Ex-Ante Evaluation (for Japanese ODA Loan)
South Asia Division 1, South Asia Department
Japan International Cooperation Agency
1. Name of the ProjectCountry: India
Project: Bengaluru Water Supply and Sewerage Project (Phase 3) (II)Loan Agreement: March 31, 2022
2. Background and Necessity of the Project(1)

Current State and Issues of the Water Supply and Sewerage Sector
the Priority of the Project in India

andIn India, households supplied with water through pipes or with access toportable water in their premises through unspecified means such as wells
account for about 81% of all households in urban areas (based on the Ministry of
Statistics and Programme Implementation’s 76th National Sample Investigation
Report in 2018). However, the development of water sources and water supply
as well as sewerage facilities has not kept up with the water demand that has
risen along with the country's population and economic growth. The operationand management of the water supply and sewerage facilities in India have faced
technical and financial problems, such as high rates of non-revenue water, low
payment collection rates, and low level of pricing, resulting in the deterioration of
the water supply and sewerage facilities in some areas. The development ofsewerage facilities has not kept up with the increase in demand due to population
growth either. The percentage of households with access to toilets connected to
sewerage has remained about 39% among all households in urban areas (basedon the Ministry of Statistics and Programme Implementation’s 76th round of
National Sample Investigation Report in 2018), which suggests the necessity ofdeveloping sanitary sewage treatment facilities.
The Bruhat Bengaluru Mahanagara Palike (Bengaluru metropolitan area,
hereinafter referred to as "BBMP") comprises Bengaluru City, which is the capitalof Karnataka State in the south of India, urban local bodies (hereinafter referredto the "ULB"), and 110 suburban villages that have been urbanized rapidly alongwith mass migration into their central parts in recent years. Also known as the
Silicon Valley in India, the area around Bengaluru City has rapidly developed into
an agglomeration area of software industry, including many Japanese companies(405 companies in total as of October 2020 based on the research by the Japan
External Trade Organization (JETRO)). However, infrastructure development,1including water supply and sewerage facilities that have not been able to keep up
with the population increase in the area, has been a major constraining factor forthe development of BBMP. The water demand in BBMP excluding groundwater
utilization was 1,550 million liters per day (MLD) as of 2016. In contrast, the watersupply capacity of the Bangalore Water Supply and Sewerage Board (hereinafterreferred to as the "BWSSB") has remained at 1,310 MLD. Thus, the water supply
in Bengaluru is not enough to meet the increasing water demand. In particular,
the 110 suburban villages are expected to see a rapid population increase in the
future and the water demand is estimated to increase to 254 MLD by 2024.
Considering that the available groundwater supply in the urban district has comeclose to its limit, there is an urgent need to develop water supply with surface
water as water sources. Regarding sewerage, the coverage ratio in Bengaluru
City and the ULB is about 60%, but there is no sewerage operated by the BWSSB
in 110 suburban villages. Thus, there is a pressing need to improve the sanitary
and water environments in these villages.
In order to cope with the water resource problem, the Government of India(hereinafter referred to as the "GOI") established a new ministry, Ministry of Jal
Shakti, by integrating existing departments related to water resources (in 2019)and implemented the Jal Jeevan Mission (Urban), which aims to supply water toall households in the urban district (according to the government's policy speech
for the 2021 budget in February 2021). Regarding sewerage, the Ministry of
Urban Development, the precursor of the Ministry of Housing and Urban Affairs,
announced the "National Urban Sanitation Policy in 2009", which included a
policy to give people access to safe sanitary facilities by conducting activities toincrease the awareness of urban residents about the importance of sanitationsuch as sewerage. GOI also announced a policy to address the continuous
installation of toilets and the development of sewerage facilities in urban districts
by establishing Swachh Bharat Mission (Urban) 2.0, which succeeds the Clean
India Policy (2014 to 2019) (according to the government's policy speech for the2021 budget in February 2021).
Furthermore, in the Urban Drinking Water and Sanitation Policy 2003 and the
Karnataka State Water Policy 2019, the Karnataka state government set a target
to provide water supply and sewerage services to everyone in the state. Under
these policies, the BWSSB has promoted the Cauvery Water Supply Scheme(CWSS) from Stage I to Stage IV to develop water supply facilities with capacitiesof 1,310 MLD as part of its efforts to achieve a water supply of 2,100 MLD
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(excluding groundwater utilization) to BBMP by 2034. The project has beenfurther promoted to Stage V so as to develop a water treatment plant, and raw
and purified water transmission mains and achieve a water supply capacity of
775 MLD. Water supply and sewerage facilities are also being developed in 110
suburban villages where the population is growing at high rates.
The Bengaluru Water Supply and Sewerage Project (Phase 3) (hereinafterreferred to as the "project") aims to assist the water supply and seweragedevelopment projects promoted by the BWSSB for ensuring stable water supply
with Cauvery River as a water source and stable sewer treatment. This isconsistent with the GOI's development policy in the water supply and sewerage
sector.
(2)
Japan's and JICA's Cooperation Policy and Operations in the Water
Supply and Sewerage Sector
The Country Assistance Policy for India (March 2016) formulated by theGovernment of Japan establishes “supporting sustainable and inclusive growth”
as a priority area and states its support for water supply and sewerage as a partof its “response to environmental problems and climate change.” Additionally,
the JICA Country Analysis Paper for India (March 2018) mentions importance ofbasic social services under "supporting sustainable and inclusive growth" andprovision of support for sustainable economic development and in the country,
sharing its benefit with society equally. In addition to providing support for this, aspart of urban development under "water and sewerage, sanitation improvement
and pollution control measures program", supporting social sector such as basicsocial infrastructure development including sewerage and sanitary facilities.Thus,
the project is consistent with these policies and analysis results.
The project is also considered to contribute to Goal 6 (ensure availability andsustainable management of water and sanitation for all) of the Sustainable
Development Goals. Therefore, it is highly necessary to assist the implementationof the project.
(3)
Other Donors' Activities
The World Bank accepted the Karnataka Municipal Reform Project (worth 216
million US dollars) for BBMP in 2006 and extended assistance in the seweragedevelopment in the ULB. In the Country Partnership Strategy (2018 to 2022), theAsian Development Bank has promoted public infrastructure development,
including water supply and sewerage facilities, for comprehensive urbanization
as one of the priority fields of the cooperation for India and intensively extended3

assistance in the promotion of public private partnership (PPP). The US Agency
for International Development (USAID) implemented capacity reinforcement
project focusing on the financial improvement of project operation agencies in thewater supply, sewerage and sanitation sector in 70 cities of 13 states, including
Odisha, Karnataka, and Maharashtra States during the period from 1993 to 2011.
3. Project Description(1)
Project Objective
The objective of the Project is to provide safe and stable water supply andsewerage services in BBMP by carrying out construction of water supply andsewerage system utilizing water resourece of Cauvery river, thereby improving
living conditions of the residents as well as the promiting industrialization in theconcerned areas.
(2)
Project Site/Target Area
Bengaluru urban district in Karnataka State (population: about 8.5 million (2011))(3)
Project Components<Water Supply Facilities>a) Installation of raw water transmission pipes (about 10 km)b) Construction of a treatment plant (treatment capacity of 775 MLD in termsof raw water) and transmission pump stations (3 locations), as well as
installation of transmission pipes between pump stations (about 70 km) andtransmission mains in the urban district (about 114 km)c) Installation of connecting pipes from new transmission facilities to existingand new distribution reservoirs in BBMPd) Construction of new distribution reservoirs (7 locations)e) Construction of overhead water tanks (135 locations) and transmission
pumps (61 locations), as well as installation of connecting pipes from
distribution reservoirs to overhead water tanks (about 200 km in 5 zones)f) Installation of water transmission networks in 110 suburban villages (5zones)g) Installation of SCADA (central monitoring) system (common to water supply
and sewerage facilities)<Sewerage Facilities>a) Construction of sewage treatment plants in 110 suburban villages (14locations with a treatment capacity of 114 MLD in total) and relay pumpstations, as well as installation of sewer mainsb) Installation of terminal sewer pipes in 110 suburban villages (5 zones)4

<Consulting Service>
Design review, schematic design, detail design, tendering assistance,
construction supervision, capability building in the operation and maintenanceof facilities and in the reduction in non-revenue water, resident enlightening
activities, implementation and supervision of the environmental management
plan and environmental monitoring, etc.
(4)
Estimated Project Cost
128,352 million Yen (Japanese ODA loan (for the tranche II): 37,068 million Yen)
(5)
Schedule
January 2021-June 2027 (114 months)
Project Completion is defined as that all facilities are installed and become in use.
(6)
Project Implementation Structure1) Borrower: President of India
2) Guarantor: None
3) Executing Agency: BWSSB
4) Operation and Maintenance Agency: BWSSB(7)
Collaboration and Sharing of Roles with Other Donors
1) Japan's Activity: N/A
2) Other Donors' Activity: N/A(8)
1
2

Environmental and Social Considerations/Cross-Sectoral Issues/Gender
Category
1) Environmental and Social Consideration
Category: B

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Reason for Categorization: Based on the "JICA Guidelines for Environmental
and Social Considerations" (published in April 2010), the project isdetermined to not have significantly adverse impacts on the environment inconsideration of the characteristics of the sector that the project falls under,
the project components, and the regions where the project takes place.

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Environmental Permit: Although the project is not required to conduct anenvironmental impact assessment (EIA) under domestic laws, environment
monitoring has been conducted according to an environment management
plan (EMP) and an environment monitoring plan (EMoP) established basedon the JICA Guidelines for Environmental and Social Considerations. The
clearance with respect to compliance with the discharge standards of sewage
treatment plants is expected to be issued by the Karnataka State Pollution
Control Board in the future.
55Anti-Pollution Measures: Regarding air quality, water quality, noise, andwaste treatment during construction, in compliance with domestic laws, theproject is subject to mitigation measures such as regular water spraying bycontractors; prohibition of disposal of earth, sand, etc., and setting up of
construction machine repair yards in areas close to water places; speed limits
for vehicles; and regular waste collection. Therefore, the adverse impacts ofthe project on environments are considered to be minimal. When sewage
treatment plants are put in service, the effluent and sludge are supposed tobe discharged after being treated to satisfy the environmental and discharge
standards of India. Therefore, sewage treatment plants are not expected to

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have any particularly adverse impacts on environments.
Natural Environment: Target sites for the project do not correspond tovulnerable areas such as national parks, etc., or areas close to thesevulnerable areas. Therefore, the adverse impacts of the project on the naturalenvironment are considered to be minimal.
Social Environment: In the project, a treatment plant will be constructed within
the premises of an existing facility, while other facilities will be constructed onland owned by government agencies. Therefore, the project does not involve
land acquisition and relocation of local residents.
Other/Monitoring: Contractors are supposed to monitor the air quality, noise,waste, etc., when the project is in the construction stage and monitor thewater quality, waste, etc., after the commencement of services.
2) Cross-Sectoral Issues① Climate change: Although the project uses surface water as a water source,
distribution reservoirs and overhead water tanks to be constructed in the
project for storing purified water are expected to ensure stable water supply
in the future, even in drought periods, which may worsen due to climatechange. Thus, the project contributes to climate change measures(application).
② Poverty measures and considerations: As measures to assist the poor who
are living in urban areas, the target areas of the project where water supply
and sewerage facilities will be constructed include poor residential districts.
A program to provide water supply service to poor districts for free has also
been implemented as a part of the project. Thus, the project is considered to
be a project that contributes to poverty alleviation.
③ Measures against infectious disease such as HIV/AIDS: The executing
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agencies have agreed to implement a list of measures (36 in total) to preventthe spread of COVID-19 infection during the formulation and implementationof the project, including the establishment of behavior rules that are effective
for infection prevention, thorough implementation of the rules, and theimplementation of contractual measures for contractors during peak periodsof infection. The list clarifies the following actions: preparing materials andequipment for communicable disease control; improving work environments,
including the promotion of behavior rules; supervising construction works withdue consideration to infection prevention; raising awareness about theimportance of infection prevention; and so on. JICA will receive quarterly
reports of the status of execution from the executing agencies to monitor
whether attention is being given to the effects of COVID-19 and whether the
executing agencies are handling situations flexibly and appropriately
throughout the project stages. During the construction work stage, theconstruction contractor will implement HIV/AIDS prevention measures for theconstruction workers.
3) Gender Category■ Gender Informed (Significant) (Gender activity integration project)<Details of Activities/Reason for Categorization> The project plans to
implement specific measures such as consulting services for public relationand educational activities to share the importance of saving water and theproper use of toilets, etc., and arranging the locations and times of these
activities to encourage the participation of female residents.
(9)

Other Important Issues: N/A

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

Baseline (Actual
value in 2016)

Target (2027)[2 years after projectcompletion]<Water Supply>
Water supply amount (110 suburban
villages) (MLD)
Water supply amount (BBMP)
(MLD)

7

N/A

295

1,3101)1,750

Utilization rate of treatment plant2)
(%)

N/A

56

N/A

1953)

N/A

47

N/A

10 or less

N/A

20 or less

N/A

1,650,000

5,840,000

9,320,000

N/A

1,480,000<Sewerage>
Sewage treatment amount (110suburban villages) (MLD)
Utilization rate of sewage treatment
plant4) (%)
Discharged BOD5) (mg/L)
6)Discharged TSS concentration(mg/L)<Reference Value7)>
Population served by piped water(110 suburban villages) (persons)Population served by piped water(BBMP) (persons)Population served by sewer (110suburban villages) (persons)1)

The total nominal capacity of the existing treatment plants is used as the reference valueof water supply.
2)

The water supply amounts are estimated based on the growth in demand along withpopulation increase, and the utilization rate of the treatment plant to be constructed in the
project is expected to reach 100% in 2035.
3)

The sewage treatment amount includes not only the amount to be treated in the plants tobe constructed in the project but also those of the existing plants connected through the pipes
to be laid in the project.
4)

The utilization rate of the sewage treatment plants is expected to reach 100% in 2034 after

taking into consideration that a certain period is required for each house to connect to thepipes after they have been installed in 110 suburban villages.
5)

Biochemical Oxygen Demand (BOD): BOD is the amount of dissolved oxygen consumed

by microorganisms when they decompose organic substances in water. It is an indicator ofwater pollution due to organic substances in rivers.
6)

Total Suspended Solids (TSS): TSS is the amount of solids suspended in water and an

indicator of water pollution in rivers.
7)

The number of houses to be connected can be counted, but the number of users in eachhouse is difficult to estimate, so the values shown are reference values.

8(2) Qualitative Effects
Stabilization of water supply, improvement in health conditions and living
environments of residents through the provision of sewerage service,improvement in the operation and maintenance capability of the executing
agencies, promotion of women's social participation, poverty alleviation, and soon(3) Internal Rate of Return
Based on the following conditions, the economic internal rate of return (EIRR) is
21.2%. The project is not intended to generate revenue from water and seweragecharges, so the financial internal rate of return (FIRR) is not calculated.
[EIRR]
Cost: Project, and operation and maintenance costs (excluding taxes)
Benefit: Reductions of costs for securing water at each house, medical care, andsewage treatment
Project Life: 30 years
5. External Factors and Risk Control(1)(2)

Preconditions: N/A
External Factors: N/A

6. Lessons Learned from Past Projects
The ex-post evaluation (conducted in 2005) of the yen loan project "Rural watersupply and sewage and sanitary environment improvement project" with respect
to water supply and sewerage development projects in India taught JICA thenecessity of deliberating practical plans for a charging system that maximizes thebeneficiaries' liabilities based on an accurate estimation of the residents'
willingness and ability to pay for services as well as for the promotion of the useof water meters. It also taught JICA the necessity of extending continuous
assistance to executing agencies so they can improve their technical capabilities
in the operation and maintenance of projects. The ex-post evaluation (conducted
in 2015) of "Bengaluru Water Supply and Sewerage Project", etc., also pointed
out that the project took longer than scheduled due to changes in sewage pipe
installation routes, which required a redesign and reapplication for permissions
from relevant authorities. Thus, another lesson learned from the ex-post
evaluation regarding the sewerage development is the necessity of setting a
project period that takes into consideration possible changes in the project plan
and associated reacquisition of permissions in the future.
In the project, it has been confirmed that the BWSSB established a financial
9improvement plan that includes the revision of charging systems and that theusers of the water supply service are obliged to install water meters at individual
houses. Thus, the progress of the plan and the installation of water meters arecontinuously monitored. In addition, the consulting service related to thereinforcement of organizational capability has addressed the transfer oftechniques related to design, supervision, and measures against non-revenue
water supply to the staff of the BWSSB. As one of the lessons learned from the"Bengaluru Water Supply and Sewerage Project", the project period for seweragedevelopment has been set with some margin in consideration of the projectcharacteristics.
7. Evaluation Results
The project is suitable for the development issues in India and development
policies of GOI, as well as the cooperation policies and analysis results of thegovernment of Japan and JICA. The project aims to provide stable water supply
and sewerage service to cater to the rapid increase in water demand through thedevelopment of water supply facilities with Cauvery River as a water source andsewerage facilities, thereby contributing to the realization of sanitary living
environment and industrial vitalization in BBMP in Karnataka State. The projectis also considered to contribute to Goal 6 (ensure availability and sustainable
management of water and sanitation for all) of the Sustainable Development
Goals. Therefore, it is highly necessary to assist the implementation of the project.
8. Plan for Future Evaluation(1) Indicators to be Used
As described in Section 4.
(2) Future Evaluation Schedule
Ex-post evaluation: 2 years after project completionEnd10