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This report was prepared for use within the Association. It may not be published nor may it be quoted as representing the Association's views. The Association accepts no responsibility for the accuracy or completeness of the contents of the report.

INTERNATIONAL DEVELOPMENT ASSOCIATION

APPRAISAL OF A ROAD PROJECT FOR

INDIA

Public Disclosure Authorized

Public Disclosure Authorized

June 7, 1961 Department of Technical Operations

CURRENCY EQUIVALENT

$100, 000 $1. 00 1 rupee

= 480, 000 rupees = 4.8 rupees = 21?

APPRAISAL OF A ROAD PROJECT FOR INTIA

Table of Contents

Page

SUARY

i

I. INTRODUCTION

1

II. THE ICED FOR DREVELOPIvENT OF ROAD TRANSPORT

1

III. THE NATIONAL HIGHWAY SYSTEM

5

A. Road Administration

B. Standards and Procedures used in

Construction of National Highways

7

C. Execution of Construction Work of

National Highways

8

D. Maintenance of National Highways

8

IV. THE PROJECT

9

A. Description

9

a) Construction and Reconstruction

of National Highways

10

b) Procurement of Equipment

11

c) Study of Traffic Problems of

lowntown Bombay

11

B. Execution

11

C. Cost and Financing

12

D. Economic Justification

15

V. CONCLUSIOl1S AND RECO-I'NEWDATIONS

16

APPENDIX

Table 1 - Registration of Motor Vehicles Table 2 - Production of the Automobile Industry Table 3 - Expenditures on Roads

Table 4 - Annual Revenue from Road Transport

Table 5 - Typical Operating Cost per mile for 7-ton Truck and 45-seater Bus

Annex 1 - Road Transport

Annex 2 - Details of Cost Estimate

Annex 3 - Economic Justification of Individual Projects Annex 4 - IDA's Participation in the Road Program of

the Third 5-Year Plan Map 1 - Road Project Financed by IDA Map 2 - Details of Roads included in Project

SUEAaRY

i.

h1m, ission visited India in January/February 1961 to investigate a

roasd project for presentation to the International Development Association.

The project is the program,contained in t.he first 31 years of India's Third

Five-Year Plan, of construction and reconstruction of National Highways andm.

Bombay Expressways. The total cost of this program is estimated at US$120

million equivalent, of which it is proposed that IDA contribute 50 percent,

or US%;60 million.

_AJ

ii.

The specific items in the program to which IDA financing would be

related are the following:

a) the construction and reconstruction of about 660 miles (1,050 km) of National Highway-s and Expressways in the States of Bihar, West Bengal, Orissa and Maharashtra, including 19 major

bridges;

b) the procurement of the necessary equipment for the execution of the works under (a); and

c) a technical and econormc study by foreign consultants of the traffic problems of downtown Bombay in connection with the expresswaays already under construction and the contemplated future expressways and highways.

iii.

The cost of the works selected by IDA has been estimated at US$77

million equivalent, including 13 percent contingencies. An additional amount

of US$3.5 million wvould be required for purchase of equipment and consultants'

fees, bringing the total cost of the items to which IDA financing is to be

related to US$80.5 million equivalent. The proposed IDA credit would provide

USi56.5 million for the works earmarked in (ii.a) and U$13.5 million for pur-

chase of equipment and consultants' fees.

iv.

Part of the works selected by IDA are centered around the two prin-

cipal cities and ports of India - Calcutta and Bombay - and provide improved

connections between these cities and neighboring industrial and agricultural

centers. Several new roads in the project will open up some of the less de-

veloped parts of the country. All of the works will yield benefits which are

sufficient to justify their execution.

v.

National Highways are under the jurisdiction of the Roads Wing of

the Ministry of Transport and Communications in the Government of India. Most

of the wTorks are executed bylocal contractors supervised by the Public WiJorks De-

partments of the States, under the control of the Roads Wing.

vi.

The roads selected for IDA financing will be constructed to modern

standards by compacting the embankment, investigating soils and applying the

proper thickness of base and subbase, and laying the pavement Ly mechanized

operations. The width of the carriagewsay and the type of bituminous pavement

to be applied will be related to the expected traffic.

- ii -

vii.

Some of the road and bridge works selected for IDA financing are

already under execution by local contractors, chosen after competitive bid-

ding for unit price contracts.

viii.

During the negotiations it has been agreed that the Government of

India will:

a) spend during the first 32 Plan years the equivalent of US60 million on the National Highway program in addition to the proposed IDA credit of US$60 million, and furnish to IDA information on the expenditure for the part of the project other than the works

selected for IDA financing;

b) continue the strengthening of the operating division of the Roads Wing in the Ministry of Transport and Communications; and

c) apply improved standards and methods for the execution and future maintenance of the works selected by IDA, and see that the Roads Wing makes full use of the facilities of the Central Roads Research Institute.

ix.

The road works to which the IDA financing would be applied are

sound and economically justified, and provide a suitable bapis for a credit

by the International Development Association of US$60 million equivalent.

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