World Bank to Support Road Network Improvements in Himachal Pradesh, India

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The World Bank approved on June 5th a US$220 million loan to the Indian state of Himachal Pradesh, designed to reduce transport costs and to improve traffic flows on the state's core road network.

The Himachal Pradesh State Roads Project will upgrade priority segments of the state's core road network, including widening of formation and pavement strengthening of about 450km of roads, and implementation of ancillary social, environmental and bio-engineering measures. It will also support periodic maintenance and minor rehabilitation of about 2,000km of roads.

"As a mountainous state with limited rail connections, no waterways, and only three small domestic airports, Himachal Pradeshrelies almost exclusively on its road network for transport," said Isabel Guerrero, World Bank Country Director for India. "This project, complementing the on-going World Bank-supported Himachal Pradesh Rural Roads Project, will improve the quality of the road network and will ensure speedier movement of agriculture products to markets, which in turn,will help the growing of alternative high valued crops and investment in agro-industry, leading to increased business activity and higher rural incomes."

The total road network in the state is about 28,000km, comprising 2,000km of national highways, 2,160km of state highways, and 2,240km of major district roads. The quality and extent of this road network is viewed as inadequate to meet the social and economic needs of the state. Half of all roads are unpaved, 90 percent of the highway network is single lane, and fewer than half of all villages are deemed connected.

"State road projects in India have often suffered from lack of maintenance of the rest of the network, resulting in project roads being an island of quality amidst a sea of disrepair," said Ke Fang, World Bank Economist and project team leader. "This project has been specifically designed to try to address this challenge. A significant portion of the project's investments will be spent in road maintenance, including piloting innovative Performance-Based Maintenance Contracts. The project monitoring and evaluation framework includes targets for the entire core network, and technical assistance has been provided to help develop a road maintenance management system."

The project is also expected to have some positive social impacts in terms of reducing travel costs to markets and social services, as well as helping to integrate the scattered population. The selection of project roads for upgrading took into account the issue of regional balance with the poorer districts in the state. Extensive environmental studies and public consultations have been properly undertaken as an integrated part of the engineering design to help protect natural environment and avoid or minimize adverse impacts.

The loan from the International Bank for Reconstruction and Development (IBRD) has 20 years maturity, including a five-year grace period. -The World Bank

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