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 5) (E/S)
Loan Agreement: June 14, 2018
2. Background and Necessity of the Project(1) Current State and Issues of the Urban Development Sector and Priority of theProject in Bangladesh
The population of Dhaka increased from 6.62 million to 16.98 million between
1990 and 2014 (United Nations Population Division, 2014). This population
increase has caused a rapid increase in transportation demand, which in turn has
led to chronic traffic congestion and air pollution.
As a result, the average vehicle travel speed in Dhaka is 6.4 km/hour, less thanhalf that in central Tokyo (14.7 km/hour; Kanto Regional Development Bureau, ofthe Ministry of Land, Infrastructure, Transport and Tourism, 2015). In terms of airpollution, the annual average PM10 concentration is reported to be 158 µg/m3(World Health Organization [WHO], 2016), which exceeds the WHO environmental
standard of 20 to 70 µg/m3. The economic loss due to traffic congestion is 3.868
billion US dollars per year (Bangladesh Water Development Board, etc., 2013),
which is degrading the investment environment greatly and hindering theeconomic and social development of Bangladesh.
To solve this problem, the Government of Bangladesh identified the promotion of
economic growth and poverty reduction as a major goal in the 7th Five-Year Plan
(FY2016/17–FY2020/21) and highlighted in its Traffic and Communication
Development Strategy the importance of reducing road traffic congestion in themetropolitan area with appropriate investment. Based on this plan, the government
revised the Strategic Transportation Plan (STP), the master plan for Dhaka urbantransportation that was formulated in 2005, with aid from JICA in August 2016. Inthe revised STP, five Mass Rapid Transit (MRT) routes and two Bus Rapid Transit(BRT) routes were proposed to form a public transport network. MRT Line 5, whichis to be developed under the Dhaka Mass Rapid Transit Development Project(Line 5) (hereinafter referred to as the “Project”), is prioritized as one of thepreferential lines in the revised STP. The other priority lines are MRT Line 1, a rail
link connecting north and south Dhaka to the new eastern city of Purbachal, andMRT Line 6, a rail link connecting north and south Dhaka that is now being
developed through the Japanese ODA loan for the Dhaka Mass Rapid Transit
Development Project.
The Project will connect east and west Dhaka and form a public transportation

network, along with MRT Lines 1 and 6 connecting north and south Dhaka, toalleviate the traffic congestion and mitigate the air pollution in Dhaka, thereby
contributing to economic development and improving the urban environment.
(2) Japan and JICA’s Cooperation Policy and Operations in the Urban Development
Sector
The JICA Country Analysis Paper for Bangladesh (May 2014) identifies urbandevelopment as a priority area. Additionally, Japan’s Country Assistance Programfor Bangladesh (February 2018) sets the Acceleration of Economic Growth thatBenefits All People as a priority area and aims to develop high-qualitytransportation and traffic infrastructure and promote the efficient transportation ofpassengers and goods. The Project is, therefore, consistent with these policies andthe analysis.
In the past, JICA implemented Institutional Building Assistance for Dhaka Urban
Transport Network Development (Dispatching of Experts; FY2010–FY2011) andPreparation of Rules and Regulations under Urban Mass Rapid Transit Act (Dhaka,Bangladesh) (Technical Assistance Related to ODA Loan; FY2013–FY2015) withthe goal of supporting the development of the legal system, including urban railway
law and urban railway technical standards. Additionally, JICA provided support for
the establishment of the revised STP through the Project on the Revision andUpdating of the Strategic Transport Plan for Dhaka (Technical Assistance RelatedLoan; FY2014–2016).
(3) Other Donors’ Activity
The World Bank assisted in the formulation of the STP and implemented theClean Air and Sustainable Environment Project, followed by support for thedetailed design of BRT Line 3 (between the airport and Jhilmil) from 2009 to 2016.
The Asian Development Bank has been implementing the Greater Dhaka
Sustainable Urban Transport Corridor Project to develop BRT Line 3 (betweenGazipur and the airport) since 2010 with the aim of opening the route by the end of2019.
3. Project Description(1) Project Objective(s)The objective of the Project is to alleviate the traffic congestion and mitigate the air
pollution in Dhaka by constructing a mass rapid transit system that connects east andwest Dhaka, thereby contributing to economic development and improving the urbanenvironment. The Engineering Service (E/S) Loan for the Project (hereinafter referred
to as the “E/S Loan”), which covers the detailed design, tenders, environmental andsocial consideration procedures, and other processes for this Project, is intended topromote the smooth implementation of the Project.
(2) Project Site / Target Area

Dhaka District(3) Project Component(s)1) Depot land development and construction (land development and construction ofdepot buildings, railway sidings, etc.; international competitive tendering)2) Civil works for main line and stations (total length of approximately 20 km;
construction of stations, including elevated and underground railway facilities, etc.;
international competitive bidding)3) Electrical and mechanical system (international competitive tendering)4) Rolling stock and equipment for rolling stock in the depot (180 cars [30 six-cartrains]; international competitive tendering)5) Consulting services (F/S review, detailed design, tender assistance, construction
supervision, environmental and social consideration, institutional development
assistance, assistance in preparing for non-rail business, security assessment, andrisk mitigation; shortlist)
This E/S Loan covers the following aspects of component 5 above except for
construction supervitsion: F/S review, detailed design, tender assistance,
environmental and social consideration, institution development assistance,assistance in preparing for non-rail business, security assessment, and risk mitigation.
The Project is expected to be co-financed by ADB.
(4) Estimated Project Cost (Loan Amount)
519,850 million Yen (E/S Loan Amount: 7,358 million Yen)
The total project cost will be recalculated during the detailed design phase coveredby the E/S Loan.
(5) Schedule
June 2018–June 2022 (49 months in total)
The E/S Loan will be completed upon its disbursement.
(June 2022).
(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 (DMTC)
4) Operation and Maintenance System:
DMTC is responsible for the operation and maintenance of the Project. Through thetechnical support provided by the consultant for the preceding ODA loan project(Dhaka Mass Rapid Transit Development Project [Line 6]) as well as the planned
technical cooperation project called the Project for Training MRT Operation andManagement Staff, the necessary skills and knowledge will be transferred to DMTC
staff engaged in the operation and maintenance of MRT Line 6. Trainers who aretrained under these cooperative measures will train staff involved in the project. The
consulting services for the Project will assist the operation and maintenance of

underground sections that are not included in the consulting services for MRT Line 6.
The operation and maintenance costs and the principal and interest repayment costs
will essentially be covered by revenue from fares. Since this revenue may beinsufficient because the fares need to be affordable to the poor, the preceding ODA
loan project (Dhaka Mass Rapid Transit Development Project) has reduced thefinancial burden of the principal and interest repayments by covering the shortage infare revenue with government funding and a concessional sublease provided by thegovernment. In the Project, JICA has also agreed with the Government of Bangladesh
to consider similar measures in the detailed design phase.
(7) Cooperation and Sharing of Roles with Other Donors
The ODA loan project called the Dhaka Mass Rapid Transit Development Project isassisting with the development of MRT Line 6 and the establishment of DMTC, theexecuting agency for the Project. In addition, the Dhaka Mass Rapid Transit
Development Project (Line 1) (E/S) is assisting with the detailed design and tenderassistance for MRT Line 1, which will cross MRT Line 5.
The Project is also supposed to introduce a fare collection system based on the useof IC cards. The Project for Establishment of a Clearing House for Integrating aTransport Ticketing System in the Dhaka City Area (2014–2018; TechnicalCooperation Project) is assisting in designing an IC card clearing system anddeveloping the organizational structure for a clearing house. Based on the system’s
design, JICA is formulating a technical cooperation project that is scheduled to start in
FY2018 called the Project for Establishment of a Clearing House for Integrating aTransport Ticketing System in the Dhaka City Area (Phase II) to establish apermanent system for promoting the use of IC cards. The Project will also adopt thisIC card clearing system.
(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 under theJICA Guidelines for Environmental and Social Considerations (published inApril 2010; hereinafter referred to as the “JICA Guidelines”) and is likely tohave influential characteristics.
③ Environmental Permit: An Environmental Impact Assessment (EIA) Report on
the Project was approved by the Department of Environment, Ministry ofEnvironment and Forests of Bangladesh, in November 2017.
④ Anti-Pollution Measures: Air pollution, noise, and vibrations caused by theconstruction work will be minimized by implementing various measures, suchas regularly sprinkling water, installing temporary enclosures, installing soundabsorbers for the construction equipment, installing noise barriers, andconducting periodic equipment maintenance. Although the estimated groundand bridge-level train noise in the project area exceeds the country’s noise
limits, the use of sound absorbers and other such measures will prevent thenoise from worsening and ensure that it meets Japan’s requirements forconventional railroad lines. The wastewater discharged from the stations andthe depot will not have an adverse effect on the water quality if it isappropriately treated using wastewater treatment equipment. The groundwater,which is located below the underground structures and thus unlikely to haveany particularly adverse effects, will be regularly monitored. The large quantityof construction waste soil (about 1.5 million m3) that will be generated by theunderground tunnel excavation work will be reused as reclamation and fillingsoil by RAJUK (the capital development authority) and private enterprises. In
the detailed design process, the specific uses, storage methods, treatment
methods, and other details regarding the waste soil will be determined by theGovernment of Bangladesh.
⑤ Natural Environment: As the Project site is not located in or around nationalparks or other vulnerable areas, any undesirable impact on the naturalenvironment is likely to be minimal.
⑥ Social Environment: The construction of the alignment and depot, most ofwhich will make use of the space above and below existing roads, will involve
the acquisition of about 23.6 ha of land (about 22 ha for the depot and about
1.6 ha for the ground and elevated sections). Out of 4,660 residents from 1,107
households affected by the Project, 135 residents from 29 households willneed to be resettled. The land acquisition and resettlement will beimplemented in accordance with the domestic procedures of Bangladesh and aresettlement plan formulated under the JICA Guidelines. No particular
objections to the Project were raised during meetings with local residents.
⑦ Other / Monitoring: During the construction phase, the contractor and theexecuting agency are in charge of monitoring air pollution, noise, vibration,water quality, waste, etc. After the start of operations, the executing agency will
monitor the air pollution, noise, vibration, water quality, etc. The executing
agency will also monitor progress in terms of land acquisition and resettlement.
2) Cross-Cutting Issues(i) Project Related to Climate Control: The Project is expected to mitigate climatechanges by reducing carbon dioxide emissions by about 39,491 tons per year.
(ii) Poverty Eradication and Poverty Consideration: N/A(iii) Control of AIDS/HIV and Other Infectious Diseases: The gender action plan
mentioned below will discuss measures for controlling AIDS/HIV and other infectious
diseases during the construction work.
(iv) Participatory Development and Consideration for Persons with Disabilities: TheProject will adopt a barrier-free design, including braille blocks and slopes forwheelchairs, in accordance with Bangladesh’s urban railway technical standards.
3) Gender Category: [Gender Project] GI (S) (Gender Activities Integration Project)
Activity Components/Reason for Categorization:
In Bangladesh’s public transportation systems, no measures have been taken toeliminate sexual harassment and a lack of sufficient safety for women using
public transportation acts as an obstacle to women’s use of these systems.
Therefore, as it is necessary to ensure women’s safety on trains and in stations
and to promote greater understanding of gender issues, JICA and DMTC haveagreed to implement gender action plans, such as the operation of women-onlycars during peak hours and the installation of surveillance cameras on trains andin stations. The progress of this gender action plan will be monitored in theprogress report for the Project.
(9) Other Important Issues: N/A
4. Targeted Outcomes(1) Quantitative Effects
1) Performance Indicators (Operation and Effect Indicators)
Indicator

Baseline(Actual Value in 20__)

Target (20__)(Expected value __ years after
project completion)

Passengers carried (1,000persons-km/day)
Frequency of trains (numberof trains in service/day)Operation rate (%)
Car-kilometers (km)To be determined during the appraisal process
for the loan for the construction phase of theProject.

Travel time for a certain
section (min.)(2) Qualitative Effects
Response to transportation demand in the Dhaka Metropolitan Area, reduction in air
pollution through the promotion of public transportation, and mitigation of climatechange through the reduction of greenhouse gas emissions.
(3) Internal Rate of Return
To be determined during the appraisal process for the loan for the construction phaseof the Project.
5. Preconditions / External Conditions(1) Preconditions: N/A(2) External Conditions: N/A

6. Lessons Learned from Past Projects(1) Lessons Learned from Past Projects
The ex-post evaluation of India's Calcutta Metro Railways Construction Project(2002) revealed that, for projects involving land acquisition and facility relocation, it isimportant to take into account the opinions of local residents and parties involved inthe planning and implementation phase. The ex-post evaluation also indicates that
underground installations, such as waterworks and sewerage, can cause construction
delays and cost overruns. In addition, the ex-post evaluation of India's Delhi
High-Speed Transit System Construction Project (I)-(IV) revealed that construction
delays were prevented because the executing agency (Delhi Metro)—not the waterauthorities or other such parties—relocated all underground installations. In thepreceding ODA loan project (Dhaka Mass Rapid Transit Development Project), thealignment for the project had to be changed due to the construction of a flyover byother governmental agencies. It is clear that proper coordination with the relevant
agencies must be conducted in the planning phase.
In addition, the results of the ex-post evaluation of India’s past urban railway projects,including the Delhi High-Speed Transit System Construction Project (I)-(VI), indicatedthat it is necessary to ensure that there are enough methods to secure profitability andthat, if there are not enough methods, there must be further examination.
(2) Application of Lessons Learned to the Project
Based on the lessons above, the Project is intended to determine the scale of theland acquisition and resettlement areas and start discussions with stakeholders during
the detailed design phase of the E/S Loan through consulting services forenvironmental and social consideration. To prevent construction delays and cost
overruns resulting from geological conditions, underground installations, undergroundobstacles, and cultural assets, JICA will conduct a geological survey, undergroundutilities survey, underground obstacle survey, and cultural asset survey during thedetailed design phase while the executing agency DMTC will relocate and remove
underground installations and coordinate the relocation and removal work withrelevant agencies.
With regard to coordination with other agencies during the planning phase, only
development projects planned in the revised STP should be implemented. Althoughprojects implemented by other agencies are unlikely to make plan changes to theProject, the necessary coordination will be made through inter-agency discussions
attended by the relevant agencies, including DMTC.
In terms of financing the Project, JICA will secure concessional financial measuresfrom the Bangladesh government as well as assist in formulating a business plan
through the provision of consulting services to secure non-fare revenues, including
development revenue from transit-oriented development (TOD), tenant revenue fromstores located on the station premises, and advertising revenue.

7. Evaluation Results
The Project aims to improve traffic flow in Dhaka, which is facing traffic congestionand deteriorating environmental conditions caused by rapid urbanization andincreased traffic. To achieve this, the Project will develop MRT Line 5, which connects
the city’s east and west, and construct a public transport network in the city, thereby
contributing to economic growth and an improved urban environment. The Project isconsistent with the development policies of the Government of Bangladesh and theassistance policies and the analysis of the Government of Japan and JICA. TheProject will also contribute to the achievement of Sustainable Development Goal
(SDGs) 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
To be determined during the appraisal process for the loan for the construction phaseof the Project.
(2) Timing
To be determined during the appraisal process for the loan for the construction phaseof the Project.