Japanese ODA Loan

Revised in January 2019

Ex-Ante Evaluation (for Japanese ODA Loan)
1. Name of the ProjectCountry: India
Project: West Bengal Piped Water Supply Project
Loan Agreement: March 28, 2013
Loan Amount: 14,225 million yen
Borrower: The President of India
2. Background and Necessity of the Project(1) Current State and Issues of the Water Supply/Sewerage and Sanitation
Sector in India
In India, accessibility to safe water has been improved from 72% in 1990 to88% in 2008. The country has been reaching its goal of establishing sustainable
access to drinking water throughout India under the Twelfth Five-Year Plan (April
2012 through March 2017). However, water resource development andconstruction of water supply systems are not keeping up with the increasing
demand for drinking water stemming from India’s increasing population andeconomic growth. Today, the country suffers from an excessive dependence ongroundwater and chronic problems such as a broken and uneven water supply.
Even worse, groundwater in some areas contains substances harmful tohumans such as fluoride and arsenic. In particular, fluoride and arsenic levels in
the water in northern and western part of the country are far beyond the WHO
guidelines, calling for urgent action to ensure the supply of safe drinking water.
The sewerage systems in the country are also troubled. Specifically, thepercentage of facilities connected to sewer pipes remains extremely low—just
28% even in urban areas. Due to a drastic influx of population into urban areas
and rapid industrialization, wastewater has overflowed treatment capacity and ispassing untreated into rivers and the like, threatening living conditions andsanitation for local residents. The organizations providing drinking/seweragewater services face technical and financial challenges in operation/maintenance,such as high ratios of non-revenue water, undervalued fares, and a lack oftrained employees.
(2) Development Policies for the Water Supply/Sewerage and Sanitation Sector
in India and Priority of the Project
The Union Government set a policy agenda under the Twelfth Five-Year Plan
(April 2012 through March 2017) for supplying drinking water to the entire

population in urban areas. In 2009, the Union Government further formulated theNational Rural Drinking Water Programme (NRDWP) to supply safe andsufficient drinking water in rural areas as soon as possible and to promotesustainable maintenance. Also, under the strategic plan related to rural watersupply that was formulated in 2010, the Government set a goal to use its
waterworks to supply safe and sufficient drinking water to the entire population inrural parts of India by 2022. The waterworks improvement program is expected
to continue under the same strategic plan in the Twelfth Five-Year Plan. The plan
aims to boost coverage of the drinking water supply system to 55% by 2017(currently at 30%). The project fulfills the strategic plan and is defined as one
that contributes to increased coverage of the drinking water supply system inrural areas.
(3) Japan and JICA’s Policy and Operations in the Water Supply/Sewerage
Sector in India
As a part of environmental measures, priority goals were formulated by theGovernment of Japan for improving poverty and environmental issues under theCountry Assistance Program for India. The Country Assistance Program willconsider the rapid growth of urban population and support the supply ofadequate and safe drinking water and the remediation of poor public sanitationin order to improve living standards and prevent water contamination in majorrivers. Further, in rural areas, water supply development projects are supported
as part of the development of basic infrastructure for the living environment ofthe poor. In Japanese ODA loans for India in the water supply/sewerage andsanitation sector, there are 26 projects with loans totaling 501.6 billion yen(14.1% of the entire approved amount). Under non-Japanese ODA loans, JICA
is currently providing Technical Assistance Related to ODA Loan, Capacity
Development Project for Non-Revenue Water Reduction in Goa. JICA's othercontributions include dispatching policy advisors in charge of the seweragewater sector to the Ministry of Urban Development since May 2011.
(4) Other Donors’ Activity
The World Bank (WB) pointed out that achieving rapid and comprehensive
growth, ensuring sustainable development, and boosting efficiency in service
supply were priority areas under the country assistance strategy scheme. The
bank decided to provide support for constructing water works and improving thesanitary environment to assist in these areas.
The Asian Development Bank (ADB) currently supports the drinking/seweragewater sector as a part of poverty reduction. The bank defined the following
priority items: ① providing support in priority states (Madhya Pradesh, Kerala,and North Eastern states), ② emphasizing the financial soundness ofinstitutions in charge of project operation, ③ considering impoverished groups,and ④ supporting pilot projects that facilitate fund diversification, including
private investment.
(5) Necessity of the Project
The project site, Puruliya District, is located in the western region of the West
Bengal State and has a population of approximately 2.93 million. The project site
is a frontier area, about 300 km away from the state capital of Kolkata. The area
is one of the most underdeveloped in the West Bengal state, with a low literacy
rate and low income level. Nearly 90% of the population lives in rural areas. The
percentage of households under the poverty line is 43.7%, higher than thenational average of 26.1%.
The Union Government formulated a policy to encourage greater use of water
systems to ensure a safe and sufficient water supply. The government of West
Bengal coined the slogan "from wells to waterworks" for its policy, while making
progress towards constructing waterworks throughout the state. However, thecoverage of the drinking water supply system in the Puruliya District is 16.8%,
which is lower than the state average of West Bengal 38.0%. In other words, thedistrict is most backward in West Bengal in terms of coverage.
Because the Puruliya District has a limited amount of surface stream water
available, most residents rely heavily on groundwater to supply their householdwater. However, groundwater levels are lower during the dry season because of
the recent surges in water demand resulting from the region’s growing
population. Water shortages therefore occur when people become unable topump the groundwater. Moreover, it was confirmed that some of thegroundwater in Puruliya District contains naturally derived fluoride at levels
beyond WHO guidelines for drinking water. Thus supplying safe drinking water
through constructing waterworks is considered to be a pressing issue.
The project aims to supply safe and sufficient drinking water to residents in thePuruliya District. Therefore, the aim of the project satisfies the development
policies of the Government of India as well as the support policies of theGovernment of Japan and JICA. Consequently, JICA's support for the project ishighly necessary and relevant.

3. Project Description(1) Project Objectives
The objective of the project is to provide safe and adequate drinking watersupply to people in the Purulia District suffering from acute scarcity ofpotable water, by constructing piped water supply schemes, thereby
improving health and quality of life in the district.
(2) Project Site/Target Area: Puruliya District, West Bengal State(3) Project Components1
1) Construction of drinking water facilities (e.g. water intake facilities, water
purification plants, water lines, pump stations, distribution reservoirs, andwater supply networks)
2) Consultation service (e.g. reviewing detailed design and bidding documents,bidding support, supervision of construction work, capacity building ofrelevant organizations, and supporting resident education activities)(4) Estimated Project Cost (Loan Amount)
20,740 million Yen (Loan Amount: 14,225 million Yen)
(5) Schedule
Planned between March 2013 and February 2022 (total of 108 months).
Project completion is defined as the commencement of the service of thefacilities (February 2021).
(6) Project Implementation Structure1) Borrower: The President of India
2) Executing Agency: Public Health Engineering Department, Government ofWest Bengal (PHED)
3) Operation and Maintenance System: Same as 2) (partial relegation tomunicipal governments is planned)(7) Environmental and Social Consideration/Poverty Reduction/SocialDevelopment
1) Environmental and Social Consideration① Category: B② Reason for Categorization: The project is classified as Category B
because it does not fall under the sector or characteristics that may have
1As a result of a detailed geo-hydrological survey by consultants hired by the executing agency and areview on the survey by project management consultants (PMC), the executing agency applied for achange in the scope in February 2018 after commencing this project. The new scope plans to use a dam asa water resource instead of that initially planned. The scope was agreed among the Government of India,
the executing agency, and JICA. The change of the scope resulted in changes in 3. (4) Estimated Project
Cost, 3. (5) Schedule, 3. (7) Environmental and Social Consideration Category, and 4. Targeted Outcomes.

an undesirable impact on the environment as defined by the JICA
Environmental and Social Guidelines (established in April 2010) and it is
not considered to have a significant impact on the environment.
2) Promotion of Poverty Reduction: The project will implement awarenessactivities for local residents including impoverished groups. Topics include
public health and conservation of the water environment.
3) Promotion of Social Development (e.g. Gender Perspective, Measures for
Infectious Diseases Including HIV/AIDS, Participatory Development,Consideration for the Person with Disability, etc.): The aspect of genderwill be taken into consideration in the capacity building of relevantorganizations and awareness activities.
(8) Collaboration with Other Donors: N/A(9) Other Important Issues: The project aims to reduce the adverse impact ofclimate change through improving living conditions for local residents. The
improvements should be achieved by securing a safe and stable drinking
water supply by constructing drinking water facilities. The project therefore
contributes to climate change adaptation measures.

4. Targeted Outcomes(1) Quantitative Effects
1) Outcomes(Operation and Effect Indicator)

Indicator

Baseline(Actual Valuein 2012)

Target (2023)【Expected value 2years after projectcompletion】

Population with access to watersupply* (thousands of people)-

710

Coverage of the water supply
system** (%)-

100

Water supply quantity (m3/day)-

69,060Available water per capita per day(L)-70

Number of Village Water andSanitation Committee to beestablished***-52* The beneficiary population by bulk water supply in Puruliya District** The percentage aimed at by the executing agency*** The number of Village Water and Sanitation Committee in Manbar-1,Purulia-I, Puncha Barbazar, and Arsha blocks
2) Internal Rate of Return
Based on the conditions indicated below, the Economic Internal Rate ofReturn (EIRR) of the project was calculated as 13.04%.
【EIRR】
Cost: Project cost (excluding tax), operation and maintenance expenses
Benefit: Reducing time for water collection, Willingness to pay for water
charge, and health promotion by improving water quality (includingfluoride elimination)
Project Life: 30 years(2) Qualitative Effects
Improvement in living conditions of residents in Puruliya District, WestBengal State, enhancing the operation and maintenance capacity of theexecuting agency and municipal governments, and adapting to climatechange5. External Factors and Risk Control
Economic stagnation and deterioration in political situation in India and thesurrounding area of the project as well as natural disasters
6. Lessons Learned from Past Projects(1) Result of Evaluation of Similar Past Projects
A lesson learned from the results of the Philippines' ex-post evaluation of theBoracay Environmental Infrastructure Project was that when the operating party
differs from the executing party, it is critical to secure involvement of theoperating party from the project planning stage to foster ownership. A lesson
learned from the results of Indonesia's ex-post evaluation of the Rural Areas
Infrastructure Development Project (3) was that when managing small, diverse
projects, it is absolutely imperative to set up a systematic management systemand define its operation throughout the entire process from central control
functions to the margins.
(2) Lessons for the Project
Operation and maintenance of drinking water facilities in the towns for theproject will be delegated not to the executing party but to respective local
municipal governments. Therefore, based on lessons learned, JICA will provide
educational activities and training programs for the municipal governments andlocal residents to educate them about their roles and responsibilities in theoperation and maintenance of the relevant facilities. The executing agency willcompile detailed information related to project progress collected at the projectsites to create a database so that the agency can manage the data in aconsolidated manner. In this way, the agency can achieve efficient operation.

7. Plan for Future Evaluation(1) Indicators to be Used
1) Population with access to water supply (thousands of people)
2) Coverage of the water supply system (%)3) Water supply quantity (m3/day)
4) Available water per capita per day (L)5) Number of water control associations to be established6) Internal Rate of Return (EIRR) (%)(2) Timing
Two years after the project completion
The Ex-Ante Evaluation was revised as the Indian side applied for a change in thescope in February 2018.