Project Data Sheet

Project Data Sheets (PDS) contain summary information on the project or program: Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.

PDS Creation Date 18 Mar 2008
PDS Updated as of 03 Dec 2014

Project Name MFF - Railway Sector Investment Program (Subproject 1)
Country Bangladesh
Project/Program Number 32234-023
Status Approved
Geographical Location
In preparing any country program or strategy, financing any project, or by making any designation of, or reference to, a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.
Sector Transport
Subsector Rail transport (non-urban)
Strategic Agendas Inclusive economic growth (IEG)
Drivers of Change Governance and capacity development (GCD)
Gender Equity and Mainstreaming Categories Category 4: No gender elements (NGE)

Financing

Type/Modality of Assistance Approval Number Source of Funding Approved Amount (thousand)
Loan2317Asian Development Fund30,000
Loan2316Ordinary capital resources100,000
Counterpart 32,500
TOTAL US$ 162,500

Safeguard Categories

For more information about the safeguard categories, please see http://www.adb.org/site/safeguards/safeguard-categories

Environment B
Involuntary Resettlement A
Indigenous Peoples C

Summary of Environmental and Social Issues

Environmental Aspects
Transport, especially vehicle emission, is the highest contributor to Bangladesh s air pollution problems. Improving the railway network will contribute significantly to reducing air pollution associated with vehicle emission especially in Chittagong, Dhaka and Khulna. The other expected potential environmental impacts are related to improving access, which will lead to increasing uncontrolled exploitation of natural resources. However, the gradual improvement in enforcing the Environmental Conservation Act, 1995 is expected to minimize the potential uncontrolled exploitation of natural resources and the environment. Nonetheless, implementation of the Investment Program has environmental consequences due to its physical intervention such as construction of railway networks. In this context, the Investment Project is categorized as a B project in accordance with ADB s Environment Policy, 2002. The initial environmental examination of the sample subproject systematically illustrates the potential environmental impacts, proposed mitigation measures, and how to implement the mitigation measures. The assessment of impacts at the subproject level will become an integral part of managing the Investment Project. The initial environmental examination for the Tongi Bhairab Bazar (64 km) section (as a sample subproject) shows that the environmental impacts associated with construction of additional tracks and formation of additional embankment, including bridge construction, are temporary and will occur only during construction. These impacts require mitigation measures that are manageable and mostly can be incorporated into construction works. 16 Therefore, the environmental management and monitoring plan, which clearly describes the required mitigation measures, will be incorporated in the bidding document to ensure that the contractors implement the mitigation measures properly. The plan provides overall guidance to address environmental impacts related to the sample subproject. For the follow-up subprojects, an environmental assessment review framework was prepared to guide the impacts assessment procedure.
Involuntary Resettlement
The Project will lead to loss of agricultural land and structures both commercial as well as residential, and loss of livelihoods in many cases. To mitigate this adverse impact on the affected population, a resettlement plan was prepared for the core subproject. To address the resettlement impacts of noncore subprojects, a resettlement framework was prepared. Subproject resettlement plans have been prepared during implementation.
Indigenous Peoples
No indigenous people will be adversely affected by the Project.

Stakeholder Communication, Participation and Consultation

The Implementation consultants has prepared a preliminary scope of works and has also reviewed available documentation in relation to Resettlement Plans and has prepared initial documentation to assist BR in the management of resettlement isues.

During Project Design
During Project Implementation

Description

The Railway Sector Investment Program which is based on the Government's Sector Roadmap and Investment Plan for 2007-2013 will improve the performance of the railway sector by implementing (i) a reform project of sector policy, organizational, and capacity building reforms to make Bangladesh Railway (BR) more commercially focused, and improve governance and accountability; and (ii) an investment project of infrastructure and rolling stock capacity improvement investments to overcome capacity bottlenecks in sectors where such investments are both economically and financially viable, e.g., the Dhaka-Chittagong and Dhaka-Darsana-Khulna corridors where it can support major direct investment. The reform and the investment projects are integrated as approval of investment subprojects will be dependent on the implementation of specific sector reform actions.

Project Rationale and Linkage to Country/Regional Strategy

Efficient transport is essential to achieve higher levels of economic growth needed for sustainable poverty reduction in Bangladesh. BR has been losing market share and consequently making financial losses thus relying on Government budgetary support. This financial support has not been enough to allow for additional investment needed in critical corridors such as the Dhaka-Chittagong and Dhaka-Darsana-Khulna corridors to overcome capacity constraints leading to poor operational performance of the railways. This in turn causes it to lose market railways will ease the pressure on land since Bangladesh has a very high population density and land is scare. It will also ease the pressure on the road network, which is congested in key corridors and thus benefit transport as a whole. This will require capital investments and reforms to ensure that the investments lead to a sustainable improvement in BR's operational and financial performance.

Development Impact

Promote sustainable national economic growth and poverty reduction in Bangladesh. It will achieve this by improving rail transport efficiency and capacity.

Project Outcome

Description of Outcome
Improve the performance of the railways sector through enhanced efficiency
Progress Towards Outcome
L2316: Construction of the Tongi-Bhairab Bazar Double Track was awarded on 27 July 2011, and the project is now under implementation. The physical progress of the project is 84.99% as of 30 September 2014. L2317: Bid docs for the procurement of videoconferencing equipment and other software and hardware approved by ADB on 15 September 2014. The actions as agreed upon in the reform program for BR are under implementation. (1) Restructure BR by Lines of Business (LOB) - An outsourcing/divesture plan for non-core services has been developed and approved. Performance of LOBs being reviewed. (2) Improve financial governance system - New Acctg and Financial Mgt system implemented in Oct 2013 through ERP software based on the new accounting architecture. (3) Improve human resource governance system - Job description of the LOB Heads has already been approved on 22 Mar 2011. LOB Heads now working according to the job description. Additional modules of the ERP IT System are rolled out progressively and nationwide coverage of the system is under implementation. (4) Improve BR operation and maintenance practices and performance - TA Consultants submitted reports to improve maintenance practices for track and signaling system in Feb 2008, rolling stock in May 2008, and improving train operations efficiency in May 2008 and April 2010. The reports were sent to respective departments to implement at field level. New manuals on New Signalling, Way and Works and LWR, and Operations have been approved. Completion report sent to ADB in July 2013.

Outputs and Implementation Progress

Description of Project Outputs
2316: Double track between Tongi and Bhairab Bazar completed 2317: BR becomes a commercially focused rail service provider 2317: BR corporate governance is improved 2317: BR safety record is improved
Status of Implementation Progress (Outputs, Activities, and Issues)
Ongoing. 84.99% progress as of 30 September 2014. Ongoing
Status of Development Objectives
Status of Operation / Construction
Material Changes

Business Opportunities

Date of First Listing 2010 Nov 03
Consulting Services
International and national consultants will be required to support the reform and investment projects of the Investment Program. The consultants financed under the MFF loans will be engaged using ADB's quality- and cost-based selection procedures in accordance with ADB's Guidelines on the Use of Consultants. The Government has asked ADB to select the consultants.
Procurement
All contracts will use international competitive bidding. Procurement will be in accordance with ADB's Procurement Guidelines.
Procurement and Consulting Notices
http://www.adb.org/projects/32234-023/business-opportunities

Timetable

Concept Clearance 06 Jun 2000
Fact-finding 30 May 2004 to 04 Jun 2004
Management Review Meeting 15 Jul 2004
Approval 13 Feb 2007

Milestones

Approval No. Approval Signing Effectivity Closing
Original Revised Actual
Loan 2316 13 Feb 2007 15 Feb 2007 24 Apr 2007 30 Jun 2011 09 Oct 2016
Loan 2317 13 Feb 2007 15 Feb 2007 24 Apr 2007 30 Jun 2011 30 Jun 2015

Utilization

Date Approval Number ADB (US$ thousand) Others (US$ thousand) Net Percentage
Cumulative Contract Awards
21 Dec 2014 Loan 2316 91,889 0 92.00%
21 Dec 2014 Loan 2317 21,312 0 71.00%
Cumulative Disbursements
21 Dec 2014 Loan 2316 94,343 0 94.00%
21 Dec 2014 Loan 2317 16,276 0 54.00%

Status of Covenants

Covenants are categorized under the following categories—audited accounts, safeguards, social, sector, financial, economic, and others. Covenant compliance is rated by category by applying the following criteria: (i) Satisfactory—all covenants in the category are being complied with, with a maximum of one exception allowed, (ii) Partly Satisfactory—a maximum of two covenants in the category are not being complied with, (iii) Unsatisfactory—three or more covenants in the category are not being complied with. As per the 2011 Public Communications Policy, covenant compliance ratings for Project Financial Statements apply only to projects whose invitation for negotiation falls after 2 April 2012.

Approval No. Category
Sector Social Financial Economic Others Safeguards Project Financial Statements
Loan 2317
Loan 2316

Contacts and Update Details

Responsible ADB Officer Satoko Tanaka (satokotanaka@adb.org)
Responsible ADB Department South Asia Department
Responsible ADB Divisions Transport and Communications Division, SARD
Executing Agencies Bangladesh Railway (BR)
Md. ANM KHASRU

Links

Project Website http://www.adb.org/projects/32234-023/main
List of Project Documents http://www.adb.org/projects/32234-023/documents