$61.7 Million Additional Financing for Himachal Pradesh State Roads Project, India – Most Districts Across the State to Benefit

October 26, 2012

So far the first Project has improved and maintained 1,200 km of roads. At least 220 km has been upgraded and travel time has reduced by more than 25 percent

WASHINGTON, October 25 2012 - The World Bank today approved additional financing of $61.7 million for the ongoing Himachal Pradesh State Roads Project to support the government of Himachal Pradesh, a mountain state richly endowed with natural resources, strengthen its road network.

The original $220 million Himachal Pradesh State Roads Project, which became effective on October 5, 2007, was aimed at reducing transport costs and improving traffic flows on priority segments of the Core Road Network of Himachal Pradesh. It is also widening and strengthening about 447 km of existing state highways to two lane roads, undertaking periodic maintenance of about 2000 km of Core Road Network, and strengthening institutions to help maintain the road network.

The additional funding of $61.7 million, approved today, will help the Himachal State Roads Project fulfill its original objective. The Project is also experiencing cost overruns. The additional financing will support the state meet increased costs for upgrading roads, cost of afforestation, land acquisition, and resettlement and rehabilitation work.

So far the Project has improved and maintained 1,200 km of roads. At least 220km of the 447 km of state highways have been upgraded to two-lane roads. Travel time on these improved roads has reduced by more than 25 percent. According to a recent user satisfaction survey, done by the Project, the level of road user satisfaction today stands at 3.9 (in a scale of 5) as opposed to 1.5 when the Project started.   

However, the state’s total road network of about 32,247 km comprising 1,458 km of National Highways and 720 km of border roads, 1,626 km of State Highways and 1,969 km of Major District Roads is not enough to meet the social and economic needs of the state.  Half of all roads are unsurfaced, 90 percent of the highway network is single lane and less than 50 percent of villages are connected.

The additional financing approved today, has added two new components – road safety system and a project management system. Recognizing that road safety is a critical issue in the country today, the additional financing will specifically support the development and operationalization of a Road Accident Database Management System (RADMS) along the lines of a similar system developed in Tamil Nadu. This will enhance the state’s ability to systematically identify, analyze, develop and prioritize critical road safety measures on all state roads, which will benefit all road users. To ensure proper maintenance of constructed roads, the Project will pilot Performance-based Maintenance Contracts (PBMC) on about 300 km of roads. This is expected to enhance the management capabilities of the Public Works Department (PWD) of the state.

 “Having made impressive economic progress, Himachal Pradesh must improve its road infrastructure for inclusive growth. This, along with attention to road safety, can spur investments, create new jobs and boost agriculture, while improving citizens’ access to markets, healthcare and education,”  said Onno Rûhl, World Bank Country Director for India.

An e-based Project Management System to be implemented under this Project will also facilitate efficient exchange of project information, track processes and report on contract execution.   

“This Project will have the same approach and strategy of the on-going Project. The additional financing will not only help the Project complete all civil works but also enhance the state’s capacity to manage maintenance work as well as prioritize road safety measures,” said Pratap Tvgssshrk, World Bank’s Senior Transport Specialist and the Project’s Task Team Leader. “We shall draw lessons from other World Bank road projects implemented in India over the years,” he added.

The loan, from the International Bank for Reconstruction and Development (IBRD), has a maturity of 18 years including a grace period of 5 years.

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