Japanese ODA Loan

Ex-Ante Evaluation (for Japanese ODA Loan)
1. Name of the ProjectCountry: The People’s Republic of Bangladesh
Project: Dhaka Mass Rapid Transit Development Project (Line 1) (I)
Loan Agreement: May 29, 2019
2. Background and Necessity of the Project(1) Current State and Issues of the Urban Development Sector and the Priorityof the Project in Bangladesh
The population of the Dhaka Metropolitan Area increased from 6.62 million to17.60 million between 1990 and 2015 (United Nations Population Division, 2018).
The population increase has caused a rapid increase in transport demand,
which in turn has led to chronic traffic congestion. As a result, the average travel
speed for vehicles during rush hours in the Dhaka Metropolitan Area is 6.4
km/hour, less than half of that in commercial areas in Tokyo (14.7 km/hour)(Ministry of Land, Infrastructure, Transport and Tourism, 2015). As for air
pollution, the annual average PM10 concentration is reported to be 158 μg/m 3.
This exceeds the World Health Organization environmental standard of between
20 μg/m3 and 70 μg/m3. The estimated economic loss due to the traffic
congestion is 3.868 billion US dollars per year (Bangladesh Water Development
Board, etc., 2013), which is hindering the economic and social development ofBangladesh.
In its Urban Trans port, Investment Priorities, The Strategy for Transport in theSeventh Five-Year Plan (FY2016/17–FY2020/21), the Government of
Bangladesh indicates that it is important to alleviate road congestion in theDhaka Metropolitan Area with appropriate investment. Based on the policy, theDhaka Strategic Urban Transport Plan (hereinafter referred to as the “STP”), amaster plan in the urban transport sector formulated in 2005, was revised withthe support of the Japan International Cooperation Agency (JICA) (approved bythe Cabinet in August 2016; hereinafter referred to as the “RSTP”). In the RSTP,
developments of five lines of the mass rapid transit system (hereinafter referredto as the “MRT”) and two routes of the bus rapid transit system (hereinafterreferred to as the “BRT”) were planned as public transport networks. The Dhaka
Mass Rapid Transit Development Project (Line 1) (hereinafter referred to as the“Project”) develops the MRT Line 1, which connects Kamalapur Station in thecentral area of Dhaka City with Dhaka International Airport and Purbachal
District, a new residential area in the east Dhaka Metropolitan Area. From theperspective of transport demand, the MRT Line 1 is considered as a prioritizeddevelopment initiative in the RSTP along with the MRT Line 5, which connects
east and west Dhaka, and the MRT Line 6, which connects north and southDhaka.
(2) Japan and JICA’s Cooperation Policy and Operations in the Urban
Development Sector
The JICA Country Analysis Paper for Bangladesh (May 2014) cites urban
development as one of the priority issues and the development of transportation
networks in the Dhaka Metropolitan Area as a priority support issue. Moreover,Japan’s Country Assistance Program for Bangladesh (February 2018) identifies
one of Bangladesh’s priority areas as being to accelerate economic growth sothat everyone can benefit. It mentions that the Government of Japan willcontribute to better connections throughout the region by developing high-qualitytransportation networks and promoting the efficient movement of people andgoods, while considering diversifying transportation. The Project is consistent
with the policy and analysis. Since the Project promotes smoother transportationin the Dhaka Metropolitan Area, it is considered to contribute to Goal 11, “Makecities and human settlements inclusive, safe, resilient, and sustainable,” of theSustainable Development Goals (hereinafter referred to as the “SDGs”).
In the past, JICA implemented the Institutional Building Assistance for Dhaka
Urban Transport Network Development (FY2010–FY2011) and the Preparationof Rules and Regulations under the Urban Mass Rapid Transit Act (Dhaka,Bangladesh): Technical Assistance Related to ODA Loan (FY2013–2015) withthe goal of supporting the development of the legal system, including urban
railway law and urban railway technical standards. JICA also provided support
for the establishment of the Revised STP through the technical assistance
related to ODA loan called the Project for the Revision of Dhaka Strategic Urban
Transport Plan (FY2014–FY2016).
(3) Other Donors’ Activities
In addition to assisting the establishment of the above-mentioned STP, theWorld Bank implemented the Clean Air and Sustainable Environment Project,which supports detailed design of the BRT Route 3 south section (between
Airport Station and Jhilmil), from 2009 to 2016.
The Asian Development Bank has been implementing the Greater Dhaka

Sustainable Urban Transport Corridor Project to develop the BRT Route 3 northsection (between Gazipur and Airport Station) since 2010 with the targeted
opening by the end of 2019.
3. Project Description(1) Project Objective(s)The objective of the Project is to alleviate traffic congestion and mitigate air
pollution in Dhaka city and adjacent areas by constructing a mass rapid transit
system, thereby contributing to economic development and improving the urbanenvironment.
(2) Project Site / Target Area
Dhaka and Narayanganj Districts(3) Project Component(s)1) Construction of a depot (land development, construction of depot buildings,
railway sidings, etc.)
2) Construction of railway structures (total length of approx. 31km,construction of 19 stations, etc.)
3) Installation of railway system (track works, electric system,
telecommunication system, signal systems, etc.)
4) Procurement of rolling stocks (200 cars)5) Detailed design and Basic design Consulting services (F/S review, basic
design, detailed design, tender assistance, etc.)
6) Supervision Consulting services (Construction supervision, etc.)(4) Estimated Project Cost (Loan Amount)
735,067 million Yen (Loan Amount: 52,570 million Yen)
(5) ScheduleJune 2017 (Loan Agreement of E/S loan) - March 2029 (142 months in total).
The Project will be completed upon the opening of all sections (December 2026).
(6) Project Implementation Structure1) Borrower: The Government of the People’s Republic of Bangladesh
2) Guarantor: N/A
3) Executing Agency: Dhaka Mass Transit Company Limited (DMTCL)
4) Operation and Maintenance System; Operation and maintenance groupof MRT Line 1 in DMTCL(7) Cooperation and Sharing of Roles with Other Donors
1) Japan’s Activity

The Japanese ODA Loan Project called the Dhaka Mass Rapid TransitDevelopment Project (approved in FY2012 for the first phase, FY 2016 forthe second phase, and FY 2018 for the third phase) has supported thedevelopment of MRT Line 6 as a preceding line for the Project, and also
supported the establishment of DMTCL, the executing agency of theProject. In addition, the yen-loan project, the Dhaka Mass Rapid Transit
Development Project (Line 5) (E/S) (approved in FY2018), will support thedetailed design of MRT Line 5 north section, which is planned to cross theProject.
The Project also plans to introduce an IC card settlement system built inthe technical assistance related to ODA loan called the Project for
Establishment of Clearing House for Integrating Transport Ticketing
System in Dhaka City (FY2014–FY2018).
2) Other Donors’ Activity
The Asian Development Bank is considering support for MRT Line 5south section (between Gabtoli Station and Aftabnagar Station,) and has
been conducting a pre-F/S since 2018.
(8) Environmental and Social Consideration / Poverty Reduction / Social
Development
1) Environmental and Social Consideration① Category: A② Reason for Categorization: The project falls into the railway sector,
and is likely to have significant adverse impact due to its characteristic
under the JICA guidelines for environmental and social considerations(April 2010).
③ Anti-Pollution Measures: Measures for air quality, noise, and vibration
during construction, such as regular water sprinkling and installationof a temporary fence, will be taken for minimizing their impacts. The
noise level after opening exceeds the noise standards in the country,
but it is expected to satisfy the noise standards of conventional
railways in Japan by the installation of long rails, sound insulation
walls, etc. Deterioration of water quality is expected to be avoided by
the introduction of wastewater treatment facilities from stations androlling stock yards. The Project will generate construction surplus soil
(approximately 2.4 million m3) by the underground tunnel excavation,
but most of the surplus soil will be reused for reclamation and banking

by DMTCL and private companies, and the rest will be disposed ofappropriately at the soil disposal site secured by DMTCL.
④ Natural Environment: The project target area does not fall undernational parks and other vulnerable areas or their vicinities, andadverse effects on the natural environment are assumed to beminimal.
⑤ Social Environment: The Project is expected to involve landacquisition of approximately 39 ha and resettlement of 2,770
residents from 698 households. The land acquisition and resettlementof residents will proceed in accordance with Bangladesh’s domestic
laws and the Resettlement Action Plan, which was formulated basedon the JICA Guidelines for Environmental and Social Considerations.
At the residents' consultation, there was a demand for sufficientcompensation and prior information disclosure, so compensation andresettlement procedures reflecting the requests of affected residents
will be carried out. At present, no particular objection to the Project
has been made by affected residents.
⑥ Other / Monitoring: In the Project, the contractor will monitor air quality,
noise, vibration, water quality, and waste during construction, under
the supervision of the executing agency, and the executing agency
will monitor noise, vibration, and water quality after opening. NGOs
entrusted by DMTCL will monitor the progress of land acquisition andresettlement procedures and livelihood recovery support.
2) Cross-Cutting Issues① Projects related to climate change mitigation: The Project is expected
to have an effect of mitigating climate change (GHG emissionsreduction) of approximately 63,421 tons/year (CO2 equivalent).
② Poverty reduction and consideration: N/A③ Measures against AIDS, HIV, and other infectious diseases: N/A④ Participatory development/consideration for persons with disabilities:
Regarding the station buildings and facilities subject to the Project,barrier-free-based urban railway technical standards, which havebeen developed in the technical assistance related to ODA loan called
the Preparation of Rules and Regulations under Urban Mass RapidTransit Act (Dhaka, Bangladesh), will be adopted, and slopes and tiles
for guiding the visually impaired will be installed to give consideration

to persons with disabilities.
3) Gender category: [Gender issues] GI (S) (Integrated gender activityproject)
Activities / reason for Categorization: The safety of female passengers, suchas measures for preventing sexual harassment, etc., is not sufficiently ensured
in public transportation in Bangladesh. This makes female passengers feel
reluctant to use public transportation. In this context, a gender action plan will be
introduced in the Project, including operation of women-only cars in rush hours
and installation of security cameras in the trains and stations, to ensure thesafety of women in the trains and stations and to enhance understanding ofgender issues.
(9)Other Important Issues: N/A
4. Targeted Outcomes(1) Quantitative Effects
Target (2028)

Baseline
Indicator(Actual value in2018)

Passenger transportation volume (1,000people/kg/day) Note 1(Between Kamalapur Station and Airport Station)
Passenger transportation volume (1,000people/kg/day) Note 1(Between Notun Bazar Station and Purbachal
Terminal Station)
Number of services (Number of trains/day) Note 2(Between Kamalapur Station and Airport Station)
Number of services (Number of trains/day)(Between Purbachal Terminal Station and Notun
Bazar Station)
Number of services (Number of trains/day)(Between Purbachal Terminal Station andKamalapur Station)
Train operating distance (km/day) Note 3(Between Kamalapur Station and Airport Station)
Train operating distance (km/day)(Between Purbachal Terminal Station and Notun
Bazar Station)
Train operating distance (km/day)(Between Purbachal Terminal Station and[Expected value 2years after projectcompletion]

NA

5,916

NA

4,058

NA146

NA67

NA54

NA

4,311

NA2,013NA2,535

Kamalapur Station)
Time required (minutes) Note 4(Between Kamalapur Station and Airport Station)
Time required (minutes)(Between Purbachal Terminal Station and NotunBazar Station)
Time required (minutes)(Between Purbachal Terminal Station andKamalapur Station)
Train operation rate (%)

139

24.3

117

20.4

207

36.2

NA

92.6

Note 1: Estimated demand in the preparatory survey in the event of completion of all
projects (MRT Line 5, MRT Line 6, and BRT Route 3) that are expected to becompleted by 2028 according to the RSTP. To avoid overlap, passengers
between Notun Bazar Station and Kamalapur Station on the Purbachal Line areincluded in the Airport Line (among Airport Station, Notun Bazar Station, andKamalapur Station).
Note 2: Set based on the results of demand forecasting. As there is little demand for
the Purbachal Line, the line will not be operated directly to Kamalapur Station,
but turn back at Notun Bazar Station right after opening.
Note 3: Train operating distance is calculated by multiplying the number of trains
passing between the stations by the distance between the stations (platformcenter interval).
Note 4: The required time is calculated using the average speed of buses running inthe section.
Note 5: At the time of opening, the number of train cars will be 25, of which 22 will
provide commercial services, and the remaining three will be put on standby for
inspection, etc.

(2) Qualitative Effects
Responding to transportation demand in the Dhaka Metropolitan Area,
mitigating traffic congestion through the promotion of public transportation, andreduction of health hazards to residents by improving the urban environment(3) Internal Rate of Return
According to the following preconditions, the Project’s Economic Internal Rateof Return (EIRR) will be 15.1%. The Financial Internal Rate of Return (FIRR) willbe 4.0%.
【EIRR】
Cost: Project costs (excluding tax) and operation/maintenance costs
Benefit: Reduction in vehicle operation costs, travel time, greenhouse gas,etc.
Project Life: 38 years【FIRR】
Cost: Project costs and operation/maintenance costsBenefit: Fare revenues
Project Life: 38years
5. Preconditions / External Conditions(1) Preconditions: N/A(2) External conditions: N/A
6. Lessons Learned from Past Projects
The results of the ex-post evaluation of India's Kolkata Subway Construction
Project revealed that, with projects that involve land acquisition and relocation offacilities, it is important to actively incorporate ideas from residents and parties
involved from the planning and implementation phase. The results also indicatedthat delay in the relocation of underground installations such as water andsewage can become a factor for construction delays and cost overrun. Based onthese lessons, the Project specified the scale and location of land acquisition
from the phase of the preparatory survey. In particular, discussions withstakeholders were held from an early stage at candidate sites for rolling stockbases, where large-scale land acquisition is expected, to form social agreement.
Additionally, construction delays and cost overrun will be prevented byconducting a detailed geological survey, underground installation survey,
underground obstacle survey, and cultural asset survey during the detailed
design phase, and having DMTCL secure the construction yard and soil disposal
site, perform the relocation and removal of underground installations, andcoordinate organizations involved.
In the preceding the Dhaka Urban Transport Development Project, only one
bidder was accepted for some of the procurement packages, and the bidding
price exceeded the planned price and procurement was prolonged. Based on
this lesson, the Project will obtain the agreement of the government of therecipient country on the fragmentation of the procurement package, and thedetailed design consultant will finalize the fragmentation of the procurement
package and the tender conditions, etc. in order to ensure competitiveness at
the time of bidding, taking into account market trends before bidding.
7. Evaluation Results
The Project will respond to the transportation demand in the Dhaka
Metropolitan Area, which faces chronic traffic congestion and environmental

deterioration due to rapid urbanization and increased traffic, by constructing
MRT Line 1 connecting the center of Dhaka District and satellite cities, thereby
contributing to economic development and improvement of the urban
environment through mitigation of traffic congestion. The Project is consistent
with Bangladesh’s development policies and with the assistance policies andanalyses of the Government of Japan and JICA. Thus, the necessity for JICA tosupport the Project is substantial. The Project is also expected to contribute toSDGs goal 11, “Make cities and human settlements inclusive, safe, resilient, andsustainable.” Thus, the necessity for JICA to support the Project is substantial.
8. Plan for Future Evaluation(1) Indicators to be Used
As indicated in sections 4. (1) to (3).
(2) Timing
Ex-post evaluation: Two years after the project completion