CURRENCY EQUIVALENTS (as of 1 August 2005)

Currency Unit – Taka (Tk)

Tk. 1.00 = $0.0153 $ 1.00 = Tk65.00

(i) The exchange of the taka is pegged to a basket of currencies with the US dollar as the intervention currency.

(ii) In this report, a rate of $1.00 = Tk 65.00 was used. This was the rate prevailing at the time of appraisal.

ABBREVIATIONS

ADB - Asian Development Bank EIA - Environmental Impact Assessment EIRR - Economic Internal Rate of Return GAP - Gender Action Plan GDP - Gross Domestic Product GOB - Government of Bangladesh ICB - International Competitive Bidding IEE - Initial Environmental Examination km - Kilometer km2 - Square Kilometer LGD - Local Government Division LCB - Local Competitive Bidding LGED - Local Government Engineering Department m - Meter MLGRDC - Ministry of Local Government, Rural Development and

Cooperatives NGO - Non-government Organization PMO - Project Management Office PPMS - Project Performance Management System RBM - Results – Based Management RHD - Roads and Highways Department RIDP-1 - Rural Infrastructure Development Project RIDP-2 - Second Rural Infrastructure Development Project RIDP-3 - Third Rural Infrastructure Development Project RIIP-1 - (First) Rural Infrastructure Improvement Project SIEE - Summary Initial Environmental Examination SOE - Statement of Expenditure UCC - Union Council Complex VOC - Vehicle Operating Cost

NOTES

(i) The fiscal year (FY) of the Government ends on 30 June. FY before a calendar year

denotes the year in which the fiscal year ends, e.g., FY2000 ends on 30 June 2000.

(ii) In this report, “$” refers to US dollars.

This report was prepared by a team consisting of: K. Ryu (Team Leader), B, C, D, and E (staff names).

CONTENTS Page LOAN AND PROJECT SUMMARY i MAP v I. THE PROPOSAL 1 II. RATIONALE: SECTOR PERFORMANCE, PROBLEMS, AND OPPORTUNITIES 1

A. Performance Indicators and Analysis 1 B. Analysis of Key Problems and Opportunities 2

III. THE PROPOSED PROJECT 4

A. Impact and Outcome 4 B. Outputs 5 C. Special Features 8 D. Cost Estimates 9 E. Financing Plan 9 F. Implementation Arrangements 10

IV. PROJECT BENEFITS, IMPACTS, ASSUMPTIONS, AND RISKS 15 V. ASSURANCES 18

A. Specific Assurances 18 B. Conditions for Loan Effectiveness 21

VI. RECOMMENDATION 21

APPENDIXES 1. Externally Financed Rural Infrastructure Projects 2. Sector Analysis 3. Project Framework 4. Cost Estimates and Financing Plan 5. Organization for Project Implementation 6. Implementation Schedule 7. Indicative Contract Packages 8. Outline Terms of Reference for Consulting Services 9. Project Justification and Economic Analysis 10. Summary Poverty Reduction and Social Strategy 11. Summary Participatory Development Framework 12 Resettlement Framework 13 Summary Gender Action Plan 14 Environmental Assessment and Review Procedures (Under processing) 15 Action Plan on Local Governance

SUPPLEMENTARY APPENDIXES (available on request) A. Selection Criteria for Subprojects

B. Sector Analysis C. Poverty Profile of the Project Area D. Organization Chart of LGED E. Description of Project Components and Unit Costs F. Participatory Development Approach During Project Preparation G. Detailed Gender Action Plan H. Detailed Terms of Reference for Consulting Services I. IEE’s for Core Subprojects and SIEE J. Improving Local Governance K. Detailed Economic Analysis L. Project Benefits and Distribution Analysis M. Resettlement Plans for Three Core Subprojects N. Detailed Cost Estimates (COSTAB) O. LGED’s Financial System P. List of Subprojects Q. Proposed Training Program for LGED and LGI R. Results-Based Management (RBM) Action Plan

i

LOAN AND PROJECT SUMMARY

The Government of the People’s Republic of Bangladesh Borrower

Intervention: Targeted Intervention Classification Sector:

Sub sector: Themes: Sub themes: Category B: An initial environmental examination (IEE) was undertaken, and the summary is a core appendix.

Environment Assessment

1The Project will reduce poverty in 23 districts of northeast and central Bangladesh. Poverty reduction will be realized by expanding the economic opportunities of the rural poor through the improvement of rural infrastructure (roads and growth center markets), gender development, and improved local governance. Poverty reduction will be achieved by targeting poor areas and by closely involving the poor and other stakeholders in planning subprojects and maintaining rural infrastructure, and strengthening the capability of local institutions.

Project Description

Efficient rural transport and supporting infrastructure are indispensable in reducing poverty and in achieving a rapid economic development of Bangladesh. Investments in the rural infrastructure sector have been made by the government with substantial assistance from external donors including the Asian Development Bank (ADB). The Project draws on experience and lessons learned from previous projects particularly in mainstreaming the participatory approach and empowering local government. The project area consists of 23 districts in the Rajshahi, Dhaka and Chittagong divisions that were selected because of the poverty level, poor state of development of the road infrastructure, and the need for strengthening the local governance. Improving the rural roads and the associated infrastructure will provide the local inhabitants with efficient transport to markets and trading centers and access to social and welfare services. These improvements will lay the foundation for better economic opportunities and assist in reducing poverty. Strengthening the local government units will enable them to plan, manage and maintain the local infrastructure. Stakeholders from the private sectors such as bus owners and operators, rickshaw drivers, farmers, and local traders will be consulted on their transport needs. Local participation will create a sense of ownership and focus greater attention to effective maintenance.

Rationale

1 The 23 districts are: (i) in Rajshahi Division: Dinajpur, Thakurgaon, Panchagar, Rangpur, Nilphamari, Gaibandha,

Kurigram and Lalmonirhat; (ii) in Dhaka Division: Mymensingh, Kishoreganj, Netrokona, Jamalpur, Sherpur, Tangail, Dhaka, Gazipur, Narsingdi, Manikganj, Munshiganj and Narayanganj; and (iii) in Chittagong Division: Comilla, Brahmanbaria and Chandpur.

ii

The Project will upgrade about 1360 km of subdistrict roads, 550 km of union roads, 3664 km of village roads, 160 rural markets and 175 union council complexes. The project would also provide for the strengthening of the capability of the local government units. These complementary elements of the rural infrastructure will provide local communities effective transport to markets and access to social services. Investments in the Project will effectively reduce poverty (by about 10%) as small farmers and the functionally landless will gain from additional employment, particularly of women. The improved rural road network will lead to increased motorized and non motorized transport services, lower transport costs for goods and passengers, substantial savings in vehicle operating costs, and an overall increase in traffic volumes (by about 70%). The project will result in an improved environment through the planting and maintaining of trees along the roads and from the more effective drainage facilities.

Impact and Outcome

The total Project cost is estimated at $ 256.8 million equivalent comprising foreign exchange of $ 66.8 million, and local currency of $ 190.0 million equivalent.

Cost Estimates

($ million) Financing Plan Source Total Percent Foreign

Exchange Local

Currency ADB 34.3 55.3 89.6 35Cofinancing Agencies 32.5 58.9 91.4 35GOB - 75.8 75.8 30Total 66.8 190.0 256.8 100

The proposed ADB financing from ADB’s Special Funds resources is equivalent in various currencies to Special Drawing Rights ……. ($ 89.6 million). The loan will have a maturity of 32 years, including a grace period of 8 years, with an interest charge of 1% during the grace period and 1.5% thereafter.

Loan Amount and Terms

Period of

Utilization Until 31 December 2011 Estimated Project 30 June 2011 Completion Date LGED in the Local Government Division of the Ministry of Local Government, Rural Development and Cooperatives.

Executing Agency

iii

The Project will be implemented by a suitably staffed project management office (PMO), to be established by LGED at its headquarters in Dhaka. A full-time project director will head the PMO, The project director will be responsible for the overall project implementation and coordination and will report to the chief engineer of LGED. The PMO will establish three regional offices--one each in LGED’s district offices in Dhaka, Rangpur, and Mymensingh – each headed by a deputy project director (DPD). The deputy project directors will have the responsibility for the day-to-day implementation and supervision of project activities in their respective regions. The office of the DPD for Dhaka Division will be based at the PMO. A project steering committee, established under RIIP-1 and comprising the concerned line agencies, local government bodies, and nongovernmental and private sector representatives will provide overall policy guidance in project implementation.

Implementation Arrangements

All procurement under the Project will follow ADB’s Guidelines for Procurement. Major items such as equipment and vehicles will be procured through international competitive bidding. Civil works for improving infrastructure will comprise many small contracts scattered over a large area. All civil works will be procured through local competitive bidding procedures under the Government’s Public Procurement Regulation (2003), acceptable to ADB from among qualified local contractors. ADB has approved advance action and retroactive financing for Government recruitment of consultants.

Procurement

Consultants will assist LGED in project implementation. Two groups of consulting services are required to assist in (i) project design, supervision and monitoring, and (ii) to improve local governance and strengthen LGED capacity. The consultants will be recruited in accordance with ADB’s Guidelines on the Use of Consultants and other arrangements satisfactory to ADB for engaging local consultants.

Consulting Services

iv

The directly quantifiable benefits of the Project consist of savings in vehicle operating costs on the improved sub-district and union roads. The beneficiaries are the various road users – bus and truck owners and operators, passengers, cargo movers and the general population in the area of influence, estimated at about 6.0 million people, 50 per cent of whom live below the poverty line. Improvements in the growth center markets will enable more efficient trading. About 52,800 person-years of employment will be generated during the construction period. Permanent employment of women (about 3800 new jobs) will be generated from the selling areas in the growth center markets, and in the maintenance of trees planted along the subdistrict and union roads.

Project Benefits and Beneficiaries

The Project’s overall economic rate of return is quite robust with 36% for subdistrict roads and with the individual sub-project’s EIRR ranging from 12% to over 50%. The Project will reduce poverty by (i) enabling the poor people to participate in economic activities and to access social services, and (ii) creating additional employment opportunities by stimulating economic growth. The beneficiaries of the Project will be the general population in the 23 districts who will experience shorter travel time at reduced costs, as well as traders, consumers, and transport operators who directly use the goods and services transported in and out of the area. The Project has been carefully prepared to mitigate risks. To avoid delays in start-up, advance action for the recruitment of consultants has been taken. Preparation of the Government Development Project Proposal was advanced for the same reason. Risks from the use of local contractors have been mitigated through actions taken in earlier projects such as training them on construction quality control. Participatory processes involving stakeholders at all levels will give a sense of ownership and minimize delays caused by lack of involvement in decision-making. Environmental and social processes including a resettlement framework formulated for the Project will address issues of local sensitivity and minimize adverse effects.

Risks and Assumptions

v

1

I. THE PROPOSAL

1. I submit for your approval the following report and recommendation on a proposed loan to the Government of the People’s Republic of Bangladesh for the Second Rural Infrastructure Improvement Project. 1

II. RATIONALE: SECTOR PERFORMANCE, PROBLEMS, AND OPPORTUNITIES

A. Performance Indicators and Analysis

2. The road transport system of Bangladesh consists of an extensive network with a total length of 272,208 kilometers (km). The primary road network connecting the major cities to the 64 districts of the country is 8,555 km long while the secondary road network, i.e., district roads (formerly known as feeder road type A, or FRA) connecting the sub-districts2 to the national/regional grid is 13,823 km long. The Department of Roads and Highway (RHD) under the Ministry of Communications administers the national and the regional grid together with the district road. The Local Government Engineering Department (LGED) of the Ministry of Local Government, Rural Development and Cooperatives (MLGRDC) is responsible for the tertiary roads (the rural road network), namely the 36,166 km of sub-district roads (formerly known as feeder road type B or FRB), 42,329 km of union3 roads (formerly called rural road, type 1 or RR1) and, together with the union councils, the 171,335 km of village roads (formerly rural road types 2 and 3 or RR2 and RR3). Out of the 36,116 km of subdistrict roads, about 50% has been paved, leaving 18,277 km in need of improvement. The need is even greater for union roads with only 20% (or 8513 km) of the total having been paved. The scope for investments in rural road development is quite substantial. 3. The volume of traffic in the country has been growing at about 7.3% a year, higher than the growth in gross domestic product (GDP) of about 5.5% (2004). Both freight and passenger traffic have shifted significantly from rail and water transport. From 1975 to 1997, the proportion of freight transported over roads increased from 35% to 63% while that for passenger traffic increased from 54% to 73%. Improved roads provide more comfortable travel to the riding public, lower transport costs and significant savings in vehicle operating costs for all vehicles. With further upgrading of the country’s road network, the demand for road transport will continue to rise. 4. Funds for the maintenance of rural roads have been provided by the Government to LGED on a sustained basis since LGED assumed this responsibility starting in 1993. Government’s allocation for this purpose has increased from Tk300 million in FY 1993 to Tk4.0 billion FY 2006. Apart from these direct allocations, LGED also receive direct assistance from external donors, including the ADB. For instance, in the recently concluded FY2005, the total amount allocated by GOB for maintenance amounted to Tk 4.8 billion of which Tk 1.1 billion was contributed by external donors. Taking account of funds from various sources, the allocation for 1 Project preparatory technical assistance (TA) was provided under ADB, 2005. Technical Assistance to the

Government of the People’s Republic of Bangladesh for preparing the Second Rural Infrastructure Improvement Project. Manila

2 Sub-districts (“upazila”) are local government units at the third level of administration below divisions and districts. 3 Unions are the next level of government below the sub-districts. A union typically covers about 30 square kilometers

(km2 ) and a population of about 27,000.

2

maintenance invariably falls below the annual requirements. The gap (averaging about 10-15% in recent years) is likely to widen as more roads are improved. The Rural Roads Master Plan (July 2005) indicates that by 2015 no new improvements on subdistrict roads will be pursued and that thereafter, as the need for maintenance rises rapidly, funds for development would be shifted to maintenance. The estimated funding requirement for rural road maintenance from FY 2016 to FY 2020, when no new road improvement is envisaged, is Tk 104.7 billion or about Tk. 21 billion a year. B. Analysis of Key Problems and Opportunities

5. The national poverty reduction strategy aims the “reduce poverty within the shortest possible time so as to lift the majority of the people above the poverty line”. The goal is more explicitly expressed in the country’s Millennium Development Goal as a reduction in the current poverty incidence by half (to about 25%) by 2015. A key element in the Government’s long-term strategy for poverty reduction is the improvement of rural infrastructure. This strategy has guided public investments in the sector since 1984 when the Government initially formulated the Strategy for Rural Development. The Strategy focused on channeling financial resources toward developing 1400 “growth centers” where physical infrastructure (roads, markets, storage facilities and minor irrigation) were developed/ improved as a major element of rural development. Available evidence shows that the strategy has provided a workable framework for substantial investments by the Government and its development partners in developing rural infrastructure through the years. Investments in the sector have been shown to result in higher farm productivity and in increasing farm income, especially of the rural poor and women. The strategy has proven to be particularly effective in reducing poverty nationwide. The proportion of the population below the poverty line has fallen from 58.8% in 1991 to 49.8% in 2000 or a decline of about 1% a year. A recent poverty monitoring report indicated a further decline of 5% over the five-year period ending in 2004. 6. The strategy has been implemented through several projects that emphasized improvement of road and market infrastructure that LGED implemented largely with external funding support (Appendix 1). Among these is a series of rural development projects (RDP-1, RDP-2, and RDP-3) and a rural infrastructure improvement project (RIIP-I) assisted by the Asian Development Bank (ADB)4. The Project completion reports for the RDP’s showed that the projects contributed significantly to the strategy particularly in generating employment for the rural poor through labor-intensive construction methods. The lessons learned from previous projects that the proposed Project incorporates are: (i) emphasizing the pro-poor bias in the selection of areas to be covered under the Project (ii) putting greater emphasis on stakeholders’ participation in project design and implementation, (iii) strengthening local government capacity to manage and maintain rural infrastructure (iv) continuing the hiring of local contracting societies for maintenance to provide employment for destitute rural women (v) continuing the use and training of local contractors who provide cost-effective, labor-intensive skills, and (vi) institutional strengthening of LGED particularly in the areas of participatory development and financial management. Future developments outlined in the Rural Roads Master Plan (July 2005) is summarized in Appendix 2. 4 ADB. 1988. Report and Recommendation of the President to the Board of Directors on a Proposed Loan to the People’s Republic

of Bangladesh for the Rural Infrastructure Development Project, Manila; ADB, 1992. Report and Recommendation of the President to the Board of Directors on a Proposed Loan to the People’s Republic of Bangladesh for the Second Rural Infrastructure Improvement Project, Manila; ADB, 1997. Report and Recommendation of the President to the Board of Directors on a Proposed Loan to the People’s Republic of Bangladesh for the Third Rural Infrastructure Development Project, Manila; ADB, 2002. Report and Recommendation of the President to the Board of Directors on a Proposed Loan to the People’s Republic of Bangladesh for the Rural Infrastructure Project, Manila.

3

7. LGED’s organizational structure has been undergoing changes to accommodate its expanding responsibilities in assisting the development of the country’s rural infrastructure. Recent efforts to enhance its capability for planning, management and implementation of projects were taken under an ADB-funded technical assistance study completed in 19985. The results of the study concluded that LGED’s responsibilities have expanded faster than the capabilities of its staff and that LGED should focus on consolidating and improving its internal efficiency. While a number of new staff have been recruited by LGED, including two additional chief engineers and six new executive engineers, the number of vacant posts remain at about 10% of total approved posts. Among the major recommendations of the technical assistance study are (a) that LGED need to develop a scientific organizational structure and install proper management systems at all levels, and (b) that LGED should upgrade its financial management system and implement fully the standard/ unified system of accounts. Implementation of these recommendations are being carried out through a number foreign assisted projects6 and will continue under the Project. In addition, LGED staff have been undergoing training in participatory approaches, project planning and management and social analysis. Further strengthening of LGED’s capability will be enhanced under the Project. 8. In order to reach a greater proportion of the population who would benefit from its development efforts, the Government has decentralized responsibilities for planning and execution of various investment projects to the local government units. In rural Bangladesh, the union council has been identified as the focal point for infrastructure development in addition to its major responsibilities in maintaining peace and order, and implementing the government health and family planning programs. Union councils receive allocations from the Government’s annual development programs and are also empowered to raise revenues locally to meet part of their financial needs. Assistance given in the past have generally been meager and as a result, the union councils remain weak organizationally and financially. They also lack the technical capacity to plan and implement project effectively. There is a continuing need to strengthen the union councils to prepare them in assuming greater responsibilities of governance and to make them effective channels of the services from the central Government. Strengthening measures and project funds will be provided to the unions under the Project to address this problem. 9. In 1994, following a review of the rural development strategy of 1984, the Government added 700 other growth centers to the 1400 identified earlier where investments in the rural area are to be concentrated. The growth centers were selected based on the size of population and area served, their revenue potentials, trading volume and the distance between neighboring growth centers. They are therefore the locations for trade and commercial activities, and improving the facilities of growth center markets are seen as the key element of the country’s rural development strategy. Pursuit of the strategy has been proven to be effective in the rational distribution of public investments. In practice, however, there still remains a need to introduce tighter regulations and to encourage greater transparency in the management and operation of growth center markets. 10. Improving rural infrastructure like roads, markets, jetties and the physical facilities of the union councils can contribute to reducing poverty. Improved roads and markets lower vehicle operating costs and marketing costs, and facilitate access to public services (health, education,

5 ADB. 1998. Technical Assistance to the People’s Republic of Bangladesh for the Management Capability Strengthening Project of

the Local Government Engineering Department, Manila. 6 An institutional strengthening action plan that seeks to enhance LGED’s capabilities in planning, monitoring, and asset

management is supported under IDA Report No. 25853-BD, 2003 Project Appraisal Document on a Proposed Credit to the People’s Republic of Bangladesh for the Rural Transport Improvement Project. Washington DC.

4

7agricultural extension). In a study carried out in 1994 , it was shown that in the influence area of the improved facilities, transport charges dropped by 18.7 % for cargo and 23.3 % for passengers while the volume traded in the improved markets increased by 100%. Substantial growth were achieved in both motorized and nonmotorized traffic which increased by 135% and 85% respectively after the roads were widened and paved. 11. In preparing the project, a number of stakeholders’ workshops were held both at the local (union) and the regional levels. The workshops confirmed the high expectations among the local communities about the benefits from improvements in rural infrastructure. The workshops also helped in identifying issues that bear on the construction of specific works under the project. The issues included the need for: (i) mainstreaming the participatory approach and improving local government units; (ii) union councils to have a sustainable source of revenue to finance their activities and services, (iii) greater transparency and strict enforcement of existing procedures in the operation of rural markets, (iv) specifying the roles of the local institutions in the sustained maintenance of completed facilities, and (v) improving the safety provisions for rural roads. The lessons learned at these workshops have been incorporated in the design of the Project.

III. THE PROPOSED PROJECT

A. Impact and Outcome

12. The impact of the Project is that it will help reduce poverty (by about 10%) in the rural communities in 23 districts in north and central Bangladesh. The impact will be realized through the following project outcomes; (i) enhanced accessibility by the rural communities to basic services; (ii) increased on-farm income due to greater availability of agriculture inputs, such as fertilizer and high-yielding seed varieties; (iii) enhanced women empowerment; and (iv) improved local governance. The increased economic opportunities will be achieved through participatory improvement of sustainable rural infrastructure, social and gender development and improved local governance in the project area by targeting the poor. The project area, totaling 47,152 square kilometers (sq km), has a population of 55.92 million accounting for 45% of the country’s total. The project area was chosen because of the extensive poverty and the low level of development in the region. In the three divisions (Rajshahi, Dhaka and Chittagong) where the 23 districts are located, about 55% of the total rural population live below the poverty line. This poverty level is higher than the national average of nearly 50%. Of the existing subdistrict roads, only 30% are classified as in “good condition” and of the 806 growth center markets, about 50% needs to be improved. The scope for further development of the rural infrastructure to reduce poverty in the project area is quite considerable. The project framework is in Appendix 3. 13. Given the facilities to be provided under the project, more than 6.0 million people will be given all-weather access to growth center markets and social services at the union council offices. The direct impact of providing these physical facilities and institutional strengthening will be an estimated reduction in the poverty level in the project area by about 10 %, an increase in the average farm family income by about 20%, employment of an additional 60,000 person years of labor during construction, and employment of about 3800 women in the new GCMs, in tree planting and care, and an additional 3200 persons for infrastructure maintenance, 30 per cent of whom are women. 7 KfW. 1994. Socioeconomic Impact of Tangail Infrastructure Development Project. Dhaka.

5

B. Outputs

14. The outputs of the Project will be (i) improved rural roads, including subdistrict, union, village, and submersible roads; (ii) improved rural infrastructure such as growth center markets, union council complexes, jetties and flood refugee shelters; (iii) improved local governance and a strengthened LGED capacity. Lastly the Project will provide support to LGED in project management. 1. Rural Roads

a. Subdistrict and Union Roads

15. The Project will upgrade 1360 km of subdistrict (“upazila”) and 550 km of union roads to bitumen-surfaced standard, in order to provide year-round connectivity between agricultural production areas and growth center markets. The Project will add about 7.6% to the current stock of improved subdistrict roads (17,889 km) and 6.4% to the existing improved union roads (8,513 km). Each road was selected through a participatory process among stakeholders. The subdistrict road will have a standard crest width of 7.3 m and the union road, 5.5 m. Structures such as bridges and culverts with a total length of 7000 m will be provided at strategic points along these roads. Provisions for road safety such as road signs, loading and unloading zones will be incorporated into the design of subdistrict roads. After meeting the requirements of these roads, an additional 2000 m of bridges and culverts will be provided to adjacent subdistrict and union roads. Women labor contracting societies8 will be engaged to improve road shoulders, plant trees on roadsides and maintain the roads. b. Village Roads 16. The Project will provide for the resectioning of 3664 km of village roads with earthworks in order to link the hinterlands/villages even closer to markets and other vital services. The roads will be selected through a participatory approach. Each union council will be asked to prepare a proposal to the PMO to improve village roads in their respective jurisdictions. PMO will review the proposals and, as warranted, grant them approval. Each road will have a crest width of 3.7 m and connect the selected villages with either a higher-order road, a growth center market, or both. Suitable structures such as bridges and culverts will be provided to close any existing gap on the road. The union council will be responsible for maintaining village roads. c. Submersible Roads

17. A total of 60 km of submersible roads will be constructed in areas that are rendered inaccessible due to total submergence six months a year, i.e., in the “haor9” areas. While transport needs in these areas are met by boats during the monsoon, boat services are greatly reduced during the dry season, isolating large populated areas. The submersible roads will facilitate dry season transport and communications and open up the haor areas to delivery of economic and social services. The submersible roads will have a standard crest width of 7.3 m

8 Labor contracting societies comprise poor women with limited income capabilities who carry out routine

maintenance on rural roads using basic hand tools and materials supplied by LGED. 9 “Haors” are wetland basin depressions that get flooded during the monsoon season to as much as 6 m above the

dry season water level. The “haors” perform an important ecological function, acting as natural water reservoirs during the monsoon season.

6

with a rigid surface to better withstand prolonged submergence. The district office of LGED will be responsible for maintaining submersible roads.

d. Road Safety Improvements 18. The Project will improve the safety provisions for roads constructed under previous projects that do not have such features but require them now due to the increasing traffics volume. Adequate road signs, markings, safety barriers, and loading/unloading zones near schools and markets will be built to make the road safe. Safety manuals and posters will be printed; and awareness campaigns mounted to further enhance road safety.

2. Rural Infrastructure

a. Growth Center Markets 19. A total of 160 markets will be improved under the Project. The markets consist of: (i) 30 growth center markets (GCM) located at subdistrict headquarters, (ii) 70 GCM located in other areas of the subdistricts, and (iii) 60 major village markets ( rural “hats” or bazars). Each GCM will be connected either to an existing paved road or to one of those to be improved under the Project. Each GCM will be provided with paved trading areas, sheds, a water supply system, adequate drainage facilities, sanitation facilities and market offices. At each GCM, a market management committee will be organized and will be made responsible for ensuring proper physical and financial maintenance. On average 10 to 12 shops, each measuring 6.0 sq. m will be allotted to poor women traders at GCMs.

b. Union Council Complexes

20. In order to enhance the effective delivery of public services to the rural sector, the offices and facilities of the UCCs in 175 locations will be improved. The improved facilities will serve as a one-stop center for the local population, providing them ready access to the social and technical services of various government ministries (health, education, agriculture, land administration and livestock) who are assigned at the respective unions. Needed office furniture and equipment will also be provided to the UCCs. Access roads to the UCCs will also be improved to permit year-round access to the facilities. The union council will be responsible for maintaining UCCs using their own funds.

c. Women’s Sections at GCM

21. While the Project GCMs are designed for each to include 10-12 shops for women sellers, the existing GCMs had been built exclusively for men. Accordingly, based on the demand as shown during participatory discussions at specific locations, additional shops will be constructed to accommodate women traders. Each shop will measure about 6.0 sq m with a roll up door and will be constructed in line with LGED’s design standard for these facilities. The added facilities will provide more economic opportunities for women to contribute to the family income, while enhancing their empowerment.

d. Jetties 22. In order to complement the connectivity afforded by rural roads and to integrate overland transport services with water transport facilities, 25 jetties will be constructed in areas selected through participatory consultations. Construction of the jetties will involve establishing mooring

7

facilities at a cleared area of the riverbank near the main loading/unloading zone where boats could be securely tied. The jetty will be linked to a paved road and located within the immediate vicinity of a GCM. Necessary sanitary facilities such as separate toilets for men and women will be provided at each jetty site. A management committee will be organized for each jetty to oversee its day-to-day operations.

e. Flood Refuge Shelters

23. In order to provide emergency relief for victims of sudden inundation in the few flood-prone areas, six flood refuge shelters will be constructed. Each shelter will have one separate section each to provide accommodation for people and for livestock during the emergency period. A typical shelter will have an area of 150 sq m inclusive of needed sanitary facilities. The shelter will be designed as a multipurpose building and located close to the UCC to maximize its use year-round.

3. Local Governance and LGED Capacity Building

a. Local Governance

24. In order to enhance the capability of local government units in planning and implementing rural infrastructure works, the Project will implement various training programs and awareness campaigns for members and officers of the union councils (25% of whom are women) in 1,832 unions, local women leader in the community, and to members of the management committees of the GCMs and the jetties. The training programs will include topics on the roles and responsibilities of the union council members, financial management, poor people’s participation in local decision making, and the use of participatory approach to planning. The training programs will be supplemented by a wide-ranging awareness campaigns using posters, comic books, and “infomercials” i.e., short radio and television programs focusing on such basic issues as governance (transparency, accountability, efficient administration etc.), health and sanitation. Project consultants will assist in packaging the training programs and implementing the awareness campaigns.

25. Resource mobilization by the unions will be enhanced by full implementation of an existing GOB regulation assigning collection of specific taxes to the union council, including assessments on homes and residential lots, taxes on owners of businesses and professionals, fees for birth and death certificates, and many others. To assist the union council in the proper maintenance of various financial records and accounts, as well as in the management of its resource mobilization efforts, the Government will appoint, by 31 December 2008, an accountant at each union. In line with the newly established regulations governing the management of growth center markets, members of the union council (including women) will be appointed as members of the market management committee (MMC). As recommended under the Project, new guidelines will be developed to govern the award and management of new leases and provide for a higher share of the income from market lease to the union council .

b. LGED Capacity Building

26. Strengthening the LGED initiated in earlier ADB-assisted projects will be sustained by providing training to LGED staff both locally and overseas. Local training will be given in contract management, financial management, participatory methods, construction supervision and quality control, application of information technology in project design, gender and development, and monitoring and evaluation. Overseas training will be given to selected LGED

8

staff in road safety designs, rural road technology, field and laboratory tests for road engineers, and project monitoring and evaluation. LGED will further strengthen its procurement unit by recruiting additional staff. The Project will also include an internship program whereby senior engineering students could gain practical work experience within LGED to complement their formal education. In addition, the physical facilities of LGED at four regions will be improved by constructing new offices cum housing for the regional superintending engineers and staff. Dilapidated furniture will be replaced at the subdistrict engineers’ offices. Project consultants will provide training on-the-job to LGED staff in road safety, road maintenance planning, social assessments, gender focus, and impact monitoring.

4. Support for Project Management

27. In order to ensure efficient implementation and management of project activities, incremental staff at the district and subdistrict levels will be provided together with needed logistics. A combination of international and domestic consulting services will be engaged to support project design, supervision, management, and capacity building. A series of socioeconomic studies that focus on the evaluation of the project’s impact on poverty and on the strengthening of the capacity of LGIs will be carried out to assist LGED in the management of the Project as well as other projects in the future. A benchmark study will be carried out at the start of the Project followed by another on the third year and the final one three years thereafter. On its own, LGED will undertake another evaluation study five years after project completion. C. Special Features 28. The Project builds upon the initiatives taken in previous ADB-assisted projects in strengthening local governance not only in providing training to local officials but also in mounting wide-ranging awareness campaigns directed at the country’s rural population. Tri-media campaigns explaining the roles and responsibilities of union council officials will be launched. Diverse issues related to local governance such as transparency, resource mobilization, cleanliness and hygiene, law and order will be covered in TV and radio spots, and in posters and comic books to be distributed in the villages. The Project will include particular focus on gender issues, participation of the poor and women. Under the Project, the capacity of union council to plan and execute local projects through the participatory approach will be sharpened as officers and members of the council initiate proposals for the improvement and maintenance of village roads in their jurisdiction. To ensure that these and other desired Project outputs and outcomes are achieved, the Project has been designed, and a parallel Monitoring and Evaluation framework has been created, that will allow the routine use by LGED of data relating to Project results to support more effective Project Management. Following this Results Based Management (RBM) approach will increase the effectiveness of Project management and, consequently, the success of the Project. This approach will use data collected by the Project monitoring and evaluation activities to provide enhanced management insight into the Project and what it is achieving. Use of these data will allow the PMO and LGED to take timely and effective management decisions that will increase the likelihood of Project success while minimizing the risk of Project failure to meet output and outcome targets. Specifically, LGED will be able to track the increasing capacities of union councils to carry these activities out in accordance with ADB principles and guidelines. Based on proposals developed by the union councils for village road improvement, they will be allocated Project funds that will be managed directly at the local level with appropriate guidelines and safeguards. The use, by LGED, of the applicable monitoring and evaluation data in accordance with the RBM principles and practices to be included as part of the Project management, will provide additional assurance to LGED

9

that these safeguards have not been breached. The capacity of the union council for resource mobilization will be enhanced further through the employment of an accountant at each union. D. Cost Estimates 29. The estimated project cost is $250 million equivalent, inclusive of physical and price contingencies, taxes and duties, and interest and service charges during construction. The foreign exchange cost is estimated at $62.2 million or about 25% of total cost. The local currency cost is estimated at $187.8 million equivalent. The local currency cost includes an estimated $20 million equivalent for taxes and duties. The project cost estimate is summarized in Table 1. The detailed cost estimate and financing plan is in Appendix 4.

Table1: Cost Summary by Project Components

$ Million Foreign Local Total

Project Component Exchange Currency Cost A. Upgrading/Construction of Rural Roads Subdistrict Roads 23.0 69.5 92.5 Union Roads 5.3 15.9 21.2 Road Structures on Subdistrict and Union Roads 9.3 21.8 31.1 Village Roads Resectioning and Structures 2.1 8.2 10.3 Submersible Roads 1.2 3.5 4.7 Subtotal Upgrading/Construction of Rural Roads 40.9 118.9 159.8 B. Improve Rural Infrastructure 6.7 17.3 24.0 C. Strengthen Capacity of LGED and LGI 0.4 6.4 6.8 D. Project Management 8.4 10.4 18.7 Total Base Costs 56.3 153.0 209.2 Physical Contingencies a) 5.1 14.3 19.4 Price Contingencies b) 3.5 22.8 26.3

Total Project Costs c) 64.9 190.0 254.9 Financial Charges During Implementation 1.9 - 1.9

Total Costs to be Financed 66.8 190.0 256.8

a) Physical contingencies are computed at 10% for civil works and 5% for all other cost items. b) Price contingencies are set at 5% a year for local currency costs and 1.9% a year for foreign exchange costs. c) The total Project cost includes taxes and duties totaling about $20 million E. Financing Plan (Note: This para will be revised as soon as cofinancing

arrangements are firmed up)

30. The Government has requested a loan of $89.6 million from ADB’s Special Funds resources to help finance 35% of the project cost. The loan will finance $34.3 million of the foreign exchange cost (51% of the total foreign exchange cost), and $55.3 million equivalent of the local currency cost (29% of the total local currency cost). Local cost financing is warranted by the poverty-oriented focus of the Project and the tight fiscal situation of the country.

31. The Borrower will be the People’s Republic of Bangladesh. The ADB loan will have a

maturity of 32 years, including a grace period of 8 years. The loan will carry an interest charge

10

of 1.0% during the grace period and an interest charge of 1.5% per annum during the amortization period. The financing plan is summarized in Table 2.

Table 2: Financing Plan

($ million)

Foreign Local Total Source Exchange Currency Cost Percent Asian Development Bank 34.3 55.3 89.6 35 Cofinancing Agencies 32.5 58.9 91.4 35 Government of Bangladesh - 75.8 75.8 30

Total 66.8 190.0 256.8 100 F. Implementation Arrangements

1. Project Management

32. The Executing Agency will be LGED in the Local Government Division (LGD) of MLGRDC. The existing interministerial steering committee established under RIIP-1 will oversee the Project.10 The committee will meet once a year to review the progress of project implementation. A project management office (PMO), headed by a full-time project director, will be established by LGED in Dhaka. The project director will report to the chief engineer of LGED and will coordinate all project activities, and will be directly responsible for the overall implementation, monitoring and supervision. In addition to the project director, LGED will appoint three deputy project directors (DPD), along with other staff of PMO by the date of loan approval. Two of the the deputy project directors will be posted in LGED’s zonal offices in Rangpur and Mymensigh, while the DPD for Dhaka Division will be based with the PMO. The organization chart for Project implementation is in Appendix 5.

33. The PMO will (i) prepare an overall project implementation plan, (ii) prepare detailed designs and supervise various physical works, (iii) organize and maintain the project financial accounts, (iv) implement the gender action plan, the resettlement plan, and environmental assessment program (v) organize the monitoring and evaluation activities, (vi) prepare periodic progress reports and a project completion report. The PMO will be assisted by consultants with expertise in engineering design and supervision, economics and finance, social and gender development, participatory approaches, environmental assessment, and local governance. 34. The PMO will work closely with the staff of LGED at the district and subdistrict offices and coordinate with union councils and the management committees of the growth center markets and the jetties in implementing relevant project activities. Existing union development coordination committees will provide the forum for stakeholders to participate in the planning and implementation of subprojects.

10 The Secretary of LGD will chair the committee, with members from LGD, LGED, RHD, the Planning Commission of

the Ministry of Planning, the Economic Relations Division of the Ministry of Finance, the Implementation, Monitoring and Evaluation Division of the Ministry of Planning, the National Institute of Local Government, the Ministry of Women and Children Affairs, local government bodies, NGO’s and the private sector. Representatives from ADB, KfW, and DFID will participate in meetings of the committee as observers.

11

2. Implementation of Subprojects 35. The LGED district office, headed by an executive engineer and, under the guidance of the PMO, will be responsible for implementing subprojects. In the course of its feasibility study, LGED has carried out the appraisal of 434 subproject roads, 167 growth center markets, and a sample of 25 union roads. In all cases, the technical and economic feasibility of each subproject has been established. The subprojects included in the Project have been prioritized based on a number of social indicators such as poverty, gender disparity, environmental conditions, requirements for land acquisition and resettlement, and, in the case of subdistrict roads, connectivity to markets and higher-order roads. Prior to detailed design, the priority assigned to the road will be conformed with the local people. As the socioeconomic conditions are generally homogeneous among subproject areas within a district, the social analyses will be carried out district-wide and the results submitted to ADB for information on this basis. The analyses will be carried out in line with ADB guidelines particularly on environmental assessment and resettlement.

3. Implementation Period

36. The Project will be implemented over a period of five years starting on the second half of 2006 and up to the first half of 2011. The activities during the first year will include recruiting the consultants, preparing detailed designs for the subprojects to be implemented in Year 1, procuring office and construction equipment and vehicles. Physical works are expected to begin during the first quarter of 2007 to permit adequate time for the preparation of detailed field surveys and designs. The PMO will not award any ADB-funded construction contract until after the implementation consultants have been appointed, the land and rights to land, free of encumbrances, are available for execution of such contracts, and resettlement activities (where necessary) and compensation payments have been completed. A summary project implementation schedule is in Appendix 5.

4. Procurement 37. Goods, related to services, and civil works financed by ADB will be procured following ADB’s Guidelines for Procurement. Since the civil works will be small and widely dispersed, foreign contractors are unlikely to be interested in bidding. Consequently, all the civil work contracts will be procured on the basis of local competitive bidding among qualified contractors in accordance with the Public Procurement Regulations, 2003 of GOB acceptable to ADB. Contract awards for all works estimated to cost more than $200,000 equivalent will require ADB’s prior approval. Contracts for rural roads (except for the village roads), structures on sub-district and union roads, growth center markets, union complexes, jetties, functional buildings, and flood refuge centers will generally be awarded by the LGED executive engineer concerned while the contracts for structures on village roads will be awarded by the LGED sub-district engineer concerned, under the guidance of the PMO and executive engineer. The union councils will implement re-sectioning of the village roads with the assistance of sub-district engineers of LGED through labor contracting societies (LCS). Contract documents for procurement of these works will be based on existing LGED procedures acceptable to ADB. To ensure efficiency and economy in contract administration, small contracts roads and related improvement works at various construction sites could be grouped together to obtain higher value. Construction of roads and the associated structures (bridges and culverts) would be closely coordinated to maximize utilization of the completed facilities. Attempts will be made to award one contract for construction of each subdistrict road. Efforts will also be made to limit the number of contracts and engage larger professional contractors. This approach will shorten the

12

construction period and ensure single accountability and high quality of work. LGED will award contracts for infrastructure construction that prioritize the involvement of poor people, particularly women. Contractors will be required to achieve parity in the payment of wages to men and women for work of equal value. Contractors who fail to perform satisfactorily in previous contracts will not be allowed to participate in the bidding under the Project 38. Equipment and materials will be procured in three ways depending on the contract value. These are: (i) through international competitive bidding where the estimated cost is more than $500,000 equivalent; (ii) by international shopping where the estimated cost is between $100,000 to $500,000 equivalent; and (iii) local procurement procedures, acceptable to the ADB, where the estimated cost is $100,000 equivalent or less. The PMO will procure the equipment and vehicles. The Government has been advised that approval of advance action and retroactive financing does not commit the ADB to finance the Project. Indicative procurement packages are in Appendix 7. LGED will necessary take steps to maximize usage of equipment already procured or to be procured under ADB - funded projects.

5. Consulting Services

39. Two packages of consulting services will be required to support project management and to strengthen the capacity of LGED and the LGIs. An infrastructure management consultant will provide 202 person-months of international and 1,504 person-months of domestic consulting services in engineering design, monitoring and supervision of project works. An international firm in association with domestic firm(s) will provide the services. In addition, 450 person-months of domestic consultants will provide institutional support to LGED and LGI. A domestic firm(s) will provide the services. LGED will engage consulting services in accordance with ADB’s Guidelines on the Use of Consultants and other arrangements satisfactory to ADB for engaging consultants. ADB has approved advance procurement action and retroactive financing for recruiting the implementation consultants from 2006 to the date of effectiveness of the loan to facilitate the start-up project implementation. The outline terms of reference and a personnel schedule for the project consultants are in Appendix 8.

6. Land Acquisition and Resettlement

40. In accordance with the practices followed in previous projects, land acquisition requirements for subdistrict roads under the Project will be minimized. Land required for the road and other infrastructure improvement is mainly within the existing right of way or is owned by the Government. Minimal parcels of private land may have to be acquired for the road improvement. In the course of the consultations held with stakeholders, landowners along the road alignments have indicated their willingness to donate the narrow strips of their land to expedite the upgrading of the road. To minimize delays due to land acquisition, the location of project infrastructure will be carefully selected. LGED, in cooperation with the union council concerned and the LGED community organizer of the subdistrict will complete the preparatory work for land acquisition in line with the provisions of the country’s Land Acquisition Law. Actual land acquisition will be completed within 365 days following the detailed survey of the subdistrict road; otherwise the subproject will be excluded from the Project. Should any of the subproject within a district requires resettlement, the district-level social analyses submitted to ADB will include a resettlement plan, in accordance with ADB guidelines on involuntary resettlement. LGED will disclose the resettlement plans to the stakeholders and payment of compensation and resettlement activities, where necessary, will be completed before LGED awards any contract for the subproject.

13

7. Maintenance

41. The district office of LGED will be responsible for both routine and periodic maintenance as well as for repairs necessitated by recurring flood damages on completed rural roads. Historically, funds allocated for maintenance have fallen short of requirement but the financing gap has been narrowing down. For instance in FY 2002, a gap of about Tk 1.4 billion representing 43% of requirement was reported. The gap fell to Tk 436 million or 8% of requirement in FY 2005. By ensuring high quality of construction and following design specifications strictly, the need for frequent road maintenance will be minimized. Earthen village roads will be maintained by the union council. With the assistance of the union council, the subdistrict engineer of LGED will engage labor-contracting societies (LCS), consisting mostly of poor women, to undertake routine off-pavement maintenance, planting of trees and caring for them. On-pavement maintenance will be carried out by LGED’s mobile maintenance teams (MMT) based at the district. LGED will field additional mobile teams (at least two teams per district) in order to meet the expanding requirements. In line with existing practice, periodic maintenance, carried out every five years on average, will be executed by the contractors engaged by LGED district office. Consultants will prepare maintenance manuals that describe the maintenance procedures to be followed by the subdistrict engineers, the LCS and local contractors. The consultants will conduct on-the-job training to ensure that subdistrict engineers, LCSs, and local contractors are familiar with their maintenance responsibilities. The Government undertakes to provide adequate funds to LGED to cover the annual maintenance requirements of the completed infrastructure under the Project.

8. Disbursements Arrangements

42. The civil works contracts to be awarded will generally be small in value and involve a large number of contractors. To ensure timely funds flow for effective project implementation, an imprest account will be opened in the name of the Project at the Bangladesh Bank after the loan becomes effective. Payments of eligible items will be made under this account. The statement of expenditures (SOE) procedure will be adopted to facilitate reimbursement and liquidation of small contracts. The imprest account and the SOE procedure will be established, maintained, and audited in accordance with ADB’s Loan Disbursement Handbook. The ceiling of the imprest account will not exceed the estimated ADB-financed expenditures for the next six months, or $12 million whichever is lower. The SOE is applicable for reimbursing eligible expenditures below $50,000 equivalent and liquidating advances provided for in the imprest account. 9. Accounting, Auditing and Reporting 43. The PMO will prepare quarterly progress reports on project implementation. The Government will submit the report to the ADB. The report will focus on the physical progress of works, the status of local governance improvement program, and address the progress in meeting project targets. Within 3 months of substantial physical completion of the Project, LGED will submit to ADB a project completion report that will cover the details of project implementation, cost, benefit monitoring and evaluation activities, and improvements in local governance. 44. LGED will maintain separate records and accounts in order to facilitate identification of expenditures and income related to the project. Sufficient and qualified accounting staff, will be assigned to the PMO. Auditors acceptable to the ADB will audit annually all the accounts and statements of expenditures and revenues related to the Project. The Foreign Aided Project

14

Audit Directorate is considered acceptable for this purpose. The annual audit will include the audit of imprest account and SOE procedures. The annual audit report will include a separate audit opinion on the use of imprest account and SOE procedure. Audited financial statements and project accounts, together with the report of the auditor, will be submitted to ADB within 9 months of the close of the financial year. 10. Project Performance Monitoring and Evaluation 45. In line with the ADB’s project performance management systems (PPMS) framework, a participatory benefit monitoring and evaluation (M&E) program will be carried out under the Project. This M&E program will be specifically designed to support the data requirements of a fully integrated BRM system in which the M&E system will be used to increase project success on an ongoing and continuous basis. Specifically, objective indicators and targets for all desired Project outputs, outcomes, and impacts will be defined for annual and/or episodic points in the Project lifecycle; these will permit regular and timely assessments of the Project’s efficiency and effectiveness. In this context, “efficiency” means the production of the planned level of outputs with the allocated levels of inputs (resources) within the Project’s schedule and budgets for funds, manpower, and other resources; “effectiveness” means the achievement of Project outcomes and impacts as a consequence of fully implementing all planned interventions. PPMS activities will be conducted periodically to assess whether project inputs have delivered the expected benefits to the intended beneficiaries. The PPMS also seeks to detect deviations between the plan and the execution of the Project. The use of an RBM approach by the Project will ensure that deviations between the Project plan and achieved results (outputs, outcomes, and impacts) will be recognized by Project management in a timely manner, thereby allowing effective, corrective management actions and decisions to be taken. The PMO will conduct benchmark physical and socioeconomic surveys at each Project district and submit for ADB’s review and concurrence a detailed implementation plan for monitoring performance and preparing benchmark information within 6 months of loan effectiveness. These Baseline surveys will be conducted in accordance with the Project M&E framework and plan and will provide the basis for preparing this benchmark information and indicator target values. Thereafter, PMO will submit annual benefit monitoring reports to ADB throughout the implementation period of the Project. These monitoring reports will be on integral part of the overall RBM system to be employed in the project.

11. Project Reviews 46. The various physical works and strengthening measures under the Project will be implemented over a wide area involving 1832 unions spread over 23 districts. It is important therefore that its implementation be closely monitored. Accordingly the regular reviews conducted by ADB at least twice a year will be supplemented by a mid-term review. The reviews will cover physical implementation, financial performance, implementation of different action plans, and identification of problems that may need to be addressed early on. The Government, ADB, DFID, and KfW will jointly conduct a comprehensive midterm review (MTR) in the third year of Project implementation. The MTR will evaluate project design, stakeholder participation, quality of works, social and environmental impacts, capacity building activities, compliance with loan covenants, improvement of local governance, effectiveness of implementation arrangements and project management structures, attainment of O&M budget for sustainable maintenance, and future implementation plans for the remaining works. Results of the MTR will guide in modifying the scope and design of the Project and reallocation of funds among the loan categories, if needed.

15

IV. PROJECT BENEFITS, IMPACTS, AND RISKS

A. Economic Impacts

47. The results of the economic analyses show that the project is economically viable. The two major components (roads and markets) accounting for about 80% of project costs, were separately evaluated. The EIRR for all subdistrict roads is 28.4% with a range of 12.01% to over 50%. The EIRR for all markets is 51.09% with a range of 15.49% to over 50%. The summary economic analysis is in Appendix 9. In addition to the quantifiable benefits of the two components, other non quantified economic impacts of the project are time savings for road users, better access to markets and essential services, lower prices for farm inputs and consumption goods, better marketing opportunities, and increased employment opportunities in the road and market construction, maintenance and roadside tree plantation programs. These benefits will lead to a higher growth of the gross regional product and ultimately will contribute to the economic development of Bangladesh. 48. Road improvement will also create reliable access to health, educational services, financial institutions, and agriculture and livestock extension services. The provision of submersible roads will reduce the travel time during dry season in the low-lying areas. The construction of jetties will facilitate safe unloading and loading of goods and passengers. The construction of flood refuge shelters will save life and property of the rural people living in the flash flood-prone areas. The construction of union council complexes will provide one-stop center for providing various services to the rural people. The human resource development program proposed under various components of the project will increase the knowledge and skill of their various categories of personnel, which contribute in gaining efficiency in performing their day-to-day activities. It is clear that implementation of the project will accelerate economic growth. B. Poverty Reduction Impacts

49. The project is expected to bring about some positive impacts on reducing poverty of all income groups by (i) creating additional employment opportunities for poor men and women, (ii) increasing out-migration particularly in lean seasons, (iii) enhancing incomes for the poor, (iv) facilitating quick and cost effective transportation of perishable agricultural commodities to urban markets which will reduce loss and help get increased farm gate prices, (v) enabling easy availability of industrial goods particularly agricultural inputs at reasonable prices, (vi) affording easy access of poor to various facilities like health care, agricultural extension including fisheries, livestock, cooperatives, etc, (vii) improving access to rural areas by service providers including health care, education, agricultural and other extension workers and NGO personnel, and (viii) stimulating the creation of transport related small businesses like service stations, repairing shops, wayside food stalls, guest houses, hotels and restaurants, etc. When roads are improved/built, the VOCs for the motorized as well as non-motorized vehicles will decline. The operators, especially of the non-motorized vehicles, are poor. The frequency of their trips would increase, and would enhance their income. Moreover, on the paved roads, the physical exertion will also be lower. Thus, the project would reduce poverty by increasing their current income and improving the long-term prospects for a better life. Appendix 10 gives the summary poverty reduction and social strategy.

16

C. Social Impacts

50. Improvements in the rural transport and trading systems along with the development of the union council complexes for delivery of social services to the rural people will yield significant positive social impacts. Benefits will accrue to the local people especially the poor, who will be involved in the construction of various infrastructures, tree plantation and care taking of trees. The improvement of rural transport infrastructure and trading systems will accelerate farm and non-farm production due to availability of inputs, easy flow of technical information about modern technologies and higher market price of the farm and non-farm products. This will create more employment and increase the income of the rural people, which will also bring social harmony in the society. Cheaper, frequent and reliable transport system will make it easier for rural people especially the female to avail of educational facilities, health and credit facilities. This will also remove cultural barriers, which exist due to isolation. The participatory approach to development will be institutionalized as a standard procedure for packaging projects at LGED. This will maximize the inputs from all stakeholders in the project and ensure consensus among all parties involved. A participatory framework is in Appendix 11. The mobility of rural women will increase which will help them to participate in local governance, decision making and raise their voice to get access to rights and resources. The flood refuge shelters will reduce the losses of valuable household assets during serious flash floods. This will be especially beneficial to the poor who have only a few essential possessions. The submersible roads will overcome the dry season isolation of the haor areas, which limits social, cultural and economic development. The safer loading and unloading facilities at the jetties will reduce injuries and accidents where most of the victims are poor. D. Resettlement

51. An adverse socio-economic impact of the infrastructure improvement under the project may result from land acquisition and relocation of the structures from the proposed right of way. Acquisition of narrow strips of land required for widening and straightening of the existing roads will have minimum impact at the individual levels. Development of growth centers will be on already available government land, and the union council complexes on land already donated by persons of the community. A resettlement framework (RF) has been prepared (Appendix 12) adopting the involuntary resettlement for the road improvement and voluntary relocation for the development of GCMs and UCCs following ADB resettlement policies. In line with the resettlement impact assessment of the three core subprojects, one full resettlement plan (RP) and two short resettlement plans have been prepared. To the extent that the detailed design for the subprojects confirm the need for the resettlement plans, the RF and the RPs will be followed in preparing and implementing the resettlement plans for subprojects as may be required under the project. E. Gender and Development Issues 52. Women in the project area are mostly engaged in household and farming activities. Under the project, the following activities would be pursued to empower rural women: (i) increasing women’s participation to at least 30% of total membership in project planning implementation, monitoring, evaluation and maintenance; (ii) generating employment opportunities for women by involving them in construction, maintenance, tree plantation activities through labor contracting societies; ensuring that during construction, female laborers are provided with temporary sheds, water and sanitary facilities; (iii) facilitating linkages of rural women beneficiaries to different support resources for sustainability of their livelihood. Certain

17

space in the open sheds (covered or uncovered) will remain reserved for women vendors; (iv) women beneficiaries in developing entrepreneurship by constructing and reserving women market sections in growth center markets. The female shop owners will be linked with different micro finance institutions so that they can run their business and contribute to the rural economy; (v) facilitating social and economic development for the user groups as a follow-up measure for increasing access to infrastructure development activities; and (vi) promoting female UC members’ participation in local governance and management of Union Council.

53. The capacity-building component of the project will incorporate gender concerns by involving women and providing them training on (i) skills development and income generating activities, (ii) off-pavement maintenance, tree plantation and caring in their capacity as members of LCS and (iii) shop management and trade skills development. Under the project, 15% if the space for trading will be designated as women’s section (Appendix 13). The female shop owners will form an association and will be represented in the market management committee (MMC) and in citizen forums. The female UC members will learn how to prepare budget, keep accounts, conduct meeting, participate in social activities through a series of workshop. This will develop their capacity and enhance efficiency. Over the long-run, the activities addressing women empowerment would eventually narrow the gender gap in Bangladesh. F. Environmental Impacts 54. The interventions under this project deal primarily with road improvement (and widening in some cases), and no new road constructions are envisaged. Hence, potential adverse environmental impacts are expected to be minimal, which can be minimized further through appropriate mitigation measures. The potential environmental impacts may be considered in two phases: short term (construction stage) and long term (post-intervention stage). Short-term adverse impacts include soil erosion from earthworks, water pollution, drainage blockage, traffic disruption and accident hazard, and dust and noise pollution. These potential negative impacts during the construction phase can be avoided and minimized by (a) limiting earthworks to the dry season, (b) careful planning in operating drainage diversions, (c) restoration/rehabilitation of borrow pits, (d) safe transport and storage of construction materials, (e) spraying of water to reduce dust hazard, and (f) prohibition of machinery use after sunset to reduce noise pollution. 55. The project, in the long run, will (i) benefit the environment by providing for tree plantation along roadsides (which will also prevent soil erosion from embankment slopes), (ii) improve the regional hydrology through reconstructing/rehabilitating cross-drainage structures, (iii) reduce dust pollution and improve water quality through bituminizing the pavement, (iv) facilitate and improve access to markets for trade and income generation, (v) allow easy movement of both motorized and non-motorized traffic, and (vi) generally improve the aesthetic quality of the region. Besides, the market improvement measures will enhance the environmental quality of the growth centers. 56. The potential adverse impacts from the project interventions might include disruption of fishing activities, drainage congestion/flooding, loss of trees, loss of agricultural land and other assets due to road widening. The only ecologically sensitive area within the project boundary is the Madhupur forest area. No intervention within this zone which might adversely affect its ecology is included under the project. Likewise, careful planning will be done during the design and construction of submersible roads in the `haor’ (or perennial wetlands) areas of Netrokona and Kishoreganj districts. All potential negative impacts will be avoided/minimized through adopting such mitigation measures as (i) tree plantation on road sides (followed by caretaking) to stabilize the soil and compensate tree removal, (ii) providing adequate/sufficient number of

18

cross-drainage structures to facilitate fish migration and flood passage, and (iii) careful road alignment during road widening to minimize farmland and asset loss, along with prompt compensation. A summary initial environmental examination is in Appendix 14. An IEE for the project area was undertaken – with focus on three core subprojects – which identified both positive and negative impacts, suggest mitigation measures, and outline monitoring needs. The strengthening of the Environmental Unit (EU) of the LGED with recruitment of additional expertise in environmental assessment and monitoring will help in the enhancement of the capability of this unit to satisfactorily perform environmental monitoring and management tasks. G. Impact on Local Governance 57. The project will strengthen local government institutions (i.e., the union council) not only through a series of training programs for the members and staff of the union councils but also by providing them project funds. One drawback in the past regarding management of the union council is a lack of financial resources to implement local projects. Under the project, union councils, through a participatory approach, will gain hands-on experience in preparing small project, in this case improvement of village roads, and seeing to its implementation under transparent procedures with technical guidance from LGED. The union councils with creditable performance in this regard are likely to get additional funds for a second project. This process will show the union council members the advantages that good performance is rewarded, thus preparing them to take on bigger responsibilities in the future. An action plan for improving local governance is in Appendix 15.

H. Risks

58. The risks faced by the Project are manageable and would be largely mitigated in the course of Project implementation. Potential delays in Project start-up will be reduced by taking advance action in the recruitment of consultants. The limited experience of some local contractors in implementing foreign-aided projects will be remedied through their participation in training programs under the Project. Use of ADB’s and GOB’s standard tender procedures will minimize potential delays. The Government commitment to provide counterpart funding through budgetary allocations will be required before ADB approves contract award. 59. While local government institutions have some organizational weakness, the Government commitment to strengthen them under the current drive toward decentralization will mitigate this risk. Furthermore, the provisions under the Project for augmenting the capabilities of the officers and members of the union council will reduce the risk. Training programs under the Project will raise the level of awareness among stakeholders about local governance issues. 60. The current level of funding for maintenance of roads is about 10% below actual requirement. However, the Government has agreed to close the financing gap by increasing the budgetary allocations to LGED. The Government commitment to aid agencies to introduce a mechanism for an assured funding for road maintenance will reduce this risk significantly.

V. ASSURANCES

A. Specific Assurances (Partial list; to be firmed up by Appraisal Mission)

61. In addition to the standard assurances, the Government has given the following assurances, which are incorporated in the legal documents:

19

(i) Each subproject will be implemented by LGED with the prior approval of ADB. Before obtaining such approval, the PMO will prepare a district-wide initial environmental examination, and an initial social analysis. If necessary, a statement on the need for any resettlement plan for particular subprojects will be included in the district-wide report. The needed resettlement plan will subsequently be prepared upon completion of the detailed design. The environmental and social analysis will complement the appraisal that was carried out by LGED that established the technical and economic viability of each of the selected subprojects.

(ii) The Government will ensure that the approved annual development program allocations for the Project will be sufficient to cover all counterpart funding required for the Project in accordance with the financing plan, including the cost of land acquisition and other resettlement compensation, implementation and monitoring activities under the land acquisition and resettlement plans, and general project management expenses.

(iii) The Government will ensure that local government bodies contribute at least 10% of the cost of the construction of growth center markets, jetties, and village roads and structures.

(iv) The Government will ensure that local government bodies will deposit the equivalent of 5% of the construction cost of union council complexes. The fund will be used exclusively for the operation and maintenance of the UCCs. (v) The Government will ensure that the market management committees (MMCs), are reorganized for more effective management of growth center markets. A tripartite agreement involving the subdistrict executive officer, the district office of LGED and the chairman of the MMC, will define the responsibilities for maintaining the structures for maintaining the structures constructed under the project and for ensuring the cleanliness of the GCMs.

(vi) In order to augment the technical capacity of union councils, the Government will appoint by 31 December 2008, an accountant at each union.

11(vii) In line with the recommendations of a technical assistance study in 1998, 10 Regional Superintending Engineers’ offices are functioning under the development budget. By 31 December 2007 the Government will bring the 10 Regional Superintending Engineers’ set-up under the revenue budget to (a) enhance construction quality control and effective work supervision, (b) provide experience based technical guidance and advice to the subordinate staff, and (c) oversee regional level training programs.

(viii) Eleven training units are functioning in LGED: one at HQ and 10 in the regions under development budget. In accordance with agreements reached with ADB under RIDP-3, these units/centers were to be brought under the revenue budget of the Government. So far the unit at HQ has been transferred to the revenue budget. By 31 December 2007 the Government will bring the remaining 10 Executive Engineers (Training) at regional level under the revenue budget to conduct and implement necessary training, on-the-job training, and workshops. (ix) By 31 December 2007, the Government will appoint 64 social scientists, one for each of the LGED district offices, the positions for which have already been approved by the government. 11 ADB.1998. Technical Assistance to the People’s Republic of Bangladesh for the Management Capability

Strengthening Project (MANCAPS) of the LGED, Manila.

20

(x) The design and planning units are managed mostly by staff on deputation from

other offices or projects with temporary support from consultants. In order to strengthen LGED’s capability and sustainability, and to develop its own human resource in these important fields, full time staff is required for these units for the long-term perspective. By 31 December 2008 LGED will appoint full time staff for the design and planning units.

(xi) The Government will ensure that the civil works contractors comply with all applicable labor laws. Bidding documents will include a clause regarding equal pay for men and women for work of equal value. Compliance with this provision will be strictly monitored during project implementation. (xii) Before 30 June of each year during project implementation, LGED will agree with ADB on the annual maintenance program for subdistrict and union roads in the project area for the following year. By May 31 of each year, LGED will submit to ADB for review, the proposed maintenance budget.

(xiii) The Government will ensure that for the entire project implementation period, sufficient budget will be allocated to fund fully all routine and periodic maintenance activities for Project roads. This amount will include budget allocations from all sources, including aid-financed project funds and food aid allocated for maintenance works.

(xiv) The Government will adopt all necessary measures to ensure that construction

and maintenance equipment is well maintained and replaced when needed. Such measures will include the following: (a) LGED will set the charges for renting their equipment at a sufficiently high level to cover the maintenance and replacement cost of such equipment; and (b) The Government will annually make available to LGED funds at a level not less than the estimated rent collected for the equipment in the following financial year. This will be done through budget allocations into a separate identifiable item in the budget of LGED. LGED will ensure that the budget allocations of these accounts will be used exclusively for maintenance and replacement of equipment.

(xv) Within six months of loan effectiveness, the Government will submit to ADB a

report on the implementation of the time-bound action plan to increase the private sector participation in road construction and road maintenance.

(xvi) LGED will ensure that all necessary actions are taken to implement the initial

environmental examination, the summary poverty reduction and social strategy, and the project resettlement framework.

(xvii) On completion of the detailed design of the three core subprojects prepared

during the TA, the Government will update the resettlement plans and ensure that census information and a full inventory of losses are included. The resettlement matrix will be revised if additional categories of affected persons are identified. A condition of award of civil works contracts for those subprojects will be the submission of an updated resettlement plan for each subproject, consistent with the provisions of the resettlement framework and in form and substance acceptable to ADB.

(xviii) The Government will assure that all people affected by land acquisition will be compensated prior to possession of land and assets. Compensation based on replacement cost will be done in a manner satisfactory to ADB.

21

(xix) The Government will ensure that LGED complete all preparatory works for land

acquisition before submitting the reports on the district-level social analysis and environmental assessment. Actual land acquisition must be completed within 365 days following the completion of detailed design for the subproject; if not, the subproject will be excluded from the Project. If involuntary resettlement and land acquisition are required, a resettlement plan will be included in the report on district-level social analysis. LGED will publicly disclose the resettlement plan for each subproject. The resettlement plan will be prepared in accordance with the project resettlement framework included in the loan documents and ADB’s Handbook on Resettlement, and will include a complete census and inventory of losses. The PMO will not award any civil works contract for any subproject unless a resettlement plan for such subproject, in form and substance acceptable to ADB, has been submitted to and approved by LGED and ADB. Land acquisition works including payments will be completed prior to possession of land and other assets, in accordance with the agreed upon resettlement plan.

(xx) The Government will take all necessary steps to ensure full implementation of the Project’s gender action plan and ensure performance reporting in the quarterly reports to be submitted to ADB.

(xxi) The Government will cause LGED to implement in full the provisions of LGED’s gender action plan for the Project’s duration. To this end the PMO will prepare field manuals for the gender action plan and conduct training for PMO staff.

B. Conditions for Loan Effectiveness

The following are the conditions for loan effectiveness.

(i) The development project proposal, consistent with the Report and Recommendation of the President and loan agreement will have been approved by the Government.

(ii) The PMO will be operational with all staffing in place.

(iii) A first-year work plan will have been prepared and submitted for ADB’s approval.

VI. RECOMMENDATION

I am satisfied that the proposed loan would comply with the Articles of Agreement of

ADB and recommend that the Board approve the loan in various currencies equivalent to Special Drawing Rights ________________ to the People’s Republic of Bangladesh for the Second Rural Infrastructure Improvement Project from ADB’s Special Funds resources with an interest charge at the rate of 1% per annum during the grace period and 1.5% per annum thereafter; a term of 32 years, including a grace period of 8 years; and such other terms and conditions as are substantially in accordance with those set forth in the draft Loan Agreement presented to the Board.

____________________ President Date:

Appendix 1 22

EXTERNALLY FINANCED RURAL INFRASTRUCTURE PROJECTS

Amount approved PROJECT TITLE Source Duration

($ million) Rural Development Project 13: Infrastructure Greater Dinajpur and Jamalpur Districts

1988-97 91.00 ADB

Rural Development Project 6: Infrastructure, Manikganj District 1989-97 9.50 SDC Rural Development Project 7: Infrastructure, Greater Rajshahi, Pabna and Bogra District

1989-97 81.15 IDA, SDC, KfW

Rural Development Project 8: Infrastructure, Greater Rangpur District

1989-97 23.00 EC, The Netherlands

Flood Rehabilitation Project: (Roads and Appurtenant Structure, 4th Revision)

1989-97 94.00 Japan

Rural Development Project 3: Infrastructure, Greater Sylhet District (2nd Phase)

1993-02 31.57 IDB

Rural Development Project 16: Infrastructure, Barisal, Patuakhali, Bhola, Barguna, Jhalokati and Pirojpur Districts

1993-99 60.00 DANIDA

Rural Development Project 18: Infrastructure, Greater Khulna, Jessore and Kushtia District

1993-99 89.00 ADB

Construction of Bridge/Culverts through Monetised USAID Flood Aid Provided Under PL-480, Title-III

1993-98 28.00 USAID

Portable Steel Bridge Project: Dhaka, Chittagong and Sylhet Divisions

1994-97 36.00 JICA

Integrated Food Assisted Development Project (IFADEP) 1994-98 23.00 EC Integrated Food for Development (IFFD) Project 1994-99 121.00 USAID Rural Maintenance Program (3rd Phase) 1995-98 45.00 CIDA Rural Development Project 11: Infrastructure in Greater Rajshahi, Bogra, Pabna and Dhaka Districts (Village Road and Market Development and Maintenance Project-2) (2nd Revised)

1996-02 198.00 IDA/SDC

Rural Development Project 14: Infrastructure, Tangail District (2nd Phase)

1996-02 26.50 GTZ, KfW

Rural Development Project: Infrastructure, Greater Rajshahi, Pabna, Bogra and Dhaka Districts (RRMIMP-2)

1996-01 140.00 IDA, SDC

Rural Development Project 4: Infrastructure, Faridpur, Madaripur, Rajbari and Gopalganj District (3rd Phase)

1997-00 15.00 SIDA

Rural Development Project 19: Infrastructure in Greater Barisal District

1997-04 30.50 OPEC

Rural Development Project 21: Infrastructure in Greater Rangpur 1997-05 156.00 ADB, SIDA, IFAD, JBIC

Rural Development Project: Greater Dhaka District (Manikganj, Munshiganj, Gazipur, Narayanganj and Narshingdi District)

1997-98 10.00 Saudi Arabia

Construction/Reconstruction of Road, Bridge and Culverts (Flood Damage Infrastructure) in rural Area on priority basis

1997-03 145.00 IDB

Construction of Bigger Bridges/Culverts on important Feeder and Rural Roads Project (Revised)

1997-02 41.00 Japan

Rural Development Project 22: Infrastructure in Noakhali Zila (Revised)

1998-04 16.00 SDC

Rural Development Project 24: Greater Faridpur, Rural Infrastructure Development Project (Work Facility and Participatory Rural Infrastructure Development) Revised

1998-06 76.00 JBIC

Rural Infrastructure Development Project in Greater Sylhet District

1998-04 35.00 IDB

DFID Aided Steel Bailey Bridge Construction Project (2nd Part) 1998-03 16.00 DFID

Appendix 1 23

Amount approved PROJECT TITLE Duration Source

($ million) Post Flood Rehabilitation Project (3rd Revised) Portable Steel Bridge Construction Project under ORET Program under The Netherlands Grant

1998-02 35.00 The Netherlands

Flood Damage Repair 1999-01 2.60 KfW Rural Development Project: Infrastructure, Tangail District (3rd Phase)

1999-01 7.50 KfW

Rural Infrastructure Improvement Project (RDB-25) 2002-09 76.90 ADB, KfW, GTZ

Growth Center Connecting Road (GCCR) Ongoing 33.00 WFP Growth Center Connecting Road Program Rural Transport Improvement Project (RDP-26) 2003-10 196.00 IDA Easter Bangladesh Rural Infrastructure Development Project

2005-09 104 JBIC

ADB = Asian Development Bank; CIDA = Canadian International Development Agency; DANIDA = Danish International Development Agency; DFID = United Kingdom’s Department for International Development; EC = European Community; GTZ = Deutsche Gesellschaft for Technische Zusammenarbeit; IDA = International Development Association; IDB = Islamic Development Bank; IFAD = International Fund for Agricultural Development; JBIC = Japan Bank for International Cooperation; JICA – Japan International Cooperation Agency; KfW = Kreditanstalt for Wideraufbau; OPEC = Organization of Petroleum Exporting Countries; SDC = Swiss Agency for Development and Cooperation; SIDA = Swedish International Development Cooperation Agency; USAID = United States Agency for International Development; WFP = World Food Program.

Appendix 2 24

SECTOR ANALYSIS

Indicators Item

2005 2010 2015 2020 2025 Remarks 1 Sector Outcomes

(i) Productive employment generation 1.47 2.42 3.38 4.32 4.82 million person-years Employment under road infrastructure improvement program (ii) 1.13 1.86 2.60 3.32 3.72 million person-years

(iii) Average condition of Sub-district Road (SDR) Fair Fair Good Good Good Union Road(UNR) Poor Poor Fair Good Good Village Road(VR) Poor Poor Poor Poor Fair

(iv) In maintainable condition : SDR 47 73 95 95 95 % of paved portion UNR 19 45 58 95 95 % of paved portion VR 0 0.5 7 15 20 % of paved portion Average vehicle operating cost on SDR,UNR and VR (v) 8.20 7.00 6.50 5.50 5.00 TK/kilometer for minibus

(vi) Funding for maintenance 91.7 283 483 948 1388 USD in million

(vii) Local government share of village road maintenance costs

7 20 30 30 30 %

2 Sector Outputs (i) National level reform

- Review need for the draft Public Road Act. 31 December,2006

- Enact law to ensure road maintenance 31 December,2007 funding mechanism. (ii) LGED capacity building

- Implement LGED gender action plan. Continuous - Continue management strengthening

and staff capacity building. Continuous

(iii) Local governance - Improve local resource mobilization Continuous capacity.

- Strengthen union level capacity. Continuous (iv) Development targets

Improved SDR 17889(50) 27432(76) 36166(100) 36166(100) 36166(100) kilometer (%) improved Improved UNR 8513(20) 17074(40) 24865(59) 42329(100) 42329(100) kilometer (%) improved Rehabilitated SDR 894(3) 6861(19) 15052(42) 24094(67) 33136(92) kilometer (%) improved Rehabilitated UNR 461(1) 3538(8) 8563(20) 16817(40) 27399(65) kilometer (%) improved Improved structures on SDR 270060(71) 325497(85) 382293(100) 382293(100) 382293(100) meter (%) improved Improved structures on UNR 205142(62) 251647(76) 291028(88) 330409(100) 330409(100) meter (%) improved Improved Growth Center Markets 1059(50) 2100(100) 2100(100) 2100(100) 2100(100) Number (%) improved Improved other Rural Markets 956(6) 4116(27) 7831(51) 11547(76) 15263(100) Number (%) improved

Appendix 2

25

3 Sector Issues/Constraints (i) Increasing community participation in infrastructure development and maintenance.

(ii) Coordinating an integrated approach towards development of transport system as a whole.

(iii) Increasing the role of the private sector in infrastructure development. (iv) Adequate sectoral allocation under the Annual Development Program ( ADP) (v) Project selection not entirely based on technical consideration and economics.

(vi) Keeping continued encouragement towards building construction industries in adequate number

(vii) Removal of organizational and management weakness and complexities in the Govt. procedures.

(viii) Establishing and funding a sustainable maintenance system. (ix) Instituting a viable operation and maintenance system for improved infrastructure.

(x) Continued capacity building of LGED at the central and particularly local levels to use more participatory approaches.

(xi) Increasing role and responsibility of local government in development planning, implementation, and financing to ensure sustainability of infrastructure maintenance.

(xii) Improving rural market management and leasing system for greater user participation to improve efficiency and increased revenue.

(xiii) Land acquisition and compensation process is simplified and well planned.

(xiv) Construction and maintenance machinery and equipment are well maintained and timely replaced.

4 Actions/Milestones/Investments Issues to addressed Schedule By Agency

ADB Government Other

1. Rural Infrastructure Improvement Project(RIIP-I) (i) – (xii) 2003-2009 Kfw, GTZ

2. Rural Transport Improvement Project - I (i) – ( xiii) 2003-2008 -

IDA

3. Rural Infrastructure Development project on northern region of Bangladesh Noakhali, Chaittagonj and Sylhet

(i) – (xii) except (iii) 2005-2009 - JBIC

5. Second Rural infrastructure Improvement Project (RIIP-II) (i) – (xiv) 2006-2011 GTZ,Kfw, DFID

GTZ= Deutsche Gesellschaft fur Technische Zusammenareit; IDA= International Development Association; Kfw = Kreditanstalt fur Wiederaufbau; DFID= Department for International Development; JBIC= Japan Bank For International Cooperation.

DESIGN AND MONITORING FRAMEWORK

Design Summary Data Sources/Monitoring Performance Targets/Indicators Mechanisms Assumptions and Risks

1. Impact Reduce rural poverty

through sustainable economic growth, rural development and improved infrastructure.

• Percentage of the population in Project areas that have

a caloric consumption of at least 2200 kcal per day will increase by 10% of the total population by EOP

• Project Completion Report • Bangladesh Bureau of Statistics

(BBS) Reports • MOA Reports • Surveys of Project area

households

• Macroeconomic stability

maintained • Poverty focused programs

continued • Large household surveys can be

undertaken by LGED PMO

2. Outcomes

2.1 Enhanced accessibility to basic services.

• Average time (hours) for Project households to access their preferred agricultural market will decrease by 75% by EOP

• At least 15 million people in Project areas will have all-weather access to economic and market opportunities and to government services by EOP

• Average time (hours) Project households to access basic services decrease by 50% by EOP.

• Farmer surveys • Transport worker surveys • BBS Reports • BME Report including

employment and wage Surveys • Project Completion Reports • Review Mission Reports

• Macroeconomic stability

maintained • Poverty focused programs

continued • Transport services will increase in

Project areas due to improved roads

2.2 Increased on-farm income

2.3 Enhanced women’s

empowerment

• Average annual household on-farm income in Project areas will increase by 20% by the EOP

• Average cost (Tk/kg) to transport crops to market preferred by household will decrease by 10% by EOP

• Percentage of Union Development Coordinating

Committee (UDCC) members that are women will increase to 33% by EOP

• Number of female shop owners in Project GCMs will increase by 960 by EOP

• The percentage of women workers employed in Project infrastructure construction will increase to 30% by EOP

• Household/ farmer surveys in Project areas

• Project records • Household level surveys of

women in Project areas • Surveys of UCCs in Project areas

• Macroeconomic stability maintained

• Poverty focused programs continued

• Prices for agricultural produce from smallholder farmers will increase due to increased competition among buyers that are more able to reach household farms

• Poverty focused programs

continued • Participation of women in all

activities ensured • Training of women folk continued • Women ready to share

accountability

26 Appendix 3

Design Summary Data Sources/Monitoring Performance Targets/Indicators Mechanisms Assumptions and Risks

2.4 Improved local governance

• 100% of Project area UCs can properly handle fund amounts that are adequate to accomplish their tasks by EOP

• 100% of Union level government offices are located in UCCs by the EOP

• 100% of UCs understand and implement GOB direction concerning functions and roles of female UC members by the EOP On average one meeting per month between GOB staff at Union level and Union Council staff in all Project areas by the EOP

• 100% of Project area UCs hold public meetings every 6 months mandated through the village governments by the EOP

• The percentage of Project area UCCs that undertake gender-based development activities increase to 25% by the EOP

• Surveys of UC members • Project Records

• UCs will accept the need for Project surveys and will respond truthfully to them

• GOB will follow through and meet their agreed responsbilities

2.5 Increased LGED capacity to undertake projects.

• Percentage of LGED staff involved in financial management, quality control, and participatory approach that have been trained will be increased to 100% by EOP.

• Percentage of LGED staff involved in Project design, monitoring, and evaluation on this Project that have been trained that perform their Project design, monitoring, and evaluation tasks will be increased to 80% by EOP

• Percentage of PMO staff that have been trained that correctly use Results Based Management (RBM) methods will increase to 100% by EOP

• Surveys of LGED staff involved in this Project

• LGED staff be given appropriate amounts of domestic and international training

• Proper LGED staff will be selected

for all training • LGED staff working on this Project

will respond truthfully to Project surveys of capacity

3. Outputs 3.1 Component 1: Upgrading Rural Roads

3.1.1 Improvement of Subdistrict Roads

• Upgrade 1360 km of Subdistrict Roads to bituminous surface standard;

• By June 2011, selected 1360 km of subdistrict road improved connecting GC markets with higher road network;

• At least 75 % increase in existing transport volume, and at least 30% reduction in travel time expected

• Technical survey and design reports prepared

• Project Progress Reports • Bid documents indicates

competition dates during annual biddings

• BME Reports including market surveys

• Project Review Missions • Project Completion Report

• Timely flow of funds available • No major natural disasters

occurred • Sufficient contractors’ capacity in

project districts • Applicable labor laws will be

complied with

3.1.2 Upgrading Union Roads (UNRs)

• Upgrade 550 km of union roads to bituminous surface standard

• By June 2011,175 union councils are connected with

• Project Progress Reports • Review Missions • Project Completion Report

• Timely flow of funds available • No major natural disasters

occurred

27 Appendix 3

Design Summary Data Sources/Monitoring Performance Targets/Indicators Assumptions and Risks Mechanisms

improved roads; • At least 75% increase in existing transport volume, and

30% reduction in travel time achieved • Technical survey and design reports prepared

• Sufficient contractors’ capacity in project districts

• Applicable labor laws will be complied with

3.1.3 Construction of Road Structures

• Construction 9000 m of bridges/culverts on subdistrict and

• union roads • By June 2011 all structures on subdistrict roads are

constructed • By June 2011 all structures on union roads are

completed and provide uninterrupted connections • By December 2007, survey and design reports on all

structures prepared.

• Bid documents indicate completion dates during annual biddings

• Project Progress Reports • BME Reports including market

surveys • Project Review Missions • Project Completion Reports

• Local Government bodies unable to contribute 10% of costs of SUVR and GC

• LGED prioritizes routine maintenance of improved union roads in allocation of its maintenance budget

• Applicable labor laws will be complied with

3.1.4 Resectioning of Village Roads

• Improve by resectioning 3650 km of village roads type A. Construction completed by June 2011.

• Project Review Mission • Project Progress Report • Project Completion Reports

• Union councils will maintain the road

3.1.5 Construction of Submersible Roads

• Construction of 60 km of submersible roads; • Construction completed by December 2010;

• Project Review Mission • Project Progress Report

• Impact on lowland (haor) areas’ ecology is minimal.

3.2 Component 2: Improvement of

growth center/ markets/ jetties/union complex

3.2.1 GC/markets facilities improvement

• Construct and improve market and public facilities

including women’s market sections (WMS) and women open area in 160 selected GC/markets

• By June 2011, 160 GC/markets facilities improved including WMS

• By June 2011, all shops in the WMS are leased out • By December 2006, location of GCs/ markets agreed

through participatory meetings • By December 2007, at least 80% of the designs

prepared and approved though participation

• Bid documents indicating extent of

competition during annual biddings

• Project Progress Reports • BME Reports including market

surveys • Project Review Missions • Administrative records of

GCs/markets

• Timely flow of funds available • Sufficient contractor capacity in

project districts • Micro-enterprise developed

around GC and more cash crops produced by farmers

• Women’s market section and areas continue operation and stimulate greater women participation in buying and selling activities

• Applicable labor laws will be complied with

28 Appendix 3

Design Summary Data Sources/Monitoring Performance Targets/Indicators Assumptions and Risks Mechanisms 3.2.2 Improvement of

jetties (“ghat”)

• By June 2011, 25 jetties are constructed • By June 2011, passenger sheds are constructed • By December 2007, designs finalized though

participatory meetings

• Project Progress Reports • BME Reports including boat

landing/ghat surveys • Project Review Missions • Bid documents indicate date of

competition

• Timely flow of funds available • Sufficient contractor capacity in

project districts • No major erosion occurs • Applicable labor laws will be

complied with • Communities agree to participate

in the subproject design • LGED training will produce skilled

facilities

3.2.3 Construction of Union Council (“Parishad”) complex (UCC)

• Construction of 175 union council complex • By June 2011, 175 union councils complex completed • By June 2011, all UC complexes are occupied by the

users

• Project Progress Reports • BME Reports Project Review

Missions • Bid documents indicate date of

competition

• Timely flow of funds available • Sufficient contractor capacity in

project districts • Applicable labor laws will be

complied with • UCs agree to participate in the

subproject design

3.2.4 Construction of

Women’s Market Section (WMS)

• By June 2011, construction of 196 WMS completed. • Position handed over by June 2011.

• Project Progress Report • Project Review Mission

• Timely selection of women entrepreneur

• Timely handing over of possession (“license”)

3.2.5 Construction of flood refuge shelters

• Construction of six flood refuge shelters; completed by June 2011.

• Project Review Mission • Project Progress Report

• Constructed at proper place to use them fully

• • • 3.2.6 Resettlement

Plans and Compensation

Land Acquisition Plans prepared

(i) Resettlement Plans Prepared

(ii) Compensation Plans prepared

• By June 2009, all land plans prepared and acquisition completed by December 2010

• Proper land compensation provided to the affected persons

• Project Progress Reports • BME Reports • Project Review Missions

• Timely flow of funds available • Lands free from encumbrances • Timely acquired

29 Appendix 3

Design Summary Data Sources/Monitoring Performance Targets/Indicators Mechanisms Assumptions and Risks

• Timely recruitment and fielding of consultants

• Trained staff apply new knowledge and skills

• Continuous political commitment to introduce change and decentralization

• Project Progress Reports • Project Review Missions • LGED project performance

management reports • LGED project performance

management report

• Capacity building consultants • Training • By June 2007, all consultants are recruited • By June 2009, LGED staff trained in technical aspects • By December 2010, members of 1832 union councils

trained • By December 2010, improved coordination services

delivery procedures being implemented in 1832 union councils

• By December 2009, new sources for resources for resource

3.3 Component 3:

Strengthen Capacity of LGED and LGIs

3.3.1 Strengthen

LGED capacity 3.3.2. Local Governance improved

• mobilization being tapped in 1832 union councils

• Train all union level staff on implementation, maintenance and local resource mobilization

• Staff of line agencies willing to coordinate and deliver services more effectively to union councils

• Stakeholders at union level accept increased responsibility for increased role in rural development

• Taxpayers willing to pay for services

• Stakeholders support increased role of women in local government administration

3.4 Component 4:

Provide Support for Project Management

3.4.1 Design and Supervision Consultants

3.4.2 Institutional Support Consultants

• Provision of 202 person-months of international and

1504 person-months of domestic consultants • Provision of 450 person-months of domestic

consultants

• Project Progress Reports • Project Review Missions

• Timely recruitment and fielding of

consultants

4. Activities

- Establishment of PD and DPDs offices

- Land acquisition and resettlement

• Prepare technical survey and design reports including

and environmental assessment • Prepare bid documents, tender and award contracts • Appointment of all staff by June 2006

• Project Implementation Progress

Reports • Project Review Missions • Project Accounts Reports

• Appropriately qualified staff are

available to the PD’s and field offices

• Delays in land acquisition

30 Appendix 3

Design Summary Data Sources/Monitoring Performance Targets/Indicators Assumptions and Risks Mechanisms - Engagement of

consultants - Procurement of civil

works - Implementation of

civil works - Support project

activities with appropriate gender and other action plans

- Monitor and review implementation of project activities and benefits

- Training of LGED and LGI staff

- Improvement of governance of LGIs

• Land Acquisition and Resettlement Plan • Based on work plan of PMO • As per plans prepared for the project • As per plans of the project • Train members and staff of union councils, MMCs and

market trade association members in local government and market management

• Establish procedures for improved coordination and service delivery between subdistrict/union line agency staff and union councils

• Identify and tap new sources for increased resource mobilization by union councils

• Select and prepare list of structures on union roads and village roads

• Structures on village roads selected and contribution at 10% of costs deposited with LGED.

• Consultants are recruited timely • Project activities can be

implemented without undue delay • Benchmark study is done during

initial year of implementation

5. Inputs

5.1 Consulting Services:

(i) Design Supervisions Management

(ii) Institutional Support

5.2 Subdistrict Roads 5.3 Union roads 5.4 Structures on

subdistrict 5.5 Village roads and

structures 5.6 Submersible roads 5.7 Construction Equipment 5.8 Vehicles 5.9 Incremental Operating cost 5.10 Office Equipment 5.11 Training 5.12 Impact Studies

• 202 person-months of International consultants and

1504 person-months domestic, $ 6.2 million

• 450 person-months, $ 1.0 million

• $ 109.9 million • $ 25.8 million • $ 37.7 million • $ 12.6 million • $ 5.5 million • $ 2.5 million • $ 1.8 million • $ 8.1 million • $ 0.8 million • $ 4.2 million • $ 0.5 million

• Annual work plans of PMO • Project Implementation Progress

Reports • Project Review Missions • Project Accounts Reports • Contract Award and

disbursements records • Loan Agreements with donors

• Timely approval of ADB, DFID

and GTZ funds • Loan Effectiveness conditions are

met on time • Counterpart fund allocation is

available on timely basis through ADP

• Project activities can be implemented without undue delay

31 Appendix 3

Appendix 4 32

Appendix 4 33

Appendix 4 34

34

Organization Chart for Project Implementation

35 Appendix 5

Local Government Division (LGD), Inter-ministerial Project Ministry of Local Government Steering Committee Rural Development & Cooperatives (MLGRDC) Chairperson – Secretary, LGD

Chief Engineer, LGED Additional Chief Engineer (Maint) Additional Chief Engineer (Impl) Additional Chief Engineer (Plan)

Regional Superintending Engineer of Rangpur, Dhaka, Mymensingh & Comilla Executive Engineer of 23 Project

Districts

Upazila Engineer of 82 Project Upazilas

Project Management office headed by PD

& DPDs

Design, Supervision and Monitoring Consultants

& Institutional Support

Consultants

Execution of Project Union Councils

36 36 A

ppendix 6

IMPLEMENTATION SCHEDULE

37

INDICATIVE PROCUREMENT PACKAGES

Value Distribution of Contract Packages Item

Mode of Procure-

ment

No. of Pack-ages

Million Tk.

Million $ 2006- 07 2007- 08 2008 - 09 2009 - 10 2010 - 11

1. Vehicles ICB, IS 2 108.9 1.7 1 1 - - -

2. Construction Equipment ICB , IS 2 105.8 1.6 1 1 - - -

37 Appendix 7

3. Laboratory Equipment ICB , IS 2 47.2 0.7 1 1

4. Office Equipment IS 4 29.8 0.4 2 2 - - -

Total ICB , IS Procurement 291.7 4.4

1. Office Furniture LCB 23 18.2 0.3 23 - - - -

2. Upgrading Subdistrict Roads LCB - 5440.0 83.7 - - - - -

Total length: 1360 km - - - 136 272 408 340 204

Total No. of Packages - 450 - - 45 90 135 112 68

3. Upgrading Union Roads LCB 1375.0 21.1 - - - - -

Total Length: 550 km - 55 110 165 140 80

Total No. of Packages: - 180 - - 18 36 55 45 26

4. Construction of Submersible Roads LCB - 300.0 4.6 - - - - -

Total Length: 60 km - 25 30 5

Total No. of Packages: 6 - 6 - - - 2 3 1

5. Resectioning Village Roads-A by Earthworks LCB 3664 219.0 3.4 - - - - -

Total Length: 3664 km - - - - 366 732 1098 916 552

No. of Packages: 3664 - - - - 366 732 1098 916 552

38

Value Distribution of Contract Packages Item

Mode of Procure-

ment

No. of Pack-ages

Million Tk.

Million $ 2006- 07 2007- 08 2008 - 09 2009 - 10 2010 - 11

6. Structures on Village Roads LCB - 449.0 6.9 - - - - -

Total Length: 3664 m - - - - 360 730 1100 910 550

No. of Packages: 1825 - 1825 - - 190 365 550 460 260

38 Appendix 7

7. Sructures on Subdistrict and Union Roads LCB 2025.0 31.1 - - - - -

Total Length: 9,000 m - - - - 900 1800 2700 2250 1350

Total No. of Packages: 370 - - - - 36 72 105 90 67

Growth Center Markets at Subdistrict HQ LCB - - - - - - - - 8.

Total No.: 30 - 30 - - 3 6 9 8 4

Total Value: Tk 240.0 million - - 240.0 3.7 24 48 72 64 32

Growth Center Markets at other Subdistricts LCB 9.

Total No.: 70 - 70 - - 7 14 21 18 10

Total Value: Tk. 280.0 million - 280.0 4.3 28 56 84 72 40

10. Village Markets ("Hats") LCB

Total No.: 60 - 60 - - 6 12 18 15 9

Total Value: Tk. 150.0 million - - 150.0 2.3 15 30 45 37 23

11. Union Council Complexes

Total No.: 175 - 175 - - 20 35 50 45 25

Total Value: Tk. 700.0 million - - 700 11.7 80 140 200 180 100

Value Distribution of Contract Packages Item

Mode of Procure-

ment

No. of Pack-ages

Million Tk.

Million $ 2006- 07 2007- 08 2008 - 09 2009 - 10 2010 - 11

12. Jetties LCB

Total No.: 25 25 - - 3 5 7 7 3

Total Value: Tk. 50.0 million - - 50.0 0.8 6 10 14 14 6

13. Functional Buildings

39A

ppendix7

39

-

16.8

14

-

-

-

Total Floor Area: 14,000 sq m LCB 16 - - 4 4 4 4

Total Value: Tk. 150.0 million - - 150.0 2.3 37.5 37.5 37.5 37.5

29

24

6

2

33.6

28

6

2

20

24

6

2

12

10

-

-

174.6

0.3

1.8

-

-

11,291.4

115.2

18.0

-

-

96

6

-

-

-

LCB

LCB

-

-

-

-

-

Total Value: Tk.115.2 million

Total Value: Tk. 18.0 million

Women's Sections at GCM

Total LCB Procurement

Flood Refuge Shelters

Total No.: 96

Total No. 6

15.

14.

Appendix 8 40

OUTLINE TERMS OF REFERENCE FOR CONSULTING SERVICES

A. Consultants for Project Design, Supervision, and Management 1. A team of consultants will be employed to assist the Local Government Engineering Department (LGED) in implementing the Project. The consultants will work directly with the project management office (PMO) and the regional Project offices in Rangpur, Dhaka and Mymensingh including LGED district and subdistrict offices in the Project area for carrying out project design, supervision and monitoring of the Project. 2. The consultants must have substantial experience of designing and supervising rural infrastructure development projects, especially in South Asia Region. They will work under the guidance of PMO to ensure the timely implementation of the project according to the approved Project documents. The consulting services will carry out the following tasks but not limited to:

(i) Carry out engineering surveys, investigations; sub soil investigation; prepare land acquisition plans including resettlement plans, as required; participatory workshops at markets and jetties;

(ii) Prepare engineering drawings, designs, engineer’s estimates, and tender documents

for all civil works under the Project; prepare annual procurement plan; (iii) Prepare tender documents for all goods to be procured under the Project;

(iv) Assist LGED in preparing and implementing Project activities, including planning,

procurement of works goods and services, execution and methodologies, training for sustainable operation of improved infrastructure, operating the quality control regime;

(v) Assist and advise LGED in all aspects of tendering, evaluation of tenders for goods

and works, and contract award; and contract administration; certify payments to contractors, and completion procedures. Assist and advise LGED with supervision of all types of civil works, including procedures for regular on-site checking, quality control and monitoring of work execution and construction methods, develop procedures for laboratory and field tests and materials quality control, LGED’s materials laboratories operation, and certification of quality and work progress;

(vi) Assist LGED in planning, monitoring, reporting, and financial management aspects,

including project framework techniques for planning and training; and financial monitoring of implementation and operation of market, jetty, and improvements on the union council complexes;

(vii) Assist LGED in planning and implementing land acquisition and resettlement

activities reporting and documentation; fixing construction equipment charge rates, allocation and use; identifying and reporting adverse environmental and social impacts by carrying out district level initial environmental examinations and initial social assessments for subprojects and modifying designs and practices to mitigate them, such as by preparing environmental management plans and resettlement

Appendix 8 41

plans; generally accomplishing project preparation tasks; and preparing monthly, quarterly and final reports including draft project completion report;

(viii) Carry out technical, economic, social, environmental and other survey and analysis,

as necessary, for inclusion of new subprojects in the Project required; and

(ix) Assist in facilitating participatory planning, implementing participatory governance activities, and implementing the gender action plan.

B. Institutional Support Consultants for Capacity Building of Local Government

Institutions (LGIs) and LGED

3. The consultants will prepare training programs and develop training modules including curriculum designs to strengthen/enhance the capability of local government institutions in planning, implementing, delivering services and maintaining local projects; advise and support LGED in developing modules; and conducting training of LGED staff. The tasks are as follows:

(i) Advise and support local government institutions in training of union council chairpersons, members, secretaries; and members and staff of the market management committees in market planning and management, governance, transparency, financial management and accounting, local resource mobilization, gender and development, and participatory approaches. Plan and organize participatory workshops at markets and jetties in connection with the market and jetty design;

(ii) Advise and support LGED in building its capacity as a facilitator for training LGED

staff in participatory development and assisting them in maintenance planning, promoting stakeholder participation, and social analyses; Initial Environmental Examinations; Environmental Impact Assessment including mitigation measures, if required; mainstreaming of gender issues; and implementing the gender action plan. Provide support in tree planting program for women, routine maintenance contracting procedures, and training for union councils to maximize employment for poor and disadvantaged women;

(iii) Advise and support LGED in providing orientation and related training to local

contractors in the Public Procurement Regulations 2003, bid preparation, work programming, financial management and cash flow, quality control, defect liability, and reducing the wage gap between men and women;

(iv) Prepare monitoring and evaluation criteria for the Project; data collection; data

analysis; benefit monitoring and evaluation; Develop management information system for LGED including design of ICT requirement; Identification of infrastructure for wide area network; Web site management and server administration; and

(v) Advise and assist in planning and implementing land acquisition and resettlement

activities under the Project including monitoring of payments to affected persons; reporting.

4. Specialists will provide the training using facilities at LGED training centers where possible. Specialists will develop training materials and programs in the respective field for courses, unknown to the local government institutions and to LGED.

Appendix 8 42

Table A7: Consultants' Schedule

Consultant Package/Personnel No. Person months

Sub-total

A. Design, Supervision and Monitoring: 1. International Consultants: a) Sr. Project Engineer/Team Leader 1 52 52 b) Project Engineering Advisers 3 50 150 Sub-total, International 202 2. National Consultants: a) Deputy Team Leader 1 54 54 b) Road Design Engineer 1 30 30 c) Structural Design Engineer 1 24 24 d) Hydrologist 1 12 12 e) Transport Economist 1 24 24 f) Market Physical Planner 1 36 36 g) Jr. Architect 1 24 24 h) Quality Control Engineers 3 50 150 i) Field Engineers 23 50 1150 Sub-total, Domestic 1504 Total for (A) 1706

B. Institutional Support Consultants (all national)

1. Sr. Training Specialist/Team Leader 1 48 48

2. Local Governance Specialist 1 48 48

3. Sociologist/Resettlement Specialist 1 36 36

4. M & E Specialist 1 54 54

5. MIS Specialist 1 36 36

6. Financial Management Specialist 1 36 36

7. Training Specialists 2 48 96

8. Gender Specialist 1 36 36

9. Participatory Development Specialist 1 30 30

10. Environmental Specialist 1 30 30

SUB-TOTAL (B) 450

Appendix 9 43

PROJECT JUSTIFICATION AND ECONOMIC ANALYSIS A. Introduction 1. The Country Strategy Paper (CSP) of ADB specifies that among the major causes of poverty in Bangladesh are living in remote and unfavorable environments with limited transport and other infrastructure. The national strategy for poverty reduction in Bangladesh gives high priority to development of roads and related infrastructure. The Project directly addresses the problem associated with lack of connectivity between the rural areas, where most of the country’s population reside, and the areas that offer economic opportunities to the rural poor.

B. Project Benefits

2. The benefits from the Project would be generated from the following sources: (i) the directly quantifiable benefits arising from savings in vehicle operating costs (discussed in part C, below); and (ii) the indirect benefits that are not quantified in the economic evaluation but are likely to be quite significant. These benefits are discussed below:

a) Difficult Access and Poverty in the Project

3. Like many rural areas in Bangladesh, the Project area suffers from a general condition of isolation. Areas of agricultural production have no year-round access to either markets or to sources of technical services. Bringing produce to an existing paved road typically takes hours of travel time on foot or with the use of bullock carts. Visits by agricultural extension services are few and far-between. Women and growing children particularly suffer from the lack of access to health services, which are invariably available only in larger towns. Although part of the available rural labor may be willing to work in non-farm activities, the lack of access to alternative employment prevents them from engaging in any such gainful jobs. Largely due to the lack of access to economic opportunities, the project area suffers from a high incidence of poverty (about 55% of rural population in 2000, latest data). With the Project, the level of poverty is expected to drop by 10%.

b) Development Through the Project

4. The project aims to improve the network of rural roads, rural markets and offices of the union council in 23 districts of Bangladesh. Through these physical works, the rural population and the agricultural production areas will be closely linked and thereby establish connectivity between rural areas and places of broader economic and social opportunities. The economic opportunities have the following dimensions; (i) rural labor will become more mobile and would be able to combine farm employment with non-farm work in nearby urban communities; (ii) agricultural producers would become more market oriented and adjust agricultural production decisions in line with profit-maximizing goals; (iii) social services, such as education and health, and technical services such as agricultural extension and access to new technology (including high-yielding seed varieties, and use of fertilizer) will be more easily available and (iv) with improved market facilities, fresh produce will be more readily available at market centers with minimal spoilage. The expanding economic opportunities will help in sustaining the poverty reduction efforts in the project area.

Appendix 9

44

c) Local Governance Improvement Through the Project

5. The improvement of local governance under the Project will be achieved by (i) the empowerment of women and (ii) giving greater responsibility to the local government units (union councils) and, through them, to the people. The empowerment of women will be attained by first providing them needed skills (e.g., in management and retail trader) and then giving them the opportunity to apply those skills (e.g., in managing their own shops in the rural markets). Apart from this, women members of the union council will be trained in development planning and financial management so that they are better able to contribute in the decision-making process of the union council, particularly on issues involving women. Women will also be given training on income–generating activities to expand their opportunities to contribute additional income to the family. With the above assistance to women in the project area and the requirements for contractors to pay equal wage to men and women for the same work value, the gender gap in Bangladesh would be gradually narrowed down.

6. Strengthening the capacity of the union councils will prepare them to assume broader responsibilities in participatory governance and in the decentralization of financial and administrative authority in the long–run. Under the Project, following a series of training programs for members and officers of the union council, they will be tasked with preparing proposals for improving village roads in their respective jurisdictions. Funds would be made available under the Project for this purpose. Union councils who perform well in the first village road they implement would be entitled to additional funds to improve more village roads. The performance – based incentive will be institutionalized under the Project to encourage union councils to improve upon the quality of their work at present. Best practices among union council activities will be emulated by encouraging neighboring union councils to visit and learn from each other. On the whole, the improvements in local governance under the Project will enhance its pro-poor focus. The stronger local government units with their clear ownership of the Project will also help in ensuring the sustainability of the Project facilities.

d) Other Benefits 7. Apart from the benefits from the rural roads and markets the project will contribute to the general well–being of the rural populations in various other ways. The provision of submersible roads will reduce the travel time during dry seasons in the low-lying areas. The construction of jetties will facilitate safe unloading and loading of goods and passengers. The construction of flood refuge shelters will save life and property of the rural people living in the flood-prone areas. The construction of union council complexes will provide one-stop services to the rural people. The human resource development program proposed under various component of the project will increase the knowledge and skills of various population groups, particularly women. C. Economic Evaluation

1. Economic Analysis of Rural Roads

8. In conducting an economic analysis of roads the following steps were followed: a. Assessment of Road Condition, Existing Traffic and Traffic Growth

9. Road condition in terms of roughness is measured by the international roughness index in meters per kilometer (m/km). For economic analysis the difference between earth and paved

Appendix 9

45

roads in their existing conditions has been taken into account. For bitumen-surfaced roads, the international roughness index (IRI) is 10 m/km; on herring bone bond (HBB) roads, the IRI is 14 m/km, and for earthen roads, 18 m/km. These values of the IRI were assumed under the “without project” condition over the project period. For the “with project” roads, an average lifetime roughness of IRI = 4 m/km is assumed. Average Annual Daily Traffic (AADT) was calculated considering the number of market and non market days in a year, and adjusted for seasonal changes. The traffic growth is assumed to be 6.50% a year while the national growth rate of traffic is 7.34% per year1. The existing traffic is assumed to represent traffic volume without the project. Traffic volume with project set as equivalent to the existing traffic plus generated traffic, the latter being assumed to be 50% of traffic without project. This level of generated traffic is considered to be conservative since additional traffic volume in recently completed projects similar to the Project has ranged from about 70% to over 100%2.

b. Estimation of Costs

10. The economic costs of rural roads under the Project include the cost of upgrading existing roads (generally earthen) to bitumen-paved condition in line with LGED standards. The investment cost, the annual routine cost of maintenance and the periodic maintenance carried out every five years were included in the costs estimates. Physical contingencies were included in the economic costs but not price escalation. The financial costs were converted to economic costs by first deducting taxes and duties, adding physical contingency and management costs then applying the standard conversion factor of 0.80.

c. Estimation of Benefits 11. The major source of benefits from improvement in rural roads is the saving in vehicle operating costs (VOC) relative to the conditions without the Project and with the Project. The savings are realized from the lower VOC over the smoother road surface for vehicles of all types. The incremental benefit increases at the rate corresponding to the traffic growth rate of 6.5 percent. The normal benefit i.e. the benefit accruing from the existing traffic due to VOC reduction is estimated to the 40% of the total benefits in the 3rd year, 70% in the 4th year and full from the 5th year. Additional benefits that will also be realized but not quantified in the present analyses are increased agricultural income arising from higher level of fertilizer use due to its lower price, greater use of high-yielding crop varieties, and higher market prices for agricultural produce.

d. Economic Internal Rate of Return (EIRR) 12. The economic analysis takes account of the different time periods at which project costs are incurred and the project benefits accrue. For any given subproject, the costs are mainly incurred during the first two to five years while benefits will start to flow in the third year, as indicated above, and achieve its full level by the fifth year of the project. The period of analyses is set at 20 years. The economic costs are compared with the economic benefits and the net benefits are used to calculate the EIRR.

1 Annual Report for 2002-2003, Roads and Highways Department, Dhaka, Bangladesh, February 2003. 2 Final Report on Benefit Monitoring and Evaluation, Rural Development Project-21, LGED, May 2004.

Appendix 9

46

2. Results of Economic Analysis of Roads

13. The economic analysis of three core subdistrict roads was performed using the procedures discussed above. On the basis of the results of EIRR all three roads are shown to be economically viable. The Churkhi-Dapunia road will generate highest benefit followed by Tarakanda-Shyamgonj. The Mominpur-Keranirhat road will generate least benefits among the three sample sub-district roads. But still it will generate more than 12% rate of return. Sensitivity analysis showed that if maintenance cost is doubled EIRR reduced to 25.432%, 59.90% and 58.69% respectively. Two years delay in maintenance EIRR increased by 27.32%, 60.75% and 59.61% respectively. This is due to exclusion of routine maintenance cost in one year and also periodic maintenance cost in year 20. In case of no maintenance with IRI increased from 4 to 10 EIRR reduced to 23.64%, 51.96% and 46.56% respectively. When only half of the traffic growth is assumed EIRR reduced to 24.67%, 59.21% and 53.70% respectively. The results of alternative scenarios showed the changes in EIRR are minimal.

Table 1: Results of Economic Analysis of Core Subdistrict Roads

(EIRR in %)

Name of the road Parameters Momoinpur-

Keranirhat Churkhi-Dapunia

Tarakanda-Shyamgonj

Base case 26.79 60.43 59.27 Sensitivity Cases: a) Maintenance cost is doubled 25.43 59.90 58.69 b) Delayed maintenance by 2 years 27.32 60.75 59.61 c) No maintenance with IRI increased from 4 to 10 m/km

23.64 51.96 46.56

d) Only half of traffic growth is realized 24.67 59.21 53.70 3. Economic Analysis of Growth Center Markets

a) Introduction 14. Growth center markets are the focal points for the sale of rural produce, agricultural inputs and consumer goods. In addition to growth center markets there are also other small rural markets. Unimproved markets are congested, unhygienic, dusty in the dry season and muddy in the wet season. The improved market provides a clean, decongested and efficient market place for the trading of farm and non farm products. In the present project three types of markets will be developed. These are growth center markets located at the sub-district headquarters, growth center markets located not in the sub-district headquarters and small rural markets which are not designated as growth center markets. Due to population growth and increase of trading of farm and non farm inputs and outputs in the rural areas the demand for the third category of markets (local markets) have been increasing. b) Methodology of Economic Analysis

15. In conducting economic analysis of Growth Center Markets the following steps were followed:

Appendix 9

47

i) Estimating the Costs

16. The economic costs of Growth Center Markets (GCM) under the Project include the cost of construction including women market section. Along with the investment cost, operation and maintenance cost were included in the costs estimates. Physical contingencies were included in the economic costs but not price escalation. The financial costs were converted to economic costs by first deducting taxes and duties, adding physical contingency and management costs then applying the standard conversion factor of 0.80.

ii) Estimation of Benefits 17. Spoilage Savings (SS) approach is used to quantify benefits. The spoilage savings is the measure of the portion of revenue lost to the seller as a result of deterioration of the quality of the product. The benefit is measured by the difference of spoilage savings of perishable goods in the market ‘with’ and ‘without’ the development and calculated on the basis of number of peak and off-peak hat days in a year. It is assumed that 60% of spoilage would be reduced ‘with project’3. The remaining 40% of the benefits will accrue from population growth, and improvement in transport facilities. Benefits are expected to be generated from the 2nd year of the improvement on the markets. It is assumed that the benefits will increase at a rate of 8% compound growth rate per year. c) Results of Economic Analysis 18. The results of the economic analysis of the core sub-project growth center market, growth center markets located at the subdistrict headquarters and growth centre markets located outside subdistrict headquarters are discussed below.

i) Core subproject Growth Center Market

19. One growth center market, Mominpur, located at Rangpur Sadar was selected to illustrate the procedure for economic analysis. A market survey was conducted at this site and annual spoilage savings calculated and benefits were estimated. The calculated EIRR is 17.87%. This level of EIRR rate is quite satisfactory and justifies investments in this component of the project. Sensitivity analysis showed that if maintenance cost is doubled EIRR decreased to 12.57%. In the case when the benefits were reduced to 45% of the spoilage averted, EIRR fell to 12.08. It is noted that at base case 60% of spoilage savings is assumed from market improvement.

ii) Growth Center Markets Located at the Subdistrict Headquarters 20. Under the Project 30 GCMs located at the subdistrict headquarters will be improved. Out of 30 GCMs results of economic analyses for 10 were available in the feasibility study report conducted by the LGED. Summary of the findings are presented in Table 2. The results showed that EIRR of the 10 markets are well above 12% and ranged from 15.49% to over 50%. Out of 10 markets four will generate EIRRs of more than 50%. These high rates of return justify investments in growth center markets.

3 Feasibility Study Report on Rural Infrastructure Improvement Project-2, July 2004.

Appendix 9 48

Table 2: Results of Economic Analysis of 10 GCM Located at the Sub-district

Headquarters

District Sub-district Name of the Market EIRR Dinajpur Nawabgonj 1. Nawabgonjhat 34.55 Panchagarh Atwari 2. Fakirgonj hat 22.16 Rangpur Gongachara 3. Gongachara hat 86.17 Kurigram Bhurungamari 4. Bhurungamari hat 15.49 Kurigram Fulbari 5. Fulbari hat 74.45 Tangail Basail 6. Basail hat 57.29 Tangail Nagarpur 7. Nagurpur hat 24.30 Netrokona Purbodhala 8. Purbodhala hat 49.25 Munshiganj Sirajdikhan 9. Sirajdikhan hat 88.70 B. Baria Nasirnagar 10. Nasirnagar 32.21

d) Project Benefit Distribution 21. A benefits distribution analysis was carried out to determine what portions of the benefits accrue to each group of beneficiaries, particularly to the poor. The beneficiaries of the project are owners and users of the vehicles plying on the rural roads. The owners and users are further classified either poor or non-poor. A poverty impact ratio (PIR) was calculated to measure the proportion of the benefits that would accrue to the poor. (The detailed procedures are in supplementary Appendix L). Under the project the PIR was calculated for subdistrict roads, rural roads and rural markets. The results are shown below:

Sources of Benefits PIR (%) Subdistrict Roads 50.4 Union roads 43.8 Rural Markets 30.1 22. The results show that the poor would benefit most from the subdistrict roads. However, although the benefits from union roads and rural markets are relatively lower, they are still substantial. e) Project Sustainability 23. In order to ensure the sustainability of the facilities constructed by the Project will (i) continue to enhance the capability of LGIs to better manage to rural infrastructure in their jurisdiction; (ii) monitor the allocations to LGED for road maintenance funds from the central government so that the maintenances gap would ultimately be narrowed; (iii) pursue the labor intensive, cost-effective maintenance procedures of LGED to ensure sustainability of rural roads; (iv) ensure the participation of LGI in contributing to the maintenance of union complexes, thus strengthening their sense of ownership of the project and (v) reorganize the MMC with the view to ensuring efficient maintenance of rural market facilities with funds received from lease of the markets.

Appendix 10 49

SUMMARY POVERTY REDUCTION AND SOCIAL STRATEGY A. Linkages to the Country Poverty Analysis

Is the sector identified as a national priority in country poverty partnership agreement?

⊠ Yes ⊠ Yes Is the sector identified as a national priority in country poverty analysis?

□ No □ No

Contribution of the sector or subsector to reduce poverty in Bangladesh: Poverty is overwhelming in Bangladesh. For poverty reduction, a good infrastructure, as mentioned in the draft PRSP, is critical. Physical infrastructure services ‘enhance the capabilities of the poor and help them in availing themselves of the economic opportunities of growth’. Construction and improvement of roads, growth center markets, and jetties, and their operation and maintenance play important role in reducing rural poverty by creating new employment opportunities for poor men and women, enhancing incomes for the poor, facilitating quick and cost effective transportation of perishable agricultural commodities to urban markets and enabling easy availability of agricultural inputs at reasonable prices. Improved UP complexes are expected to bring services of the central government closer to the people. The project will help reduce poverty by creating sustainable seasonal and long-term employment opportunities targeted to the poor. On the paved roads, bus, truck and tempo services will be started, where the poor will get employment as drivers, conductors and helpers. Some new employment will also be created in non-motorized transport sector. The improved growth centers and small markets on the sides of the improved roads are expected to serve landless and marginal farmers for making daily necessities available always so that they can buy after getting wages. The project would also benefit other segments of population including the small traders. The infrastructure construction and improvement undertaken by the Project will directly generate employment for about 60,000 person-years for the poor of which 30% are women. B. Poverty Analysis Targeting Classification: Targeted intervention What type of poverty analysis is needed? The overall objective of the project is poverty reduction. The impact of the project on poverty will be measured using some economic and social indicators: (a) changes in household well-being - income, consumption expenditure, and household assets; (b) changes in work, employment and wage – type of work, employment, job turnover, and average daily wage; (c) changes in production – crops, small business, prices etc.; (d) changes in social structure, status and behavior – family size, occupation of household head, mobility, migration, community actions; (e) changes in health and educational outcome etc. For this purpose benchmark poverty situation will be assessed using baseline survey before starting a project. Follow-up surveys will be carried out for comparing with the benchmark situation. Although declining, the incidence of poverty is still very high in Bangladesh. According to the Household Income and Expenditure Survey of 2000, about 50% of the population in the country live below the upper poverty line, while 34% below the lower poverty line. Compared to the national average, both the measures are higher for rural areas than for urban areas. The incidence of poverty at the national level declined by about 1% annually in the 1990s; further declines of the same magnitude were reported from 1999 to 2004. The division-wise distribution of the incidence as estimated by both the measures of head-count rates shows that Rajshahi division had the highest poverty incidence followed by Khulna and Dhaka divisions. The incidence of poverty, on the other hand, was lowest in Barisal and Chittagong divisions. Analysis of poverty situation in the project districts shows that the incidence of poverty was highest in the districts belonging to Rajshahi division. Compared to the national average of 34% in 2000, more than 38% of the people in these districts were found to live below the lower poverty line. In the districts of Gaibandha and Kurigram, the rate was even higher, more than 40%. Factors responsible for high poverty in these areas are: (i) Dominance of sandy soil: Substantial area of Gaibandha and Kurigram is the char (accreted) land, where about 2 million people live. (ii) Limited scope for double or triple cropping: mostly one crop is grown a year. Yield per acre is low. (iii) Slow adoption of technology due to low literacy (iv) Seasonal joblessness and limited job in non-farm activities, (v) Excessive floods and river bank erosion and (vi) Limited access to infrastructure

50 Appendix 10 The incidence of poverty is also high in several districts of Dhaka division, particularly Netrokona, Mymensingh, Jamalpur, Sherpur, and Kishoregonj districts, where 32% to 38% of the people live below lower poverty line. (Bangladesh Planning Commission and WFP). The districts bordering India (Sherpur, Jamalpur, Mymensingh and Netrokona) are frequently affected by flash floods. Moreover, a sizable area of Netrokona and Kishoregonj districts are located in ‘haor’ (or perennial wetland) areas, which remain under water for about 8 months. Only one crop is grown there. This may also be affected by early floods. Except three urbanized districts- Dhaka, Narayanganj and Gazipur, where the incidence is less than 20%, the poverty in other districts is moderate – 20 to 30%. The low incidence of poverty in the urbanized districts is due to better network of infrastructure and other facilities. The proposed project will create substantial economic opportunities for the rural poor. They will get employment opportunities from infrastructure construction and maintenance activities. It is expected that a total of 60,000 person-years of employment opportunities will be created for unskilled laborers, of which 30% are women. Road networks will create employment for large number of poor people including transport workers (or operators, drivers, helpers), ancillary support and service providers, and small traders. When roads are improved, the vehicle operating costs for the motorized and non-motorized vehicles will decline. The operators, especially of the non-motorized vehicles, are poor. The frequency of their journey would increase. This would enhance their income. The general population particularly women and children will have better access to social service facilities and institutions including education, health, micro-finance and small enterprises. Travel time will be short. Due to improvement in transport facilities, farm gate prices of agricultural commodities would increase. Also, the people would get agricultural inputs at reasonable prices. Environmental conditions in growth center markets areas will significantly improve. Micro-finance agencies, including NGOs, will be encouraged to expand their credit and other income generating activities in the project areas. This would benefit the poor immensely. C. Participation Process

Is there a participation

strategy? ⊠ Yes □ No ⊠ Yes □ No Is there a stakeholder analysis?

A stakeholder analysis was conducted through a series of regional and union level workshops as well as conducting focus group discussions with different groups of stakeholders at three core sub-project sites. The consultations helped in identifying both the ‘supply side’ (service providers) and the ‘demand side’ (beneficiaries) stakeholders. The former group includes donors, LGED staff, administrative staff, government workers of different departments at district, sub-district and union levels, NGOs and CBOs, contractors and local government officials. The ‘demand’ group includes farmers, retail traders and businessmen, small entrepreneurs, wholesale traders, woman traders, poor and vulnerable women, rickshaw-pullers and van drivers, transport owners, school/college teachers and students. The proposed participation strategy includes

1. Mobilizing concerned community groups including women through extensive campaigns about the project components and the accruable benefits as well as their role and responsibilities so that they could develop a sense of ownership for the project.

2. Provisions for capacity building for the officers and members of local government units on participatory approach, participatory supervision and monitoring of project activities.

3. Provision for women’s representation in all project management committees. 4. Provision of appropriate facilities for women in UC complexes that will facilitate their participation in

local governance. 5. Arrangement for poor women through LCS to participate in road maintenance, tree plantation and

caring. 6. Provision of IGA training for the LCS members. 7. Issue of strengthening and instituting participatory skills and capabilities of the concerned staff of

LGED, the executing agency, through imparting training on participatory tools and techniques, so that they can effectively promote and guide participatory practices under the project.

8. Provision for developing a sustainable monitoring and evaluation (M&E) mechanism in LGED to periodically assess the impact of the project on the level of livelihood of the targeted poor community members.

51 Appendix 10 D. Gender Development

Strategy to maximize impacts on women:

The major infrastructure under the project will address the needs of women for greater empowerment. Construction of the rural roads will improve the mobility of women and benefit them as users of markets, union council complexes and roads. Short-term and seasonal employment in improving and maintaining infrastructure will be created. Employment generation for women will take place in women market sections, in open sheds of growth center markets and also in construction work as laborer. The extensive participation of poor women under the project is largely in line with the national policy of the government in reducing poverty highlighted in the PRSP. The project will promote the effective participation of women in governance and will facilitate strengthening the role of female union council member through providing training and capacity building to plan and coordinate different activities. The project will help the female union council members to be involved in development activities and in union development coordination committees. They will be assisted through training so that they could better understand their roles and responsibilities. The project will continue to mainstream gender issues within LGED. Has an output been prepared? ⊠ Yes □ No A detailed gender action plan has been prepared. E. Social Safeguards and Other Social Risks

Significant/ Not Significant/

None Item Strategy to Address Issues Plan Required

Resettlement Resettlement impact assessment has been carried in three core subprojects of RIIP-2 based on survey and consultation with the affected people. About 0.8 ha land per km will be needed for the road improvement. Some structures will need partial or full relocation and some trees fell down. Narrow strips of additional lands required on both the sides of existing road will touch many plots but impact on the individual households will be minimum (less than 10% of the households income). Impact on indigenous population is unlikely. The growth centers and the Union Council Complexes will be built on donated or already acquired land while improvement of subdistrict level road will be carried out acquiring land. As a result both voluntary and involuntary resettlement will be involved in the project.

A Land Acquisition and Resettlement Framework (RF) has been prepared. One full and 2 Short Resettlement Plans have been prepared to guide preparation and implementation of RPs for all the sub-projects. If there is impact on the indigenous population "Indigenous Peoples Action" will be recommended in the RPs for implementation.

□ Significant ⊠ Not Significant □ None

1. Sub-project resettlement impact should be assessed through survey and consultation and negative impact through exploring all possible measures minimized.

2. If required, short/full resettlement plans (RPs) would be prepared to mitigate the impact with special emphasis on the women and the vulnerable people so that nobody is worse off.

52 Appendix 10 3. Timely implementation of RPs will be

carried out through appropriate organizational, institutional and financial arrangement.

4. Keep internal and independent monitoring and evaluation in place to monitor the progress and impact of the project.

As a result of implementing the project, the access to goods and services of the poor or otherwise vulnerable groups will not be worse off, rather they will be better off. This is because their opportunity for income generating activities would improve. Due to improvement in infrastructure, transportation cost would reduce. This would increase their mobility. On the other hand, union councils will be able to improve their growth center markets, union council complexes and boat landing jetties by contributing only 10% of the total costs required.

Affordability: □ Yes □ Significant ⊠ Not Significant ⊠ No □ None

No adverse impact is anticipated. At the implementation stage, the poor men and women would get employment. After the implementation, women will get job in maintenance of roads, tree plantation and their cares. Moreover, a substantial number of jobs will be created in non-farm activities.

Labor □ Significant ⊠ Not Significant □ Yes □ None ⊠ No

No indigenous people live on the roadsides of the core subproject area.

Indigenous Peoples

□ Significant □ Yes □ Not Significant ⊠ No ⊠ Uncertain The project will ensure that in case

indigenous people live in the other subproject areas, they will be properly identified.

Other Risks/ Vulnerabilities

There can be obstruction in the movement of country boats under the bridges to be built on the navigable canals due to lack of free port.

□ Significant

⊠ Not Significant □ Yes □ None ⊠ No

Cattle raising will not be allowed on the improved roads. Some people grazing cattle on the roadside will be affected. The increased mobility may encourage harmful migration of men, women and children.

Appendix 11 53

SUMMARY PARTICIPATORY DEVELOPMENT FRAMEWORK A. Introduction

1. The Project has been prepared with extensive consultations with local stakeholders during the planning stage and will be implemented under the participatory development approach. The Project interventions include improvement of subdistrict, union and village roads, construction of submersible roads, bridges and culverts, improvement of growth center and village markets, construction of women sections in the improved markets, union council complexes and jetties. 2. The participatory approach adopted for the Project has the following objectives: a) To identify the community problems and needs in respect to infrastructure facilities

and to prioritize the infrastructures to be developed; b) To reach a consensus through discussions on what activities need to be

implemented under the project; c) To identify and determine the sources and process of local contribution needed to

supplement the cost of the Project; d) To strengthen the confidence and willingness of the community members to actively

participate in construction, management and monitoring of physical infrastructures; and e) To increase the participatory skills and capabilities of the community members

and/or their representatives in respect to proper and adequate management and maintenance of the physical infrastructures.

B. Participation at different stages of the Project 3. The participatory framework envisages sequential actions taken during project preparation and implementation, namely: i) at feasibility study stage, ii) planning, iii) design, iv) implementation, and v) management and maintenance.

1. Feasibility Study Stage 4. The subdistrict roads under the Project will be sited mainly along the existing embankments constructed under the Food for Works program during the late 60s and 70s. These embankments or alignments have the advantages of being compacted through use of both vehicular and non-vehicular transportation modes over the years. During the feasibility study, the elected representatives of the community were consulted on justifiability of the selection of the subdistricts roads, as it was not practical for LGED to consult each and every community member. Thus, based on consultation with people’s representatives, the list of roads under the Project was prepared and prioritized. 5. The preparation of the list was followed by ranking of the roads for inclusion in the Project. Ranking was guided by the primary consideration of poverty reduction goal as indicated in the poverty reduction strategy paper (PRSP) of the Government of Bangladesh. The PRSP identified the major cause of poverty as living in remote areas with unfavorable environments. This points to the need to establish connectivity between the hinterlands and the regions that could provide economic opportunities to the rural people. Connectivity was therefore used as the major criterion in ranking of the subproject areas. Other considerations include potential economic benefits measured by EIRR, technical or engineering consideration, equity, environmental issues and social development.

Appendix 11 54

2. Planning Stage

6. The set of activities to be accomplished during the planning stage are: a) describing the project, b) identifying the stakeholders, c) identifying and quantifying the impacts, d) identifying the mechanism for compensating losses. These are described below: a. Describing the project 7. The first step in planning is to acquaint the local stakeholders about the nature of the project, its goal and objectives, components and outputs and the implementation arrangements. This approach will ensure that the stakeholders are aware of the expected benefits/losses attributable to the Project as well as of their own role and responsibilities in making the benefits self-sustaining. For instance, in the case of improving roads, all the inhabitants of the project areas might not be aware of the details of project components and the accruable benefits. It would be therefore appropriate to launch an extensive awareness-building and mobilization program well before the initial phase of project implementation. Once all the sectors of the community are fully aware of the project activities, they would develop a sense of ownership over the project and would be forthcoming to get involved with the Project activities.

b. Identifying the stakeholders

8. During the consultation process with the community members, an important task will be to identify the different groups of people who have ‘stake’ in the project implementation process. These stakeholders can be grouped in two categories – the service providers (‘supply side’) and the service recipients (‘demand side’). In the context of the Project, the results of the consultations and discussions carried out with community members in three sub-project areas are indicative of the outcome. The ‘supply side’ stakeholders are the donors, LGED staff, administrative and government staff of different agencies at district, upazila and union levels, NGOs and CBOs, contractors and the local government officials. They generally provide the resources needed to put the project in place. The ‘demand side’ stakeholders are the farmers, retail and wholesale traders/businessmen, small entrepreneurs, woman traders, poor and vulnerable women, rickshaw/van drivers, transport owners, school/college teachers and students. They generally stand to benefit from the project.

c. Identifying and quantifying impacts

9. The next step in the participatory process is to identify the potential impacts of the project. The exercise to be carried out through individual discussions, focus group discussions (FGDs) and workshops with the stakeholders will identify the potential gainers of the project as well as the losers. While identification of the gainers is a necessary step, it would be a crucial step for the project management to locate the people who are likely to be affected adversely by the project. Once the gains and losses are quantified, the former is to be weighed against the later and if the proportion of gain is more than the losses, the project could be implemented.

d. Defining the mechanism for compensating losses 10. Through discussion and consultation with the community members, the extent of the possible losses by affected persons is to be ascertained, and ways are to be proposed how these losses can be compensated. Such an approach is important to ensure endorsement of the community in course of project implementation. Only a fully participatory consultation

Appendix 11 55

process with the project-affected individuals can ensure a willing community to come forward to take part in project implementation and thereby exercise ownership of the project. 11. The above activities were carried out by the Project consultants through a series of consultation and discussions with the local beneficiary groups as well as through union and regional level stakeholder workshops in three core subdistricts in order to elicit perception of the grassroots level stakeholders on the project components, anticipated benefits or losses and the possible role and responsibilities of the community members in maintenance of the structures and other facilities. While the participants indicated an appreciable level of their awareness about the project components and the potential benefits and losses, they were nonetheless aware and enthusiastic about their own role and responsibilities in maintenance of the infrastructure facilities. However, they indicated the need for institutional support from LGED in respect to strengthening their skills and capability for increasing awareness and mobilization of the community members and ensuring community participation in project activities. An action plan for strengthening the participatory skills and capabilities of the community members as well as the concerned LGED staff is Supplementary Appendix F.

3. Project Design Stage 12. During the design stage, it is useful to distinguish the participatory activities for specific subproject components, i.e., for rural roads vis-à-vis rural markets.

a. Rural roads 13. Apart from designing the awareness-building and mobilization activities aimed at enlisting the community support during project design, the following activities are applicable: (i) Design for bridges and culverts- During the grassroots level discussion, the stakeholders highlighted the need for associating them in selection of small bridges and culverts in their respective areas. As such, LGED will consult with the community members at the time of preparing design of these structures so as to ensure their inputs as to how many and where these structures will be located; (ii) Formation of labor contracting societies (LCS)- The subdistrict engineer (SE) with the assistance of the district sociologist (DS) and community organizer (CO) will form the LCSs in consultation with UC chairperson and members in line with the agreed eligibility criteria. The LCS members will be oriented on their duties and responsibilities in respect to day-to-day minor road maintenance, tree plantation on the roadside and caring of the planted trees.

b. Rural markets

14. A series of activities are to be carried out for ensuring stakeholders’ participation during the design of rural markets. These are: (i) Information and planning meeting at subdistrict level- The subdistrict engineer of LGED with assistance from DS and CO will organize the meeting. The subdistrict executive officer, Assistant Commissioner (Land), UC chairperson, UC members and the members of MMC will be invited to participate. The occasion will be utilized to discuss different issues of project implementation such as inputs and local contribution. Documented commitment for local contribution will be specifically obtained. An action plan for community participation will be prepared to indicate how they will participate in different stages of project implementation; (ii) Dissemination and mobilization- The DS and CO will arrange meeting at various places for informing community members about the development on improvement of rural markets. Posters may be used for informing people. The posters would be made so that the general public can easily read and understand the contents. The topics to be discussed

Appendix 11 56

should include the goal and objectives of the project, importance of the project, the manner in which community members can participate, and such other items. The public should be made aware of the need to contribute minimal amount to meet a modest part of construction costs; (iii) Social investigation- Through social investigation, LGED will recognize the critical issues concerning the components such as markets or jetties and this will help in the process of designing the activities. It will also enable them to identify the community members who will assist in implementation. In carrying out this activity, DS and CO will inform the affected parties and will visit the places and discuss ways for collecting relevant information. As for markets and jetties/ghats, they should also discuss the issues with UC chairperson and members, the convener and members of management committees and the elites; (iv) Group discussion- The DS and CO will initiate discussions with individual groups of traders (initially with small groups), UC officials, MMC members and women groups in order to determine their needs on a priority basis. The need for proper maintenance and their respective role and responsibilities should also be stressed in the discussion with the LGED staff; (v) Consolidation of the outputs of group discussion- The results of the group discussion following the discussion with individual groups will be consolidated. The proposal of each group will be discussed by the participants and consensus will be secured; (vi) Groundwork on participatory planning meeting- The DS and CO will lead the meeting with representatives of each group. The group members will be briefed on how to present the lists of their respective group’s needs, problems and proposals. DS and CO will brief prospective participants about the objectives the participatory planning meeting. They will also ensure attendance of the women representatives at the meeting; (vii) Holding of participatory planning meeting- The participatory planning meeting will be held with representatives of all stakeholders. The DS and CO will organize this meeting. subdistrict executive officer, AC (Land), UC chairperson will be invited to attend the meeting. In the meeting, individual group findings will be presented and the house will finalize through discussion the needs of each group on a priority basis. Final decision will be taken as to how and when the local contribution will be deposited; (viii) Preparation of design-map of the market structure- The subdistrict engineer will invite UC chairperson and members, representatives of different groups of market users e.g. grocery shop owners, fishermen, rice traders, vegetable traders, women traders, etc to a participatory workshop, preferably on a non-hat day. The LGED physical planner, participation specialist, DS and CO will also participate in the workshop. The physical planner will place a sketch-map of the market structure and solicit proposal from individual users’ groups to place their space requirements on the sketch-map. The individual needs will be discussed in light of the budget provision and after through deliberations, only the logical demands will be accommodated. All the workshop participants will then sign on the draft map, which will subsequently be finalized by the physical planner.

4. Implementation Stage 15. During implementation of the project activities, the participatory approach will include the following activities:

a. Training of the UC chairpersons, members and secretaries on planning, implementation, supervision and maintenance activities;

b. UC chairperson and members in consultation with the village people will select the village roads to be developed under the project.

c. Discussions with affected persons regarding the land acquisition (and, if necessary, resettlement) issues as well as compensation payment.

d. In the case of rural markets, discussions will be held between UC chairperson and members and the MMC regarding mobilization of funds needed as their share of the construction cost of the facilities.

Appendix 11 57

e. Training on the roles and responsibilities of the MMC and users of the rural markets regarding maintenance.

5. Management and Maintenance Stage

16. After completion of the construction works of the physical facilities, namely the roads and UCCs and rural markets, the participatory approach will continue to be applied during the maintenance of the facilities.

a. Road and UC Complexes 17. In the maintenance of roads and union council complexes (UCC), it is crucial to ensure sustainable participation of various stakeholders. This involves: (i) Participation in maintenance activities- For sustaining benefits of roads and UCCs, the community members, particularly their representatives, will ensure that the constructed infrastructures are maintained well. For the planted trees, while maintenance activities will be done by the LCS members, the community members will also ensure that the trees are not damaged; and (ii) Participation in M&E activities- The Project envisages participation of the community members in monitoring and evaluation of project activities. In addition to imparting training on participatory monitoring, DS and CO will associate them in periodic monitoring of the socio-economic changes due to the improved road and other infrastructures. These will be accomplished through holding focus group discussions and key person interviews with the target beneficiaries.

b. Rural markets 18. The participatory approach in maintenance of rural markets will include: (i) Discussions of GoB regulations on leasing and management of markets- Concerned community members and their representatives will be trained by LGED on the existing government rules and regulations about leasing, distribution of income, duties of the management committee members and other related matters; (ii) Discussion of issues related to allotment of shops for woman traders- Concerned community members will be acquainted with the procedures of selection of woman traders leading to actual selection. The role of the subdistrict engineer and NGOs in selecting women traders will also be discussed. They will also be informed about the features of the contract signed between the women traders and subdistrict market management committee; (iii) Discussion on market maintenance, objectives and strategy- The objective of such discussion will be to acquaint participants with the basic information related to maintenance as well as to prepare a work plan for such maintenance activity; (iv) Preparation of a list of maintenance activities, recommendations and the budget- Initially, the present problems will be identified and recommendations on how to solve the problems will be decided through discussions among the participants. Based on such recommendations, a work plan will be prepared along with budget provisions; (v) Preparation of sample notice board and monitoring form- With a view to keeping people informed about the management and maintenance of markets a notice board will be installed at a public place containing all the relevant information. For monitoring of maintenance activities, a monitoring format will also be prepared; and (vi) Monitoring of market-related participatory activities- The CO under the guidance of DS will carry out monitoring of activities concerning holding of monthly MMC meetings and issues discussed in these meetings, maintenance of market facilities and maintenance of cleanliness in the markets. He will focus particularly on the issues relating to women traders’ participation in the market management affairs. The subdistrict engineer, sub-assistant engineer and DS will also pay periodic visits to market sites in order to see how these facilities are being utilized and

Appendix 11 58

managed. CO will have the responsibility to ensure participation of the MMC members and other community leaders in the monitoring and assessment activities. 6. Conclusion 19. LGED has consistently adopted the participatory approach in its development projects – from the time the project is planned and designed up to the time the project is implemented and later evaluated. Accordingly, the projects prepared in this manner reflect the interests and concerns of various stakeholders including the project beneficiaries and the public officials involved in its management. The stakeholders have been showing genuine ownership of the projects and the completed facilities are invariably well maintained and sustainable.

Appendix 12 59

SUMMARY RESETTLEMENT FRAMEWORK I. Introduction 1. The Resettlement Framework (RF) provides the basis for preparing Resettlement Plans (RPs) for specific subprojects as may be required under the Project. It identifies the broad scope of the project and outlines the policy, procedures and institutional requirements for formulating RPs for subprojects. As executing agency for the Project, LGED is responsible for preparing and implementing the resettlement plans in line with the resettlement framework. II. The Framework

2. The current legislation governing land acquisition in the country is the Acquisition and Requisition of Immovable Property Ordinance 1982 and subsequent amendments. The 1982 Ordinance recognizes only the legal owners of land and property but does not cover project-affected persons without formal title such as squatters, occupiers, and informal tenants and lease-holders (without registered deeds). The law also does not ensure replacement value of the property acquired.

3. In the absence of a national resettlement policy in Bangladesh, the GOB has adopted the policy of donors on involuntary resettlement. This ensures that persons affected by land acquisition will be eligible for appropriate compensation and resettlement benefits. Persons having no legal title but might lose land to the project would be provided with compensation and resettlement benefits. The customary rights to land and physical property will also be recognized, including leases of homestead, commercial and agricultural land, sharecroppers, and renters of land and structure.

4. The framework bridges the gaps between GOB and ADB policies and endorses an income restoration strategy for vulnerable APs including squatters irrespective of legal titles to the affected property.

Table 1: Measures for compliance with ADB Policy and GOB Laws

Assessment 1982 LA Act and subsequent amendments (GOB Policy)

ADB Policy

Loss of land/ structure/ tree/ crops/ income and the owners

Loss of land, structure, tree/crop is assessed and the title holders are identified as per legal provisions of law and through Joint Verification

Loss of land, structure, tree/crop and income of the title and non title holders are identified by socioeconomic survey (SES) and verified by JVT

1

2

Valuation of affected property

Compensation as per sale value of land recorded in the sub-registrars' office and rate fixed by PWD3 for structure, Department of Forest (DOF) and Department of agricultural Extension (DAE) for trees/crops with a 50% premium in all cases.

Replacement value at current market price is recommended by PVAT4. Non-asset losses (viz. income and dislocation) are also assessed and restoration supports are provided.

1 Joint Verification of affected property by Acquiring and Requiring Bodies 2 Joint Verification Team (JVT) formed by the Ministry of LGRD 3 Public Works Department maintains updated rates of different structure items 4 Project specific Property Valuation Advisory Team is formed by the line Ministry.

Appendix 12 60

5. Land acquisition and resettlement activities of the Project will be carried out in consultation with the affected persons (AP) and the other stakeholders. All efforts will be made to minimize displacement during subproject planning and implementation and AP preferences will be taken into account. An Entitlement Matrix (Table 2) prepared on the basis of potential resettlement impacts at three core subprojects identifies the categories of impact based on surveys carried out on the tentative right of way (ROW) and shows the entitlements for each type of losses. If new impacts are identified later during the detailed design such losses will be included in the entitlement matrix and the RP will be appropriately revised. III. Preparation and Implementation of Resettlement Plans

6. Resettlement plans for selected subprojects will be prepared and implemented as may be needed. The RPs will be reviewed by the LGED and submitted to ADB for review and concurrence. If impacts on indigenous people are identified then an indigenous people development plan (IPDP) will also be prepared according to ADB guidelines. The RP prepared for the sample subproject will be used as a model for the preparation of subsequent RPs. The RP must comply with ADB policy on involuntary resettlement and other social safeguard policies; including consultation with people affected which will provide local insights in establishing safety net mechanism. Preparation of a resettlement plan involves the following procedures (a) collection of socioeconomic information; (b) valuation of affected property; (c) assessment of gender impact; (d) disclosure of the plan to stakeholders; (e) redress of grievance if any; (f) payment of actual compensation. These procedures are described below.

(a) Collection of socioeconomic data 7. The LGED with the help of the resettlement specialist will undertake, social surveys of including a full census of the households and physical establishments requiring relocation. An agricultural land survey on 20% sample plots and a detailed socio-economic survey of 20% of the households to be relocated and other establishments will be carried out. The socioeconomic survey will establish baseline information on household incomes, occupational and livelihood patterns, resettlement needs/responses, social organization, community organization and cultural parameters in the subproject area. LGED will ensure that appropriate entitlements and mitigation measure are established in the RPs in accordance with the RF. If the impact is significant, i.e. number of people physically displaced or losing 10% or more of their income is 200 or more, a full resettlement plan will be prepared for project preparation. If the impact is insignificant, less than 200 persons, a short resettlement plan will be sufficient for the purpose. If no involuntary resettlement effects are foreseen, no resettlement plan will be prepared.5

(b) Valuation of Property 8. Losses and impacts on the APs due to land acquisition and involuntary relocation will be assessed by LGED through a resettlement survey covering the titled and non-titled owners of the affected property, including their loss of income and employment. Quantification of the affected property will be done through joint verification carried out by the acquiring and requiring parties and the date of verification will be considered as the cut off date for the physical losses for compensation under law. The land acquisition section of the district administrations will fix the Cash Compensation under Law (CCL) as per the land acquisition act. The LGED, to determine

5 Asian Development Bank, Involuntary Resettlement - Operations Manual, Section F2/OP, page 5: 29 October 2003.

Appendix 12 61

and ensure the replacement market price of the affected property, will organize a property valuation advisory team (PVAT) and assess the replacement market value of all the affected property.

(c) Gender Impact 9. The social surveys should identify gender issues in the production system both in the farm and other nonagricultural activities. Since legal ownership of land does not reflect gender compliance in case of spouses, sufficient measures should be included in the resettlement plans to ensure their rights and social safety. The measures should include the following: (i) Identify the socioeconomic condition, needs, and priorities of women, and monitor and evaluate the impact of land acquisition and resettlement on women separately; (ii) Identify the female headed households to be affected and set entitlement criteria to recognize female-headed households; (iv) Provide resources in kind (land, structure, etc.) in the name of both spouses of the to be affected households; (v) Involve women's groups in resettlement planning, management, and operations and in job creation and income generation.

(d) Disclosing and Consultation 10. The RP will be prepared and implemented in close consultation with the stakeholders. The resettlement framework will be made available in Bangla to the APs in the planning phase so that their views on the project and resettlement impact and mitigation measures are known to the planners and incorporated into the planning documents. The RPs will be translated in Bangla and disclosed to the APs at the start of the resettlement implementation. The APs, including the women and vulnerable groups, local government and civil society representatives will participate in assessing the resettlement impact and their mitigative measures.

(e) Grievance Redress 11. Grievance redress committees will be established for each subproject, with representatives from LGED, affected persons, women and vulnerable groups, local government and NGOs. The resettlement officer or his nominee will chair the grievance redress committee. Other than disputes relating to ownership rights, the committee will review grievances involving all resettlement benefits, relocation and relevant assistance. Grievances will be redressed within 2-4 weeks from the time of lodging the complaint.

(f) Compensation

12. For the purpose of compensating affected persons, the LGED will prepare land acquisition proposals (LAP) with the help of the consultants and submit to the respective DCs for processing. The market price from sub-registrar's office will be collected in a pre-designed format certified by the sub-registrars. The district LGED representatives will accompany representatives from the consultants in joint verification and price fixation process by the Deputy Commissioner. The PVAT having representatives from LGED and the DC will determine replacement market price of land, structure and trees. The PVAT will recommend the replacement price for approval from the LGED. The recommendation will ensure replacement price of land and property at current market value. The RF also includes an income restoration strategy for vulnerable APs including squatters irrespective of legal titles to affected property. The people involuntarily displaced from their

Appendix 12

62

homes, assets, or income sources as well as non-titled people affected by the project will receive subsistence allowance and priority access to income generating programs.

IV. Resettlement Budget and Financing

13. The land acquisition and resettlement budget includes the costs of acquisition of assets and costs associated with involuntary resettlement. The EA will determine replacement price of land and other property under acquisition for the sub-projects through the PVAT. The Government will provide the fund for land acquisition and resettlement (if needed). The fund for land acquisition will be disbursed through the DC office. The PMO will ensure that the land acquisition and resettlement budgets are delivered on time to the DCs for timely implementation of the RPs. LGED will also ensure that the RPs are submitted to ADB for concurrence, and that fund for compensation and entitlement under the RPs are fully provided to APs prior to the award of the civil works contract.

V. Implementing the Resettlement Plans

14. The Ministry of LGRDC through LGED has the overall coordination, planning, implementation and financing responsibilities for the resettlement plan. The EA with assistance from consultant will undertake land acquisition survey, prepare LA proposal, carry out resettlement surveys and prepare full/short resettlement plan for each sub-project according to the significance of impact. The resettlement specialist will provide technical support to LGED and supervise and review the field activities. Resettlement plans will be prepared starting from the first year of the Project through its fifth year.

15. The Deputy Commissioner has the power to acquire land and to assess compensation of properties thus acquired. The DC requires the land through the land acquisition office, Officer (LAO) or his staff. Along with LGED, the LAO will conduct joint physical verification of property on the land in accordance with the approved Land Acquisition Proposal to be submitted by LGED as soon as the detailed design and alignments for the subprojects will be finalized. The DC offices are responsible for the entire acquisition process from notification to affected persons to award of compensation to owners of properties and payments of compensation. LGED will liaise with concerned DC offices to complete the land acquisition process in a timely fashion. VI. Monitoring and Evaluation 16. As a part of its overall monitoring system, PMO will monitor the progress of land acquisition, compensation and resettlement activities. The PMO will include land acquisition and resettlement as part of the quarterly progress report to be submitted to ADB.

Table 2: Land Acquisition and Resettlement Entitlement Matrix

Type of Loss Entitled Person Entitlement Implementation Issues/Guidelines

Organization Responsible

63 Appendix 12

a. Assessment of type and quantity of land/waterbodies by Joint Verification Team

a. DC, LGED 1. Agricultural Land, including waterbodies

Legal owner(s) of land at the time of serving Notice u/s-3 of Land Acquisition Act

1. Replacement value of land/ waterbodies b. DC, LGED

c. LAO, Revenue Office, LGED 2. Refund of Registration Cost (RRC)1 for replacement land purchase @ 10% of replacement market value of the acquired land determined by PVAT

b. Determination of replacement value of land and

d. APs

waterbodies by PVAT through market survey

c. Title updating d. Replacement land purchase

within 6 months of payment of compensation.

2. Homestead land Legal owner(s) of land at the time of serving Notice u/s -3 of Land Acquisition Act

1. Replacement value of land acquired.

a. Assessment of land by Joint Verification Team

a. DC, LGED

2. RRC for replacement homestead purchase @ 10% of replacement market value of homestead determined by PVAT

b. Determination of replacement value of land by PVAT through market survey

b. DC, LGED 2 c. LAO, Revenue Office, LGED, GRC

d. APs c. Title updating d. Replacement land purchase

within 6 months of payment of compensation.

3. Developed Legal owner(s) of land at the time of serving Notice u/s -3 of Land Acquisition Act

1. Replacement value of land a. Assessment of land by Joint Verification Team

a. DC, LGED Commercial Land 2. RRC for replacement land

purchase @ 10% of replacement market value of homestead determined by PVAT

b. DC, LGED (private land on b. Determination of replacement

value of land by PVAT through market survey

c. LAO, Revenue Office, LGED which commercial d. APs structure has been constructed) c. Title updating d. Replacement land purchase

within 6 months of payment of compensation.

4. Trees and standing perennial crops on private land acquired

Legal owner(s) of land at the time of serving Notice u/s -3 of Land Acquisition Act

1. Value of trees and perennial standing crops on land acquired

a. Assessment of type, size and quantity of trees/ perennial standing crops by Joint Verification Team

a. DC, LGED b. DC, LGED

2. Perennial standing crops be taken away by the APs for b. Value of trees and perennial

1 Refund of registration cost which is about 10% of the sale value for the rural area 2 Grievance Redress Committee (having representatives from the requiring body, the local union council chairperson to be formed by the Ministry of LGRD.

Type of Loss Entitled Person Entitlement Implementation Issues/Guidelines

Organization Responsible

free without disturbing the project work.

3. Salvaged trees will be retained with the LGED

standing crops determined by PVAT through market survey

5. Trees and standing perennial crops on public land within road alignment

Owner(s) of trees/standing perennial crops on the ROW

1. Share/Value of trees and perennial standing crops within the road alignment

2. Perennial standing crops be taken away by the APs for free without disturbing the project work.

3. Salvaged trees will be retained with the LGED

a. Ownership of trees determined by joint verification Team b. Assessment of type, size and

quantity of trees/perennial standing crops by Joint verification Team

c. Value of trees and perennial standing crops determined by PVAT through market survey

a. DC, LGED b. DC, LGED c. DC, LGED

6. Structure (dwelling, commercial or community structure) on private land acquired

Owner(s) of the structure 1. Price of structure at replacement market value 2. Salvaged structure materials be taken away by the APs for free without disturbing the project work 3. Shifting and reconstruction grants @ 10% of assessed value of structure

a. Ownership of structure determined by the JVT

b. Type and quantity of structure determined by the Joint Verification Team

c. Value of structure determined by PVAT through market survey

a. DC, LGED b. DC, LGED c. DC, PWD, LGED d. LGED GRC

7. Structure (dwelling, commercial or community) on public land within road alignment

Owner(s) of the structure 1. Value of the structure at replacement market value 2. Salvage of structure materials

be taken away by the APs free of cost without disturbing the project work

3. Shifting and reconstruction grants @ 10% of assessed value of structure

a. Ownership of structure determined by the Joint Verification Team

b. Type and quantity of structure determined by the Joint Verification Team

c. Value of structure determined by PVAT through market survey

a. DC, LGED b. DC, LGED c. DC, LGED, PWD

8. Business/rental income diminished due to acquisition of commercial structure

1. Proprietor of the business 2. Owner of commercial structure (if rented)

1. Three months net income of business to the business proprietor

2. Three months' rental income to the owner

a. Proprietor/owner of rented commercial structure identified by the Joint Verification Team

b. Business/rental income assessed by market survey PVAT

a. DC, LGED b. DC, LGED

9. Wage employment diminished due to

Regular employees of the business

1. Three months wages a. Identification of regular employees by the Joint

a. DC, LGED b. DC, LGED, GRC

64 Appendix 12

Type of Loss Entitled Person Entitlement Implementation Issues/Guidelines

Organization Responsible

acquisition of commercial structure

Verification Team b. Prevailing skilled and unskilled

wage rates determined by market survey by PVAT

10. Vulnerable, handicapped or women headed households losing structure

Head of the vulnerable households

Additional subsistence allowance Payment of additional subsistence allowance

LGED

11. Poor households to be displaced or losing more than 10% of their income due to acquisition.

Head of poor households affected due to the acquisition

Priority in income generation program or any other poverty reduction support from the Project

Priority in project civil works, if available

LGED

12. Host area people experiencing adverse impact.

Host population experiencing adverse impact

Enhanced community facility in the host area to accommodate demand of project affected people

Renovation and extension of community facilities in the Host areas are provided

LGED

13. Indigenous people affected, if any.

The indigenous people/ community affected

In case of major impact, benefits under Indigenous People's Development Plan. If the impact is not significant, Indigenous People' Actions will be recommended in the Resettlement Plans

Compensation package should be developed based on assessment by JVT and consultation with the affected community

LGED, JVT

65 Appendix 12

Appendix 13 66

SUMMARY GENDER ACTION PLAN (GAP)

1. The objective of Gender Action Plan (GAP) is to increase women’s participation in development activities, infrastructure construction and maintenance. Infrastructures are designed to have gender focused services and during implementation those should address gender related issues in an effective manner. This gender action plan will equally promote the participation of men and women stakeholders as change agents and as beneficiaries in the project’s development process with particular attention to (a) women’s poverty reduction and (b) women’s empowerment to participate in decision making and in public life. 2. The project will ensure women’s participation in infrastructure activities, as users, as construction labor and in management and maintenance of infrastructures. It will promote equality in wage for women and men for equal work. Women’s equal participation in public life, in social and environmental management and in local governance will also be promoted with greater attention. The GAP attempts to ensure participation of women citizens, adolescent girls, staff of the project, and elected women representatives in project activities at relevant levels. It also provides women to equally access to resources and services, derive benefits from the project services as well as contribute to the development of the community. A summary of Gender Action Plan is given below:

Component Activity and Target Rural Roads • Ensure consultation with women for participation in

planning, design and implementation; • Create employment opportunities for poor women by engaging them as construction laborers; • Ensure women’s participation in operation and maintenance of roads; • Promote wage parity of women and men for similar work; • Orient contractors to employ women laborers and pay equal wage for women and men; • Form women LCS groups and engage them in tree plantation and routine maintenance; • Train LCS women on off-pavement maintenance, tree plantation and care taking, leadership development, skill development on some trades and profitable income generating activities;

Rural Infrastructure • Establish women market sections in growth center markets for accommodating women traders and mainstreaming rural women in rural economy; • Keep 15% space earmarked for women vendors in open sheds of GCM; • Provide one stop services to rural people specially women by

providing facilities at the union council complex to representatives of various ministries of GoB and NGOs;

• Establish support services (separate toilets, waiting rooms etc.) for women in jetties, flood refuge shelters and women market sections;

• Establish network for female UC members and female shop owners for voicing their rights and participating in public life and

Appendix 13 67

decision making processes; • Ensure women’s participation in Market Management Committee (MMC) and Operation and Maintenance (O & M) committee of infrastructures; • Provide skills development and shop management training to the female shop owners through selected NGOs;

Local Governance and LGED Capacity Building

• Organize workshops/ training for UC members on preparing budget, conducting meetings, accounts keeping, participating in public life etc; • Ensure women’s access to resources; • Organize rallies and meetings on different issues like health, family planning, sanitation, CEDAW, protection against dowry, early marriage, acid throwing, registration of birth, marriage and death etc; • Encourage adolescent girls’ participation in monthly ward level meetings in UCC; • Promote citizen’s awareness including women and adolescent girls on social and gender related issues; • Ensure participation of female UC members in local governance;

Support for Project Management

• The district sociologist will be assigned on a permanent basis by LGED to assist the community organizers in implementing gender-related activities;

• Build capacity of LGED personnel by organizing different in country – out country training/ workshops; • A GAD specialist will be engaged to ensure mainstreaming and

implementation of gender – related activities and oversee training programs;

• Conduct socio-economic studies to evaluate poverty reduction of women and participation of female UC members in local governance. • Establish gender based data and monitoring system. • Include female UC member in construction supervision committee at union level.

Appendix 14 68

ENVIRONMENTAL ASSESSMENT AND REVIEW PROCEDURES A. INTRODUCTION 1. Background 1. Bangladesh is a small country with a very large population. Population pressure on natural resources has contributed to their overexploitation and consequent environmental degradation. Bangladesh is predominantly an agrarian society. About three fourths of the country’s population are directly or indirectly dependent on agriculture for their livelihood, although this sector contributes only 22% to the Gross Domestic Product (GDP). Land is the principal resource base in Bangladesh. Poverty is the major problem in Bangladesh. About half of the total population remains poor (with a per capita daily intake of less than 2122 calories), while about a third of the population is classified as `absolute poor’, having a per capita daily calorie intake of less than 1805. On account of scarcity of agricultural land, lack of employment opportunities and inadequate physical infrastructure, the process of pauperization has accelerated in rural areas and there has been a steady steam of rural to urban migration. The Poverty Reduction Strategy Paper (PRSP), recently prepared by the Government of Bangladesh (GOB), highlights the need for rural physical infrastructure development as a tool for poverty amelioration. 2. The development of rural transport facilities is the effective way in providing access to trading of agricultural goods in rural markets (2100 of them are now classified as growth centers), creating income generating opportunities, and improving the general quality of life. Rural roads, along with markets, play a very significant role in poverty reduction efforts. The current length of Subdistrict (Upazila) Roads and Union Roads are about 36,166 and 42,329 km respectively. Local Government Engineering Department (LGED) is one of the leading government organizations responsible for planning and implementation of rural infrastructure development and is a driving force in the country’s overall development process. 3. The Asian Development Bank (ADB) is one of the major development partners in Bangladesh’s economic growth, social advancement and poverty reduction efforts. ADB alone has made significant contribution of around USD 650 million in implementing 23 different sectoral projects with LGED since 1988. The most recent ADB financed project in the rural development sector in Bangladesh is the Rural Infrastructure Improvement Project-1 (RIIP-1 or RDP 25) extending over 16 districts of Khulna and Barisal divisions. The projects in the rural development sector aim at reducing rural poverty and increasing agricultural production through the upgrading of subdistrict (upazila) roads and reconstruction of ancillary structures as well as improvement of physical facilities at the Growth Centers. The proposed Rural Infrastructure Improvement Project-2 (RIIP-2) will be implemented through assistance received from the ADB and other development partners. It will extend over 23 districts in northwestern, north-central and east-central parts of Bangladesh, and the LGED of the Ministry of Local Government, Rural Development and Cooperatives (MoLGRDC) will be the executing agency. 2. Project Objectives 4. The principal objective of the project is to accelerate agricultural and non-farm economic as well as social development by improving rural transport and supporting infrastructure through a participatory planning process, especially involving the poor in all stages of project implementation. In specific terms, the project objectives are to:

Appendix 14 69

a) Provide all-weather Subdistrict (Upazila) and Union roads, associated bridges and culverts, construction of submersible roads in `haors’ or wetland areas, improved Growth Centers (GC)/markets and boat landing facilities (locally known as ghats);

b) Create employment opportunities for the destitute women by involving them in maintaining environmental standards through tree plantations and their caretaking along the road sides;

c) Provide women’s market sections in improved Growth Centers/markets, thereby creating income-generating opportunities for the rural women;

d) Create both short and long term income earning opportunities for the rural poor, including the landless, by involving them in construction and maintenance of rural infrastructure; and

e) Contribute to the strengthening of the institutional capacity of the LGED and the local government institutions (LGI) in the development, operation and management of the rural infrastructure.

5. Expected key performance indicators are: (a) Enhanced regional GDP by increasing agricultural production;

(b) Increased economic activities and employment opportunities in secondary and tertiary sectors; (c) All weather access to economic and market opportunities for more than 15.4 million

people by June 2011; (d) Increased income for 1.5 million poor households by at least 10% in constant terms

by June 2011;

(e) Spatial poverty reduced by 10% of the existing rate;

(f) By June 2011, upgraded 1300 km of subdistrict roads, 550 km of union roads and 3664 km of village roads; constructed/renovated 9000 m of bridges/culverts; constructed 60 km of submersible roads, 25 jetties or boat landing stations, six flood refuge shelters and 175 Union Council Complexes; improved 160 Growth Centers/Markets and constructed 196 Women’s Market Sections in Growth Centers; and strengthened LGED and Local Government Institutions capacity.

3. Purpose of the EARP 6. The `Environmental Assessment and Review Procedures’ (EARP) has been developed on the basis of the findings and recommendations of the Project Preparation Study, conducted by the ADB and the LGED in preparation of the RIIP-2. The purpose of the EARP is to guide the LGED and the consultants to implement the various subprojects of the Project. During the implementation period, all activities related to potential environmental impacts will be carried out in accordance with Bangladesh’s environmental assessment requirements, LGED’s environmental guidelines in tandem with ADB’s Environmental Guidelines. The IEE prepared as part of the project Preparation Study has outlined mitigation measures for potential negative environmental impacts and monitoring plans for both short-term (construction) and long-term (post-construction) phases, and it is expected that the EARP will support the integration of these measures and practices in the project design.

Appendix 14 70

B. OVERVIEW OF TYPE OF SUBPROJECTS TO BE ASSESSED 1. Main Project Components 7. The proposed development objective of the RIIP-2 is to increase rural incomes and reduce rural poverty through sustainable economic growth, rural development and infrastructure improvement in 23 districts of Bangladesh. The project components are outlined in greater detail below. 8. Component 1: Upgrading Rural Roads. The objective of this component is to improve the physical infrastructure of rural transport facilities in the project area. The road network in the rural areas plays a catalytic role in the invigoration of regional economic activities and enhancement of the quality of life of the poor. At present, on account of a lack of all-weather facilities in subdistrict (upazila) roads (SDR), both motorized and non-motorized transport are facing difficulties in movement. Upgrading of SDRs through widening and bituminizing the surface is an essential activity under this project. Another major activity of this project is the upgrading of union roads (UNR), most of which have earthen surface. Upgrading task will be supplemented with construction or restoration of 9000 meters of bridges/culverts, which will help in reducing/removing drainage congestion problems and enhance regional water flow potential. At the same time, village roads (Type A with crest width of 3.7 m) will be improved through resectioning. In addition, submersible roads will be constructed in the `haor’ (perennial wetland) areas of Netrokona and Kishoreganj districts as well as six flood refuge shelters will be constructed in flash flood prone areas under this component. 9. Component 2: Improvement of Growth Centers/Jetties/Union Council Complex. The objectives of this component are to construct and improve market and public facilities including women’s market sections (WMS) in 160 selected Growth Centers. Growth Center/Markets are considered as focal points for integration of rural transport and trading systems, and upgrading/improvement of Growth Centers are, therefore, essential for the rural development of the area. The current status of the markets is extremely poor, unhygienic and inadequate, and improvement measures under this component will address the environmental concerns in the markets. This component also proposes to construct 196 `Women’s Market Sections’ (WMS) in the Growth Centers in order to provide opportunities to women vendors for trading. Although the main focus of the RIIP-2 is on road transport, the need for improved water transport in certain parts of the project area will be addressed through constructing efficient boat landing stages of jetties (locally known as ghats) in some areas. Under this component, union council complexes will be constructed throughout the 23 districts with a view to addressing the government’s policy of decentralizing powers and responsibilities to the grassroots level. Although minimal amount of land acquisition might be needed in the event of road widening or straightening, this component will prepare resettlement and compensation plans during the detailed design of the subprojects. 10. Component 3: Strengthening of LGED and LGIs. The objective of this component is to contribute to strengthening LGED’s institutional capacity for efficient management of rural infrastructure as well as to strengthening local government institutions (LGI) (i.e., union council) through a series of training programs for the members and the staff, and through providing them with project funds. Under this component, the members of 1832 union councils will gain hands-on experience – through a participatory approach – in preparing small projects, and receive training on implementation, maintenance and local resource mobilization.

Appendix 14 71

11. Component 4: Project Management Support. Under this component, two groups of consultants will be engaged for project implementation. A team of consultants will be employed to assist the LGED for the design, supervision and management tasks of the project, including carrying out Initial Environmental Examinations (IEE) for subprojects and suggesting mitigation measures for potential negative environmental impacts, if any. Another group of consultants will be employed for capacity building of LGIs and LGED. They will prepare training programs and develop training modules to strengthen/enhance the capability of LGIs in the planning, implementation, maintenance and service delivery of local projects as well as advise and support LGED in training and management tasks, including environmental assessment. 2. Type of Subprojects 12. The subprojects involving civil works account for nearly 88 percent of the total base costs of the project. The civil works will include improvement of subdistrict roads, union roads, village roads and growth center/markets, and construction of submersible roads, boat landing stages or jetties, flood refuge shelters, and union council complex buildings.

(a) Upgrading of subdistrict roads (SDR). A total of 1300 km of SDRs will be improved through widening to a standard crest width of 7.3 meters and bituminizing the surface. On an average, one SDR in each of the 189 subdistricts (upazila) will be selected as a subproject for improvement through a participatory process among stakeholders. Bridges/culverts along these SDRs will be renovated or constructed. The design of the SDRs will include provisions for road safety signs/markings and loading/unloading spaces. Labor contracting societies – comprised of poor and destitute women – will be formed and engaged in road maintenance and tree caretaking tasks.

(b) Upgrading of union roads. A total of 550 km of union roads (UNR) will be improved to

bitumen-surfaced standard and a crest width of 5.5 meters, including restoration/construction of bridges/culverts at strategic points.

(c) Village roads. Resectioning of 3664 km of village roads is proposed under this project

with earthworks, which will be selected through a participatory approach. Each road will have a crest width of 3.7 meters, and be connected to a growth center and/or a higher-order road. Bridges/culverts will be provided to close any gap on the roads.

(d) Submersible roads. A total of 60 km of submersible roads will be constructed in the low

lying areas (haors or perennial wetlands) of the districts of Netrokona and Kishoreganj districts, where there is total submergence between May and October, while boat transportation is restricted in the dry months due to the shrinkage of the water bodies. The submersible roads will be constructed with a rigid surface (to better withstand prolonged submergence) and a crest width of SDR standard. Special care will be taken in the design of these roads in order to maintain local hydrologic balance.

(e) Jetties. Twenty five jetties will be constructed in areas in the vicinity of a growth center,

selected through participatory consultations. The civil works will include provisions for mooring facilities, enhancement of safety and basic hygiene and sanitation amenities.

(f) Flood refuge shelters. In order to provide emergency relief in areas prone to flash

floods, six flood refuge shelters will be constructed for the flood affected families. These shelters will have separate sections for the people (including sanitation facilities) and the

Appendix 14 72

livestock for the emergency period, while they will be designed as multipurpose buildings for year-round alternate use.

(g) Growth center/markets (GCM). Of the 160 markets to be improved under the project,

30 GCMs are located at subdistrict (upazila) headquarters, 70 GCMs located in other parts of the subdistrict, and 60 will be major rural markets (or bazaars). Improvement measures are expected to contribute to significant environmental enhancement of the markets through provisions for paved roads and selling shed/stalls, adequate drainage and sanitation facilities, and safe water supply. A special feature of GCM improvement will be the construction of women’s market sections (WMS) in the GCMs. About 10 to 12 shops will be designated for excusive use by women traders, which will contribute to the social and economic empowerment of women.

(h) Union Council complexes UCC). The office and other ancillary facilities of 175 UCCs

will be improved with a view to enhancing the effective delivery of public services to the rural population. Improvement measures will provide the local people with a one-stop service delivery point for various government agencies like health, education, agriculture, livestock and land administration as well as allow year-round access for the local people to the facilities/services.

3. Potential Impacts 13. The interventions under the project deal primarily with road improvement, and no new road constructions are envisaged. Hence, potential adverse environmental effects are expected to be minimal, which can be mitigated/avoided through appropriate mitigation measures. Short-term (construction phase) negative environmental impacts include soil erosion from earthworks, water pollution, drainage blockage, traffic disruption and accident hazard, and dust and noise pollution. These impacts can be mitigated by (a) limiting earthworks to the dry season, (b) careful planning/operation of drainage diversions,and restoration/rehabilitation of borrow pits, (d) safe transportation and storage of construction materials, (e) spraying of water to reduce dust pollution, and (f) prohibition of machinery use after sunset to reduce noise pollution. 14. Long-term (post-construction) potential adverse impacts include disruption of fishing activities, drainage congestion/flooding, loss of roadside trees, loss of agricultural land and other assets due to road widening, and road safety hazards due to the movement of greater number of motorized vehicles. The only ecologically sensitive area within the project boundary is the Madhupur forest area. No intervention within this zone which might adversely affect its ecology is included in the project. Careful planning will be done in the design and construction of submersible roads in the `haor’ or wetland areas of Netrokona and Kishoreganj districts. All potential negative impacts will be minimized/avoided through adopting such mitigation measures as (a) tree plantation on roadsides and their caretaking, (b) providing adequate number of cross-drainage structures to facilitate fish migration and flood passage, (c) careful adjustment of road alignment during road widening in order to minimize cropland and asset loss, and (d) providing road safety signs/markings at vulnerable road sections and their regular maintenance. C. COUNTRY’S ENVIRONMENTAL ASSESSMENT AND REVIEW PROCEDURES 15. The Government of Bangladesh (GOB) is committed to undertake environmental assessment for each new development project and prepare mitigation, monitoring and management plans with a view to minimizing or preventing potential disbenefits. In 1989, a

Appendix 14 73

separate ministry was created as the Ministry of Environment and Forest (MOEF) – and within it, a new department - Department of Environment (DOE) - was formed as the technical arm of the ministry. The DOE acts as the planning, implementation and enforcement agency for the MOEF. A National Conservation Strategy (NCS) was prepared by the government in 1991, which had its roots in the national awareness of the significance of sustainable environmental management. In 1992, the National Environment Policy was formulated by the GOB. 16. The linkage between environment and national development planning is embodied in the National Environment Management Action Plan (NEMAP), completed in 1995. This action plan was prepared by the government, with assistance from the UNDP, through a participatory process, and is expected to be the basis for programs and interventions aimed at promoting sustainable environmental management. Public consultation and people’s participation were the hallmarks of NEMAP formulation. As a follow-up of NEMAP, the government launched a UNDP funded Sustainable Environment Management Program (SEMP) in 1998, which will be completed by the end of 2005.

17. Bangladesh has a wide range of laws and regulations related to environmental issues. An early legislation impinging directly upon environmental conservation was the Environment Pollution Control Ordinance of 1977. However, a comprehensive environmental law was passed by the national Parliament in 1995, known as the Environment Conservation Act (ECA), which replaced the 1977 ordinance. The ECA was followed by another legislation in 1997 – the Environment Conservation Rules (ECR). The ECR spells out specific rules and regulations for the enforcement of the ECA. Under the ECR of 1997, 186 types of projects and industries are grouped into four categories according to the extent of their potential adverse environmental impacts. The four categories are: Green (least harmful with no potential negative impacts); Orange `A’ and `B’ (some potential for negative impacts requiring IEE); and Red (high potential for negative impacts requiring full-blown EIA). It is mandatory for all proposed projects to obtain Environmental Clearance Certificate from the DOE. According to the ECR of 1997, the activities of the RIIP-2 fall under the category of Orange `B’, and therefore, an Initial Environmental Examination (IEE) is sufficient to assess environmental assessment of the project interventions as well as for the different subprojects to be implemented. It is, therefore, concluded that a detailed follow-up EIA is not required for the project and the subprojects. Categorization of the RIIP-2 under the ADB Guidelines also puts it under Category B, which requires the completion of IEE for the project and the subprojects. D. SPECIFIC PROCEDURES TO BE USED FOR SUBPROJECTS 1 Responsibilities and Authorities 18. The Ministry of Local Government, Rural Development and Cooperatives (MoLGRDC) has overall responsibility for policy matters on the proposed sector loan. The executing agency will be LGED in the Local Government Division (LGD) of the MoLGRDC. An inter-ministerial steering committee, set up under RIIP-1, will have the oversight responsibility. The steering committee, headed by the Secretary of the LGD, will comprise of representatives from the LGD, LGED, the Ministry of Planning, the Ministry of Finance, the Ministry of Women and Children Affairs, National Institute of Local Government, local government bodies, NGOs and the private sector. Donor representatives will participate as observers in the steering committee meetings. 19. A project management office (PMO), headed by a full-time Project Director, will be established at the LGED headquarters in Dhaka. The Project Director will be responsible to the Chief Engineer of the LGED for the overall implementation, monitoring and supervision. In

Appendix 14 74

addition to the Project Director, management responsibilities will be delegated at the regional levels to three Deputy Project Directors, located at Rangpur, Mymensingh and Dhaka. The PMO will prepare the Project Implementation Plan (PIP), initiate and supervise physical works, implement gender action plan, undertake monitoring/evaluation activities, maintain financial accounts, prepare periodic progress reports and the project completion report. The PMO will be assisted in its tasks by international and domestic consultants in different sectors, including environmental assessment. The LGED will engage consulting services in accordance with ADB’s Guidelines on the Use of Consultants and other arrangements satisfactory to ADB. 20. The PMO will have close working partnership with the LGED staff at the district (23 Executive Engineers) and subdistrict (182 Subdistrict Engineers) levels, and actively coordinate with union councils, management committees of the growth centers and jetties during the implementation stage. The LGED district office, headed by an executive engineer and under the guidance of the PMO, will be responsible for implementing subprojects. Planning and implementation of subprojects will be aided through stakeholder participation, facilitated by the Union Development Coordination Committees. 2. Environmental Criteria of Subproject Selection 21. The subprojects under the RIIP-2 will be prioritized on the basis of a number of social and economic indicators such as poverty level, gender disparity, level of community demand, requirements for land acquisition and resettlement, and overall environmental conditions. In the case of selecting subdistrict roads as subprojects, their connectivity to growth centers and higher-order roads will be considered and evaluated. Local people will be consulted to elicit their views and perceptions before finalizing detailed design of the subprojects. Environmental conditions which will influence the selection procedure will include the assessment of such parameters as (a) environmentally sensitive sites (b) negative effect on wildlife (c) impairment of fish migration (d) loss of fertile farmland (e) irreversible changes in regional hydrology and (f) major environmental concerns of the local community. 22. On the other hand, the following criteria will be used for excluding subprojects which may have significant negative environmental impacts:

(a) Ecologically sensitive area such as reserved forests, wildlife habitat etc.; (b) Potential for disrupting the life and property of the indigenous or tribal population; (c) Need for significant amount of land acquisition and resultant compensation; (d) Potential for permanent drainage obstruction and resultant flooding; (e) Significant encroachment on wetlands causing their shrinkage; (f) Encroachment on cultural features like places of worship, graves/cemeteries, historical

monuments etc.; and (g) Any subproject assessed to require full-blown EIA.

3. Procedures for Environmental Assessment of Subprojects 23. The RIIP-2 is classified as a Category B project and an IEE report has been prepared during the project formulation phase. All civil works related to the improvement of rural infrastructure in this project are free from any significant adverse environmental impacts, and hence, the subprojects are also not expected to be of any major environmental concern. Assuming that the subprojects also belong to Category B, Initial Environmental Examinations (IEE) for them will be carried out by an Environmental Specialist at district level with a view to

Appendix 14 75

identifying potential adverse environmental and social impacts of each subproject, and propose design modifications, if necessary, and mitigation measures for avoiding or minimizing probable negative impacts. The institutional support consultants, during the project implementation phase, will advise and support the LGED in building its capacity as a facilitator for training in environment assessment of subprojects, including mitigation measures and monitoring plans. 24. Environmental assessment of subprojects will involve three phases: (a) pre-construction (b) during construction and (c) post-construction. The first task in preparing the IEE report in the pre-construction phase is to screen and identify potential positive and negative environmental impacts of the subproject, and review the available literature and data on environmental conditions of the district in which the subproject is located. This will be followed by preparing a detailed checklist of environmental parameters to be examined and assessed for the subproject through field inspection. These checklists will be formatted in accordance with the LGED’s Guidelines, and include such impact issues (for assessment) as fisheries, wetlands, flash floods, forest, tree removal/revegetation, soil erosion/siltation, regional hydrology and flood proneness, drainage congestion, air and water quality, agricultural land loss, navigation, access to markets and employment opportunities, sanitation, road safety and traffic, and cultural features. The Environmental Specialist will analyze and interpret the data to prepare the IEE report for the subproject, which will include suggested measures for mitigation of potential negative environmental impacts and outline the monitoring plan to ensure compliance of the mitigation measures. 25. During the construction phase, environmental assessment will mainly focus on environmental supervision and monitoring. A checklist, based on the IEE report for the subproject, will be prepared by the Environmental Specialist for the purpose of field checking of environmental impact issues in the subproject. This checklist will include environmental parameters or components to determine if the construction-related activities are producing negative environmental consequences and whether mitigation measures, recommended in the IEE and SIEE of the project as well as in the IEE for the subproject,t are being complied with. Special attention will be given to the compliance of the contractors with the environmental clauses contained in the tender documents, especially those dealing with design requirements, waste disposal, storage and transportation of construction materials, and worksite health conditions for the labor. 26. In the post-construction phase, environmental assessment will mainly focus on identifying long-term environmental impacts of the subproject, and monitoring of compliance of the requirements outlined in the IEE for the subproject. Post-construction assessment will include investigations to ensure that mitigation measures for negative environmental impacts (recommended in IEE) have been correctly followed, unused construction materials and other wastes have been removed, borrow pits restored/rehabilitated, roadside tree plantations and their caretaking are satisfactory, flood proneness has not increased, fish migration and boat communication are not hampered, siltation and gully erosion have diminished, road safety measures are in place, cultural features have not been damaged or encroached upon, and local communities do not feel disadvantaged from the environmental point of view. E. EARP COMPLIANCE WITH ADB SAFEGUARD POLICIES 27. All standard requirements for environmental assessment for sector loans are being applied in accordance with ADB’s `Environmental Assessment Guidelines’. The PMO will prepare district level Initial Environmental Examinations (IEE) for all subprojects. Since the subprojects have only limited potential for adverse environmental impact, full-blown EIAs are not

Appendix 14

76

required for them nor is there any requirement for preparing an Environmental Management Plan (EMP) for the subprojects. In the task of preparing the IEE for the subprojects, the updated LGED `Environmental Guidelines of 2005’ (which is awaiting final approval shortly) will be followed as well as the environmental assessment requirements and safeguard policies of ADB will also be fully conformed to. 28. The various physical works under the project will be implemented over a wide area of 1832 union of 182 subdistricts (upazila) in 23 districts. The implementation period is five years and it is recommended that the implementation tasks be closely monitored in order to evaluate the project’s efficiency and effectiveness. Hence, the regular reviews to be carried out by ADB at least twice a year will be supplemented by a mid-term review (MTR). The mid-term review will be conducted jointly by the government, ADB and other development partners in the project during the third year of project implementation. The MTR will evaluate all aspects of the project design, implementation and management, including environmental and social impacts. 29. Both ADB and the government of Bangladesh require that development projects do not result in unacceptable damage to cultural heritage. The environmental assessment of subprojects will ensure that potential adverse environmental impacts to sites and structures of cultural value (viz., mosques, temples, churches, graves, archaeological remains, aesthetic locations) are taken into full consideration. 30. Since the project involves rehabilitation and upgrading of existing physical structure, no significant land acquisition is anticipated. Yet, whatever minimal acquisition will be required, the government is committed to provide prompt and just compensation to the affected persons. The principles and modalities for compensation payment are provided in the Resettlement Framework. The district level social analyses of the subprojects will include a resettlement plan, in accordance with ADB guidelines on involuntary resettlement. The basic premise in the concept of compensation is that all affected persons – regardless of their tenure status – will be assisted to attain a living standard higher than the pre-project level. 31. Stakeholder participation will be an integral part of subproject design, implementation and monitoring. The PMO will work closely with the local government leaders in the project area to ensure that the local community needs are satisfactorily met through the subproject implementation and that gender equity is attained in benefit sharing and employment opportunities. In accordance with international labor requirements, no child labor will be engaged in the construction work. F. STAFFING REQUIREMENTS AND BUDGET 32. Environmental assessment and related monitoring/supervision tasks will be carried out by two specialists: one designated as Hydrologist under the package of Design, Supervision and Management Consultants (DSMC), while the other – Environmental Specialist – is included in the package of Institutional Support Consultants (ISC). During the project implementation period, they will have an input of 42 person-months. It is expected that the environmental specialists of the project will maintain close cooperation with the Department of Environment in order to remain updated on all environmental assessment requirements and comply with all rules and regulations. The cost estimates for environmental assessment/monitoring/supervision under the project will be worked out in detail by the PMO.

ACTION PLAN FOR LOCAL GOVERNANCE

Area of Focus Objectives Activities Target Group Quantitative target

Indicators Action By Time Schedule

1. Empowerment of Union Council (UC)

Provide support to UC’s so that those become more responsive and responsible to play effective role with more empowerment.

Pursue government policy of strengthening UC’s. Keep liaison with government for a) Posting of accountant for UC. b) Empower UCs to manage its own personnel. c) Giving more responsibility to UC’s with adequate fund. d) Allocating resources to UC’s on performance basis. e) Issuing strict order to government departments to shift their union level offices to Union Council Complex (UCC) f) Giving role of coordination to UC’s and instructing line agencies to keep UC’s apprised. g) Raise honorarium of UC chairman and members.

UC chairmen, members and secretaries of the project area. GOB line agencies in Union level. Community people.

All UC’s within the project area.

UC’s are empowered. Accountant assigned to UC. UC’s are more responsive and responsible and can handle adequate fund to accomplish tasks. UC’s receive fund on performance basis. All union level government offices shifted to UCC. Central government officials at union level work under coordination of UC’s. Honorarium of UC chairman and members are raised.

Project management office (PMO) Local Government Division (LGD)

From three months of commencement of project up to the end of the project period.

2. Updating rules, regulations and frameworks.

Provide updated rules and regulations to the UC’s. Remove language barrier, provide all Acts, rules and regulations after translation in Bangla. Remove all ambiguities by spelling out powers and functions of UC’s in legal frame works. Implement government directions, particularly concerning functions of female UC members. Prepare further regulations and frame works on need basis.

Collect copies of all relevant Acts, rules, regulations and circulars and organize those subject-wise in a planned manner. Remove language barrier and arrange translation of all documents into Bangla for clear understanding of the UC functionaries. Liaise with government to get ambiguities removed from legal framework of the UC’s. Liaise with government and LGI’s for implementation of directives concerning functions of female UC members. Engage NILG as appropriate to prepare new framework when necessary.

Chairmen, members and secretaries of all UC’s are of the project area. All trainers responsible for conducting training to the UC’s.

All UC’s under the project area.

All UC functionaries have a set of rules and regulations for knowledge and reference. They have all regulations translated into Bangla. UC’s have clear idea about their roles and functions. They have more power through knowledge. UC female members can function better UC’s can contribute better in playing their role in rural development.

PMO/LGD

From three months of commencement of project until end of the project.

3. Awareness building

Raise awareness simultaneously for the UC functionaries as well as for the people-not only of project area

Prepare production materials for radio and television program on various aspects of LGI’s. Produce short and attractive TV spots

UC’s of the project area. People of the project area.

All LGI’s including UC’s of the whole country.

The UC’s have better awareness of their role in the society. Local actors including

PMO/LGD

From six months of commencement of the project until the end of the project.

78 Appendix 15

Area of Focus Objectives Activities Target Group Quantitative target

Indicators Action By Time Schedule

but also beyond. on LGI. Chose subjects of television program from concerned Ministries so as to involve the whole government machinery towards better local governance. Call UC functionaries for participating in Radio/TV programs. Make over these materials to Ministry of LGRD&C for arranging regular transmission through radio and television. Organize seminar, workshop and discussion meetings throughout the country for awareness building on LGI’s.

People of the whole country.

women and poor are also aware of their responsibility for local governance and local development. Concerned ministries of the government are involved in local governance. People in general of the project area and of the whole country are educated on good governance. People of the whole country are ready for a change from traditional to a better way of good governance.

M/LGRD&C Bangladesh Radio BTV

4. Capacity Building and Training

Build capacity of UC’s through training on relevant subjects including general administration, infrastructure, and on democratic, transparent and accountable management of UC affairs, involving NGO’s, CBO’s, women and poor.

Conduct training programs for UC leaders on gender issues and gender – based services, female work number capacity, etc. 1. Review and update: a) Coordinated training module of LGD

dated 30 April 2003. b) Financial management manual of NILG of June 2003. c) Financial management procedure of LGD of December 2001. d) Revenue collection strategy of LGD of December 2003. e) Training manual of financial management of project RDP-21 of September 1999. 2. Engage NILG along with BARD, RDA

and LGED training centers as appropriate for training of UC.

3. Complete TOT training. 4. Complete basic training for LGIs on

financial management, administration, law and order.

UC Chairmen, members and secretaries of the project area.

All UC’s of the project area.

No of UC leaders trained; No of training modules prepared concerning gender issues Union Parishads function in democratic, transparent accountable and efficient manner. NGO’s, CBO’s and other local actors actively participate with UC’s in local development process. Union Parishads are better equipped with knowledge, training and capacity to handle local administration with good governance. Union Parishad functionaries have better working relationship through visits and exchange of experience.

PMO/LGED PMO/LGD PMO/LGD LGED LGI’s/PMO

First to Third year of Project From 4th month of commencement of the project until the end of the project. From 6th month of Project First year of Project Fourth year of Project

79 Appendix 15

80 Appendix 15

Area of Focus Objectives Activities Target Group Quantitative target

Indicators Action By Time Schedule

- By 4th years of Project

5. Complete refresher courses of PMO/LGI 6. Visiting to unions with best practices. 7. Task NILG, BARD, RDA and LGED

training institutes, as appropriate, for all matters of training including keeping records of training, trainees and trainers and of visits etc of the UC’s under their zones.

- Yearly for 5 years

8. Task NILG, as appropriate, to handle emerging issues and develop necessary manual and framework from time to time.

5. Enhancing transparency in UC operations

To improve UC operations and inform local communities of UC activities

1. Hold monthly meetings regularly at UCCs.

UCs All UC’s of the project area.

Monthly meetings held; UCs Throughout Project period. Notice boards used

regularly. PMO

2. Publicize decisions made during meetings. 3. Publicize annual budgets and expenditures on notice boards.

Coordination ensured between UC’s and Officials. 4. Hold quarterly meeting with government

officials of union level. Participatory meetings held. 5. Hold six monthly participatory meetings for

planning and discussion of budget and development matters.

6. Review and completion of backlog.

To ensure successful completion of the entire program by keeping the last year of the project for review and for clearing back logs.

The entire action plan will be reviewed in terms of targets achieved and shortfalls verified; prepare a list of targets, which could not be achieved.

UC Chairman, members and secretaries of the project area.

All UC’s of the project area.

Project has a successful ending.

PMO/LGED From the last quarter of the 4th year of the project until the end of the project.

PMO All its targets are fulfilled.

UC’s Take follow up actions for completion all the

back logs. All communities, groups, committees etc. of project area.

All backlogs cleared. - During the 5th – 6th year of the Project

All stakeholders

All LGI’s All line agencies. All stakeholders