Japanese ODA Loan

Ex-Ante Evaluation
1． ProjectCountry: People's Republic of Bangladesh
Name of the Project: Inclusive City Governance Project
Loan Agreement: June 16, 2014
Loan Amount: 30.690 billion yen
Borrower: The Government of the People’s Republic of Bangladesh
2． Background and Necessity of the Project(1) Current Status and Issues in the Urban Development Sector in Bangladesh
Recently, rapid urbanization is taking place in Bangladesh. As of 2012, 29.0%(about 45 million) people live in urban areas, resulting in an annual growth rate of 2.9
percent—far beyond the national average of 1.2%. The urban population is expected
to further rise in the near future. Urban infrastructure development (e.g. roads,drainage trenches, waste disposal and treatment facilities) is falling behind the rising
population, resulting in severe urban problems such as serious traffic congestion,
urban environmental deterioration, noise, air pollution, and other contamination. Thereare eleven city corporations (core metropolitan areas) in Bangladesh that serve as
regional industrial clusters—and as important economic centers, they lead nationaldevelopment. Besides the city corporations, relatively small local cities called“Pourashava” also exist in the country. However, Bangladesh's fragile urban
infrastructure hinders appropriate economic activity and blocks further job creationand market revitalization. In addition, overlapping functions between agencies of thecentral government and city corporations, coupled with lack of coordination, further
hinders the effective provision of development projects and administrative services. In
particular, four rapidly-growing core metropolitan areas have a variety of development
needs as a result of expanded area and population comprehensive urban
development and reinforcement of administrative capacity are now imperative if they
are to fulfill their roles as centers of regional development.
(2) Development Policies for the Urban Development Sector in Bangladesh and thePriority of the Project
As the nation's top-ranked development strategy, the 6th Five-Year Plan
(2011/2012–2015/2016) defines "acceleration of economic growth and poverty
reduction" as a goal, while identifying "creating jobs by improving urban infrastructure
for well-balanced urban development and improving infrastructure for cultivatingindustries" as a key issue. The government of Bangladesh places more importance on
improving "City Governance", aiming at governance that includes the coordination ofinvolved organizations and the establishment of urban management mechanisms.
The Bangladeshi government integrated a legal basis for establishing laws into theCity Corporation Act (2009), legislation that was previously established by each corecity. In this way, the country promotes functional enhancement in core metropolitan
areas. Since this project complies with the development policy and law stated above
while contributing to the achievement of these goals, the country has given it highpriority.
(3) Japan and JICA’s Aid Policy/Actual Performance in the Urban Development
SectorIn JICA Country Analytical Work for Bangladesh (April 2013), "well-balanced urban
growth in the context of urbanization" is defined as a key issue. The Japan’s Country
Assistance Program for Bangladesh (June 2012) also identified "accelerated
economic growth" as a priority area. Reinforcing government functions andadministrative services are also identified in the policy in order to improve governance,thus this project is consistent with Japan’s and JICA’s aid policies and analysis. Major
assistances provided recently to the country are listed below:· Loan projects: Dhaka Mass Rapid Transit Development Project (2012),
Karnaphuli Water Supply Project (Phase 2) (2012), etc.
· Technical Cooperation projects: Project for Strengthening Solid Waste
Management in Dhaka city (2007), Project for Improving Fare System of
Mass-transportation in Dhaka City Area through ICT (2011), and Comprehensive
Urban Development Plan for City Corporations (2012)(4) Other Donors’ Activity
The Asia Development Bank (ADB) has supported infrastructure improvement
projects in core metropolitan areas and surrounding areas since 2012. The WorldBank established urban infrastructure development funds targeting core metropolitan
areas in 1999, and continues provide supports to date, while building the capacity ofmunicipal governments. The project will support four of eleven core metropolitan
areas.
(5) Necessity of the Project
The country's largest commercial city, Chittagong, and four core metropolitan areas
newly established after 2011 are important hubs for water and land transport. With aconcentration of industries, these cities contain four of eight districts in Bangladesh
dedicated to processing imported materials. Numerous Japanese-owned companies
are located in these cities. In response to rapidly progressing urbanization and further
concentration of industry to achieve economic growth, it is urgently necessary todevelop urban areas that contribute to the creation of healthy business environments
by improving infrastructure and enhancing municipal governments in core
metropolitan areas. Therefore, the project aims to resolve these problems in line withthe development policies of the Bangladeshi government as well as the support
policies of Japanese government and JICA. Consequently, JICA's support forimplementing this project is highly necessary and relevant.
3． Project Description(1) Project Objectives
The objective of the project is to improve public services and promote economic
opportunities in the target 5 City Corporations by strengthening the city governments’administrative capacity and improving urban infrastructure, , thereby contributing to
the economic growth and better quality of life for urban residents.
(2) Project Site/Target Area
Narayanganj, Comilla, Rangpur, Gazipur, Chittagong(3) Project Description
The project aims to improve urban infrastructure and administrative capacity asselected by the criteria shown below, based on the "infrastructure development
program" formulated by the targeted core metropolitan areas.
1) Urban infrastructure development (e.g. city roads, elevated bridges, drainage
facilities, and street lights)
2) Administrative and financial capacity improvements (city planning
improvement and training programs focused on enhanced tax collectioncapacity)
3) Reinforcement for implementation systems (e.g. vehicle procurement)4) Consultation services (e.g. detailed design, bidding support, supervision ofconstruction work, improvement of governance and infrastructure, monitoring,and assessment)(4) Total Project Cost 37.824 billion yen (Yen Loan Amount: 30.690 billion yen)
(5) Project Implementation SchedulePlanned between June 2014 and March 2020 (total of 70 months) Projectcompletion is defined as the commencement of facility services (March 2019)(6) Project Implementation Structure1) Borrower: The Government of the People’s Republic of Bangladesh
2) Executing Agency: Local Government Engineering Department (LGED)
3) Operation and Maintenance System: LGED and municipalities of core
metropolitan areas targeted by this project(7) Environmental and Social Considerations, Poverty Reduction, and Social
Development
1) Environmental and Social Considerationsi.
Category: Bii.
Reason for Categorization: The Project is classified category B inaccordance with JICA Guidelines for Environmental and Social
Considerations (April 2010). There is no significant negativeenvironmental and social impact caused by the Project both during theconstruction and operation phases.
iii.
Environmental Permit: The Environmental Impact Assessment (EIA)
Report is required for sub-projects including bridges over 100 m and theconstruction of elevated bridges. Therefore, construction will be launchedafter obtaining approval from the Ministry of Environment and Forests(MoEF).
iv.
Anti-Pollution Measures: In accordance with the environmental
management plan, preventive measures will be taken; this includes slope
protection for water pollution as a result of soil runoff from mounds, grassestablishment, drainage equipment, and water sprinkling for dust during
construction. Therefore no major pollution is expected.
v.
Natural Environment: The project site is not located in or around sensitive
areas such as national parks, and adverse impact on the naturalenvironment is assumed to be minimal.
vi.
Social Environment: The project will involve no land acquisition or resident
relocation, since it targets lands owned by core metropolitan areas.
vii.
Other/Monitoring: The environment will be monitored based on
environmental monitoring for corrosion status, drainage conditions, traffic
safety, and the like, by the executing agency while the construction isunderway and municipalities of core metropolitan areas targeted by thisproject after service starts.
2) Promotion of Poverty Reduction: Each city will formulate measures tosupport slum improvement programs in each city with the aim ofimproving administrative and financial capacity.
3) Promotion of Social Development (e.g. Gender Perspective, Measures toPrevent Infectious Diseases Including AIDS, Participatory Development,Consideration for the Handicapped, etc.): Formulate and implement
programs for gender-related issues as a part of improving administrativeand financial capacity. Also, formulate a participatory development
program for core metropolitan areas.
(8) Collaboration with Other Schemes and Donors:
In the five core metropolitan areas targeted by this project, a Technical Cooperation
project for Development Planning entitled "Project for Developing Inclusive City
Government for City Corporations (2012)" has been implemented since 2012 with theaim of formulating action programs for infrastructure improvement plans as well asadministrative and financial capacity. The World Bank plans to provide assistance tothe cities of Narayanganj, Comilla, and Rangpur. JICA will consolidate themanagement of administrative and financial support targeting the three core
metropolitan areas, and the World Bank will supply funds for infrastructuredevelopment based on the results of JICA's support. With regard to this project’srelationship to urban infrastructure development, target projects will be checked inadvance to avoid overlap.
(9) Other Important Issues: In the sewage disposal, waste disposal technology, andurban planning fields, the possibility of collaboration with Japan's local governments isunder consideration. To improve the legal systems governing core metropolitan areas,a Project for Developing City Government for City Corporations (Yen Loan accessoryproject) is planned to start, while city planning advisers aiming to reinforce city
planning capacity in core metropolitan areas are being considered.
4． Project Benefits(1) Quantitative benefits
1) Evaluation Indicators (Operation and Effect Indicator) Operation and effectindicators are set per sub-project category and investigated based on samples.
Sub-project
category

Road-related
facilities

Indicators (unit)

BaselineAnnual average traffic volume per day(cars/year)-

Target (2021)
Two years after
completion
Increased

Average hours required-

Decreased-

Decreased-

Increased

Number of days roads are impassible
due to flooding (days/year)
Number of people affected by floods inliving areas (persons/year)-

Decreased

Water supply volume (days/m3)-

Increased

Population with access to safe water(number of persons)-

Increased

Averagenumberofbus/truck
arrivals/departures (vehicles/day)-Increased

Average number of people used
(number of people/day)Street lights in operation (number ofstreet lights)
Annual traffic accidents (number ofaccidents/year)
Shelter capacity (number of people)-

Increased-

Increased-

Decreased-

Increased

People affected by floods (number ofpeople/event)-Decreased

Training program participation (numberof people/year)-

Increased

Business licenses issued (number oflicenses/year)-

IncreasedAverage costs needed(TK/travel)
Operation rate (%)
Drainage facilities

Water
supply/sanitation
facilities

Bus/truck terminals

Improving
lightsstreetSchools that can beused as cyclone
shelters
Improvingadministrative
capacity
Promotingexpansion
economicopportunities

offortravel

Decreased

Gender
activities

support

Number of Gender Committee meetings(times/year)-Increased

Indicators and criteria will be set after conducting baseline surveys for each
sub-project.
2) Internal Rate of Return (IRR): Economic Internal Rate of Return (EIRR) iscalculated based on samples taken during the implementation phase.
(2) Qualitative benefits
Improve economic growth of urban areas and quality of life for residents.
5． External Risk Factors and Risk Control
Delays in civil engineering work due to natural disasters such as floods.
6． Lessons Learned from Past Projects(1) Results of Evaluations of Similar Past Projects
The ex-post evaluation results for the Small-scale Infrastructure Rehabilitation andUpgrading Project II in Sri Lanka demonstrates that establishing appropriate
implementation, project management, and monitoring systems is important forprojects with a significant number of sub-projects in several sectors. The ex-post
evaluation results for the Programme for Construction of Multipurpose Cyclone
Shelters (Bangladesh) demonstrate that securing electricity and safe drinking water
for shelters to prepare for disasters is necessary.
(2) Lessons for the ProjectThis project includes a significant number of sub-projects implemented in severalsectors. Establish a system for managing and monitoring administrative and financial
services in each core city targeted to achieve a consolidated management system
controlled by the LGED, while receiving consultation services based on the lessons
learned from previous projects. Since this project includes the construction of schoolsthat can be used as cyclone shelters, the basic design for the buildings includes
installation of solar panels and tanks for holding rainwater based on lessons learned
from previous projects. This will allow the project to secure a power supply and safe
water when disasters strike.
7． Plans for Future Evaluation(1) Indicators for Future Evaluation:
1) Annual average traffic volume per day (cars/year)
2) Average hours required3) Average costs needed for travel (TK/travel)4) Operation rate (%)5) Number of days roads are impassible due to flooding (days/year)6) Number of people affected by floods in living areas (persons/year)
7) Water supply volume (days/m3)8) Population with access to safe water (number of persons)9) Average number of bus/truck arrivals/departures (vehicles/day)
10) Average number of people used (number of people/day)11) Street lights in operation (number of street lights)
12) Annual traffic accidents (number of accidents/year)13) Shelter capacity (number of people)
14) People affected by floods (number of people/event)15) Training program participation (number of people/year)16) Business licenses issued (number of licenses/year)17) Economic Internal Rate of Return (EIRR) (%) (to be calculated in the future)18) Number of Gender Committee meetings (times/year)(2) Timing of Next Evaluation: Two years after completion