance with ADB’s policies and procedures.

3. At Loan Negotiations the borrower and ADB agreed to the FAM and ensure consistency with the Framework Financing Agreement. Such agreement has been reflected in the minutes of the Loan Negotiations. In the event of any discrepancy or contradiction between the FAM and the Loan Agreement, the provisions of the Loan Agreement shall prevail.

4. After ADB Board approval of the project's report and recommendations of the President (RRP) changes in implementation arrangements are subject to agreement and approval pursuant to relevant Government and ADB administrative procedures (including the Project Administration Instructions) and upon such approval they will be subsequently incorporated in the FAM.

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Abbreviations

ADB - Asian Development Bank DEA - Department of Economic Affairs DMF - design and monitoring framework EIRR - economic internal rate of return EMP - environment management plan ESMS - environment and social management system FAM - facility administration manual FFA - framework financing agreement FIRR - financial internal rate of return GAAP - Generally accepted accounting principles GAP - gender action plan GOI - Government of India IPP - indigenous people plan IPPMS - Investment program performance monitoring system JNNURM - Jawaharlal Nehru National Urban Renewal Mission LIBOR - London Interbank Offered Rate MDGs - Millennium Development Goals MFF - multitranche financing facility MSW - municipal solid waste NCR - national capital region NCRPB - National Capital Region Planning Board NCRUIFF - National Capital Region Urban Infrastructure Financing Facility NCT - national capital territory PFR - Periodic financing request PMT - Project management team PPP - public-private partnership PSMG - project sanctioning and monitoring group PSP - private sector participation ULBs - urban local bodies WACC - weighted average cost of capital WSS - water supply and sanitation

NOTES

(i) The fiscal year (FY) of the National Capital Region Planning Board (NCRPB) and the Government of India end on 31 March of the following year. FY before a calendar year denotes the year in which the fiscal year ends, e.g., FY2010 ends on 31 March 2011

(ii) In this report, "$" refers to US dollars.

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I. FACILITY DESCRIPTION

1. Rationale. Due to greater economic opportunities in urban areas, urban areas in India are witnessing explosive growth rates. The urban infrastructure and basic services are under stress due to the increasing demand. Urban infrastructure by nature is complex and more difficult to scale up compared to other infrastructure. Cities are unable to cope with the demand because of weak municipal financial and institutional capacities. While on one hand tariffs for urban basic services are low, the public good nature of urban infrastructure makes them untenable for user fees. The high perceived and real risks of urban infrastructure make private investors wary. The Government of India has launched a reform linked urban investment program in December 2005, the Jawaharlal Nehru National Urban Renewal Mission (JNNURM), to address some of the challenges surrounding rapid urbanization. 2. There is also need for paradigm shift in the way urban infrastructure is planned and executed. From city-centric, the emphasis of urban infrastructure needs to have a regional approach that encompasses both surrounding rural areas as well as other smaller towns in the sub-region. City centric urban infrastructure planning is "reactive" approach: responding to in-migration in a knee-jerk manner. The regional planning approach is "proactive" approach: use urban planning and urban infrastructure investments to direct urban growth to spur economic growth. Regional approach has potential to guide systemic development of urban areas bereft of downsides of rapid urbanization: environmental degradation, traffic jams, growth of slums, non-inclusive growth, increase in greenhouse emissions, among others. Urban infrastructure needs competitive interest rates and longer tenure debt to make projects bankable. 3. NCRPB is a regional planner and financier of NCR, which is one of the fastest growing urban agglomerate region in India. NCRPB's Regional Plan 2021 envisages massive scaling up of urban infrastructure investments in NCR. However, due to domestic debt market limitations, the tenure that NCRPB is able to offer is maximum of 10 years. Moreover, due to weak capacities of a number of borrowers of NCRPB, adequate number of projects is not generated, and there are systemic weaknesses in project execution. Before weak urban infrastructure starts acting as a binding constraint on rapid pace of economic growth in NCR, among others, NCRPB needs to enable scaling up of urban infrastructure by implementing priorities of Regional Plan 2021 by providing longer tenure low cost debt, technical capacities for implementing agencies (borrowers of NCRPB) in urban planning, project development, project implementation, identification of bankable projects and enabling private sector investments, improving urban basic service provision, among others, through partnership with private sector. Adequate incentives need to be provided by NCRPB to motivate cities and state entities to undertake public and environmental urban infrastructure projects that can mitigate greenhouse gas emission, and introduce private sector efficiencies. The National Capital Region Urban Infrastructure Financing Facility (NCRUIFF) is built around this rationale. Important details of the rationale are discussed further in this section as well as in the sector road map (Web-Linked Document 1's Schedule 1, and Web-Linked Document 2). 4. Location. NCR is a 33,578 square kilometer area covering Delhi and sub-regions of the States of Haryana, Rajasthan and Uttar Pradesh. NCR consists of nine districts of Haryana (Faridabad, Gurgaon, Rohtak, Rewari, Palwal, Jhajjar, Mewat, Sonipat and Panipat), one district of Rajasthan (Alwar district) and five districts of Uttar Pradesh (Meerut, Ghaziabad, Gautam Buddha Nagar, Bulandshahr and Baghpat). The population of NCR is 37 million (urbanization level of 54% as per 2001 census), which is expected to increase to 64 million by year 2021.

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In addition to NCR, NCRPB supports Gwalior (Madhya Pradesh State); Dehradun (Uttarakhand); Patiala (Punjab); Hissar and Ambala (Haryana); Kota (Rajasthan); and Kanpur and Bareilly (Uttar Pradesh) as Counter Magnet Areas (CMA) where development strategies are implemented in order to ease the projected population pressure on National Capital Territory (NCT) of Delhi.

Figure 1: Map of the National Capital Region

Source. National Capital Region Planning Board

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5. Beneficiaries. The population of NCR is 37 million (urbanization level of 54% as per 2001 census), which is expected to increase to 64 million by year 2021. Rapid economic growth in the NCR is likely to generate increased demand for water supply, waste water management and solid waste management of the order of Rs230,000 million ($5 billion approximately). This amount excludes the demand for urban transport infrastructure in the region. This regional demand needs to be financed so that regional economic development can be maximized. Analyses of the States and cities economies suggest that own fund and technological know-how is not sufficient to provide the rapid growth in demand for urban infrastructure. Both private and external assistance will be needed. While the National Capital Territory (NCT) of Delhi is making rapid strides in urban infrastructure development, the remaining portions of the NCR are still lagging behind in infrastructure resources vis-à-vis Delhi. Environment-oriented infrastructure development like water resource management, solid waste management, etc. should be one of the major thrust areas for the different participating state governments in the NCR. 6. Impact and Outcome. The impact of NCRUIFF is to improve overall quality of life and economic well-being of urban residents in India's NCR. The outcomes of NCRUIFF are improved economic growth support and public and environmental urban infrastructure services in the participating cities and/or subregions of the NCR in accordance with the Regional Plan priorities. To this effect, NCRUIFF will support NCRPB in (i) leveraging its resources through a line of credit and other market access support services, and (ii) support a project development facility that would focus on design, implementation and delivery of quality growth oriented and public and environmental urban services and support capacity enhancements as well. 7. Outputs. There are three broad outputs of this project:

(i) Firstly, NCRUIFF would support creation of high quality urban public and environmental infrastructure. This would include water supply, sanitation and waste management projects including possible regional initiatives.

(ii) Secondly, to foster economic growth and mobility, NCRUIFF will support creation

of connectivity and/or up-gradation of transit infrastructure in the region. (iii) Implementation support for strengthening of NCRPB and participating

implementation agencies' capacity to design and execute high quality urban infrastructure project, and other capacity development activities including enabling public-private partnerships.

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II. IMPLEMENTATION PLANS

A. Project Readiness Activities

Figure 2: Project readiness activities

(Completed for Tranche 1)

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Table 1: Project readiness at the time of loan fact finding mission in March 2010 SN Milestones Action Points Responsible

Agency Status

1 Before loan fact-finding mission of ADB

PPTA, if any, is substantially completed ADB/EA Completed 1.2 Feasibility study report and preliminary design completed

EA Completed

2 Before loan appraisal mission of ADB

2.1 Concurrence of the line Ministry/Competent Authority

Line Ministry/ DEA

MoUD- Yes

2.2 Approval under FRBM Act from Dept. of Expenditure

DEA

2.3 Approval for Govt of India guarantee by Budget Division, if required

DEA

2.4 Commitment to provide counterpart funds EA NCRPB and IA’s will contribute to the counterpart funds. Current procedures required NCRPB’s borrowers to contribute to 25% of the costs

2.5 Budgeting for at least 30% of land acquisition and resettlement requirements completed, if any.

EA The Pipeline of projects do not involve any rehabilitation but provisions made for temporary impacts during construction.

2.6 Designation of PMU/PIUs staff completed and core staff for the project assigned

EA Structure of Additional Staffing for NCRPB finalized and will be completed before Loan Approval . In the interim, staff have been assigned to complete preparatory works

2.7 Procurement plan for the project detailing contract packages, modes of procurement, pre-requisites for awarding the contracts, approval flow chart, decision making structure and schedule for each contract be in place

ADB/EA Procurement Plans finalized and Bridging TA Consultants involved on preparation of Bid Documents- Target Completion July 2010

2.8 Terms of reference (TOR) for all consultancy contracts including Project Management consultants, shortlist of consultants/consulting firms and documents for prequalification of contractors are prepared and approved/reviewed by ADB

ADB/EA TORs finalized. Bridging TA Consultants to support NCRPB in preparation of Bid Documents- Target Completion May 2010 and Invitation to Bid July 2010

2.9 Environmental Management Plan (EMP) for the first two years of project implementation be finalized. Complete IEE/EIA and secure ADB approval

ADB/EA ESMS to be placed before PSMG or approval- Target July 2010

2.10 Relief & Resettlement Plan for the first two years of the project implementation should be finalized and confirmation regarding R&R activities are aligned with the Procurement Plan be conveyed.

ADB/EA Not applicable.

3 Before loan negotiations

3.1 Bidding documents for all contracts, including criteria for consultant recruitment and procurement, to be awarded during first 12 months of project implementation should be

ADB/EA Bid Documents to be ready by May 2010.

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SN Milestones Action Points Responsible Agency

Status

prepared, approved and issued. Issue of RFP for consultants and calling of bids for civil works

3.2 Project Implementation Plan/ Administration Manual/ Memorandum covering scope, organization and its TOR, procurement, budgeting, disbursement, reporting and auditing arrangement be finalized.

ADB/EA Finalized.

3.3 At least 50% of land acquisition (if required) to be completed

EA No LA contemplated as part of tranche I

3.4 Establish (a) financial management system (b) auditing arrangement (c) fund flow arrangement (d) system of oversight.

ADB/EA Systems in Place and ADB compliant FM reporting systems to be completed during the bridging Phase

3.5 All Statutory clearances like environmental/forest clearances to be in place

EA Target July 2010

3.6 Administrative clearances for temporary use of land i.e. right of way taken

EA Target July 2010

3.7 Administrative approval for shifting of utilities taken

EA Target July 2010

3.8 At least 30% of the tendering work should be completed for awarding

EA Will be ready with Bid documents by May 2010

3.9 Provision of budget for project implementation in first financial year

EA Target July 2010.

4 Before loan signing

4.1 Award of contracts for consultancy services to be completed and at least 30% Contracts for civil works to be awarded within a month after loan signing.

ADB/EA In process.

5 Before loan effectiveness

5.1 Dedicated PIUs to be established, if need be.

EA Not applicable as implementation will be through regular execution divisions of IA’s

5.2 Legal opinions taken DEA/EA

ADB = Asian Development Bank, DEA = department of economic affairs, EA = executing agency, EMP = environmental management plan, IEE = initial environmental examination, MoUD = Ministry of Urban Development, NCRPB= National Capital Region Planning Board, PIU = project implementing unit, PMU = project management unit, PPTA = project preparatory technical assistance, PSMG = Project Sanctioning and Monitoring Group, TOR = terms of reference. Source: Asian Development Bank.

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B. Overall Project Implementation Plan

Figure 3: Project implementation plan

Task initiated and ongoing (original)

Task initiated and ongoing (revised) Milestone achieved

Indicative Activities

2010 2011 2012 2013 2014 2015 2016 2017

1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4

First PFR submission

Second PFR submission

DMF Outputs

1. High quality public and environment health related urban infrastructure investments 1.1. DPR for at least one subproject relating to WSS, SWM prepared 1.2. At least one project approved by NCRPB for financing 1.3. Construction work on at least one project started 1.4. NCRPB introduces concessional lending for public and environmental health and PPP/ PSP 1.5. Increase in NCRPB investments by 5% points from base line for pubic and environmental health infrastructure 1.6.Mainstream gender-inclusive and pro-poor environmental and social safeguards 1.7. Solid waste management investment plans prepared in line with Regional Plan 2021 1.8. Increase in investments of regional significance 2. High quality economic growth related regional and urban infrastructure investments 2.1. DPRs for at least one subproject relating to regional inter-city connectivity roads, and multimodal bus terminals prepared 2.2. At least one project approved by NCRPB for financing: June 2010

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2010 2011 2012 2013 2014 2015 2016 2017

1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 2.3. Construction work on at least one project started: September 2010 2.4. Construction work completed and operations begin 2.5. Increase in NCRPB investments by 5% points from base line for urban transport and multimodal transit facilities 2.6. Transport investment plans prepared in line with Regional Plan 2021 2.7. Increase in investments of regional significance 3. Strengthening of capacity of NCRPB and implementing agencies to scale-up urban infrastructure and improve basic urban service delivery 3.1. Strengthening of NCRPB to execute scale-up mandate more effectively 3.1.1. Additional staff to be hired by NCRPB to reinforce PMU (Schedule 3 of FFA) 3.1.2. Achieve prudential norms of a financial intermediary as stated in Schedule 1 of FFA 3.1.3. Improvement in risk management practices 3.1.4. Improvement in the treasury management practices 3.1.5. Reduction in the duration gap between asset and liability 3.1.6. NCRPB staff trained for better project monitoring and management 3.1.7. NCRPB develops web based tools to integrate project approval, project monitoring and loan disbursement processes

3.1.8. Introduction of pooled financing 3.1.9. Capacity building of subborrowers including, among others, web based tools available de 3.1.10. Social and gender-relevant processes and practices institutionalized through capacity development of relevant stakeholders 3.2. Enabling inclusive and more balanced growth 3.2.1. Implementation support consultant firm recruitment and mobilization

3.2.2. Gender sensitive design and project

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2010 2011 2012 2013 2014 2015 2016 2017

1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 implementation mainstreamed

3.2.3. DPRs pertaining to WSS and SWM prepared to enable more investments in urban basic services 3.2.4. DPRs prepared for city-level urban infrastructure, especially for Uttar Pradesh

3.3.Improvements in project execution 3.3.1. Technical assistance to weak implementation agencies on project management 3.3.2. NCRPB engages consultants to monitor the quality of construction work 3.3.3. NCRPB develops web-based tools to strengthen project management 3.3.4. NCRPB organizes training program and field trips for implementing agencies to improve infrastructure skills and adopt best practices 3.3.5. Systematic and regular progress monitoring of financial, physical, social and gender related impacts of subprojects introduced by NCRPB 3.4. Increased participation of private sector in urban infrastructure and basic service management 3.4.1. NCRPB introduces a PPP checklist to filter projects that could be otherwise implemented through with private capital: September 2010 3.4.2. Technical assistance introduced to structure PPP/PSP 3.4.3. NCRPB introduces long tenure concessional lending to encourage PSP/PPP 3.4.4. Technical assistance support provided to at least one PSP/PPP transaction 3.4.5. At least one PSP/PPP transaction accomplished

B. Management Activities

Setting up and strengthened urban infrastructure project management systems in NCRPB Preparation of annual implementation plan, disbursement projects and revision of procurement plan

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2010 2011 2012 2013 2014 2015 2016 2017

1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 Submission of annual implementation plan, disbursement projection and procurement plan

Advance procurement actions for first PFR Advance procurement actions for second PFR

Consultant selection procedures (Firm) Consultant selection procedures (Individual on need basis)

Environment management plan key activities

Annual/Mid-term review

Communication strategy key activities

Project completion report

DMF = design and monitoring framework, DPR = detailed project report, FFA = framework financing agreement, NCRPB = National Capital Region Planning Board, PFR = periodic financing request, PMU = project management unit, SWM = solid waste management, WSS = water supply and sanitation, Source: Asian Development Bank.

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III. PROJECT MANAGEMENT ARRANGEMENTS

A. Project Stakeholders – Roles and Responsibilities

1.1 Sponsors, Stakeholders and External Agencies

(i) Sponsors: o Ministry of Finance (MOF), Department of Economic Affairs,

Government of India o National Capital Region Planning Board, Ministry of Urban

Development, Government of India o Asian Development Bank (ADB)

(ii) Stakeholders: o All Implementing Agencies in the National Capital Region,

covering the States of Delhi, Haryana, Uttar Pradesh and Rajasthan.

Table 2: Project stakeholders

Project Stakeholders

Management Roles and Responsibilities

Executing Agency

National Capital Region Planning Board

Establish an imprest account in a current account, with a commercial bank acceptable to ADB;

Management and replenishment of accounts; Organize audits of the accounts by chartered accountants or independent

auditor acceptable to ADB; Establish a PMU headed by a Director who will be a senior staff of NCRPB for

facility administration, loan disbursement, accounts maintenance, and reporting to ADB;

Carry out consultant service recruitment; Liaise with ADB to address any implementation issues; Prepare the quarterly, 6 monthly and annual progress reports based on the

information submitted by PMU; Establish an IPPMS within 3 months of the signing of the PFR including a set of

clearly measurable performance monitoring indicators relating to implementation, improvements, institutional development, and capacity building milestones including those in the DMF.

Ensure that sub borrower and subproject selection criteria is adopted in accordance with ADB procedures and NCRPB's business plan.

Implement the approval procedure for proposed subprojects; Assign adequate staff to the PMU cell to implement the ESMS and approval

procedure for proposed subprojects; Ensure implementation of the ESSF for evaluating subprojects for ADB

financing; Monitor progress of subprojects in line with subproject proposals; Monitor implementation of the Facility in line with the IPPMS; Ensure implementation of funds flow and disbursement requirements to eligible

subprojects; Ensure auditing of loan proceeds and maintenance of accounts; Obtain and provide to ADB all disbursement-related documentation and fulfill

certification requirements Subborrower Develop projects of high quality and as per subproject selection criteria submit

the to NCRPB Procurement of good and works Monitoring of the civil works and other works of the contractors Ensure adequate counterpart funds Submit quarterly progress reports to NCRPB

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Project Stakeholders

Management Roles and Responsibilities

Provide support to NCRPB and ADB missions Submit either certified by the finance department of the implementing agency or

independent accounted certified financial statements to claim disbursements from NCRPB along with engineer's certificate

Provide adequate staff for project implementation and supervision

B. Key Persons Involved in Implementation

Table 3: Key persons involved in implementation Government of India Officer's Name: Ms. Monika Dhami

Deputy Secretary (ADB I) Department of Economic Affairs Room No. 51-D North Block, New Delhi Tel +91-11-23092420

Executing Agency Agency Name Officer's Name : Ms. Naini Jayaseelan

Position: Member Secretary Telephone: 24642285 ; 24642163(Fax) Email address: [email protected]

Officer's Name: Dr. Kavitha Gotru Director, Finance and Administration Email address: [email protected]

Office Address: National Capital Region Planning Board (Ministry of Urban Development) Core-IV B, First Floor, India Habitat Centre Lodhi Road, New Delhi-110003

C. ADB Staff

The department responsible for the implementation of the Project is the South Asia Regional Department (SARD), represented by the Urban Development and Water Division (SAUW). SAUW has the overall responsibility for the implementation of the Project in ADB. ADB Urban Development and Water Division (SAUW) South Asia Department (SARD) Address Facsimile: Website Address:

Mr. Fei Yue Director, SAUW Telephone No. +632 632 6858 Email address: [email protected] Mr. Norio Saito Principal Urban Development Specialist Telephone No. +632 632 6258 Email address: [email protected] Asian Development Bank No. 6 ADB Avenue, Mandaluyong City 1550 Metro Manila P.O. Box 789 0980 Manila, Philippines +632 636 2293 http://www.adb.org

http://mail.nic.in/

mailto:[email protected]



http://www.adb.org/

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D. Facility Organization Structure

8. The facility organization structure is as follows:

Figure 4: Facility Organizational Structure

9. NCRPB will be the Executing Agency (EA) of the proposed Facility. Policy direction and strategic oversight will be provided by NCRPB's Board of Directors. The project management team (PMT) under overall supervision of Director, Administration and Finance will be strengthened by NCRPB to high quality project development, project implementation, and capacity development of a scaled-up urban infrastructure development mandate. The PMT will also monitor day-to-day implementation of the Facility. The PMT is staffed with existing NCRPB staff and will consist of specialists with expertise in risk and project management. The organization structure is given in Figure 1. 10. An Assistant Director, reporting directly to the Director, will be appointed to ensure and certify project compliance with the ESMS. The PMT will have a dedicated finance and accounts officer to monitor accounts and processing claims. The PMT will be responsible for the identification, screening, selection, and monitoring of all subprojects ensuring compliance with state and national policies and the ESMS. In addition, the PMT will be responsible for developing and implementing an investment program performance monitoring system (IPPMS).

Asian Development Bank

Ministry of Finance

National Capital Region Planning Board (Executing Agency)

Delhi Integrated Multimodal Transport System Ltd./ Transport Department of Delhi

Haryana Public Health Engineering Department Haryana Roads and Bridges Corporation Ghaziabad Urban Development Authority

(Implementing Agency)

Ministry of Urban Dev’t .

State Governments

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Figure 5: Organizational structure including project management team

Board: Union Minister for Urban Development & Chairman of the NCRPB

Member Secretary

Director(Administration & Finance)

Chief Regional Planner

Joint Director (Tech)

Joint Director (Tech)

Dy. Dir (Tech)

Dy. Dir (Tech)

Deputy Director(Admin.)

Asst. Dir.

(PMC)Assistant Director (Finance-Resource

Mobilization)

Asst. Dir (Est)

Assistant Director

(Finance-Accounts)

Asst. Dir (Tech)

Asst. Dir (Tech)

Asst. Dir (Tech)

Asst. Dir (Admn.)

Finance & Accounts

Officer

Project Sanctioning and Management

Group

Joint Director

(Technical)

Dy. Dir. Project

Development, MIS and

Monitoring

Assistant DirectorProject

Finance & Procurement

Asst. DirectorSafe-

guards

Assistant DirectorFinancial

Management Project Management Consultants

Proposed Positions

Existing Positions

Pro

jec

t M

an

ag

em

en

t U

nit

Admn. = administration, Asst. = assistant, Dir = director, Dy. = deputy, Est = establishment, Tech = technical. Source. National Capital Region Planning Board

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IV. COSTS AND FINANCING

11. The project is estimated to cost $200,000,000.1 The investment plan is summarized in Table below.

Table 4: Project Investment Plan ($ million)

Item Amounta

A. Base Costb

1. Water supply and sanitationc 34.3

2. Urban transport, regional connectivity and other economic growth infrastructurec 116.3

3. Implementation support 4.0 Subtotal (A) 154.6 B. Contingencies

d 30.0

C. Financing Charges During Implementatione 15.4

Total (A+B+C) 200.0 a Includes taxes and duties be financed from government resources or ADB loan resources.

b In mid-2009 prices.

c Indicative as the facility is for a financial intermediary.

d Physical contingencies computed at 10% for civil works; and 10% for equipments and materials. Price contingencies computed at rates as per Bank’s forecast on foreign exchange costs and on local currency costs; includes provision for potential exchange rate fluctuation under the assumption of a purchasing power parity exchange rate.

e Includes interest and commitment charges. Interest during construction for ADB loan(s) has been computed at

the 5-year forward London interbank offered rate plus a spread of 0.20%. Commitment charges for an ADB loan are 0.15% per year to be charged on the undisbursed loan amount.

Sources: Asian Development Bank. 12. Table 2 summarizes the financing plan for the Facility. NCRPB will be the Borrower under the Facility and the Government will provide a sovereign guarantee in form and substance acceptable to ADB for the term of each loan as a condition precedent to the effectiveness of each tranche requested by NCRPB and provided by ADB pursuant to the terms of each loan agreement. ADB's financing for each of the subprojects will be 75% of the total cost of the project including taxes and duties.

Table 5: Financing Plan ($ million)

Sources Total % Asian Development Bank

a 150.00 75.0

National Capital Region Planning Boardb

50.00 25.0 Total 200.00 100.0 a

ADB financing includes taxes and duties.

b National Capital Region Planning Board's contribution also includes contribution from the subborrowers.

Source: Asian Development Bank and National Capital Region Planning Board estimates.

1 Based on the city development plans, advisory technical assistance of ADB, city master plans and functional

plans, the investment pipeline for NCR and CMAs is worth $680 Million. The projects are in various stages of readiness and the pipeline for the Facility is of the order of $400 million including taxes and contingencies and implementation support.

21

A. Detailed Cost Estimates by Expenditure Category

Table 6: Cost estimates (indicative) by expenditure category

% %

Total

(Rupees Million)

(US$ Million) Foreign Base

Local Foreign Total Local Foreign Total Exchange Costs

I. Investment Costs

A. Land 99.6 - 99.6 2.1 - 2.1 - 1

B. Civil Works 6,253.2 - 6,253.2 133.0 - 133.0 - 87

C. Equipments & Materials 724.3 - 724.3 15.4 - 15.4 - 9

D. Resettlement Package 3.1 - 3.1 0.1 - 0.1 - - E. Implementation Assistance - - - -

Consulting Services 187.1 - 187.1 4.0 - 4.0 - 3

Total BASELINE COSTS 7,267.3 - 7,267.3 154.6 - 154.6 - 100

Physical Contingencies 697.8 - 697.8 14.8 - 14.8 - 10

Price Contingencies 1,101.7 - 1,101.7 15.2 - 15.2 - 10

Total PROJECT COSTS 9,066.8 - 9,066.8 184.6 - 184.6 - 119

Interest During Implementation 717.7 - 717.7 14.9 - 14.9 - 9

Commitment Charges 24.9 - 24.9 0.5 - 0.5 - -

Total Costs to be Financed 9,809.5 - 9,809.5 200.0 - 200.0 - 128

Source: National Capital Region Planning Board.

B. Allocation and Withdrawal of Loan Proceeds

The disbursement will be recorded and monitored in Loan Finance Information Systems (LFIS) by sub-loans/subprojects, not by cost category.

Table 7: Indicative allocation of loan proceeds

Loan Disbursement

Amount %

Land Acquisition - -

Civil Works 119.8 82.6

Equipment & Materials 13.4 80.0

Poverty Alleviation - -

Consulting Services 3.5 80.0

Unallocated 13.3 -

Total 150.0 81.2

Financial Charges During Implementation - -

Total Costs to be Financed 150.0 81.2


22

C. Detailed Cost Estimates by Financier

Table 8: Cost estimates (indicative) by financier

(US$

Million)

Asian Development NCR Planning Local

Bank Board – NCRPB a Total For. (Excl.

Duties &

Amount % Amount % Amount % Exch. Taxes) Taxes

I. Investment Costs

A. Land - - 2.3 100.0 2.3 1.0 - 2.3 -

B. Civil Works 131.7 82.6 27.8 17.4 159.5 81.7 - 140.4 19.1

C. Equipments & Materials 14.8 80.0 3.7 20.0 18.5 8.0 - 16.2 2.2

D. Resettlement Package - - 0.1 100.0 0.1 - - 0.1 0.0

E. Implementation Assistance - - - - - - -

Consulting Services 3.5 80.0 0.9 20.0 4.3 2.4 - 3.8 0.5

Total PROJECT COSTS 150.0 81.2 34.7 18.8 184.6 93.1 - 162.8 21.9

Interest During Implementation - - 14.9 100.0 14.9 6.7 - - -

Commitment Charges - - 0.5 100.0 0.5 0.2 - - -

Total Disbursement 150.0 75.0 50.0 25.0 200.0 100.0 - 162.8 21.9 a Includes contribution of the sub-borrowers. Source: National Capital Region Planning Board.

D. Detailed Cost Estimates by Outputs

Table 9: Cost estimates (indicative) by outputs Water

Supply and Sanitation

MMTC, regional

connectivity

Implementation Assistance

Total

I. Investment Costs

A. Land 2.1 0.0 - 2.1

B. Civil Works 28.9 104.1 - 133.0

C. Equipments & Materials 3.3 12.1 - 15.4

D. Resettlement Package - 0.1 - 0.1

E. Implementation Assistance - - - -

Consulting Services - - 4.0 4.0

Total BASELINE COSTS 34.3 116.3 4.0 154.6

Physical Contingencies 3.2 11.6 - 14.8

Price Contingencies 3.5 11.3 0.4 15.2

Total PROJECT COSTS 41.1 139.2 4.3 184.6a

a Remaining amount is for financial charges during implementation. Source: National Capital Region Planning Board.

23

E. Detailed Cost Estimates by Year

Table 10: Cost estimates (indicative) by year

(US$

Million)

Base Cost

2011 2012 2013 2014 2015 2016 Total

I. Investment Costs

A. Land 2.1 - - - - - 2.1

B. Civil Works 18.3 31.3 36.0 34.2 13.3 - 133.0

C. Equipments & Materials 2.4 3.7 4.3 4.0 1.0 - 15.4

D. Resettlement Package 0.1 0.0 0.0 0.0 - - 0.1

E. Implementation Assistance - - - - - - -

Consulting Services 0.8 0.8 0.8 0.8 0.6 - 4.0

Total BASELINE COSTS 23.7 35.8 41.2 39.0 14.9 - 154.6

Physical Contingencies 2.1 3.5 4.0 3.8 1.4 - 14.8

Price Contingencies 1.8 3.3 4.2 4.2 1.7 - 15.2

Total PROJECT COSTS 27.6 42.6 49.4 47.0 18.0 - 184.6a a Remaining amount is for financial charges during implementation.


F. Use and Allocation of Loan Proceeds

13. Use and Allocation of Loan Proceeds. The Facility will be provided to NCRPB in line with the provisions of the Multitranche Financing Facility (MFF) modality. The MFF is particularly well-suited for the Facility because (i) the MFF structure allows the flexibility to NCRPB in its investment decisions based on the readiness of subprojects which will dictate disbursement projections as well as fund raising plan of NCRPB; and (ii) the performance of the subprojects financed can guide the financing of further subprojects, among others, through incentives such as introduction of free limit for facilitating implementation. Further, the Facility supports NCRPB's institutional transformation in line with the evolving infrastructure and financial sector reforms, thus building a long-term partnership between ADB and NCRPB. 14. The investment program will be financed under the MFF in accordance with the Framework Financing Agreement (FFA) that was signed between the Borrower, Guarantor, and ADB. Pursuant to the provisions of the signed FFA, the Borrower and the guarantor submitted and signed the periodic financing request for the first loan (PFR1). As the Facility is provided as an MFF modality through a financial institution and the proposed projects will be reviewed for environmental and social safeguard compliance before disbursement, the list of projects proposed in the PFR are purely indicative. Further, the list provided through the PFR is indicative to provide flexibility in selecting compliant subprojects within the larger proposed list.

24

15. Framework Financing Agreement. The Borrower and India have entered into a Framework Financing Agreement (FFA) with ADB. The FFA records the full set of assurances, warranties, and representations on cross-cutting themes covering safeguards, governance, anticorruption, financial management, procurement, and disbursement and subproject selection. Before ADB accepts the PFR, India and NCRPB will ensure full compliance with the terms and conditions of the FFA. 16. Periodic Financing Request. Multipurpose sub loans will be extended under the Facility to a range of subprojects subject to submission of the related PFR by .NCRPB and execution of related loan and guarantee agreements. Each PFR will be accompanied by a list of subprojects identified for financing under the Facility including those subprojects which can be substituted for subprojects that are not in compliance with ADB requirements. Each individual tranche will not be less than $70 million. The first tranche PFR (PFR1) for $78 million to finance infrastructure subprojects has been received and listed in the Table below.

Table 11: Indicative list of subprojects for PFR1 S. N

Project Name of the implementing agency

Sector Total Project

Cost 1 Panipat - Water Supply Haryana: Public Health Engineering

Department Water Supply and Sanitation

31.0

2 Multi Modal Transit Centre - Sarai Kale Khan

Delhi Integrated Multimodal Transport System Ltd

Urban transport

37.8

3 Multi Modal Transit Centre - Anand Vihar

Delhi Integrated Multimodal Transport System Ltd

Urban transport

37.1

4 Development of State Highways (Jhajjar)

Haryana Roads and Bridges Development Corporation

Regional connectivity

29.45

5 Development of Roads (Sonepat)



22.32

6 Nuhu Water Supply Haryana: Public Health Engineering Department

Water Supply and Sanitation

30.0

7 Pataudi Water Supply Haryana: Public Health Engineering Department

Water Supply and Sanitation

15.0

8 Badli Byepass - 5.70 Km Haryana Roads and Bridges Development Corporation


5.47

9 Development of Roads (Rohtak to Bhiwani; Rohtak to Hissar)



29.03

10 11

Development of Roads (Mewat) Sonepat Drainage

Haryana Roads and Bridges Development Corporation Haryana: Public Health Engineering Department

Regional connectivity Water Supply and Sanitation

14.78

4.8


Moreover, using implementation support component, the PFR will assist in the PPP/PSP transaction of the following subprojects (advisory):

Name of the implementing agency Project Sector

Ghaziabad Development Authority Ghaziabad - Solid Waste Management Solid waste Haryana Public Health Engineering Department

Pataudi - Water Supply Water supply

25

Name of the implementing agency Project Sector Haryana Public Health Engineering Department

Panipat - Water Supply Water supply

Haryana Public Health Engineering Department

Nuhu - Water Supply Water supply

Ghaziabad Development Authority Bus stand and car parking Urban transport Source: National Capital Region Planning Board.

17. OCR Loan Terms. All the provisions of the OCR loan regulations will apply to each loan subject to any modifications that may be included under the individual loan agreements for each tranche. Each loan will carry an interest rate in accordance with ADB's LIBOR based lending facility and a commitment charge of 0.15%. Conversion options may be exercised in accordance with the terms of the FFA and the loan regulations, and such other terms set forth in the loan agreement. The foreign currency risk will be borne by the borrower. NCRPB has provided ADB with (i) the reasons for its decision to borrow under ADB's LIBOR-based lending facility; and (ii) an undertaking that these choices were its own independent decision and not made relying on any communication or advice from ADB. 18. Loan Drawdown. In accordance with ADB's MFF guidelines, a retroactive financing to the extent of 20% of the proceeds of the first tranche will be permissible for past disbursements where the disbursements have occurred at most 12 months prior to loan signing. In all cases of retroactive or proactive financing, the qualified sub-borrower (i.e., the recipient of the subloan) shall carry out and operate the qualified project in accordance with sound administrative, financial, economic, engineering, environmental,--social safeguards; -and business practices, including maintenance of adequate accounts and records. The selection of (the qualified sub-borrower shall be in accordance with subproject and sub borrower selection criteria and approval process and will include compliance with ADB's environmental and social safeguard requirements. ADB shall have the right to review and examine the records and accounts of the borrower, the qualified project and the qualified enterprise, suppliers, and contractors relating to the qualified project. Further, ADB and NCRPB shall each be entitled to obtain all such information as each shall reasonably request relating to the sub loan, the goods, works, and consulting services financed out of the proceeds of the loan, the qualified project, the qualified enterprise and other related matters.

26

G. Fund Flow Diagram

Figure 6: Fund flow diagram for imprest payment mechanism

Project Operating Bank Account

Asian Development Bank (ADB)

USD Advance

Replenishment

Submit liquidation cum replenishment in USD

Executing Agency: NCRPB

Pay 100% to

suppliers

and

contractors

Suppliers, Contractors and Consultants- deliver

Goods & Service

Submit liquidation withdrawal application with 1.Financial

progress self certified or by chartered accountant and 2.

physical progress certified by engineer in a proforma that

explains variations from original

plan and if there is any need for technical assistance from

NCRPB

Subborrowers

State

Share

NCRPB loan funds in Indian

Rupees

Submit

Utilization

Certificates

State Government

Source: Asian Development Bank

27

V. FINANCIAL MANAGEMENT

A. Financial Management Assessment

19. The key findings of the financial management assessment undertaken for the NCRPB are listed below.2 The board of NCRPB has been constituted as per the Act, consisting of a mix of Ministers of the Government of India, Chief Ministers of constituent states, and various key personnel connected with the development of NCR. All the board members are nominated in accordance with the Act, and their conducts are regulated by the Act. NCRPB has 58 authorized staff positions, of which 53 are currently filled. The procedures of day-to-day business conducts are stipulated in the rules concomitant to the Act.

(i) Sound Business Objectives and Strategy. The development policy of NCRPB is governed by the Regional Plan.

(ii) Accounting Policies. The significant accounting policies adopted by NCRPB indicates that they are generally in accordance with the applicable Indian Accounting Standards.

(iii) Credit and risk management policies. NCRPB has no risk management framework, as most of the loans are guarantee backed. The interest rate risk is marginal as nearly 80% of the lending resources are the grants from the Government of India and NCRPB’s constituents, and only a small portion has been raised from the market.

(iv) Transparency. The Audited Accounts together with Comptroller and Auditor General of India certificate are placed before the Parliament.

(v) Compliance with Prudential Regulations. There has been no need for any exposure norms, as NCRPB is an entity not regulated by any entity and its loans are guaranteed and financing is demand responsive.

(vi) Autonomy in Lending Decisions. PSMG have authority to sanction loans to the eligible borrowers in NCR, yet the membership of PSMG includes the Secretaries in-charge of NCR states. As investment decisions are made based on the Regional Plan, the potential risks of conflict of interest between the members of PSMG and the states as the borrowers are adequately minimized. NCRPB is entitled to set interest rates, which are prescribed by the Government of India.

(vii) Capacity to Assess Economic, Social and Environmental Impacts. NCRPB normally appoints external agencies for assessment of DPR, which includes technical and financial details of the subprojects.

20. At present NCRPB is governed by its own Acts and controls imposed by Government regulations. However, as NCRPB (apart from its planning function) also acts as a financial intermediary, it would be appropriate to follow in addition the prudential norms stipulated by Reserve Bank of India or any other appropriate regulator so that NCRPB gains strength as a Financial Intermediary and complies with ADB's requirements. The following institutional reform road map will be undertaken by NCRPB to reach the requirements by 31 December 2011.

2

Available at: http://www.adb.org/Documents/Others/FM-toolkit/Methodology-Note.pdf, and Financial Management. See also Analysis of Projects Guidelines (2005): http://www.adb.org/Documents/Guidelines/Financial/default.asp.

http://www.adb.org/Documents/Others/FM-toolkit/Methodology-Note.pdf

http://www.adb.org/Documents/Guidelines/Financial/default.asp

28

Table 12: Road map for institutional reform of NCRPB ADB Requirements

Norms (RBI/ Regulator for Banks/FIs) and Existing Situation

Next Steps/ Road Map requirements

Capital Adequacy Minimum 12% As most of the loans of NCRPB are to the State Governments for which zero risk weightage needs to be provided, and certain other loans are also only to State Government agencies (with State Government guarantees) where only 20% risk weightage needs to be provided (as stipulated by the Reserve Bank of India in its circular regarding calculation of Capital Adequacy Norms), the Capital to Risk Weighted Assets Ratio (CRAR) of NCRPB is almost in excess of 100%.

As against a CRAR of 12% required by RBI for Financial Institutions, NCRPB has a very high CRAR due to mostly lending only to State Government/agencies. In future when NCRPB proposes to lend to borrowers based on project risk/asset security, the Capital Adequacy norms would be applied and then NCRPB would need to monitor the CRAR very closely in order to meet the prudential norms for a financial institution.

Asset Quality NPA’s and Provisioning Till date there has been no defaults and consequently, no provisioning for Non Performing Assets have been made.

In future when NCRPB proposes to lend to borrowers based on project risk/asset security, a more substantive credit appraisal of the borrower needs to be undertaken by NCRPB and cash flows of the project need to be monitored such that no/less provisioning is required due to payment defaults.

Liquidity RBI norm of Statutory Liquidity Ratio (SLR) of 24% (of their Net Demand and Time liabilities) and Cash Reserve Ratio (CRR) of 5% (of the Bank’s relevant deposits) NCRPB’s liabilities are only long tenure Bonds. Also, NCRPB is creating a Bond Reserve for one such Bond issue. Even otherwise, with a low D:E ratio, and a comfortable reverse cash flow from repayments and interest payments, coupled with no defaults till now, NCRPB’s liquidity position is comfortable. Loan to Deposit ratio of NCRPB would be 100% indicating a good liquidity position

As and when NCRPB accesses more debt (in various forms), it might be prudent to meet appropriate prudential norms of the RBI stipulated for a FI as NCRPB effectively also performs the lending functions of a Financial Institution. Hence meeting such prudential norms which are appropriate would provide strength to the operations of NCRPB

Debt Equity Ratio While there is no guideline of D:E Ratio for Banks/FIs, the CRAR (as explained earlier) needs to be met. As indicated earlier, NCRPB’s CRAR is in excess of 100% due its asset profile.

With Own funds of Rs 20,337.3 million and Debt of Rs 4,651 million (as of March 31, 2009) the D:E position is only 0.23: 1 which gives a lot of scope for raising additional debt. Typically, financial intermediaries like Non Banking Financing Companies, Banks, etc. leverage their own funds at least 5 to 8 times. Consequently, NCRPB can raise substantial debt in future for development (During 2009-10, NCRPB has raised additional Bonds of Rs 1,349.0 million at 8.68% p.a.)

ROI and ROE As NCRPB’s D:E ratio is very low and it finances infrastructure at a low rate of interest, its Return on Equity is only 5.75% pa

A Financial Intermediary’s ROE can only increase with increased leverage. While average cost of borrowings is 6.55% p.a., the weighted average cost of funds is only 1.69% p.a. due to low D:E ratio. The average yield on loans is 6.60% p.a giving a margin of about 4.91% p.a. However, as the D:E ratio increases due to raising of additional debt, the WACC would go up reducing the margin earned from lending However, as leverage increases due to additional borrowings, the absolute net earnings of NCRPB would increase provided the interest

29

ADB Requirements



rates on loans are maintained or increased based on the cost of capital. Therefore, NCRPB needs to leverage its Owned Funds in order to efficiently use scarce resources.

Credit and risk management policies

NCRPB has no risk management framework as most of the loans are guarantee backed and no financial due diligence of sub project cash flow is carried out. Interest Rate Risk: At present the interest rate risk is marginal as almost 80% of the funds on lent are grants from GOI/Delhi Government and only a small portion has been raised from the Market. Further NCR’s borrowing and loans are on fixed terms and consequently the interest rate risk is negligible.

With reduced dependence on State Government backed projects and increased lending to projects based on project risk, NCRPB capabilities would need to be enhanced to include credit risk evaluation, Asset Liability management, etc. Apart from a detailed review of project cash flows, the interest rate risk and maturity risk of both NCRPB’s borrowings and its lending need to be managed such that the Assets and Liabilities are matched on these fronts.

Operating systems, and procedures

NCRPB being a Board under the Government of India, appropriate operating systems and procedures are being followed for budgeting, periodical review of performance vs budget, loan sanctions, raising of finance, etc.

NCRPB would however need to implement stronger systems and procedures for treasury, risk management, budgeting and loan management in case of increased borrowing and also lending in order to scale up its business model in the area of Financial Intermediation

Compliance with prudential regulations, including exposure limits;

Being an entity not regulated by any entity, loans are guaranteed and financing is demand responsive, there has been no need for any exposure norms.

Acceptable corporate and financial governance and management practices including, among other things, transparent financial disclosure policies and practices

The management of NCRPB is being carried out as stipulated in the Act and regulations and follow basic principles of governance. Further the Audit of accounts are carried out by CAG and Placed in the Parliament.

Current disclosures however are not adequate if evaluated from a regulatory disclosure perspective for a Financial Intermediary. NCRPB needs to adopt the appropriate disclosure requirements stipulated for Banks/FIs by RBI or other relevant regulatory agencies in order to meet this requirement. NCRPB will generate and disclose complete set of financial statements comprising of: (i) a statement of financial position as at

the end of the period; (ii) a statement of comprehensive income

for the period; (iii) a statement of changes in equity for

the period; (iv) a statement of cash flows for the

period; (v) notes, comprising a summary of

significant accounting policies and other explanatory information; and

(vi) a statement of financial position as at the beginning of the earliest comparative period when an entity applies an accounting policy retrospectively or makes a retrospective restatement of items in its financial statements, or when it reclassifies items in its financial statements.

30

ADB Requirements



Sound business objectives and strategy and/or plan

The development policy of NCRPB is governed by the Regional Plan and is not backed by a business plan reflecting the entities capital investment program.

Effectively implement the Regional Plan through lending and nonlending instruments available with NCRPB, and collaborate with relevant National and State programs in this respect.

Autonomy in lending and pricing decisions

As per Rules of the NCRPB, interest shall be charged at such rate as may be specified by the Board for any particular loan or for the class of loans concerned and the rate of interest prescribed by the Government from time to time shall invariably be adopted by the Board. However, in practice, NCRPB, after considering the changes in the interest rate scenario in general and its own cost of funds in particular, prepares a note for revision of interest rates, which is forwarded to the Government which, after considering the representation of NCRPB, approves the revision, with changes, if necessary.

A more dynamic lending and pricing mechanism needs to be implemented to operate as a Financial Intermediary in the market place derive the benefit of interest rate and foreign exchange rate movements and also any other matter. Pricing decisions also need to be project risk specific and any other matter relevant to pricing.

Adequate policies, systems, and procedures to assess and monitor the economic, social, and environmental impact of subprojects in accordance with parameters established by ADB for this purpose.

NCRPB has appointed external agencies to evaluate the Detailed Project Reports submitted by the IAs and submit report to the NCRPB.

NCRPB implements the agreed ESMS.

Financial intermediaries should have or build up capacity for mobilizing domestic resources.

NCRPB has over the last two years raised Rs 600 crores as Bonds from institutional investors. Salient features are given in Annexure 1.

Based on the past experience it is felt that NCRPB has the requisite capability to raise finance in the domestic markets.

Use of ADB Funds NCRPB uses funds for infrastructure investments as per regional plan priorities.

NCRPB will use ADB funds as per agreed subborrower and subproject criteria.

Financial intermediary should have local cost anchors

NCRPB lending is based on flexible rates to provide incentives for infrastructure of public good nature including environmental infrastructure.

Onlending will be based on WACC that also includes cost of currency risk management while continuing to provide incentives for urban infrastructure that have positive environmental externalities.

B. Disbursement

21. NCRPB shall ensure that the individual loan proceeds under the Facility will be disbursed in accordance with ADB's Loan Disbursement Handbook (2007, as amended from time to time).

31

1. Types of Disbursement Arrangements 22. There are four major types of disbursement:

(i) Direct payment procedure where ADB, at the borrower's request, pays a designated beneficiary directly;

(ii) Commitment procedure where ADB, at the borrower's request, provides an irrevocable undertaking to reimburse a commercial bank for payments made or to be made to a supplier against a letter of credit financed from the loan account;

(iii) Reimbursement procedure (with or without full supporting documents) where ADB pays from the loan account to the borrower's account, or in some cases, to the project account for eligible expenditures which have been incurred and paid for by the project out of its budget allocation or its own resources; and

(iv) Imprest fund procedure where ADB makes an advance disbursement from the loan account for deposit to an imprest account to be used exclusively for ADB's share of eligible expenditures.

23. For all procedures, it is necessary for the copy of a contract or subproject evaluation report and information memorandum etc., as this is a FI loan. For imprest fund, supporting documents (estimate of expenditure, reconciliation statement and bank statements) are in addition to the regular supporting documentation required for reimbursement. 24. Required actions prior to initial withdrawal

(i) Authorized signatory letter from the NCRPB addressed to ADB (ii) Authenticated specimen signatures of authorized signatories (iii) Submission of withdrawal application (initial advance) and duly accomplished

Estimate of Expenditures Sheet3 in case of imprest account. 25. The request for initial advance to the imprest account should be accompanied by an Estimate of Expenditure Sheet setting out the estimated expenditures for the first six (6) months of project implementation, and submission of evidence satisfactory to ADB that the imprest account has been duly opened. For every liquidation and replenishment request of the imprest account, the borrower will furnish to ADB (a) Statement of Account (Bank Statement) where the imprest account is maintained, and (b) the Imprest Account Reconciliation Statement (IARS) reconciling the above mentioned bank statement against the EA’s records.4 26. The minimum value per withdrawal application is US$100,000, unless otherwise approved by ADB. The borrower is to consolidate claims to meet this limit for reimbursement and imprest account claims. Withdrawal applications and supporting documents will demonstrate, among other things that the goods, and/or services were produced in or from ADB members, and are eligible for ADB financing. Withdrawal applications and other loan disbursement information are available at ADB Controller's Department's website http://lfis.adb.org. A disbursement monitoring information sheet is found in Figure 7 which should be used to reconcile ADB and EA's records. 27. NCRPB will be responsible for the use, management, replenishment, and liquidation of the imprest account. The imprest account will be exclusively used to finance the ADB share of eligible expenditures. The initial amount to be deposited into each imprest account will not

3 Available in Appendix 29 of the Loan Disbursement Handbook.

4 Follow the format provided in Appendix 30 of the Loan Disbursement Handbook.

http://lfis.adb.org/

32

exceed the estimated expenditure to be funded from the imprest account in the first 6 months or 10% of the amount of the loan, whichever is lower. The imprest amount, at any time, will not exceed (i) 10% of each loan tranche, or (ii) estimated expenditures for the 6 months of project implementation, whichever is lower. While making disbursements, NCRPB will review the utilization report for each subproject verified by a chartered accountant. The utilization report will be accompanied by an engineer’s certificate from sub-borrower.5 28. Reimbursement and Liquidation Using Statement of Expenditures (SOE). The SOE procedure will be adopted for reimbursing and liquidating the imprest account for eligible expenditures not exceeding $100,000 per payment. Procedures for establishing and operating the imprest account and SOE procedures are detailed in the Disbursement Letter which will be issued by ADB's Controller's Department. 29. Disbursement Practice. To expedite disbursement, ADB’s Loan Disbursement Handbook has a dedicated section in Chapter 4 on (i) actions to be taken by the Borrower, (ii) basic requirements for disbursement, and (iii) withdrawal application. 30. Reimbursement Procedure. While making disbursements, via the reimbursement procedure, NCRPB will review the utilization report for each subproject verified by NCRPB. The utilization report shall also be accompanied by (i) an engineer's certificate on physical progress, (ii) utilization certificate of past disbursements, and (iii) evidence of payment made to the sub borrower. The final utilization report requirement could be in the form of receipt or acknowledgement issued by the sub-borrower or confirmation through NCRPB regarding execution of real time gross settlement system (RTGS) instruction with full details of the name of the account to which credit given, account number, value date. The disbursement applications should be submitted using forms in ADB's Loan Disbursement Handbook for Reimbursement Procedure along with the summary sheet. SOE procedure will also be used where necessary. With specific regard to the withdrawal application procedure for individual projects:

(i) Withdrawal application Separate withdrawal application for each sub-loan is not a requirement as per Loan Disbursement Handbook; the withdrawal application for sub-loans could be combined.

(ii) Initial withdrawal application for a subproject (or sub-loan): In addition to item (i)

above, an initial withdrawal application and summary sheet of a subproject requires to be accompanied by supporting documents including (a) sub-loan evaluation form together with the Project Information Memorandum, safeguards compliance certificate accompanied by due-diligence report and Environmental Impact Assessment / Initial Environmental Examination mentioned thereto; (b) latest copy of the engineer's report regarding physical progress; (c) utilization certificate endorsed by Lender's Agent; and (d) evidence of payment made by NCRPB to the subproject.

5 The imprest account can be established in a commercial bank acceptable to ADB, in a savings account or current

account, provided the account will allow full withdrawal of all funds in credit at any time, and not place any restriction on number or amount of withdrawals at any time. The interest earned on such savings account should be utilized for project operational expenditure (any category, can be part of counterpart funding). In imprest fund operation, while ADB is providing USD and will expect accounting in USD, in India bank accounts will be maintained only in Indian rupees. NCRPB should find out if it can maintain a USD account, where ADB imprest fund can be kept, to be withdrawn only when expenditure is already incurred and needs to be paid. This will minimize exchange rate risk.

33

(iii) Subsequent withdrawal application for a subproject: For subsequent (or

follow-on) withdrawal application for the same subproject, NCRPB is required to prepare and submit (a) withdrawal application with summary sheet; (b) latest copy of the lenders' independent engineer's (Project Management Consultant (PMC) of NCRPB) report regarding physical progress; (c) utilization certificate endorsed by PMC of NCRPB; and (d) evidence of payment made by NCRPB to the subproject.

31. Pursuant to ADB's Safeguard Policy Statement (2009) (SPS),6 ADB funds may not be applied to the activities described on the ADB Prohibited Investment Activities List set forth at Appendix 5 of the SPS. All financial institutions will ensure that their investments are in compliance with applicable national laws and regulations and will apply the prohibited investment activities list (Appendix 5) to subprojects financed by ADB. 32. The NCRPB will be responsible for (i) preparing disbursement projections, (ii) requesting budgetary allocations for counterpart funds, (iii) collecting supporting documents, and (iv) preparing and sending withdrawal applications to ADB.

2. Accounting 33. The NCRPB will establish and maintain separate and consolidated project accounts and records by funding source for all expenditures incurred on the Project. Project accounts will follow international accounting principles and practices for those prescribed by the Government's accounting laws and regulations. The NCRPB will record, in a transparent manner, all funds received from the Government, ADB, and other sources.

3. Auditing 34. Statutory Audit. NCRPB is subject to annual statutory audit by the Office of Comptroller & Auditor General of India as statutory auditors. Detailed and consolidated annual project accounts will be maintained by NCRPB through the PMU and will be audited by independent auditors whose qualifications, experience, and terms of reference are acceptable to ADB. The accounts will be submitted to ADB within 6 months of the end of the fiscal year. The annual audit report will include a separate audit opinion on the use of loan proceeds, free limit, imprest accounts, SOE procedures, compliance with financial loan covenants, and conformity with ADB's procurement guidelines. NCRPB has been made aware of ADB's policy regarding delayed submission, and the requirements for satisfactory and acceptable quality of the audited accounts. ADB reserves the right to verify the project's financial accounts to confirm that the share of ADB’s financing is used in accordance with ADB’s policies and procedures. 35. NCRPB will regularly report on timely submission of subproject audit reports within 6 months of the close of each fiscal year. Further, any critical audit observations on subprojects should be reported to ADB, and action taken also monitored. NCRPB will be able to submit entity level audit report within 6 months from the close of the financial year and introduce a mechanism for collection and review of subproject audit reports for ADB's review. The audit reports should include an assessment of the adequacy of the accounting and internal control systems, the ability to maintain proper and adequate records and document in support of

6 Available at: http://www.adb.org/Documents/Policies/Safeguards/Safeguard-Policy-Statement-June2009.pdf

http://www.adb.org/Documents/Policies/Safeguards/Safeguard-Policy-Statement-June2009.pdf

34

transactions, and the eligibility of incurred expenditure for ADB financing. ADB retains the right to (i) review and examine any account; and (ii) verify the validity of the certification issued by the Government for each withdrawal application.

Figure 7: Indicative chart for disbursement MIS

Rs -

Rs

-

Rs -

Rs

-

Total - Category 1 (Wor ks) Rs

Rs

2 Equipment

Rs

Rs

Rs Rs

Total - Category 2 (Equipment)

Rs Rs

3 Consulting Services

Rs

Rs

Rs Rs

Total - Category 3 (Consulting Services)

Rs Rs

4 Recurrent Costs

Rs

Rs

Rs Rs

Total - Category 4 (Recurrent Costs)

Rs Rs

5 Interest Charges

Rs

Rs

Rs Rs

Total - Category 5 (Interest Charges)

Rs Rs

Total Project Cost

Rs Rs

Disbursement MIS

Contract

No.

Subproject Description

Proc Mode & WA Date

Subloan No. & WA

No.

Contract Amount

Contractor Name and Address

ADB Financing

Total Govt. & Others

Total

Cum u lati ve

Total

Cost to Complete

Govt.

Financing

Other s

Finan cing

1 Civil Works

Rs

35

VI. PROCUREMENT AND CONSULTING SERVICES

A. Advance Contracting and Retroactive Financing

36. All advance contracting and retroactive financing will be undertaken in conformity with ADB’s Procurement Guidelines (April 2010, as amended from time to time)7 that are applicable to this Facility (para 3.12 thereof). and ADB’s Guidelines on the Use of Consultants (April 2010, as amended from time to time).8 The issuance of invitations to bid under advance contracting and retroactive financing will be subject to ADB approval. The borrower, NCRPB and implementing agencies have been advised that approval of advance contracting and retroactive financing does not commit ADB to finance the Project. 37. Advance contracting. Under each loan of the MFF, advance contracting of (i) civil works, (ii) equipment and materials, and (iii) recruitment of consultants, may be requested subject to these being eligible as per the agreed procedures and guidelines. Advance contracting would include (i) preparation of tender documents to procure materials and equipment; (ii) tendering and bid evaluation for civil works packages; (iii) evaluation of bids; and (iv) recruitment of consultants. 38. Retroactive financing. Except as otherwise agreed with ADB, the expenditures incurred for civil works, equipment and materials, and consulting services eligible for advance contracting, will be eligible for retroactive financing for up to 20% of the proposed amount for the loans under the facility for eligible expenditures in each category incurred prior to effectiveness of each loan, but no earlier than 12 months before the signing of the respective loan agreement.

B. Procurement

39. In accordance with ADB's Procurement Guidelines (April 2010, as amended from time to time),9 ADB will encourage the Borrower to require its sub borrowers to adopt internationally competitive bidding procedures to the extent possible when the amount of the investment is unusually large and economy and efficiency can be gained by following such procedures. For procurement of goods and services to be financed by sub loans out of ADB loan proceeds, the, Borrower will ensure that the price paid is reasonable, and that account is taken of factors such as time of delivery, efficiency, and the reliability of goods. The Procurement Plan for Tranche 1 is in Appendix 1 of the FAM. Electronic procurement may be used provided the e-procurement system has been cleared by ADB. C. Consultant's Terms of Reference

40. The Project Management Consultant firm will be selected using full technical proposal using quality and cost based selection (QCBS) with 80% weight for quality and 20% weight for cost. The revised person-months breakup by specialists and terms of reference are presented below:

7 Available at: http://www.adb.org/Documents/Guidelines/Procurement/Guidelines-Procurement.pdf

8 Available at: http://www.adb.org/Documents/Guidelines/Consulting/Guidelines-Consultants.pdf

http://www.adb.org/Documents/Guidelines/Procurement/Guidelines-Procurement.pdf

http://www.adb.org/Documents/Guidelines/Consulting/Guidelines-Consultants.pdf

36

Table 13: Indicative person months breakup of project management consultants

Technical Specialists (National) Man months 2012 2013 2014 Project Management Specialist & Public Health Engineer (Team Leader) 30 8 11 11 Urban & Regional Transport Specialist (Dy. Team Leader)

14

5

5 4

Water Supply and Sewerage Specialist 8 3 3 2

Roads Engineer 6 2 3 1

Economist/ Planner 6 3 3 -

Urban/Regional Planner 12 6 6 -

Solid Waste Management Specialist 4 2 2 -

Environment Safeguards Specialist 6 2 2 2

Social Safeguards Specialist 6 2 2 2

Project Performance Monitoring Specialist 10 4 3 3

Procurement Specialist 6 2 2 2

Financial Management Specialist 6 2 3 1

IT and MIS Expert 6 2 2 2

Sub-Total (National Experts)

120

43

47

30 Support Engineers & other tech & non-tech support personnel as required 144 60 60 24

Total

264

103

107

54


37

1. Terms of Reference of Facility Management Consultants

Table 14: Indicative terms of reference of project management consultants Expert Educational

Qualification Terms of Reference

Project Management Specialist and Public Health Engineer / Team Leader (National)

Bachelors in Civil Engineering/ Masters in Public Health Engineering with preferably 20 years experience in design, management and supervision of infrastructure projects and water supply and sanitation projects. Demonstrated leadership qualities. Conversant with ADB/ World Bank Project Management

Overall Management of the Project i. Manage all tasks required under the contract and ensure delivery of outputs in a timely and satisfactory

manner in accordance with the overall project implementation schedule; ii. coordinate and assist the NCRPB in their functions and responsibilities in project development, design

and implementation; iii. assist NCRPB in coordinating with implementing agencies; iv. in consultation with the Project Director i.e Director (A&F), NCRPB, assist with the establishment of

annual work plans, job descriptions, staffing schedules and budgets, and prepare a detailed implementation schedule (based on inputs from sub borrowers) covering all stages of implementation process for the projects;

v. set up procedures and systems for overall project management and monitoring project implementation; vi. review project implementation progress from the perspective of overall project management and

detailed annual work plans, and recommend remedial measures as appropriate; vii. review implementation of loan covenants in collaboration with NCRPB and recommend remedial

measures as appropriate; viii. support the NCRPB in monitoring of sub projects, compliance with regard to assurances, progress on

the agreements relating to management reforms and maintenance of PPMS database; ix. coordinate and assist the NCRPB in their functions and responsibilities in project development, design

and implementation; x. assist in review of Regional Plan-2021 and in preparation of integrated Development Plan and city

sanitation plans as agreed with NCRPB. The consultant shall be responsible for Appraisal Functions for New Projects proposed by clients

i. Review detailed designs prepared by sub borrowers relating to water and wastewater prior to approval ensure compliance with all applicable guidelines;

ii. Provide recommendations/guide sub borrowers accordingly; Management

i. As part of program implementation, periodically monitor the overall progress as part of implementation specifically, monitor over all quality of construction of waste management, water and wastewater facilities and compliance with agreed designs by contractors, conducting audits if necessary;

ii. Periodic monitoring the implementation of the water and wastewater utility programs; particularly in matters pertaining to metering, rationalization of charges, creation of databases and GIS systems etc.

38

Expert Educational Qualification

Terms of Reference

iii. Prepare sections of monthly/quarterly reports pertaining to overall implementation of water and wastewater components.

Project Identification & Development i. Contribute to the design of the city sanitation plans, feasibility studies of new projects as identified ii. coordinate review and analysis of sub projects as envisaged as part of the access and sub project

selection criteria of NCRPB and as required by National/ International standards including assistance in preparation of bidding documents

iii. Coordinate consultations required as part of project development iv. Review of Regional Plan-2021 and prepare integrated Dev. Plan as decided.

Urban and Regional Transport Specialist / Deputy Team Leader (National)

Masters in Transportation Planning with preferably 15 years experience in design and supervision of urban transport projects. (Additional experience in urban/regional rail based projects shall be preferred)

Project Identification/Development / Planning i. Coordinate and assist the NCRPB in their functions and responsibilities in project identification and

development (feasibility studies) and monitoring of transport sector sub-projects , ii. Review Transport Plans and proposals of various state governments/cities with their consultation and

identify project pipeline and feasibility, iii. technical review of detailed designs of transport projects submitted by the sub-borrower, including

assistance in preparation of bidding documents. iv. Assist the team and NCRPB for review of RP-2021 and in preparation of integrated Dev. Plan for CMA

or other towns as decided.

v. Support in other day to day technical/financial works in sector related projects/plans/studies/ schemes.

Management and Monitoring in consultation with the Team Leader,

i. review progress of transport sub projects

ii. review and consolidate supervision reports submitted by the sub borrowers and

advice NCRPB on issues relating to appropriateness, quality and progress of works Water Supply and Sewerage Specialist (National)

Bachelors in Civil Engineering/ Masters in Public Health Engineering. Preferably 10 years experience in design, supervision and management of water supply and waste water projects.

Project Identification/Development/Planning In consultation with the team leader

i. Supervise and carry out preparation of city sanitation plans of the selected towns,

ii. review Master/Infrastructure Plans for selected cities to identify water and sanitation projects for

implementation and carry out feasibility of identified water and sanitation sub projects

iii. Coordinate surveys and investigations required to complete the tasks

iv. Review O&M practices

v. Assist the team in review of RP-2021 and prepare integrated development plan for selected towns

vi. Any other tasks as assigned by the Team Leader

Appraisal

39


Terms of Reference

i. Support NCRPB in appraisal of projects submitted for financing as per the eligibility and sub project

selection criteria

Management i. As part of program implementation, periodically monitor the overall progress as part of implementation

specifically, monitor quality of construction of waste management, water and wastewater facilities and compliance with agreed designs by contractors, conducting audits if necessary;

ii. Periodic Monitoring the implementation of the water and wastewater utility programs; particularly in matters pertaining to metering, rationalization of charges, creation of databases and GIS systems etc.

iii. Prepare sections of monthly/quarterly reports pertaining to overall implementation of water and wastewater components.

Roads Engineer (National)

Education and Experience: Bachelor of Civil Engineering/ Masters in Highway Engineering with preferably15 years experience in design and supervision of Highways/ urban road network. Should be conversant with the requisite national codes in design of highways and networks.

Coordinate and assist the NCRPB in their functions and responsibilities in project identification, development, and monitoring; Project Identification/Development In consultation with the team leader and deputy team leader,

i. Review the transport/road sector plans and identify sub-projects for funding by NCRPB ii. Carry out relevant surveys and investigation to complete the feasibility of identified projects iii. Assist in review of Regional Plan & Preparation of development plan as required

Appraisal i. Support NCRPB in appraisal of projects submitted for financing as per the eligibility and sub project

selection criteria

Management Review progress of works related to transport sector projects and advise NCRPB on issues relating to quality and conformity with the design and development objectives

Economist / Planner (National)

Masters in Economics/ Planning/ Development Studies with experience in design and management of regional development projects preferably 10 years experience in area development projects.

In consultation with the team leader, NCRPB and States, i. define area development programs

ii. carry out required economic base assessments and developmental impact reviews,

iii. define project elements

iv. lead and assist preparation of Development Plans of selected towns

v. define land based financing strategies for proposed development including various planning tools to

augment land based resources

vi. Support team in economic analysis of sub projects

vii. Support team to carry out review of RP-2021

40


Terms of Reference

Urban/Regional Planner (National)

Masters in Urban/ Regional Planning with preferably15 years experience in Urban/ Regional Planning of a large Region

i. Assist the team and NCRPB in review of Regional Plan-2021

ii. Carry out the assessment of Development /Implementation Status in NCR with reference to Regional

Plan-2021 policies and proposals

iii. Preparation of Development Plan for selected Cluster of towns/areas in NCR and CMAs

iv. identification of Development Projects in consultation with the stakeholders and assist the concerned

State Governments in this regard

v. Support the team in carrying out the functions related to Planning.

Solid Waste Management Specialist (National)

Bachelors in Civil Engineering/ Masters in Public Health Engineering with preferably 15 years experience in design and management of waste management services

Coordinate and assist the NCRPB in their functions and responsibilities in project development and implementation; The consultant shall

Project Identification & Development i. Review/Prepare Waste Management Plan for select towns in consultation with state concerned ii. plan and carry out surveys as required ; iii. conduct feasibility for identified subproject as prioritised in the Plan iv. prepare estimates in consultation with other specialists v. support NCRPB in transaction vi. Organise workshops as required in defining the project vii. Review the relevant sector in RP-2021 and assist team in preparation of integrated Dev. Plan of

selected towns as decided. Appraisal

i. Support NCRPB in appraisal of projects submitted for financing as per the eligibility and sub project

selection criteria

Review and Management i. review designs prepared by IAs relating to solid waste management prior to approval, ensure

compliance with all applicable guidelines; ii. Provide recommendations/guide IAs accordingly; iii. As part of program implementation, specifically monitor the overall progress of waste segregation,

issuing of applicable legal bylaws; and solid waste monitoring and rectification programs; iv. As part of implementation, monitor overall quality of construction of solid waste management facilities

and compliance with agreed designs by contractors, conducting audits as necessary; v. Support the Team Leader in monitoring the implementation of the solid waste management utility

programs; particularly in matters pertaining to compliance with contractual targets (for compost operations), rationalization of charges, creation of databases and GIS systems etc.

vi. Prepare sections of monthly/quarterly reports pertaining to overall implementation of solid waste management components

Environment Masters in Planning/ Support and advise the NCRPB in

41


Terms of Reference

Safeguards Specialist (National)

Environment/ Masters in Environmental Planning/ Environmental Engineering with preferably 15 years experience in design of environment related safeguards for donor aided projects, preferably with ADB and in oversight of their implementation/ compliance. Should be conversant with relevant national and state Land and environmental laws, NCRPB’s ESMS and ADB procedures.

Project Identification & Development i. Coordinate base line requirements with the Design team, ii. For proposed project, carry out a review of safeguards in relation to NCRPB’s ESMS and prepare the

requisite plans / documents required. iii. Carry out baseline surveys, environmental monitoring plans and programs, initial environmental impact

examinations (IEE) as may be required are carried out ; Management

i. On behalf of NCRPB oversee implementation of ADB compliant resettlement plans if any based on the approved framework,

ii. oversee implementation of Resettlement Plans and iii. preparation of performance monitoring reports iv. assistance and advice on institutional strengthening and capacity building at the NCRPB and sub

borrowers levels in regards to environmental practices; v. oversight of implementation of environmental standards and safeguards as part of project

implementation and vi. preparation of performance monitoring reports

Social Safeguards Specialist (National)

Masters in Planning/ Social Science with preferably 15 years experience in design of Social safeguards for donor aided projects, preferably with ADB and in oversight of their implementation/ compliance. Should be conversant with relevant national and state social policies and Land laws, NCRPB’s ESMS and ADB procedures.

Support NCRPB and the design team in Project Identification & Development

i. Coordinate base line requirements with the Design team, ii. For proposed project, carry out a review of safeguards in relation to NCRPBs ESMS and prepare the

requisite plans / documents required. Management

i. On behalf of NCRPB oversee implementation of ADB compliant resettlement plans if any based on the approved framework,

ii. oversee implementation of Resettlement Plans and iii. preparation of performance monitoring reports

Project Performance

Masters in Engineering/ Planning/ Social

In relation to the project outcomes and in discussion with the PM and the Team, design the project performance monitoring mechanisms for the project, to include:

42


Terms of Reference

Monitoring Specialist (National)

Science with preferably 15 years of experience in project performance monitoring, preferably projects supported by Donors.

i. Definition of the Project Performance Monitoring System (PPMS), forms and monitoring schedule, the outputs and outcome monitoring requirements (based on discussions ADB, NCRPB and all specialists);

ii. Devise TOR for initiation of base line studies and routine and periodic monitoring of outputs and outcome

iii. Supervise surveys and investigations iv. carry out monitoring as per agreed schedule with NCR v. Review and Contribute to project completion reports of sub borrowers and NCRPB vi. Coordinate with IT specialist to complete web based designs.

Procurement Specialist (National)

Bachelors in Civil Engineering with preferably 15 years of experience in procurement goods, works and services as part of donor aided projects, preferably ADB. Should be conversant with the current procurement procedures of ADB.

Project Identification & Development In consultation with the Project Manager, and the Director, prepare the procurement plan for all goods works and services to be taken up for new projects and

i. For specific activities / new projects developed, support the NCRPB in Review of procurement plan Finalizing of Bid Documents Support in preparation of Evaluation reports and related transactions ii. Monitoring In coordination with NCRPB prepare procurement Status Report Monitoring progress for ongoing projects, Preparation of Post Review formats for procurement of goods, works and consultancy

assignments for review by ADB Mission/INRM/NCRPB. Financial Management Specialist (National)

CA/ICWAI Masters in Financial Management with preferably 15 years experience in project accounting and financial management systems. Should have adequate experience in design, implementation and management of project accounting financial management aspects of donor driven projects.

Terms of Reference: Lead overall management of financial management, analytical services and reporting systems of the project and more importantly advise on PPP possibilities and in defining transaction advisory service needs. Management and Reporting

(i) Prepare financial management and reporting systems of the project and oversee production of Financial Management reports for submission to the ADB by NCRPB and sub borrowers including preparation of investment program projections, disbursement requirements, contract award and disbursement targets

Financial Appraisal

(i) Screening of projects to see feasibility of implementing the project on PPP basis (ii) Contribute to the financial management improvements and revenue enhancement measures of new

projects (iii) Estimate the financial and economic internal rates of return for the sub projects to be lent by NCRPB as

well as projects identified by the team, as relevant, following ADB's guidelines; (iv) Study the financial viability of the project under a commercial format and under different user fee

43


Terms of Reference

scenarios and funding options. The Financial analysis for the project should cover financial internal rate of return, projected income statements, balance sheets and fund flow statements and should bring out all relevant assumptions. The sensitivity analysis should be carried out for a number of probabilistic scenarios.

(v) The financial analysis should cover identification, assessment, and mitigating measures for all risks associated with the project. The analysis shall cover, but be not limited to, risks related to construction delays, construction costs overrun, basis of revenue, revenue shortfalls, operating costs, exchange rate variations (if applicable), convertibility of foreign exchange (if applicable), interest rate volatility, non-compliance or default by contractors, political risks and force majeure.

(vi) Conduct sensitivity analyses, including the computation of sensitivity indicators and switching values, which should reflect changes in individual key parameters and assumptions and not be limited to changes in aggregate costs and benefits;

(vii) During the construction and operation of the subprojects, the financial and economic viability should be continuously monitored and reported to the management of NCRPB

(viii) Support team in financial structuring of PPP projects Information technology and MIS expert (National)

The expert will have a management background and preferably 7 years experience in monitoring and evaluating large projects and programs, preferably in the urban sector.

Development i. Review and refine methodology and format for collecting and tracking data on Project progress. ii. Assist the team leader in refining benchmarks and/or indicators against which progress of Project

can be measured. iii. Develop content and protocols and design the same

Management and Maintenance i. Update, refine and expand the web content, database at the central level and a method for on-line data

entry for continuous tracking of Progress in each state and city. ii. Ensure that each city updates monitoring data regularly and train and support ULBs and state

governments to meet this requirement. iii. Submit aggregate quarterly reports to the Project Director on the progress of

reforms, financial disbursements, and other relevant indicators. iv. provide technical support to the sub borrowers for evaluating the benefits of IT interventions v. Monitor the status of implementation of NCRPB-funded project investments vis-à-vis approved timelines

and key deliverables. vi. Provide technical support to the Director in evaluating the benefits of Project interventions, if

required. vii. Manage and maintain web content and database during the project period.


44

2. Indicative Terms of Reference of Individual Consultants

Table 15: Indicative terms of selected individual consultants Consultant position

Education and experience Terms of Reference

Internal Auditor Chartered Accountant by Training with over 10 years of experience in audit functions in a public sector environment.

The following control functions need to be undertaken by internal audit: (i) Review of the appropriateness, scope, efficiency and

effectiveness of internal control systems, policies and procedures;

(ii) To ensure a permanent monitoring of financial activity risks (credit risk, interest rate risk, currency risk, market liquidity risk, country risk, operational risk and other risks that may appear in the course of financial activity ), to conduct current analysis of the financial state, to verify and analyze the state of the internal control in the subdivisions of the financial institution, as well as to appreciate it in an appropriate manner, to control the implementation of the management policy;

(iii) Review of the implementation of management policies; (iv) Detailed testing of transactions and balances and the operation

of individual internal controls to ensure that specific control objectives have been met;

(v) Special investigations for management or the Board; (vi) To ensure compliance with the external legal and regulatory

requirements and codes of conduct; (vii) Review of accounting and other records and the internal control

environment; (viii) The testing of the reliability and timeliness of regulatory

reporting; (ix) Follow up recommendations made in previous reports; and (x) Review of the internal audit procedures of the implementation

agencies and ensure they are adequate. Transaction Advisory Specialist

Post Graduate Degree in Management Finance/Economics (or) Charted Accountant/Cost Accountant. Extensive experience of 15 Years in project development/ transaction advisory services to any National/State or Local Body or any large private financial institution. He/She must have experience associated with PPP project structuring and bid process management. International experience would be a positive.

(i) Preparation of project concept based on discussions with NCRPB, Sub Borrowers and institutional investors/ operators;

(ii) Assist NCRPB/sub-borrower in al tasks relating to concept approval;

(iii) In consultation with NCRPB and Sub Borrowers, define the TOR for preparation of the techno – economic feasibility studies and possible public - private partnership to assist the sub Borrower with: Techno – Economic Feasibility study and Preliminary Project Report/ Application for Viability Gap Funding Approval/Preparation and Production of all bid documents, including draft concession agreement/ PPP bid process management;

(iv) Prepare relevant summary and technical reports for the review committee;

(v) Review and coordinate consultants’ outputs and advise NCRPB/sub borrower on the next steps; and

(vi) Closure of transaction.

Specialist Waste Management

Post Graduate Degree in Public Health Engineering/Environmental Sanitation. 15 Years in project development/transaction advisory services to any National/State or Local Body or any large private financial institution. He/She must have experience associated with PPP project structuring.

(i) Preparation of project concept based on discussions with NCRPB, Sub Borrowers;

(ii) Prepare technology/ management options overview report for collection transfer treatment, and disposal; (iii) Assist NCRPB/ Sub Borrower in all tasks relating to concept

approval; (iv) In consultation with NCRPB and Sub Borrowers, define the

TOR for preparation of the techno – economic feasibility studies for Solid Waste Management/ specific activities;

45

Consultant position


International experience would be a positive.

(v) Prepare relevant summary and technical reports for the review committee;

(vi) Review and coordinate consultants outputs and advise NCRPB / sub borrower on the next steps; and

(vii) Coordinate with other lead specialists to achieve closure of the project.

Legal and/or Contracts Expert

Graduate / Post Graduate in Law with over 15 Years in infrastructure/urban sector. Conversant with legal and transaction advisory with regard to planning and development functions as well as PPP/PSP transactions.

(i) Advise NCRPB, Planning bodies and Sub Borrowers on legal Issues on aspects relating to urban planning, planning and development of growth and environmental infrastructure;

(ii) Advise NCRPB on legal issues linked to implementing business plans and proposed pool finance and market access arrangements;

(iii) Define and assist NCRPB in amendments, modifications to regulations in relation to the business plan objectives; and

(iv) Coordinate with other lead specialists to achieve closure of the project.

Water Supply – Water Systems Management

Graduate/Post Graduate in Public Health Engineering with over 15 Years in design and management of water supply systems. Specific experience in urban sector. Conversant with legal and transaction advisory with regard to planning and development functions as well as PPP/PSP transactions.

(i) Assist Sub Borrower in improving billing and revenue realization from authorized consumers;

(ii) Assist sub borrowers in reducing theft/ leakages and develop monitoring systems to trigger reviews of system performance;

(iii) Define methods of reducing technical losses- Assist sub borrowers in defining the TOR for technical audits and follow-up improvements/investments to reduce UFW;

(iv) Define methods of improving energy efficiencies - Assist sub borrowers in defining the TOR for energy audits and follow-up improvements/investments;

(v) Follow up recommendations with implementable actions and prepare outcome reports;

(vi) Manage knowledge management activities with regard to water utility management; and

(vii) Coordinate with other lead specialists to achieve closure of the project.

Urban Transport Specialist

Masters in Urban Transport with over 15 years experience in design of urban transport plans and interventions.

(i) Assist NCRPB/ Sub Borrowers in review of Comprehensive Transport Plan or Mobility Plan;

(ii) Define priority investment packages for the city; (iii) Define: TORs to carry out techno economic feasibility studies for

specific sub projects, and Policies required for parking, advertising and fares for the entities;

(iv) Formulate plans and policies to facilitate PSP in urban transport sector; and

(v) Advise NCRPB/Sub Borrowers on technology options in the transport sector and define possible areas of automation in the region- Define TOR for next step activities to implement smart systems in transport planning

Business Process Reengineering and Information Technology Specialist

Masters in Management and Exposure to IT based system design with over 15 years experience in design of business process improvements and IT applications in a public sector environment.

Assist NCRPB’s sub borrowers in (i) Business Process Reviews - Review of existing procedure

adopted in specific department; (ii) Coordinate stakeholder consultation; (iii) Recommendation of workflow & procedures for specific

department and define next steps in installing an ERP for the organization;

(iv) Formulate IT Policy and Investment plan for the sub borrower; and

46

Consultant position


(v) Enhance delivery mechanism by introducing IT and ITES where possible.

Training and Institutional Development Specialist (National)

Degree in Management, Planning, public administration or another relevant field and around 15 years or more experience in fields related to public or public/private property management, both within the country and in the region. Direct experience in managing Institutional Development Actions highly desirable

Based on institutional reviews carried out of NCRPB and IA (i) In consultation with NCRPB and IA’s Plan and define various

capacity building activities required for the project and IA’s; (ii) Formulate annual budget and work plan and identify partner

institutions for provision of training; (iii) Coordinate conduct of training in planning at partner institute,

design and management of infrastructure. Training will include structured learning events such as short term courses, structured workshops/seminars. Training should also be provided to the agencies in increasing their awareness of service delivery management;

(iv) Structure TORs and invite agencies for PPP transaction advisory; and

(v) Contribute to the project outcome monitoring indicators in consultation with PPM specialist.

Poverty, social development and gender specialist (National)

Degree in relevant social sciences, public administration or another relevant field and around 15 years or more experience in fields related to poverty, social development and gender, both within the country and in the region. Direct experience in multilateral financed projects or bilateral financed projects in similar projects would be given preference.

Support the PMU and PIUs with application of social, poverty, and gender dimensions at all stages of project planning, design, implementation, and post-construction service delivery, as well as supporting appraisal of succeeding tranches. Poverty, social development and gender issues will be mainstreamed in all project design and implementation activities, particularly capacity building, training, hygiene promotion, sanitation, and monitoring and evaluation. Specific responsibilities will be to: (i) implement the gender action plan; (ii) design and implement public consultations and participatory

approaches during project detailed design and implementation; (iii) determine ways to ensure increased access of women and the

poor to project planning and consultation processes; (iv) ensure services are provided equitably and identify any

stakeholder groups not benefiting from the project, then develop measures to address these—particularly in relation to the poor, women, and vulnerable groups;

(v) work together with the PIUs to develop public awareness activities plus interaction with customers, as well as to establish and monitor the customer complaints system, provide gender sensitivity training for PIUs, and provide any needed training activities targeting communities and households;

(vi) liaise with the community, nongovernment organizations, civil society groups, and others to identify stakeholder groups that can support project implementation;

(vii) develop adequate information and communications channels with the public for project implementation;

(viii) prepare the social impact assessment reports for the project; (ix) monitor any ethnic minority concerns, if they arise; and (x) (j) lead the monitoring of social, poverty, and gender aspects of

the program performance monitoring system, and ensure sex-disaggregated data and qualitative data on poverty is collected for quarterly and annual reports and the project completion report.


D. Private Sector Participation/ Public Private Partnerships

41. With a view to providing assistance to NCRPB and the implementing agencies in evaluating projects amenable for Public Private Partnerships (PPPs) or private sector

47

participation (PSP) as appropriate, the various criteria which can be adopted to develop projects on a PPP/PSP approach are enumerated in the subsequent paragraphs. The options for developing these projects in a PPP/PSP mode could range from a service contract to a Build Own Operate and Transfer (BOOT) contract with the private partner also investing equity in the project. A synopsis of the various PPP/PSP options possible and their relative suitability with respect to different circumstances is given below:

Table 16: Range of public-private partnership options Range of PPP options

Form of PPP Service operation

Management Leasing DBFO

BOT, BOOT and Concession

Divestiture

Complexity of the Structure

Low Low Moderate Complex Complex

Rights of private partner

Simple services Supervisory management control with or without O&M

Construct and or O&M and transfer

Design, rehabilitate, construct, O&M and transfer

Fully divested and sale of assets to private partner

Ownership of Assets

With Government or its agencies

With Govt and its agencies

Lease rights with private partner for the period

With private partner from the Construction and/or O&M period

With private partner for eternity

Duration of contract

Short term Short term Medium to long term

Long term Perpetuity

Examples Billing and collection of water and holding tax, meter reading, maintenance, replacement, etc.

Improvements in existing system, operations; Streamlining administrative and operational practices

Distribution system improvement

Efficiency enhancement and creating new assets

Sale of existing assets

Source: Asian Development Bank

42. Screening Criteria. The projects which are sought to be implemented need to be evaluated as to whether these projects can be implemented as PPPs/PSPs based on the various screening parameters enumerated below:

(i) Clarity in project objectives; (ii) Improvement in service delivery; (iii) Commercial viability / revenue model (is there an identifiable stream?); (iv) Competition (Are there sufficient competing firms in the market providing a

similar service?); (v) Efficiency of Operations (Can the private sector improve service efficiency to

consumers through innovative use of technology?); and (vi) Organizational Capacity (Does the ULB have the capacity to manage projects,

past projects, procurement procedures and systems management?).

43. NCRPB and its clients should assign different weights depending upon the importance of the parameter to be concerned and come-up with a weighted average score. Each project sponsor/local body should be able to evaluate whether the nominated project should be financed on PPP/PSP or other structure on the basis of the following checklist. Further, the sponsor/local body should also discuss whether other PPP/PSP could be considered, and other steps taken.

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Table 18: Screening checklist for PPPs

Screening Check List for PPP Rating Description of Rating of PPP/PSP

Clarity in Project Objectives On A Scale of 1 to 5 (1 low; 5 high)

A rating of 1 if there is no clarity on which components of the project are to be taken up by PPP. Higher ratings can be assigned if specific objectives for PPP have been identified including: financing, design, technology and construction; O&M; or some combination of above. A high rating can be assigned if the scope, roles and responsibilities of the private sector have been worked out.

Improvement in Service Delivery (i.e. improving quality, quantity, and physical coverage of services)

On A Scale of 1 to 5 (1 low; 5 high)

The rating depends upon whether the service to be monitored by the private party can be identified, measured, and monitored. The guidance for the rating is provided as follows:

1- If the benefits cannot be measure or quantified and it is not possible to link payments to services.

2 & 3- If the payments can be measured, quantified and monitored.

4 & 5- Benefits can be measured, quantified and monitored. Payments directly linked to service delivery indicators.

Commercial Viability/ Revenue Model For the Project (is there an identifiable revenue stream)


Any project that involves delivering a service to the users against a tariff or user charges is important for commercial viability of the project. The guidance for ratings is as follows:

1- If the project has no scope for generating revenues.

2- If the project can generate revenues but it is too low even to meet O&M expenses.

3- If project revenues can meet entire O&M expenses.

4- If project revenues can meet O&M expenses and part of debt servicing.

5- If project can meet O&M, debt servicing and principal repayment.

These ratings should take into consideration existing user charges, ability to generate revenue from other non-tax sources such as land, etc.

Competition (Are there sufficient competing firms in the market providing a similar service)


Availability of competitive suppliers for a particular project will help lower the cost of the service for the ULB. The guidance is provided below, including:

1- There are no competitive firms providing / capable of providing the service in the market.

2 & 3 – There are few domestic firms or international firms present the Indian Market who has the capability to execute the project.

4 & 5 – There are a reasonable number of domestic and international players who have executed projects in India.

Efficiency of Operations (Can the private sector improve service efficiency to consumers through innovate use of technology)


The rating on this parameter would depend upon the scope that the project rating offers to improve efficiency of operations. The guidance for ratings is provided below:

1- The ULB has been providing the services in the past and there is little scope for the private sector to improve efficiency.

2 & 3 – The same service is also provided by the private sector in some cases with much better service levels at same or slightly higher costs. There is some scope for technology improvements.

4 & 5 – Private party can provide the same or better service at lower costs through elimination of waste, and / or better

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Screening Check List for PPP Rating Description of Rating of PPP/PSP

technology.

Organizational Capacity (Does the ULB have the capacity to manage projects (PPS) – this includes past projects, procurement procedures, and systems management).


The guidance for ratings is given below:

1 – The ULB has only undertaken material procurement or simple labor contracts using the private sector.

2 – The ULB has undertaken some outsourcing of services to private sector.

3 – The ULB regularly undertakes out-sourcing of services and has experience with performance based contracts.

4 – The ULB has undertaken at least one PPP. The project has been successful.

5 – The ULB has undertaken a reasonable sized PPP in which the private sector is responsible for development and O&M of service.

Regulatory Impact On A Scale of 1 to 5 (1 low; 5 high)

The guidance for ratings is provided below:

1- Any rules, provisions in the Municipal Act or policies from the state government expressly prohibiting PPP in the concerned service/activity.

2- The Municipal Act/Other does not prohibit PPP in the concerned services but there are no policy guidelines from the state government.

3- The Municipal Act/Other policy guidelines allow PPP but there is no specific mechanism for state support.

4 & 5- Supportive legal framework. The state has an over-arching framework for PPP. The support mechanism from the state government is well laid out.

Overall Score Weighted Average Score – Whether Project is Amenable to PPP/PSP?


44. Identification of projects. Once the projects are identified based on the aforesaid criteria, NCRPB/Implementation agencies can use the Government of India (GOI) initiatives in providing funds to further develop these projects in the PPP/PSP mode. Some of the facilities being provided by GOI are as follows:

45. India Infrastructure Project Development Fund (IIPDF). One of the schemes being

implemented by the GOI for supporting initiatives in implementing urban projects in the PPP

mode is the IIPDF. The brief details of the scheme are enumerated below:

(i) The procurement costs of PPPs, and particularly the costs of Transaction Advisors, are significant and often pose a burden on the budget of the Sponsoring Authority.

(ii) Department of Economic Affairs (DEA), Government of India, has identified the IIPDF as a mechanism through which Sponsoring Authority will be able to source funding to cover a portion of the PPP transaction costs, thereby reducing the impact of costs related to procurement on their budgets.

(iii) From the Government of India’s perspective, the IIPDF must increase the quality and quantity of ‘bankable projects’ that are processed through the Central or States’ project pipeline.

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(iv) The IIPDF will be available to the Sponsoring Authorities for PPP projects for the purpose of meeting the project development costs which may include the expenses incurred by the Sponsoring Authority in respect of feasibility studies, environment impact studies, financial structuring, legal reviews and development of project documentation, including concession agreement, commercial assessment studies (including traffic studies, demand assessment, capacity to pay assessment), grading of projects, etc. required for achieving Technical Close of such projects, on individual or turnkey basis, but would not include expenses incurred by the Sponsoring Authority on its own staff.

(v) The Fund will assist ordinarily up to 75 percent of the project development expenses to the Sponsoring Authority. On successful completion of the bidding process, the project development expenditure would be recovered from the successful bidder. However, in case of failure of the bid, the assistance would not be recovered. The Sponsoring Authority would be liable to refund the amount of assistance received, in case it does not conclude the bidding process for some reason or does not contract out the project after the bid process has been completed.

(vi) The application shall contain the financial details of the project. Ordinarily, three types of projects can be posed for funding under the IIPDF:

(vii) Revenue Generating Commercial Projects (Concession/BOOT or its

variants/Lease contracts). A project FIRR of 20 percent or more on the private sector investment should be demonstrated. If the FIRR is below 20 percent even with viability gap financing (VGF) of up to 40 percent (maximum of 20 percent from VGF Scheme of GoI and 20 percent from the Sponsoring Authority) then the Project shall not ordinarily be considered.

o Efficiency Enhancement/Cost Savings Projects (Management or

Service contracts or Engineering, Performance based O&M contracts). Where there is no or low private sector investment, the financial savings/enhanced revenues should ordinarily be able to recover payouts by government within eight to ten years of completion of the project. Annuity based project would also be covered under this category.

o Non-revenue generating projects with high economic returns (e.g.

Sewerage System). In case of project undertaken in PPP formats based on Economic Returns considerations, the project eligibility will be based on sector preferences to be established by the government or lending agency and would be based on annuity payments by the Sponsoring Authority.

(viii) Proposals for funding under these Guidelines would cover the entire gamut of

PPP projects, i.e. BOT (Toll), BOT (Annuity), long term management contracts etc. The decision of the Empowered Institution about the eligibility of a project shall be final.

(ix) Project development funding, ordinarily, will be an interest free financial

assistance to meet the project development expenses. This is expected to be recovered from the successful private sector partner on award of the project. The Sponsoring Authority will reimburse the IIPDF, the project development expenses

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along with a fee up to 40 percent of the funding as provided below. The Sponsoring Authority must provide a plan for the same.

o Revenue Generating Commercial Projects (Concession/BOOT or its

variants/Lease contracts). In case of revenue generating projects proposed to be implemented through private sector investments, the Memorandum for Consideration (MFC) must include a plan for recovery of the IIPDF amount with a success fee of 40 percent.

o Efficiency Enhancement/Cost Savings Projects (Management or

Service contracts or Engineering, Procurement and Construction (EPC) contracts with limited period performance based O&M contracts). Where there is no or low private sector investment, the plan for recovery of project development expenses will be with a success fee of 25 percent.

o Non-revenue generating projects with high economic returns (e.g.

Sewerage System). In case of projects undertaken in PPP formats based on Economic Returns considerations, project development funding may be considered merely as an interest free financial assistance to the project, to be repaid without any success fee, by the government.

46. Viability Gap Fund (VGF). Another scheme of the GOI to encourage implementation of

projects in the PPP mode is the VGF. With a view to provide financial support to infrastructure

projects that are to be undertaken through Public Private Partnerships (PPP), the Government

of India has notified a scheme called Viability Gap Funding Scheme. A brief note on this

scheme is as follows:

(i) These guidelines will apply to PPP projects posed by the Central Ministries, State Governments and Statutory Authorities, as the case may be, which own the underlying assets;

(ii) Proposals to be made under this Scheme shall be considered for providing Viability Gap Funding (VGF), one time or deferred, with the objective of making a PPP project commercially viable;

(iii) The proposal shall relate to a Public Private Partnership project which is based on a contract or concession agreement between a Government or statutory entity on the one side and a private sector company on the other side, for delivering an infrastructure service on payment of user charges;

(iv) This Scheme will apply only if the contract/concession is awarded in favor of a private sector company in which 51 percent or more of the subscribed and paid up equity is owned and controlled by a private entity;

(v) A private sector company shall be eligible for VGF only if it is selected on the basis of open competitive bidding and is responsible for financing, construction, maintenance and operation of the project during the concession period;

(vi) The project should provide a service against payment of a pre-determined tariff or user charge; and

(vii) The quantum of financial support (VGF) to be provided under this Scheme shall be in the form of a capital grant at the stage of project construction. The amount of VGF shall be equivalent to the lowest bid for capital subsidy, but subject to a maximum of 20 percent of the total project cost. In case the sponsoring

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Ministry/State Government/statutory entity proposes to provide any assistance over and above the said VGF, it shall be restricted to a further 20 percent of the total project cost.

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VII. SAFEGUARDS

A. Environmental Social Management Systems

47. The subproject selection criteria ensures that safeguards impacts will be avoided or minimized (see Web-Link Document 1, Framework Financing Agreement for subproject selection criteria). Further, an Environmental and Social Management Systems (ESMS) has been developed and adopted by NCRPB (Web-Linked Document 12 as well as Appendix 2 of the FAM). The ESMS clarifies NCRPB's environmental and social policies; and safeguard screening, categorization, and review procedures. The ESMS document also sets out a plan to strengthen the environment and social organization structure and staffing; and sets our performance monitoring and reporting procedures. The ESMS includes further development of institutional capacity within NCRPB to manage environmental and social issues. Other key references that can assist in implementation of the facility, including safeguards, are provided in the Appendix 3 of the FAM. 48. An Environmental and Social Management Cell will be established in NCRPB to perform the following functions:

(i) Maintain and update the ESMS ; (ii) Ensure all subprojects financed by NCRPB are screened, categorized, and

reviewed in accordance with the ESMS; (iii) During screening provide advise to the subborrower to ensure that safeguard

(environment, involuntary resettlement, and indigenous peoples) impacts are avoided or minimized;

(iv) In accordance with the ESMS ensure that safeguard documents (environmental management plan, resettlement plan, and indigenous peoples plan) as required are prepared;

(v) Set loan conditions for subprojects and ensure all safeguards requirements are fulfilled including but not limited to award of civil works contracts only after compensation where involuntary resettlement occurs;

(vi) Monitor subprojects to ensure safeguards compliance in accordance with safeguards documents prepared for subprojects;

(vii) Provide training and capacity-building to subborrowers; (viii) Provide information to ADB and other donors in accordance with the ESMS; (ix) Provide assistance and required information to external ESMS auditors for the

conduct of annual audits; and (x) Ensure monitoring and reporting requirements are undertaken in accordance with

the ESMS. 49. NCRPB will follow the ESMS in the preparation of each PFR. Second and subsequent PFRs will include a review of ongoing projects and their compliance with the ESMS. If there is noncompliance, a corrective action plan will be prepared and submitted to ADB. B. Poverty Dimension

50. The percentage of population in poverty in rural India and NCR constituent states is higher than is population in poverty urban India. Rural Uttar Pradesh has 43 percent in poverty, which higher than all other NCR constituent States and also the national average. The urban poverty levels of both Uttar Pradesh and Rajasthan are higher than the national average. The incidence of poverty in rural and urban Delhi and Haryana do not vary too much. However,

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considering the population in urban pockets, the number of persons below poverty will be more in these two states. The poverty levels in Haryana and Uttar Pradesh for 2004-05 have come down significantly from the 1993-94 revised estimates based on the new methodology. However, more than one-third of population in Uttar Pradesh and a little more than one-third population in Rajasthan are in poverty. There has been a decrease in the proportion of poor over the last decade (1993-94 to 2004-05) in the rural parts of NCR States and the decrease is significant in Haryana. The poverty head count ratio of Haryana that was 40 percent in 1993-94 has reduced to 25 percent in Haryana. The poverty head count ratio in Uttar Pradesh has come down from 51 percent to 43 percent and Rajasthan has reported a marginal fall in the proportion of population in poverty from 41 percent to 36 percent. Delhi that already had a reduced poverty ratio, reported a marginal decrease in the poverty ratio. 51. Except Delhi that has experienced a higher rate of urban poverty alleviation, the rural poverty alleviation amongst NCR constituent States is better compared to the urban poverty alleviation. Rural poverty alleviation rate of Haryana is the highest amongst the NCR constituent States and Uttar Pradesh fares better in terms of urban poverty alleviation. Both rural and urban poverty alleviation in Rajasthan is weak. The urban poverty alleviation rate in Rajasthan is just 0.02 percentage points per annum. The rate of poverty reduction is given in the following table.

Table 19: Rate of Poverty Reduction

NCR Constituent States

1993-94/2004-05

Rural Urban Total

Delhi 0.05 0.25 0.24 Haryana 1.38 0.16 1.07 Rajasthan 0.45 0.02 0.35 Uttar Pradesh 0.75 0.38 0.68 India 0.75 0.55 0.74

Source: Based on Data from Planning Commission of India

52. Impact of Sub-projects on Poverty Reduction. The road connectivity projects in Sonipat, Jhajjar and Badli and the multimodal transit centers (MMTCs) in Anand Vihar and Sarai Khale Khan will improve the much needed public transport system that is the main mode of commuting for the poor and a large population of this region. Access to employment, health centers, hospital, schools and markets will improve with better roads and improved transport system. With better roads, it is expected that there would be more public transport covering these locations and thereby help the community in accessing facilities and markets. Further, the travel time will reduce considerably and those commuting to work can reach their respective destination faster. Better connectivity will induce economic development and provide for poverty alleviation. With increased opportunities for employment the poor will be able to engage themselves in activities that would provide higher income/wages and with the increased income, the poor will be able to meet their educational and health needs. 53. The water supply project in Pataudi will ensure supply of safe drinking water and more time at disposal for the women who go out to collect drinking water. The sewerage project in Pataudi will ensure safe disposal of sewerage which otherwise is currently contaminating the ground water due to poor discharge system prevalent in the town. Sewerage system will result in less sick-days and more working-days. Thus water supply and sewerage projects will not only provide safe water and sanitation to the poor but will also enable them to engage themselves in income generating activities as the overall health of the people will improve..

Table 17: Summary of Sub-project Benefits (MMTC)

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Impact Sector Beneficiary Benefit Outcome

Employment Poor households Women Migrants

Faster and easy access to centers where there are opportunities Increased economic activity Access to markets

Better paid jobs Increased income Increased spending on health and education Improved standard of living Better prices for their produce

Education Children Easy, faster and safer access to educational institutions Better educational attainment

Increased literacy level amongst children Increased Opportunities to higher studies

Health Men and Women Reduction in number of labor days lost Will have access to antenatal care Institutional deliveries Access to health care

Increased income Reduced maternal mortality rate Better results in family planning program More institutional deliveries Reduced infant mortality rate (IMR)

Children Access to health care Lower IMR Lower child mortality rate Reduction in malnutrition


C. Gender Mainstreaming and Gender Action Plan

54. NCR has a sex ratio of 847, lower than the national sex ratio and is largely due to Delhi that reports a very low sex ratio of 821 compared to the other NCR constituents. The sex ratio of six years and below population is 856 in NCR and interestingly Delhi reports a higher sex ratio of 868 in this age group indicating that preference for male child over female child is reducing among the population. While the sex ratio in Uttar Pradesh and Haryana record a fall in the 0-6 year’s age group compared to the respective population sex ratio, the fall is too steep in Haryana requiring the attention of the State Department of Health and Family Welfare. 55. Impact of Sub-projects on Women. Access to health centers, hospital, schools and markets will improve with better roads and improved transport system. With better roads, it is expected that there would be more public transport covering these locations and thereby help the community in accessing facilities and markets. This apart with better connectivity, the auxiliary nurse midwife (ANM) workers who are the torch bearers of National Rural Health Mission will be able to easily access the targeted population. Decline in MMR, CMR and IMR are expected due to increased institutional deliveries and access to antenatal care. Improved literacy level and increased income due to access to schools and markets is also expected. Water supply projects will ensure supply of safe drinking water and more time at disposal for the women who go out to collect drinking water. The additional time gained can be directed towards income generating activities. The sewerage project will reduce ground water contaminating and will result in less sick-days and more working-days. 56. The women have been consulted during planning stage to seek their views and concerns to address the same. The consultation will continue during the construction stage. Existence of the grievance redressal mechanism to redress the grievances of the people directly or indirectly affected by the sub-projects has been disseminated. The social safeguard framework provides for additional support and guidance for women headed households. The sub-project will give preference to women in employment in construction activities. The construction contract will have built-in provision of toilet and child care facilities at the construction site for women and children.

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57. Road connectivity projects that would improve free flow of traffic and reduce travel time are likely to increase exposure of the local population to HIV/AIDS and other sexually transmitted disease. Further, awareness on road safety measures will be undertaken to ensure safety of women and children who use these roads. The road connectivity projects in Sonipat, Jhajjar and Badli and the MMTC in Anand Vihar and Sarai Khale Khan will improve the much needed public transport system that is the main mode of commuting for the poor and a large population of this region. 58. The water supply project in Pataudi will ensure supply of safe drinking water and more time at disposal for the women who go out to collect drinking water. The sewerage project in Pataudi will ensure safe disposal of sewerage which otherwise is currently contaminating the ground water due to poor discharge system prevalent in the town. Sewerage system will result in less sick-days and more working-days.

Table 18: Summary of Sub-project Benefits (Roads)

Impact Sector Beneficiary Benefit Outcome

Education Female children

Educational attainment

Increased literacy level amongst female Opportunities to higher studies

Health

Women

Will have access to antenatal care

Institutional deliveries

Access to health care

Reduced MMR Better results in family planning program More institutional deliveries Reduced IMR

Children Access to health

care

Lower IMR Lower CMR Reduction in malnutrition

Occupation Women Access to

employment Access to market

Access to money Involvement in decision making in family Better prices for their produce


59. A gender action plan has been prepared that outlines some gender benefits that are likely to arise in implementing the sub-projects and the likely negative impact and the necessary mitigatory measures. The activities include: (i) disclosure of sub-project details; (ii) concerns of women are recorded and mitigated; (iii) awareness creation targeted for women on HIV/AIDS and sexually transmitted diseases; and (iv) preference for employment in sub-project construction activities. The gender action plan is based on the gender analysis that was prepared during project preparatory stage and is in line with Policy on Gender and Development (2003) and Sector and Thematic classification of Operational Projects of the Asian Development Bank (ADB). The 11th plan has emphasized the need for integrating women’s need, rights and contribution in every section of planning. 60. Gender Action Plan. Because women benefit from subprojects and because they are disadvantaged by lower levels of education and literacy, the GAP ensures that (i) subproject details are disclosed to female beneficiaries, (ii) concerns of women are recorded and design includes mitigation, (iii) subproject benefits positively impact women and that benefits are equitable; and (iv) employment of women in subproject construction is ensured. The details of GAP are provided below in the table.

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GENDER ACTION PLAN During the project design and implementation special attention will be given to elicit views and feedback of women and the poor so that the design has features that maximizes the benefits of infrastructure created for women and the poor. Existing community based organization, nongovernment organization and other women's collectives would be approached to obtain collective feedback in addition to household qualitative surveys to obtain views of women and the poor.

Table 19: Gender action plan

Time/Focus Objective Task Target Indicator Implementation

Project Design To integrate gender perspective in project design Provide opportunities for women to participate in subprojects from the identification stage to implementation stage

Road improvement projects. Disclose project details and address concerns of women during design Redevelopment of MMTCs. Take into consideration requirements of women and children in planning various facilities in the multimodal transit centers (MMTCs) Water supply and sewerage project. Ensure involvement and participation of women during project planning, pricing, and implementation

Plan, design and implement road safety awareness programs for local communities in road projects to ensure safety of women and children

Consult women during planning and construction stage o regarding location of bus stops and

pedestrian crossings o facilities and amenities required for women

labourers at the construction site o addressing demand for amenities due to

influx of migrant labour o mitigate social impacts that may arise due to

presence of migrant labour force o Identification of beneficiaries so as to ensure

that the envisaged benefits positively impacts women and are equitable

Formulate participation plan to ensure stakeholders, male and female participate in the planning process and implementation, specifically considering that women’s participation is balanced with their other tasks so as not to overburden them

Establish specific mechanisms to promote women’s representation in decision-making processes in project finalization, implementation and management of assets

Ensure equal wages are paid to men and women labourers for involvement in all stages

Provide budget for screening gender impacts Finalise the entitlement packages for women in

consultation with women Create awareness on HIV/AIDS and other sexually

transmitted disease

Women living in subproject locations

Elected representatives of panchayats and/or municipalities

Disaggregated records (on participation, employment in subprojects, training and skills development activities for project beneficiaries, etc.) by gender and vulnerability

Subproject selection, subproject designs, etc. are gender responsive and respond to women's need and priorities

Regularity of meetings and/or consultations held, and adequate representation of women as indicated by meeting minutes

Confirmation whether the views of women have influenced the design outcomes as indicated by interviews

% women participants in training and skill development activities as indicated by rosters

% representation of women in project implementation as indicated by number of women employed

Interviews with women on site to assess participation levels, extent of benefits, etc.

Social development specialist of the PMU

Project management consultants

NGO / organization engaged towards short resettlement plan (SRP) implementation, awareness generation and training programs

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Time/Focus Objective Task Target Indicator Implementation

To integrate gender within project implementing units (PIUs), urban local bodies (ULBs), etc.

Provide gender sensitization training to implementing agency staff, PIU , ULBs, contractors, etc.

Prepare training materials for gender sensitization workshop

PIU, ULB, implementing agencies, contractors, etc.

Workshops conducted Number of participants Number of women participants

amongst the PIU, ULBs

Social specialist of PMC, PMU, NGOs

Project Implementation and monitoring Gender perspective in project implementation Ensure women’s awareness and involvement in project implementation and benefits Ensure women gain benefits from construction activities Ensure that project benefits positively impact women and that benefits are equitable

Ensure women participate in project related construction activities Deliver safeguard entitlements to affected women Undertake awareness creation on HIV/AIDS and road safety Assist and provide guidance to women in redressing grievance

Contractual clauses to be built into the contracts ensuring that o women are given preference in

employment o equal wages for men and women for

same kind of labour and/or employment o provide minimum wages as prescribed by

the respective States o make adequate provisions of toilets

exclusively for women in the construction site

o make adequate drinking water available to labourers and in particular where women take food and/or rest

o establish, if required, child care facilities in the construction site Ensure safeguards provision as provided in the

entitlement framework are fully delivered to women o disclose entitlements to all affected

households, and provide guidance and assistance to women headed households in effective utilization of entitlements Undertake awareness creation on HIV/AIDS

and other sexually transmitted diseases particularly amongst women living along the road project corridors Create awareness on road safety, best practices in sanitation and hygiene Disseminate information about the structure and process of redressing grievances

Women living in subproject locations

Number of women employed by the contractor

Number of temporary toilets built exclusively for women labourers

Record of wages paid to women and men

Site verification of adequacy in provision of drinking water and child care facilities

Number of women headed households affected

Details of disbursement of entitlements

Number of awareness creation campaigns undertaken

Copies of information, education and communication (IEC) material

Grievances of women, time taken to resolve them, and satisfaction level of women

Social development specialist of the PMU

Project management consultants

NGOs/ organization engaged towards SRP implementation, awareness generation and training programs

Contractors

HIV/AIDS = human immunodeficiency virus/ acquired immune deficiency syndrome, IEC = information, education and communication, MMTC = multimodal transit center, NGOs = nongovernment organizations, PIU = project implementing unit, PMU = project management unit, SRP = short resettlement plan, ULB = urban local body. Source: Asian Development Bank.

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VIII. PERFORMANCE MONITORING, EVALUATION, REPORTING AND

COMMUNICATION

61. This section explains project's specific monitoring, evaluation, reporting, and communications arrangements. Design and monitoring framework (DMF) for the Facility is shown in Table 21 below while the DMF for Tranche 1 is in Appendix 4 of the FAM.

A. Project Design and Monitoring Framework

Table 20: Project design and monitoring framework - Facility

Design Summary

Performance Targets and Indicators with Baselines

Data Sources and Reporting Mechanisms

Assumptions and Risks

Impact Improved quality of life and economic well-being of urban residents in NCR and CMAs

Waterborne diseases are decreased by 10% by 2019 compared to 2010 Residents in areas assisted by the facility show increased satisfaction with urban basic services significantly compared to baseline Economic growth in NCR is commensurate with the expectations of India's 11th Five Year Plan Preference for public transportation increased by 10% by 2019 compared to 2010

Household demographic, health, and income expenditure surveys Project-specific household and economic surveys

9

Assumption Investments (both public and private) and regulations enable improvements in public and environmental health Risk Infrastructure investments fall short of demands posed by rapid urbanization and in-migration

Outcome Urban residents use improved growth-supporting, public health, and environmental urban infrastructure services in the intervention cities of NCR and CMAs in accordance with Regional Plan 2021 priorities

In the cities supported by the facility in NCR and CMAs, specific to the urban infrastructure support: (i) Intercity road movement increased by 10%

by 2016 from 2010 (ii) Use of multimodal public transport

increased by 10% from the baseline (iii) Piped water supply connection increased

by 10% by 2016 from 2010 (iv) Women's drudgery for fetching water

reduced by 10% by 2016 from 2010

Household demographic, health, and income expenditure surveys Project-specific household and economic surveys (footnote 9)

Assumption Urban infrastructure investments in NCR continue to have high priority Risk In-migration into NCR outstrips the pace of urban infrastructure development

Outputs Increase in investments for urban waste management and water supply in the overall portfolio of NCRPB by 5 percentage points by 2016 from 2010 NCRPB's concessional lending to public health and environmental urban infrastructure introduced by December 2011 Gender targets in the gender action plan achieved by December 2016 NCRPB mainstreams gender-inclusive and pro-poor environmental and social safeguards by December 2016

1. High quality urban public health and environmental infrastructure created

Project performance monitoring reports Review mission reports

Assumption Competent subborrowers undertake projects as per schedule Risk Lack of sufficient interest among end borrowers to seek debt for public health and environmental projects

9 Baseline and final survey will be conducted in the cities where the projects will be undertaken to assess outcomes.

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Design Summary

Performance Targets and Indicators with Baselines



2. High quality economic growth-related regional and urban infrastructure created

Investments by NCRPB in intercity regional roads and multimodal transport facilities increased by 5 percentage points by December 2016 from 2010 Gender targets in the gender action plan achieved by December 2016 NCRPB mainstreams gender-inclusive and pro-poor environmental and social safeguards by December 2016


Assumption Competent subborrowers undertake projects as per schedule Risk Land acquisition delays project implementation

3. Strengthened capacity of NCRPB and subborrowers to scale-up urban infrastructure and improve basic urban services

3.1. NCRPB becomes more effective in executing its scaled-up mandates: (i) At least one pooled municipal fund facility

arranged by NCRPB by December 2016 (ii) Strengthening of project management unit

of NCRPB by December 2011 (iii) Capacity building of subborrowers

including, among others, web-based tools available by December 2013

(iv) NCRPB strengthens risk, treasury, and project management processes by December 2011


Assumption NCRPB continues to provide competitive and attractive lending and nonlending products Risk Liquidity, tenure (asset–liability mismatch), interest, foreign exchange risks

3.2. Inclusive and balanced geographical and sector infrastructure development enabled: (i) At least five DPRs that will enable higher

investments at city level, especially in Uttar Pradesh, prepared by December 2013

(ii) Social and gender-relevant processes and practices institutionalized through capacity development of relevant stakeholders by December 2016


Assumptions Adequate debt-based project demand for public health and environmental urban infrastructure exists Risk Slow pace of reforms continues to keep municipal finances and institutional capabilities weak

3.3. Urban infrastructure projects are executed effectively: (i) Subproject readiness assessed and

subborrowers provided technical support for better project readiness by June 2010

(ii) Project management consultants hired by April 2011

(iii) Systematic and regular progress monitoring of financial, physical, social, and gender-related impacts of subprojects introduced by NCRPB by June 2011


Assumption Land acquisition and shifting of utilities, among others, are undertaken well in advance Risk Trained and experienced staff are transferred to unrelated assignments

3.4.Increased private sector participation in urban infrastructure development and urban basic service provision: (i) Checklist for PSP/PPP introduced by

September 2010 (ii) Lending and nonlending incentive scheme

for PSP/PPP introduced by NCRPB by June 2011

(iii) At least one urban infrastructure project to be structured and executed within PSP/PPP framework by December 2016


Assumption Sufficient interest among capable private sector entities in urban infrastructure development and/or services delivery Risk Lack of capacities and interest among subborrowers to engage with private sector

Activities with Milestones Inputs

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Activities with Milestones Inputs 1. High-quality public health and environment-related urban infrastructure investments: DPR for at least one water supply and sanitation subproject prepared and approved by NCRPB

for financing by June 2012 Construction work completed by December 2016 Environmental, social, and gender-related good practices introduced by December 2011 2. High-quality economic-growth-related regional and urban infrastructure investments: DPR for at least one subproject each relating to regional intercity connectivity, and multimodal

transit center prepared and approved by NCRPB for financing by June 2011 Construction work completed by December 2016 Environmental, social, and gender-related good practices introduced by December 2011 3. Strengthening of capacity of NCRPB and subborrowers to scale-up urban infrastructure and improve basic urban service delivery 3.1. Strengthening of NCRPB to execute scaled-up mandate more effectively: NCRPB develops core staff capabilities for better project monitoring and management from

January 2011 onwards Additional staff engaged for project management unit by December 2011 NCRPB develops web-based tools to integrate project approval, project monitoring, and loan

disbursement processes from June 2011 onwards Pooled financing Introduced by December 2016 Treasury management practices improved, including reduction in the duration gap between

asset and liability and risk management by December 2012 3.2. Enabling inclusive and more balanced growth: Project development facility established by NCRPB by December 2010 Social and gender-relevant processes and practices institutionalized through capacity building

of relevant stakeholders by December 2016 DPRs prepared with help of project development facility for city-level urban infrastructure,

especially in Uttar Pradesh administered NCR by December 2016 Transport investment plans prepared in line with Regional Plan 2021 by December 2013 Solid-waste management investment plans prepared in line with Regional Plan 2021 by

December 2013 3.3. Improvements in project execution: Implementation support component provides support to implementation agencies on project management: January 2011 to December 2016 NCRPB engages project management consultants to monitor the quality of construction work

from January 2011 onwards NCRPB develops web-based tools to strengthen project management skills among the

subborrowers from January 2011 onwards NCRPB organizes training program and field trips for subborrowers to improve infrastructure

skills and adopt best national and international practices from January 2011 onwards 3.4. Increased participation of private sector in urban infrastructure and basic service management: NCRPB introduces a PPP checklist list by September 2010 NCRPB enables innovative design of public-financed infrastructure to shift appropriate

performance risks to private sector, among others, by March 2011 NCRPB enables innovative public–private partnerships at institutional level to drive efficiencies,

including longer tenure and concessional lending for projects with PPP/PSP design aspects, from January 2011 onwards

4. Tranche release progress and reporting (continues to fourth quarter 2016): Periodic financing request for the first tranche of $78 million to be signed and submitted before

end of June 2010 Periodic financing request for the second tranche to be submitted for tranche release during or

before fourth quarter of 2014 Supporting documentation submitted regarding compliance with ADB requirements (quarterly,

semiannual, and annual reports)

ADB $146 million infrastructure investment and $4 million implementation support First tranche $78 million ($75 million infrastructure and $3 million implementation support) Second and/or subsequent tranches of $72 million ($71 million infrastructure support and $1 million implementation support) 6 person-months of professional inputs NCRPB and subborrowers $50 million Counterpart staff support for the project management unit

ADB = Asian Development Bank, CMA = counter magnet area, DPR = detailed project report, JNNURM = Jawaharlal Nehru National Urban Renewal Mission, NCR = National Capital Region, NCRPB = National Capital Region Planning Board, PPP = public–private partnership, PSP = private sector participation. Source: Asian Development Bank.

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B. Information Technology 62. Systems Improvement at NCRPB using ADB TA. The National Capital Region Planning Board (NCRPB) has articulated its vision for transforming the National Capital Region as the engine for driving economic growth in the region through substantial investments in infrastructure and concomitantly strengthening its own operations to support these investments. In this context ADB is providing Technical Assistance to NCRPB for capacity building in all areas of operations, including the use of latest information technology tools to enhance operational efficiencies. 63. Existing status of IT usage at NCRPB:

(i) A detailed assessment of current NCRPB operations by the TA consultants during the inception phase concluded that while NCRPB staff have been able to manage the loan portfolio and project monitoring with limited technology/systems and few skilled people, a lot of time is being spent on data collection, compilation, reconciliation, analysis and generating management information reports. This pointed to the need for enhancing work flow efficiencies at NCRPB through use of appropriate IT tools and solutions.

(ii) The Project Monitoring and Coordination (PMC) Wing is using a basic management information system which is updated using manual records and physical files and compiled on Microsoft Excel, which is not a relational database system. Furthermore, the task of maintaining this Excel database is far too demanding and requires considerable time. Since data is not integrated into a common database for use by other departments like finance or planning or administration, discrepancies in data across departments exist.

(iii) Likewise, the Finance and Accounts Wing is using a basic accounting package (Tally 7.2) for accounting entries and financial statements. There is no guideline for following a fixed Chart of accounts. Due to limitations of Tally 7.2, most of the financial reports like daily cash and bank balance statements, yearly statements for plan and non-plan expenses, are being generated manually entering data in excel sheet from the trial balance. Because of the long preparation time of routine periodic accounts and necessary ratio analysis, financial status of the Board is available only at the end of year after accounts are finalized.

64. Systems Improvements in NCRPB. The role of IT in any organization is facilitative and builds on the proposed strategic initiatives of the organizations. For this purpose, a detailed mapping and re-engineering of business processes at NCRPB was carried out to define the specifications for a future ERP solution for the organization. As part of this exercise, the TA consultants identified priority areas for which IT tools could be developed as part of the capacity building initiatives under the ADB TA itself to enhance organizational effectiveness. Accordingly, the following solutions were developed for NCRPB:

(i) Project Management Information System integrated with Loan tracking System; (ii) Dynamic website with interactive features like forum, employee login, etc; and (iii) Customized Tally ERP 9.

65. Project Management Information System. The central activity of NCRPB is to appraise projects and if approved, disburse funds and monitor progress of the activities. In order to enhance efficiency and aid management and decision making, this area was prioritized for intervention. Ideally, a part of the ERP, this module was proposed to be developed in advance

63

by the TA consultants. Accordingly, an online web-based project management software has been developed with the following features:

(i) Separate login for PMC, Finance, Admin and Implementing Agencies (ii) Tracking of each project proposal from DPR to PSMG approval; (iii) Auto calculation of interest and schedule of loan installments; (iv) Progress reporting (physical and financial) by Implementing Agencies and

approval by NCRPB; (v) Tracking of each loan / tranche and flexible reporting of progress; and (vi) Currently the migration of existing loan data (from manual records) is ongoing

and once completed it will be used for real-time tracking of all proposals submitted to and loans made by NCRPB.

66. Dynamic Website of NCRPB. A new website of NCRPB has been developed which would replace the existing site. The new site has a more attractive look, better organized sections, archived material and interactive features such as forum, ‘Write to Member Secretary’ and email access for employees. The new site, along with the PMIS will significantly streamline NCRPB operations and ensure that useful information is available easily to interested users. The site now needs to be hosted on NIC server and thereafter needs to be updated and maintained along with Search Engine Optimization (SEO) techniques for greater visibility. 67. Customized Tally ERP 9. To improve accounting practices, ERP based Tally 9 has been installed in NCRPB in a customized form facilitating auto-generation of all C&AG required financial statements. This has not only resulted in saving substantial time and energy of NCRPB, but also obviated possibility of any errors in financial statements. This new Tally 9 also facilitates additional features such as TDS on expenses, Cash flow projection integrated with accounting system and easy planning of cash flow, payroll management etc. 68. Next steps. The next steps are as follows:

(i) All these IT solutions should be operational by April 2010 and NCRPB should ensure adequate maintenance support for these new initiatives.

(ii) NCRPB should tender for a new ERP system by 2014-15 when loan volumes would have gone up substantially.

(iii) In the interim, periodic upgrades of the Tally ERP 9 system should be carried out as and when new versions are available.

C. Monitoring

69. NCRPB will be responsible for establishing an investment program performance monitoring system (IPPMS) acceptable to ADB within 3 months from the signing of the FFA and the first PFR. For the IPPMS, NCRPB will first select a set of clearly measurable performance monitoring indicators relating to implementation, improvements, institutional development, and capacity building milestones including those in the design and monitoring framework. NCRPB will establish a baseline data for each of the selected indicators within 6 months of the date that the first loan under the Facility takes effect. Subsequently, NCRPB will conduct annual surveys and will update ADB on progress against each indicator. NCRPB will submit quarterly progress reports attached to the facility administration memorandum (Appendix 5). NCRPB will also submit to ADB a completion report within 3 months of the completion of all ADB-supported activities and subprojects.

64

70. At the time of subproject appraisal and approval, an agreement should be reached with the implementing agency on technical and financial monitoring and reporting. Going in with the objective of making NCRPB into a professional financial intermediary, the arrangement should include obtaining technical progress certification from Project Management Consultants. Simultaneously, the quarterly financial status should be certified by a chartered accountant firm. All disbursements should be based on such certifications as far as possible. This will add a cost to the project for paying fees to the engineers and accountants, but promote transparency and accountability. 71. There will be a need to focus on early resolution of issues related to land acquisition, resettlement of affected persons, removal of encroachments, obtaining environmental clearances, obtaining clearance from specialized agencies (railways, national highways, Archaeological Survey of India, defence establishments, etc.). A critical list of such activities should be prepared during subproject appraisal stage, indicating timeframe for completion. The list and status of completion should be regularly updated, and issues going towards criticality (beyond time limit) should be flagged before they lead to implementation delay. 72. ADB will, at its discretion, conduct reviews of the management, financial, and operational performance of the Borrower and subprojects financed under the Facility after the closing of withdrawals. Such reviews will include safeguard implementation and procurement procedures used by the subprojects. 73. A set of indicators for monitoring, which includes satisfactory implementation of resettlement, and evaluating the performance of the Investment Program and each subproject in relation to the goals, purposes, and outputs of each, will be agreed upon with ADB in reference to the design and monitoring framework within no more than 3 months from the signing of the Facility (in the case of the Investment Program) and each Legal Agreement (in the case of an individual tranche). Results of the analyses, comments, and conclusions on the performance of the Investment Program, and its subprojects will be incorporated in every quarterly report to ADB.

74. Compliance monitoring. Quarterly progress reports of NCRPB will also describe the progress of various loan covenants—policy, legal, financial, economic, environmental, and others. 75. Safeguards monitoring. Monitoring and reporting for safeguards compliance are described in detail in the ESMS (Appendix 1). An annual ESMS audit will also be undertaken by an independent auditor engaged by NCRPB. 76. Poverty and Social action plans. The Gender Action Plan (GAP) will be implemented and monitored by NCRPB. Implementation of the GAP will be reported as part of NCRPB's progress reports as detailed in Section E. 77. Subproject Review. Subproject review is designed to ensure that all ADB funds to NCRPB are relent only to subprojects that comply with the ESMS and other ADB requirements. Further, all subproject sites will be visited by the ESMC staff, and environmental and social safeguard consultants with compliance reports submitted to ADB for review. Thus, ADB will have prior information on subproject location, development impact, and potential environmental and/or social safeguards issues and will have the ability to reject subprojects not in compliance with ADB requirements. In addition, NCRPB is continuously upgrading its internal subproject monitoring capabilities as indicated in the assurances. ADB will, at its discretion, conduct

65

reviews of the management, financial, and operating processes of NCRPB and subprojects financed under the NCRUIFF, with regard to the potential pool of funds that could be generated in the event of tenor differentials between ADB loans to NCRPB and NCRPB's relending. ADB monitoring will ensure that the usage is compliant with ADB norms and conforms to subproject eligibility and approval guidelines. D. Evaluation

78. Monitoring and Evaluation. The performance of the Facility will be periodically reviewed at three levels using the design and monitoring framework by (i) NCRPB through the PMT (quarterly), (ii) PSMG (semiannually), and (iii) ADB (annually).

E. Reporting

79. The PMT will prepare the quarterly progress report based on its quarterly review within 45 days following the end of the quarter (within 60 days for the quarter ending on 31 March) (Appendix 5 of the FAM provides an indicative format of the quarterly report). NCRPB's PSMG will review the performance semiannually and will forward the semiannual progress reports to ADB by the 30th day of the month following the semiannual review. ADB will review the quarterly progress reports and semiannual reports during the annual review missions and during the tripartite reviews chaired by the Government. In addition, a midterm review of the investment program will be conducted in FY2014. The review will cover disbursements, implementation progress, including progress of capacity building initiatives, ESMS implementation, and status of the IPPMS. The review will identify weaknesses and suggest changes in scope, outputs, and due diligence, and agree on suggested changes. 80. The progress reports prepared by NCRPB will provide (i) a narrative description of progress made during the review period (progress on compliance with environmental and social safeguards requirements, including environmental management plan, resettlement plan, and indigenous peoples plan; and progress on implementing the gender action plan); (ii) changes in the implementation schedule; (iii) problems or difficulties encountered; and (iv) activities for the next period. The progress reports will also include a summary financial account for the subproject components consisting of subproject expenditures during the period, total expenditures to date, and benefit monitoring in accordance with procedures acceptable to ADB. Performance will be evaluated on the basis of indicators and targets stipulated in the design and monitoring framework. ADB Management will prepare periodic reports to inform ADB Board of Directors of the overall progress of the Project. 81. The NCRPB will provide ADB with:

(i) quarterly progress reports in a format consistent with ADB's project performance reporting system, which also include (i) progress achieved by output as measured through the indicator's performance targets; (ii) key implementation issues and solutions; and (iii) updated implementation plan for next 12 months (for the quarter ending on 31 March only).

(ii) a project completion report10 within 3 months of physical completion of each loan. To ensure projects continue to be both viable and sustainable, project accounts and the executing agency audited financial statements for (revenue generating

10

Project completion report format available at: http://www.adb.org/Consulting/consultants-toolkits/PCR-Public-Sector-Landscape.rar

http://www.adb.org/Consulting/consultants-toolkits/PCR-Public-Sector-Landscape.rar

http://www.adb.org/Consulting/consultants-toolkits/PCR-Public-Sector-Landscape.rar

66

projects), together with the associated auditor's report, should be adequately reviewed.

82. MFF Annual Report. The NCRPB will provide ADB with MFF annual reports11 informing the ADB on the overall MFF progress. The annual reports will provide (i) statistical information on the MFF, including progress made on each of the physical and nonphysical components; (ii) risks and issues, and actions being taken to mitigate the risks and resolve the issues; (iii) DMF updates; (iv) status of compliance with undertakings; (v) any changes in circumstance or material facts relating to the investment program or investment plan; and (vi) information on cofinancing administered. The content of the annual report includes sufficient information in summary form to be useful to ADB as a funding agency. The purpose of the report is to enable the borrower, NCRPB, and ADB to monitor the overall progress, become aware of current problems, and assess whether the project’s immediate objectives will be met. The annual report sent to ADB will enable ADB staff to readily capture key information for inputting into the project performance report (PPR). Indicative format of the report is in Appendix 6. 83. Completion Report. The completion report will cover the details of project implementation, costs, monitoring and evaluation activities, safeguard compliance, and other information requested by ADB. Within 6 months of physical completion of final tranche under the MFF, the NCRPB will also submit to ADB an MFF completion report12 which will cover the details of Investment Program implementation, total investment, evaluation of the Investment Program’s impacts, and other information requested by ADB. F. Stakeholder Communication Strategy

84. For governance to work effectively and development projects to be successful, civic engagement in governance is crucial. In this, the involvement of all stakeholders is equally important (Barry, 2002).13 Stakeholders includes groups or individuals who are either benefited or affected by a policy / project or those groups or individuals who can affect the policy / project. Stakeholders can be individuals, communities, social groups, organizations, and others. Generally the poor and the marginalized (women, children, elderly, disabled, orphans, landless laborers) are often ignored either because they are unaware and not consulted or because they do not have a forum to express their views. 85. Identifying and consulting all stakeholders, especially the poor and the vulnerable is important to ensure that a project meets the need of all sections of the people. Further, consultations open up the line of communication between the various stakeholders and the project implementing authorities, thereby aiding the process of resolving conflicts at early stages of the project rather than letting it to escalate into conflicts resulting in implementation delays and cost overrun. Participation of the local community in decision making will help in prioritizing projects and identifying cost effective measures in mitigating adverse impacts. 86. Consultations were held during the PPTA stage with affected households, elected representatives and other stakeholders. Further, consultations were held during the socio-economic surveys undertaken in sub-project towns and census surveys undertaken to assess the magnitude of involuntary resettlement in each sub-project.

11

This is required under Para 35, OM Section D14/OP, Issued on 6 August 2008. 12 This is required under Para 36, OM Section D14/OP, Issued on 6 August 2008. In compliance with ADB’s Public

Communications Policy (2005), a MFF completion report will be made publicly available. 13

Barry K, et.al. (2002) ‘Citizens at the Heart of Governance’ Reviving Democracy, [London: Earthscan]

67

87. The urban infrastructure projects proposed by NCRPB for assistance from ADB aim at reducing poverty and the deprivations associated with it. Improving provision for water supply, sanitation and other essential forms of infrastructure and services must be based on an understanding of the needs and priorities of those who, within households, are responsible for water collection, sanitation, laundry, disposing of solid waste and other daily necessities (Hardoy, J.E. et al 1992)14. In most instances these responsibilities fall on women who are rarely consulted. Further, the urban poor who do not have a forum to express their needs are often not consulted in projects and schemes that aim at improving their standard of living. Keeping this in mind NCRPB has developed a consultation and participation strategy from the sub-project identification stage through the implementation stage 88. During the project design and implementation special attention will be given to elicit views and feedback of women and the poor so that the design has features that maximize the benefits of infrastructure created for women and the poor. Existing community based organization, nongovernment organization and other women's collectives would be approached to obtain collective feedback in addition to household qualitative surveys to obtain views of women and the poor. The Table below describes what project information will be communicated, the means of communication, who will provide the information, the audience(s), and frequency.

Table 21: Project communication plan S.No Project

information Means of communication

Who will provide

Audience Frequency

1 Projects sanctioned Web EA and IA All stakeholders At the time of sanctioned

2 Progress on subprojects

Web and field consultations

EA and IA End users and other stakeholders

Quarterly basis

3 Project design Consultations and stake holder meetings

EA and IAs End users and other stakeholders

Intensely during the design stage

4 Environment and social management systems

Web, meetings and field level meetings

EA and IAs End users and other stakeholders

Regular basis as per need

5 Poverty and social development

Field level consultation meetings with all stakeholders

EA and IAs with help of CBOs and NGOs, among others

End users and other stakeholders

Regular basis as per need

6 Development outcomes and impact

Web, newsletters, workshops and seminars

EA Government of India, State Governments, Development partners, and other stakeholders

Annual basis

7 Gender mainstreaming

All traditional media and

EA and IAs with help of

Government staff Consultants

In all phases depending on

14

Hardoy, J.E., Miltin, D. & Satterthwaite, D. (1992) Environmental Problems in an Urbanized World [London, Earthscan]

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nontraditional methods like women's group meetings

experts and help of CBOs and NGOs

Construction workers Operators Opinion makers

need and assessment


69

Consultation and Participation Strategy Table 22: Consultation and participation strategy

Project Cycle

Target Group Structure of Consultation Process of Consultation Indicator Responsibility

Sub-project selection

Beneficiaries including women

General public Elected representatives Civil Society

Organizations Interest groups

Sub-project selection criteria

- Reason for prioritizing the sub-project

- present status

- improvements / benefits envisaged through the project

- estimated cost

Targeted consultations Information leaflets about

sub-project benefits Newspaper articles seeking

feedback Stakeholder representatives Open house meetings

Number of people in different category consulted

Details of information shared

Views of public received

Minutes of the meeting

Implementing agency

Sub-project design stage

Beneficiaries including women

Affected household General public Elected representatives Interest groups

Design criteria

- alternatives considered

- project components involving land acquisition mitigation measures

- environmental impacts mitigation measures

- cost of the project

- likely charges, if any

Targeted consultations Newspaper articles seeking

feedback Stakeholder representatives Open house meetings Household questionnaire Gist of reports

(DPR/IEE/RP/IPP)





Implementing agency

DPR consultant

Sub-project implementation stage

Affected households General public Elected representatives Civil Society

Organizations Interest groups

including women’s groups

Progress of implementation Temporary impacts / discomfort to public

- advance communication about civil work schedule

Quality and adequacy of environmental and social mitigation measures undertaken

Share design changes, if any

- reason for the same

- alternatives considered Efficacy of the grievance redressal system Labor standards and safety measures Awareness measures

- Sanitation and water conservation

- HIV AIDS and other communicable diseases

Targeted consultations Stakeholder representatives Monitoring surveys Periodic open house

meetings Newspaper articles





Implementing agency

Contractor


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IX. ANTICORRUPTION POLICY

89. ADB reserves the right to investigate, directly or through its agents, any violations of the Anticorruption Policy relating to the Project.15 All contracts financed by ADB shall include provisions specifying the right of ADB to audit and examine the records and accounts of the executing agency and all Project contractors, suppliers, consultants and other service providers. Individuals/entities on ADB’s anticorruption debarment list are ineligible to participate in ADB-financed activity and may not be awarded any contracts under the Project.16 To support these efforts, relevant provisions are included in the FFA, loan agreement and the bidding documents for the Project. 90. The following measures will be undertaken by NCRPB and the implementing agencies to ensure integrity and transparency:

(i) NCRPB will establish a project website to disclose information about project implementation. The project website will provide updated detailed information on project implementation. For example, the website will include procurement-related information, such as the list of participating bidders, name of the winning bidder, basic details on bidding procedures adopted, amount of contract awarded, and the list of goods and/or services procured.

(ii) NCRPB will establish a grievance redress mechanism to ensure greater

accountability. The grievance redress mechanism will be set up to receive and resolve complaints, as well as to act upon stakeholders’ reports of irregularities on project-related matters, including grievances concerning resettlement. NCRPB will widely publicize the existence of this mechanism to ensure that stakeholders are aware that a venue is available to address concerns or grievances relating to fraud, corruption, abuse, and any other aspects of project implementation.

(iii) NCRPB will support concurrent internal audit of the project activities so that

variances from set protocols are detected early and proactively corrected. (iv) Implementing agencies will maintain and update its website to present

information on this Project. With regard to this Project, the website shall provide information on financial statements of this Project procurement activities and details on the adopted bidding procedures, amounts of the contracts awarded, the list of goods and/or services purchased, and their intended and actual utilization.

91. Any individual obtaining information of fraudulent, corrupt or collusive practices will immediately contact ADB's Office of the Auditor General and report the same: Contact Office of Anticorruption and Integrity:

by email at [email protected] or [email protected] by phone at +63 2 632 5004 by fax to +63 2 636 2152 by mail at the following address (Please mark correspondence Strictly Confidential):

15

Available at: http://www.adb.org/Documents/Policies/Anticorruption-Integrity/Policies-Strategies.pdf 16

ADB's Integrity Office web site is available at: http://www.adb.org/integrity/unit.asp

http://www.adb.org/Documents/Policies/Anticorruption-Integrity/Policies-Strategies.pdf

http://www.adb.org/integrity/unit.asp

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Office of Anticorruption and Integrity (OAI) Asian Development Bank 6 ADB Avenue Mandaluyong City 1550 Metro Manila, Philippines http://www.adb.org/OAI/default.asp

X. ACCOUNTABILITY MECHANISM

92. People who are, or may in the future be, adversely affected by the project may address complaints to ADB, or request the review of ADB's compliance under the Accountability Mechanism.17

Contract details:

Secretary Compliance Review Panel Asian Development Bank 6 ADB Avenue Mandaluyong City 1550 Metro Manila, Philippines Tel + 63 2 632 4149 Fax +63 2 636 2088 Email: [email protected] Web: www.compliance.adb.org

XI. RECORD OF FAM CHANGES

93. All revisions/updates during course of implementation are retained in this Section to provide a chronological history of changes to implemented arrangements recorded in the FAM. Dated Changes made to the Facility Administration Manual 2 Dec 11 Table of Contents updated based on changes Table 1: Action Plan for Selection of PMC Firm * Table 4: Key persons involved in implementation III C. ADB Staff Figure 4: Facility Organizational Structure Table 12: Indicative list of subprojects for PFR1 Para 39 (Procurement Plan for Tranche 1 added as Appendix 1) Table 14: Indicative person-months breakup of PMC * Para 40 Terms of Reference of Facility (Project) Management Consultants * Para. 61 (DMF for Tranche 1 added as Appendix 4) Para 78 Monitoring and Evaluation and Para 79 Reporting – duplication deleted Para 82 (Format of MFF Annual Report added as Appendix 6) Appendixes renumbered * Based on revised scope and budget due to unsuccessful initial recruitment.

17

For further information see: http://compliance.adb.org/.

http://www.adb.org/OAI/default.asp

http://compliance.adb.org/

72

Dated Changes made to the Facility Administration Manual May 13 Para 79: Timeline for preparing quarterly progress reports changed to “within 45

days (within 60 days for the quarter ending on 31 March)” Para 81: Consolidated annual reports merged with quarterly progress reports Page 17: Names of key persons (NCRPB and ADB) updated Figure 2 and Table 1: Deleted (actions achieved) Procurement plan (Appendix 1) updated

XII. APPENDIXES

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APPENDIX 1: PROCUREMENT PLAN – TRANCHE 1 (The document can also be accessed from ADB’s website)

Basic Data

Project Name: National Capital Region Urban Infrastructure Financing Facility - Project 1 Country: India Executing Agency: National Capital Region Planning

Board, Loan Amount: $ 78 Million Loan Number: 2660-IND Date of First Procurement Plan: July 2010 Date of this Procurement Plan: March 2013

A. Process Thresholds, Review and 18-Month Procurement Plan

1. Project Procurement Thresholds

1. Except as the Asian Development Bank (ADB) may otherwise agree, the following process thresholds shall apply to procurement of goods and works.

Procurement of Goods and Works Method Threshold International Competitive Bidding (ICB) for Works Above $10,000,000 International Competitive Bidding for Goods Between $500,000 and $1,000,000 National Competitive Bidding (NCB) for Works Beneath that stated for ICB, Works National Competitive Bidding for Goods Beneath that stated for ICB, Goods Shopping for Works Below $100,000 Shopping for Goods

Below $100,000

Note: Loan agreement does not provide threshold limits for ICB/NCB/Shopping etc. Loan Agreement states that procurement of goods, works and consultancy services shall be done with due attention to economy and efficiency and in accordance with established private sector or commercial practices acceptable to ADB. Thus loan agreement does not stipulate ICB to be followed in any case. However we have proposed all works under ICB/ NCB process in tranche 1 as per above threshold limits.

2. ADB Prior or Post Review

2. Except as ADB may otherwise agree, the following prior or post review requirements apply to the various procurement and consultant recruitment methods used for the project. Procurement Method Prior or Post Comments Procurement of Goods and Works ICB Works Prior ICB Goods Prior NCB Works Post For NCB in each project, the first draft

English language version of the procurement documents should be submitted for ADB review and approval regardless of the estimated contract amount. The documents will be reviewed by the sector division, OSFMD, and the Office of the General Counsel (OGC). OGC will review the special conditions of contract and will advise on specific legal issues, including covenants to be complied with in the financing agreement, in accordance with agreed review procedures (post and prior review). ADB-approved procurement documents should be used as a model for all procurement

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financed by ADB for the project, and need not be subjected to further review unless specified in the procurement plan, or required under special arrangements.

NCB Goods No such work proposed Shopping for Works No such work proposed Shopping for Goods

No such work proposed

List other methods of procurement No other method proposed

Recruitment of Consulting Firms Quality- and Cost-Based Selection (QCBS) Prior Quality-Based Selection (QBS) Prior Not proposed Other selection methods: Consultants Qualifications (CQS), Least-Cost Selection (LCS), Fixed Budget (FBS), and Single Source (SSS)

Prior Not Proposed

Recruitment of Individual Consultants Individual Consultants Prior Not Proposed

3. Goods and Works Contracts Estimated to Cost More Than $1 Million

3. The following table lists goods and works contracts for which procurement activity is either ongoing or expected to commence within the next 18 months.

General Description

Contract Value

Procurement Method

Prequalification of Bidders (y/n)

Advertisement Date (quarter/year)

Comments

Road work in Jhajjar

$29.45 m

ICB

No

22 Sep 10

Work awarded

Road work in Sonepat

$22.32 m ICB

No

22 Sep 10

Work awarded

Badli Bypass

$5.47 m ICB

No

23 Dec 10

Work awarded

Panipat Water Supply

$28.19 m ICB

No

Q 3 /2013

DPR under revision

Pataudi Water Supply from canal source

$4.45 m NCB

No

Q 2 /2013

Bid document under review

Nuh Water Supply

$23.64 m

ICB

No

Q 2 /2013


Sonepat Drainage

$3.64 m

NCB

No

Q 2 /2013

Bid document under preparation

Gohana Lakhanmajara Bhiwani Road

$14.55 m

ICB

No

Q 2 /2013


Gurgaon Chandu Badli Road

$18.18 m

ICB

No

Q 2 /2013


Bahadurgarh Badli Road

$6.36 m

NCB

No

Q 3/2013


Sonepat Gohana Road

$32.33 m ICB No Q 2 /2013 Bid document under preparation

75

4. Consulting Services Contracts Estimated to Cost More Than $100,000

4. The following table lists consulting services contracts for which procurement activity is either ongoing or expected to commence within the next 18 months.

General Description

Contract Value

Recruitment Method

Advertisement Date

(quarter/year)

International or National

Assignment Comments Project

Management Consultant

$1 m QCBS Quality cost ratio 80:20

Q3- 2011 National Awarded

5. Goods and Works Contracts Estimated to Cost Less than $1 Million and Consulting Services Contracts Less than $100,000

5. The following table groups smaller-value goods, works and consulting services contracts for which procurement activity is either ongoing or expected to commence within the next 18 months.

General Description

Value of Contracts (cumulative) Number of Contracts

Procurement / Recruitment

Method1 Comments

No such procurement proposed

B. Indicative List of Packages Required Under the Project

6. The following table provides an indicative list of all procurement (goods, works and consulting services) over the life of the project. Contracts financed by the Borrower and others should also be indicated, with an appropriate notation in the comments section.

General Description Estimated

Value (cumulative)

Estimated Number of Contracts

Procurement Method

Domestic Preference Applicable

Comments

Goods No procurement for goods proposed

Works

Jhajjar Road

$29.45 m 1

ICB

No

Awarded

Sonepat Road

$22.32 m 1

ICB

No

Awarded

Badli Bypass

$5.47 m 1

ICB

No

Awarded

Panipat Water Supply

$28.19 m 1 ICB

No

DPR under revision

Pataudi Water Supply from canal source

$4.45 m 1 NCB

No


Nuh Water Supply

$23.64 m

1

ICB

No


Sonepat Drainage

$3.64 m

1

NCB

No


Gohana Lakhanmajara

$14.55 m

1

ICB

No


76

General Description Estimated Value

(cumulative)

Estimated Number of Contracts

Procurement Method

Domestic Preference Applicable

Comments

Bhiwani Road

Gurgaon Chandu Bahadurgarh Badli Road

$24.54 m

2

One ICB & one NCB

No


Sonepat Gohana Road

$32.33 m

1

ICB

No


MMTC Anand Vihar

$33.00 m

1

ICB

No

DPR approval awaited

MMTC Sarai Kale Khan

$35.10 m 1

ICB No DPR approval awaited

Consulting Services PMC

$1.00 m

1

QCBS (80:20)

Full

Awarded

Note: Cost of all works under ICB/NCB and QCBS will be borne under ADB Loan

77

APPENDIX 2: ENVIRONMENTAL AND SOCIAL MANAGEMENT SYSTEM

The document can be accessed from the following web link of NCRPB: http://www.ncrpb.nic.in/docs/esms.pdf

http://www.ncrpb.nic.in/docs/esms.pdf

http://www.ncrpb.nic.in/docs/esms.pdf

78

APPENDIX 3: KEY ADB DOCUMENT PERTAINING TO PROJECT IMPLEMENTATION

Key ADB Documents5 Relevant to Project Administration A. General Anticorruption and Integrity (revised December 2007) Anticorruption Policy: Description and Answers to Frequently Asked Questions (revised 2008) Guidelines for Economic Analysis of Projects (revised February 1997) Guidelines for the Financial Governance and Management of Investment Projects Financed by ADB (revised October 2005) Guidelines for Preparing the Design and Monitoring Framework (July 2007) e-Handbook on Project Implementation (March 2008) Second Governance and Anticorruption Action Plan (July 2006) Operations Manual (Policies and Procedures) (updated October 2003 – latest updates of individual Business Procedures and Operational Procedures apply) Ordinary Operations Loan Regulations (Applicable to LIBOR-Based Loans Made from ADB’s Ordinary Capital Resources) (dated 1 July 2001) Ordinary Operations Loan Regulations (Applicable to Loans Made by the Bank from its Ordinary Capital Resources) (dated 1 July 1986) Regulations of the Asian Development Fund (dated 7 February 2005) Special Operations Loan Regulations (Applicable to Loans Made by ADB from its Special Funds Resources) (dated 1 January 2006) Special Operations Grant Regulations (Applicable to Grants Made by ADB from its Special Funds Resources) (dated 7 February 2005) B. Consultants Guidelines on the Use of Consultants by the Asian Development Bank and Its Borrowers (revised Feb 2010) Harmonized RFP for TA (updated 28 August 2009) Harmonized RFP for Loans - (updated 28 August 2009) Consulting Services Operations Manual - 2008 C. Procurement Procurement Guidelines (revised April 2010) Guidelines on the Use of Consultants (revised April 2010) Guide to EA Procurement Capacity Assessment Guide to Completing Procurement Plans Handbook on Problems in Procurement for Projects Financed by the Asian Development Bank (Revised November 1987, reprinted October 1995) Standard Bidding Documents – Procurement of Goods (including related services) Standard Bidding Documents – Procurement of Works Standard Bidding Documents – Procurement of Works (Small Contracts) Standard Bidding Documents – Procurement of Plant-Design, Supply, Install Standard Procurement Document – Prequalification of Bidders Standard Procurement Document – Prequalification of Bidders, User’s Guide (Revised October 2009) Guide on Bid Evaluation (October 2009) D. Disbursement Loan Disbursement Handbook (January 2007) Technical Assistance Disbursement Handbook (January 2008) Guidelines for Disbursement of Technical Assistance Grants (December 1992) E. Environmental and Social Safeguards Safeguard Policy Statement (2009) F. Social Dimensions and Gender Development Handbook on Social Analysis: A Working Document (2007) - Technical Note on Social Analysis for Transport Project (2009) - Technical Note on Social Analysis for Multi Tranche facility (2009) - Technical Note on Social Analysis for Private Sector Projects (2009)

79

Poverty Handbook Analysis and Processes to Support ADB Operations: A Working Document (2006) Core Labor Standards Handbook (2006) Strengthening Participation for Development Result: A Staff Guide to Consultation and Participation (2006) Interacting with Workers' Organization: A Primer for ADB Staff (2009) Sector Gender Checklists: - Gender Checklist on Agriculture (2001) - Gender Checklists on Education (2000) - Gender Checklist on Health (2000) - Gender Checklist on Resettlement (2003) - Gender Checklist on Urban Development and Housing (2001) - Gender Checklist on Water Supply and Sanitation (2007) Quick Reference Guide on Gender and Project Performance Management System (2009) Project Gender Action Plans: Lessons for Achieving Gender Equality and Poverty Reduction Result (A Briefing Note, 2009) Gender, Law, and Policy Toolkit (2006) Good Practices Guide for Incorporating Legal Empowerment into Operations (2009) G. Others

Executing Agency's Project Progress Report (PAI 5.01)

80 APPENDIX 4: DESIGN AND MONITORING FRAMEWORK-TRANCHE 1

Design Summary Performance Targets

and Indicators Data Sources and

Reporting Mechanisms Assumptions

and Risks Impact Urban residents use improved urban infrastructure services in the intervention cities of NCR and CMA in accordance with Regional Plan 2021 priorities

By 2021: Intercity road movement increased by 10% from the baseline

Use of multimodal public transport increased by 10% from the baseline

Piped water supply connection increased by 10% from baseline

Women’s drudgery for fetching water reduced by 10% from baseline

Traffic surveys

Public transport ridership survey

Household demographic, health surveys, and income expenditure surveys

Project specific household and economic surveys

Assumptions Urban infrastructure investments in NCR continue to have high priority Risks In-migration into NCR outstrip the pace of urban infrastructure development

Outcome Improved transport system and connectivity in NCR, and access to safe drinking water in sub-project cities

By end 2014: NCRPB investment in the road subsector increase by 5%

NCRPB investment in the WS subsector increase by 5%

Improved project planning and execution capacities of NCRPB / subproject implementing agencies – preparation of toolkits and dissemination; introduction of best practices for safeguards, monitoring and procurement systems

NCRPB annual project reports

NCRPB annual project reports

Project Performance Evaluation Reports

Assumptions Competent sub-borrowers undertake projects as per schedule Risks Slow pace of reforms continue to keep municipal finances and institutional capabilities weak

Outputs 1. Road network

improved in Jhajjar and Sonepat Districts

2. Traffic diverted from

Badly city center

78.7km for 9 regional roads in Jhajjar District, 68.5km for 3 regional roads in Sonepat District are widened and improved as per design and quality standards ADT annual growth rate of 7-8% on those roads 5.7 km by-pass built, and 1.3km road improved around Badly

NCRPB quarterly project reports NCRPB annual progress reports NCRPB quarterly project reports

Risks Land acquisition delay project implementation

81

Design Summary Performance Targets and Indicators



3. Multi-Modal Transit

Centers (MMTC) developed in Anand Vihar and Sara Kale Khan

4. Provision of safe

drinking water and water supply coverage increased in Panipat city

5.Provision of safe

drinking water and water supply coverage increased in Pataudi

6. Project Management

and capacity building

town, as per design and quality standards 30% of existing city traffic to shift to by-pass 10 % of construction work of 2 MMTC completed as per design and quality standards 90% of length of pipeline increase (from 285km to 540 km) completed Increase storage capacity by 100% Bulk metering at source and at zonal reservoirs

50% increase in pipe line length Increase storage capacity by 100% Bulk metering at source Project PMC hired on time PMU strengthened with 5 additional staff Systematic and regular progress monitoring of financial, physical, social and gender related impacts of subprojects introduced – preparation and submission of periodic reports in time Introduction of web-based tools to build capacity

NCRPB annual project reports NCRPB annual project reports NCRPB quarterly project reports NCRPB quarterly project reports NCRPB quarterly project reports NCRPB quarterly project reports NCRPB quarterly project reports NCRPB quarterly project reports NCRPB quarterly project reports NCRPB quarterly project reports NCRPB quarterly project reports NCRPB quarterly project reports

82 Activities with Milestones Inputs 1. Road network improved in Jhajjar and Sonepat Districts 1.1 Preparation of Detailed Project Reports (DPR) for roads in Jhajjar and

Sonepat Districts for 50 m $, bidding works and award of work by June 2011

1.2 Construction of road works for 50 m $ completed by Dec 2014 1.3 Introduce quality assurance and quality control systems in road construction

works in HSRDC by Dec 2014 1.4 HSRDC to hire Sub project PMC by Jun 2011

2. Badli Bypass Road 2.1 Preparation of DPR for Badli Bye Pass, bidding works and award of work

by Jun 2011 2.2 Construction completed by Dec 2014 2.3 Introduce quality assurance and quality control systems in road

construction works in HSRDC by Dec 2014 2.4 HSRDC to hire Sub project PMC by Jun 2011 3. Multi-Modal Transit Centers developed in Anand Vihar and Sarai Kale

Khan 3.1 Preparation of DPR for Multi-Modal Transit Centers in Anand Vihar and

Sara Kale Khan, bidding works and award of work of Anand Vihar by Dec 2012 and Sarai Kale Khan by Jun 2013

3.2 Construction completed by Dec 2016 3.3 Introduce quality assurance and quality control systems in sub projects by

Dec 2016

4. Provision of safe drinking water and water supply coverage increased in Panipat city

4.1 Preparation of DPR for water supply project in Panipat, bidding works and award of work by March, 2012

4.2 Construction completed by Dec 2016 4.3 Introduce quality assurance and quality control systems in sub project by

Dec 2016 4.4 PHED to hire Sub project PMC by March 2012 5. Provision of safe drinking water and water supply coverage increased

in Pataudi 5.1 Preparation of DPR for water supply project in Panipat, bidding works and

award of work by March, 2013 5.2 Construction completed by Dec 2016 5.3 Introduce quality assurance and quality control systems in sub project by

Dec 2016 5.4 PHED to hire sub project PMC by March 2013 6. Project Management and capacity building 6.1 Hire project PMC by April 2012 6.2 Strengthen PMU by hiring 5 additional staff by April 2012 6.3 Systematic and regular progress monitoring of financial, physical, social and

gender related impacts of subprojects introduced – preparation and submission of periodic reports in time

6.4 NCRPB develops web based tools to integrate project approval, project management, project monitoring and loan disbursement processes from April 2012 onwards

6.5 NCRPB develops core staff capabilities for better project monitoring and

ADB $78 million ($75 million infrastructure and $3 million implementation support) Government (NCRPB and sub borrowers) $25 million NCRPB: Counterpart staff support for PMU

83

management from Jun 2011 onwards

6.6 Periodic Financing Request (PFR1) for the first tranche of $78 million to be signed and submitted Before end of June 2010

6.7 Supporting documentation submitted regarding compliance with ADB requirements (quarterly, semiannual, and annual reports)

6.8 Implementation support component provides support to implementation agencies on project management: January 2011 to December 2016

6.9 NCRPB organizes training program and field trips for sub borrowers to improve infrastructure skills and adopt best national and international practices from April 2012 onwards

ADT = average daily traffic, CMA = counter magnet area, HSRDC = Haryana State Regional Development Council, NCR = National Capital Region, NCRPB = National Capital Region Planning Board, PMC = Project Management Consultant, PMU = Project Management Unit, Source: Asian Development Bank

84 APPENDIX 5: FORMAT OF QUARTERLY PROGRESS REPORT

For the Period _________________ Overall Status Facility Management 1. Provide comment on present project management structure as compared in the original plan. Please mention any deviation from original plan. Subproject Selection, Preparation, and Appraisal 2. Same as above. Implementation Period 3. Same as above Consultant Recruitment 4. Same as above Procurement 5. Same as above Disbursement 6. Same as above Reporting requirements 7. Same as above Technical Part Performance Targets/Indicators Progress/Status

Description Assessment of Progress-to-date

In the event of “nil” activity for any of the above component during the reporting period, “no progress during the period” should be stated under relevant heading with reasons. Financial Part I. Counterpart Funds Provided by NCRPB and Sub-borrowers Amount requested by the Executing - Rs_______

85

Agency for allocation in the annual budget Amount approved by the Government in - Rs_______ the annual budget Amount of utilization to date - Rs_______ Difficulties in getting the allocated amount - released due to budgetary or other procedures Loan Covenants and Other Miscellaneous Matters II. Expected Progress for the next half of the year narrative description of the expected progress for the next reporting period III. Problems encountered which significantly affected the implementation of the Project / Action Taken and/or Proposed Loan Covenants as of ________________

Covenants Status Date Complied (if required)

Sector Covenants Financial Covenants Environmental Covenants Social Covenants Other Covenants Problems: __________________________________________________________________________________________________________________________________________________________________________________________________________________ Actions Taken and/or Proposed: __________________________________________________________________________________________________________________________________________________________________________________________________________________

86 Implementation Schedule with Activity and Weights

Design Changes (if any) Major or minor changes in project scope, design, costs, and implementation arrangements are described in Project Administration Instructions (PAI) 5.04 which can be downloaded from the following website http://www.adb.org/Documents/Manuals/PAI/default.asp. The approval date of changes should be recorded in the following matrix. Description

Date Approved by ADB

87

Framework and Guidelines in Calculating Project Progress

A. Introduction 1. To ensure that all implementation activities are reflected in measuring implementation progress against the project implementation schedule, the term "physical completion” in the Project Performance Report (PPR) has been changed to "project progress.” 2. Physical and pre-commencement activities are considered in calculating project implementation progress. These activities, which may include recruitment of consultants, capacity building, detailed design, preparation of bid and prequalification documents, etc., could constitute a significant proportion of overall implementation and therefore should be counted. 3. Each activity in the implementation schedule will be weighted according to its overall contribution (using time as a reference) to progress of project implementation. These weights will then be used to calculate the percentage of project progress along the entire time span of the project. This is to provide a holistic view of the pace of implementation. B. Framework for Compiling Activity List and Assigning Weights 4. As implementation activities and their corresponding weights will vary according to the type of project, sector, and country, sector divisions or RMs will be responsible for determining and including them in the project administration memorandum. The actual project implementation progress of these activities should be reported regularly through the EA’s quarterly project progress report. To ensure ADB-wide consistency, the following framework has been established; its application will be monitored through the PPR. 1. Compilation of Activity List 5. Sector divisions or RMs concerned should identify major implementation activities and include them in the implementation schedule, which is attached as an appendix in the report and recommendation of the President (RRP). The implementation schedule should follow the critical path of the project’s major activities in project implementation taking account of various country, sector, and project constraints. 2. Assignment of Weights 6. Corresponding weights for each activity should be assigned to ensure that “project progress" measures the percentage of achievement (non-financial except when the project has credit components) for all events during the entire duration of the implementation schedule. To avoid disproportionate assignment of weights, to the extent possible these should be evenly distributed along the implementation schedule. When activities are concurrent, avoid “double counting.” 3. Computation of Project Progress 7. Once all activities are identified and corresponding weights assigned, project progress should be calculated using the following steps:

(i) Determine the actual percentage progress (non-financial) of each activity.

88

(ii) Multiply these percentages by the assigned weight of each activity to arrive at the weighted progress.

(iii) Add up the resulting weighted progress of all activities to determine the project progress.

8. Figure 1 of this Appendix provides an illustration of this calculation using a generic sample implementation schedule and Figure 4 of the Appendix, a specific example.

Figure 1. Implementation Schedule with Activities and Weights

Yr1 Yr2 Yr3 Yr4 Yr5

A

a

B

b

Cd

c

De f

E

A C

T I

V I T

I E

S

1. Sum of all weights should equal 100 percent (a+b+c+d+e+f+g = 100%)2. When calculating the percentage of “project progress,” all completed activities should be counted as accomplished, regardless of when they

were scheduled to be completed. For example, when calculating the percentage of “project progress” after year 3, if activity D is completed inyear 3 rather than in year 2, it should still be included in the computation.

3. Total weight of each activity is as follows: Activity A–a; Activity B–b; Activity C–c; Activity D–d; and Activity E–e + f +g4. Project progress of a project is the summation of the actual percentage of progress for each activity multiplied by the total weight of each

activity.

89

Activities Year 1 Year 2 Year 3 Year 4(a)

AssignedWeight

(b)Actual

Progress

(a) x (b)WeightedProgress

Establish PIU 5% 100% 6%

Establish Accreditation Board, etc. 5% 0% 0%

Appoint Staff and Budget 4% 75% 3%

Adopt Architecture Plans 2% 100% 2%

Shortlist Consulting Firms 6% 100% 6%

Prepare Fellowship Program 6% 76% 4%

Prepare Civil Works Tendering 30% 0% 0%

Civil Works: Classrooms, Dorms, etc. 6% 0% 0%

Procurement of Furniture and Equipment 16% 10% 2%

Field Work of Consultants 7% 0% 0%

Provide Fellowships 6% 0% 0%

Conduct Study Tours 6% 0% 0%

Provide Curriculum Standards 6% 0% 0%

Total Weight 100%Imp. Progress 24%

(a) Assigned weight for each activity(b) Actual progress of each activity(a) x (b) weighted progress for each activityProject progress = sum of all weighted progress for each activity

Figure 2. Sample Implementation Schedule

90

APPENDIX 6: FORMAT OF MFF ANNUAL REPORT

SOUTH ASIA

Table A{x}.1: List of Multitranche Financing Facility Approvals, 2011

DMC/MFF Approval

Date Sector Theme Inst.a Typeb

MFF Tranche Date Cofinan-cingd

Risk Categorizatione

Tranche Amount Amt Tranche/

Signing Effective-

ness Safeguards

($ million)c ($ million)c MFF Ratio Categorizationf

National Capital Region Urban 10 Aug 10 MS ENV/ 150.00

Infrastructure Financing GRO/

Facility (MFF No. 0044) CAD

- Tranche 1 (Loan No. 2660) 18 Aug 10 78.00 17 Mar 11 29 Jun 11

Sectors: ANR=agriculture and natural resources, EDU=education, EN=energy, FI=finance, HS=health and social protection, IN=industry and trade, MS=multi-sector, PSM=public sector management, TC=transport and ICT, WMS=water supply and other municipal infrastructure and services. Themes: CAD=capacity development, ENV=environmental sustainability, GEN=gender equity, GOV=governance, GRO=economic growth, PSD=private sector development, RCI=regional cooperation and integration, SOD=social development Note: The source of funds is ordinary capital resources, unless otherwise indicated

a Indicate if L=loans, Gr=grants or Gu=guarantees b Indicate if Pr=project, Sec=sector, or FI=financial intermediation c Indicate amount approved and/or any cancellation d Information on cofinancing administered. e Complex or low-risk. f Applies to tranches only. Source: Asian Development Bank staff.

Table A{x}.2: Approved Multitranche Financing Facility—MFF Performance, 2011

DMC/MFF MFF MFF Age Tranche Processingd

MFF Delayse

(R, P, T)

Tranche Performancef

(R, P, T)

Compliance with MFF Undertakingsg

(S, PS, U)

Overall MFF MFF

Suspended or Cancelled

Availability Time MFF relative Approved Tranches

RRP Projected Tranches

Expected Tranches

Performance Period Elapsed age Ratingh

(years)a (years)b (%)c (R, P, T)

National Capital Region Urban

Infrastructure Financing

Facility (MFF No. 0044)

- Tranche 1 (Loan No. 2660) 18 Aug 10

R=at risk, P=potential problem, T=on track; S=satisfactory, PS=partly satisfactory, U=unsatisfactory Note: The source of funds is ordinary capital resources, unless otherwise indicated. a {MFF approval date to completion date (in years)} b {Time elapsed = 31 Dec 2011 - MFF approval date (in years)} c {MFF relative age = Time elapsed / MFF availability period (%)} d {Indicate approval, projected and expected dates.}

e {Contributors to MFF Delays are (i) substantial delays in tranche processing and/or (ii) substantial delays in tranche implementation. Timeliness in Tranche processing will be evaluated against the tranche sequencing program forecasted in the RRP. Tranches processed (i) within one year of the forecasted period will be given an ‘on track’ (T) rating; (ii) between 1 and 2 years of the forecasted date will be given a ‘‘Potential problem’ (P) rating and (iii) beyond 2 years of the forecasted date will be given an ‘at risk’ (R) rating.

For MFFs where a time-bound tranche sequencing program was not forecasted in the RRP, only, MFF delays will be determined on the following grounds: (i) if less than 2 years have passed since approval of the previous tranche (up to the stage where the entire MFF has been turned into tranches), a “T” rating is granted, (ii) if more than 2 years but less than 3 years have elapsed, a “P” rating is given; and (iii) if more than 3 years have elapsed, a “R” rating applies. Delays in tranche implementation leading to forecasted extensions on MFF Availability Period, which require Board approval, would trigger a “R” rating}.

f {Extract tranche information from Tranche ‘Overall Rating’ in Table A{x}.5. Poor performance (‘at risk’) on 33% or more of the MFF tranches (by number) would place the MFF ‘at risk’ (R). ‘Potential problem’ rating on 33% or more of the MFF tranches (by number) would categorize the MFF as ‘potential problem’ (P), unless a red rating is triggered. Other ratings will result ‘on track’ (T)}.

g {Status of compliance with undertakings: provide explanatory text if gaps are identified and actions taken to achieve compliance). The assessment should include compliance with Safeguards and PCP requirements, as well as any timely Reform implementation targets. Non-compliance with more than 3 undertaking will place the facility in ‘U’ (unsatisfactory). Non-compliance with any ‘safeguards’, ‘PCP’ and/or ‘reform implementation’ undertakings will place the MFF in ‘U’ (unsatisfactory). Non-compliance with 2 undertakings (other than those outlined in the preceding sentence), will place the facility as ‘partly satisfactory’. Compliance with all undertakings with a maximum of one exception (other than those outlined before), will signify a ‘satisfactory’ criteria.}

Source: Asian Development Bank staff.

Table A{x}.3: Status of Multitranche Financing Facility Approvals—MFF Progress, 2011

DMC/MFF Physical and Nonphysical

MFF Risks Problemsd

Mitigation Plans In Placee

MFF Updates to Material Changes Changes in Outcome/

Progressb On track DMF Updates Road Map To MFF Invest. MFF Structure/

Outputsa (Y, N)c (Y, N) (Y, N) Program/Plan (Y, N)f Scope (M, m)

2010




- Tranche 1 (Loan No. 2660)

{Please list and define, in alphabetical order, all abbreviations here.} a {Based on MFF DMF (Outcome and Outputs)} b {Progress against outcome/outputs in adjacent column, describe progress made on meeting MFF outcome and outputs} c {The on-track assessment should be linked to achievements versus facility/tranche Board/President-approved implementation plans} d {Discuss risks identified in the MFF DMF (indicate R) and project-related problems (indicate P) needing attention} e {Report actions being taken to mitigate the risks and resolve the issues} f {Provide changes explaining any changes in circumstances or material facts relating to the investment program or investment plan.} Source: Asian Development Bank staff.

Table A{x}.4: Status of Multitranche Financing Facility Approvals—Programming Impact

DMC/MFF MFF Tranches

Impact on Strategy and Program (Projected) Tranche % of Is the Primary Sector of

Approved Unapproved Amount (Projected) Country program This Tranche part of the ($ million) ($ million) ($ million) Approval Year (COBP, for given year) Current/future CPS? (Y, N)

National Capital Region Urban 150.00 72.00



- Tranche 1 (Loan No. 2660) 78.00 2010

- Tranche 2 (Loan No. XXXX) 72.00 ????

COBP=country operations business plan, CPS=country partnership strategy, DMC=developing member country, N=no, Y=yes Source: Asian Development Bank staff.

Table A{x}.5: Approved Tranches—Tranche Performance, 2011

DMC/MFF/TRANCHE

Tranche Performance Ratinga

Contract Awards (cumulative)

Disbursements (cumulative)

Changes in Scope (M, m)b

Suspension/ Cancellation

Overall Financial (T, P, R)

Contract Disburse- Safe- Tech- Rating Award ments guards nical

(T, P, R) (T, P, R) (T, P, R) (T, P, R) (T, P, R) Amt ($ million) % Amt ($ million) %





M = major, m = minor, P = potential problems, R = at risk, T = on track a {Extracted directly from Project Performance Report Ratings during Q4, at end December. Ratings should be consistent with information provided in Project Information Document. Ratings will indicate whether the

Tranche is ‘at risk’ (R), ‘has ‘potential problems’ (P) or is ‘on track’ (T)}. b {Indicate whether the change in scope was major (M) or minor (m) and the date of approval. Summarize the content of the change in scope request; revisions to outcome, outputs and/or inputs; and new targets and/or

indicators} Source: Asian Development Bank staff.

Table A{x}.6: Approved Tranches—Tranche Progress, 2011

DMC/MFF/TRANCHE Physical and Nonphysical Tranche Risks Mitigation Compliance with Loan

Outcomes/Outputsa Progressb On track (Y, N)c Problemsd Plans in Placee Covenants (S, PS, U)f





DMC=developing member country, N=no, PS=partly satisfactory, S=satisfactory, U=unsatisfactory, Y=yes a {Based on MFF DMF (Outcome and Outputs)} b {Progress made on physical and nonphysical components.} c {The on-track assessment should be linked to achievements versus facility/tranche Board/President approved implementation plans} d {Discuss risks identified in the tranche DMF (indicate R) and project-related problems (indicate P) needing attention} e {Report actions being taken to mitigate the risks and resolve the issues} f {Status of compliance with covenants: provide explanatory text if gaps are identified and actions taken to achieve compliance). Non-compliance with more than 3 covenants will place the facility in ‘U’ (unsatisfactory).

Non-compliance with 2 covenants will place the facility as ‘party satisfactory’. Compliance with all covenants with a maximum of one exception will signify a ‘satisfactory’ criteria} Source: Asian Development Bank staff.

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