Ex-Ante Evaluation (for Japanese ODA Loan)
1. Name of the ProjectCountry: Republic of India
Project: Chennai Metro Project (V)Loan Agreement: March 31, 2017
Loan Amount: 33,321 million yen
Borrower: The President of India
2. Background and Necessity of the Project(1) Current State and Problems with the Urban Transportation Sector in India
With the recent rapid urbanization, the number of registered automobiles andscooters in India has risen dramatically over the years since FY 2002 with an averageincrease rate of about 8%. On the other hand, the improvement of public transportation
infrastructures has not seen much progress, and its rate of use decreased from 69% in1991 to 55% in 2001 and is expected to drop to 50% by 2021. In large cities such as
Chennai, in particular, traffic congestion has become a serious problem as the result of
increasing road transportation needs, causing economic loss and serious healthdamage due to air pollution, noise, and other pollution generated by automobiles. Thus,
improvement of the public transportation system is necessary for reducing traffic
congestion and improving the urban environment.
The Chennai Metropolitan Region in the state of Tamil Nadu is the largest urban
region in South India with the fourth largest population in the country. The population ofthe region rapidly grew from 4.5 million in 1981 to 7.06 million in 2001 and reached 8.7
million in 2011. The population density of the city of Chennai, the center of the region, is
25,000 people/km2, making it one of the most densely populated cities in the world. The
number of registered automobiles, which has been on a marked rise as the population
has grown, more than doubled between 2001 and 2011. Thus, the average speed ofvehicles on major roads in the city is only about 17 km/h, causing serious trafficcongestion.
(2) India’s Development Policies for the Urban Transportation Sector and the Role ofThe Project
The Government of India is focusing on the improvement of the public
transportation system from the perspectives of safety, energy efficiency, and social
environment conservation, in addition to dealing with the above problems by meeting
the growing transportation needs resulting from the recent economic growth, andestimates that its investment in the metro project over the period from 2012-2017 willbe 1.3 trillion Indian rupees.
In the Chennai Metropolitan Region, given the difficult circumstances for enhancing
the transport capacity of the existing public transit system (bus and railway) andimproving road networks, the improvement of a mass rapid transit system has
become a large pillar of the urban transportation policy and the measures for urban
environment issues faced by the state of Tamil Nadu in order to reduce traffic
congestion and respond to automobile pollution. Its importance is also stipulated in
the Chennai Comprehensive Transportation Study (August 2010), prepared by theChennai Metropolitan Development Authority, and the Chennai Metro Project(hereinafter referred to as “the Project”) is one of the major components of this policy.
(3) Japan and JICA’s Assistance Policies and Operations in the Urban Transportation
Sector in India
Japan’s Country Assistance Policy for India (March 2016) sets “enhancement ofregional connectivity” as one of its priority areas and states that with a view toremoving the bottlenecks in the infrastructure constraining investment and growth, it isnecessary to support development work in the area of railways (including high speed
railways and metro lines) to strengthen connectivity among major industrial cities andeconomic zones, as well as regional connectivity, throughout the country. In addition,
JICA's Country Analysis Paper for India (March 2012) indicates the necessity ofproviding assistance for the development and improvement of infrastructure
contributing to the acceleration of regional economic development, streamlining oflogistics and expansion of foreign investment, including highways, urban railways,
roads and ports, mainly in the six major urban centers of the country, as well as inother industrial clusters, such as the special economic zones in the Delhi-MumbaiIndustrial Corridor (DMIC) and other economic corridors, to resolve bottlenecks ineconomic growth. The Project is consistent with the Policy and Analysis. As ofFebruary 2017, JICA received authorization to provide ODA loans to India in theamount of 1.3944 trillion yen for 32 projects in the railway sector (which accounts for
71.9% of the transportation sector in India).
(4) Other Donors’ Activities
In the urban transport sector, the World Bank provides assistance through theMumbai Urban Transport Project (improvement of roads and suburban railways) andfor the improvement of the Eastern corridor in building freight-only railway lines. The
Asian Development Bank has assisted the railway sector, especially throughorganizational reform of Indian Railway and other tangible support, while providing its
support to the urban railway sector; 250 million dollars to Bangalore Metro in March2012 and 176 million dollars to Jaipur Metro in May 2014.
(5) Necessity of the Project
JICA has provided its support to metro projects not only in Chennai, but also inother metropolitan regions in the country (Delhi, Bengaluru, Kolkata and Mumbai).
Continuing with the Project into the next phase while taking advantage of theexperience and knowledge already gained from the activities of Phases I to IV, isrequired as a measure for serious traffic congestion in Chennai and is in line with theissues and development policy of India, as well as the assistance policy of Japan andJICA. Furthermore, given the potential contribution the Project can make toSustainable Development Goal (SDG) 9, it can be deemed as highly necessary andrelevant for JICA to support it.
3. Project Description(1) Project Objective
By constructing a mass rapid transit system in the Chennai Metropolitan Region,
which is located in the south Indian state of Tamil Nadu, and the densely populatedareas surrounding it, the project is to address the increasing need for transportation,
thereby developing the regional economy and improving the urban environment withincreased urban mobility, reduced traffic congestion and mitigated traffic pollution,such as air pollution and noise.
(2) Project Site/Target Area
Chennai Metropolitan Region, the state of Tamil Nadu
(3) Project Components
1) Civil and construction work, track construction- Line 1: approx. 31.9km/25 stations (elevated section: approx. 14.8km/12
stations, underground section: approx. 17.1km/13 stations)
Including an extended section of approx. 9.0km/9 stations (elevated section: approx.
6.0km/ 6 stations, underground section: approx. 3.0km/3 stations)- Line 2: approx. 21.4km/17 stations (elevated section: approx. 10.6km/8 stations,underground section: approx. 10.8km/9 stations)* Two of the above stations are at the intersection of Line 1 and Line 2. Thus, thetotal number of stations on Line 1 and Line 2 is 40 stations.
- Rail yard construction2) Electrical and mechanical work, signal and telecommunication work, automaticcharge collection system, etc.
3) Procurement of train cars (192 cars: 48 trains, 4 cars per train)4) Consulting services (Design review, bidding support, construction supervision,etc.) Procurement method: 1 to 3 by international competitive bidding and 4 by theshort-list method(4) Project Cost
385,646 million yen (Loan amount: 183,595 million yen)
(5) Project Implementation Schedule/Cooperation Period
September 2008 – March 2020 (139 months in total). Project completion is definedas the commencement of service (March 2020).
(6) Project Implementation Structure1) Borrower: The President of India
2) Guarantor: none
3) Executing Agency: Chennai Metro Rail Limited (CMRL)

4) Operation and Maintenance System: same as (3) above. However, outsourcingof the operation and maintenance of trains and system maintenance is now
under review at the CMRL.
(7) Environmental and Social Considerations / Poverty Reduction / SocialDevelopment
1) Environmental and Social Considerations① Category: A② Reason for Categorization:
The Project is classified as Category A because it has the potential to exert
significant negative impact by being classified into the railway sector under the“Japan Bank for International Cooperation Guidelines for Environmental andSocial Considerations” (dated April 2002).
③ Environmental Permit:
Preparation of an Environmental Impact Assessment (EIA) report for theProject is not required under Indian law. However, an EIA report wascompleted in May 2008. Another EIA report was created on the extended
section in June 2016 and was approved by the CMRL.
④ Anti-Pollution Measures:
The Project takes measures during construction to adequately control
pollutants, construction vehicles, and heavy machines based on environment
management plans. Measures will be taken to mitigate noise by installing noise
reduction walls and pads after starting service. So far, no significant problems
have occurred during construction in terms of air quality, noise, and vibration.
⑤ Natural Environment:
The Project sites are located in an urban area and the planned track mostly
passes along existing roads. Therefore, it is likely to have a minimal adverse
impact on the natural environment, as these sites are not considered places
particularly susceptible to natural environmental changes, like national parks,
or areas surrounding such places.
⑥ Social Environment:
The Project involves land acquisition of 77.62 ha (of which 13.87 ha is privateland) and resettlement of 550 households (including 522 illegally settledfamilies), and 215 shops. The process of acquiring this land was carried out
according to the compensation policy, resettlement plan, and laws for acquiring
land stipulated by the CMRL, upon discussion with those involved in landacquisition and resettlement. By August 2014, all land acquisition andresettlement of residents had been completed. According to monitoring of theliving conditions after resettlement and success of the income restoration
program, no significant problems have been reported so far. The extension
work involves land acquisition of approx. 6.8 ha (including 2.8 ha of private

land) and resettlement of 21 households (including 15 shops and 6 houses that
double as shops).
⑦ Other/Monitoring:
Air quality, water quality, noise, vibration and waste disposal will be monitoredby the contractor of each part of the construction work during construction andby the CMRL after the commencement of service. Furthermore, the CMRL will
also monitor the resettlement of residents and progress in the income
restoration program.
2) Poverty Reduction: N/A
3) Social Development (e.g., Gender Perspective, Measures to Prevent Infectious
Diseases Including AIDS, Participatory Development, Considerations for theHandicapped, etc.):
The Project makes efforts to ensure that female passengers can use the metro
safely and comfortably, for example, by introducing women-only coaches, marking
priority seats for passengers who need assistance, including women, installing
CCTV cameras in stations and coaches, and setting strap hangers at a lower
position. This is the reason that the Project is classified as a Gender Integrated
Project.
In this country which has a risk of AIDS infection, the Project implements
large-scale construction work with a significant portion of the labor force
concentrated in the site. Thus, the high risk of transmission is considered. The
Project has established a special plan for HIV prevention and requires eachcontractor to take measures in accordance with the plan.
Special needs of the elderly and the physically challenged are taken into
consideration when designing stations and coaches (e.g., universally designed
elevators and escalators, announcements at stations, signs in Braille, and space forwheelchairs) by learning from precedents such as accessibility considerations
adopted by Delhi Metro, in accordance with the accessibility-related laws andpolicies of India.
(8) Collaboration with Other Donors: N/A(9) Other Important Issues: N/A

4. Targeted Outcomes(1) Quantitative Effects
1) Operation and Effect Indicators
Baseline(recorded in2008)

Indicator

Target (2021) [2 years
after projectcompletion]

－

92.0

distance－

84.0

Number of Running Trains

－

400－

10.4－

42.1

Operation rate (%/year)
Cartraveling(1,000km/day)
(No.

of

trains/day,one

direction)
VolumeofTransportation(million man-km/day)
Passenger Revenue (millionRupees/day)
2) Internal Rate of Return
Based on the conditions indicated below, the economic internal rate of return(EIRR) of the Project will be 6.1% and the financial internal rate of return (FIRR)
will be 13.6%。
【EIRR】
Cost: Project cost (excluding tax), and operation and maintenance costs
Benefit: Effects of reducing the operation and maintenance costs of the existingtransportation system and roads, travel time of users of this line and othertransportation users, operation and maintenance costs of buses and other transit
systems by mitigating traffic congestion, and the number of traffic accidents andpollution.
Project Life: 30 years【FIRR】
Cost: Project cost, and operation and maintenance costs
Benefit: Fare revenue, advertisement revenue, and revenue from real-estatedevelopment
Project Life: 30 years(2) Qualitative Effects
The qualitative effects of the Project include the improvement of traffic conditions,mitigation of traffic pollution, reduction of green gas emission by promoting modal shift,increase of convenience by securing punctuality of travel, and economic developmentin the Chennai Metropolitan Region.5. External Factors and Risk Control(1) Precondition: N/A(2) External Factors: N/A
6. Evaluation Results and Lessons Learned from Past Projects(1) Results of Evaluation of a Similar Past Project
A lesson has been learned from the ex-post evaluation of the Delhi Mass Rapid
Transport System Project (Phases I to VI) in India as one example, that public
transportation carriers should cooperate with each other to form a larger system ofurban transportation and promote efficient operation of the whole system, rather thancompeting. Another lesson is that it is desirable to encourage preconditions ofsecuring profitability when they are evaluated as insufficient after monitoring.
(2) Lessons for the ProjectIn the Project, the CMRL developed a feeder bus plan with a view to further
increasing the rate of use and raising fares, and submitted it to Metropolitan Transport
Corporation (Chennai) (MTC), which manages public bus services in Chennai. MTC
has been implementing this plan.
The CMRL has also signed contracts with private-sector contractors to add to therevenue and improve profitability, for the installation of vending machines, kiosks andATMs in stations, management of parking lots near stations, and so on.

7. Plans for Future Evaluation(1) Indicators for Future Evaluation
1) Operation rate (%/year)2) Car traveling distance (1,000 km/day)3) Number of Running Trains (No. of trains/day, one direction)4) Volume of Transportation (million man-km/day)
5) Passenger Revenue (million Rupee/day)(2) Timing
Two years after project completion-END-