The views expressed in this report are the views of the author(s) and do not necessarily reflect the views or policies of the Asian Development Bank (ADB), or its Board of Directors or the governments they represent. ADB does not guarantee the source, originality, accuracy, completeness or reliability of any statement, information, data, finding, interpretation, advice, opinion, or view presented, nor does it make any representation concerning the same.

Project Number: 38272-033 June 2011

India: Uttarakhand Urban Sector Development Investment Program - Tranche 2 Sub-project Appraisal Report: Construction of OHSR and Appurtenant Works under Water Supply System in Haldwani

      

UTTARAKHAND URBAN SECTOR DEVELOPMENT INVESTMENT PROGRAM

ADB LOAN No. 2410-IND Tranche 2

SUB-PROJECT APPRAISAL REPORT

CONSTRUCTION OF OHSR AND APPURTENANT WORKS FOR WATER SUPPLY SYSTEM IN HALDWANI

.

‐ 1 ‐ 

      

1. SUB-PROJECT NAME : Construction of OHSR and Appurtenant Works under Water Supply System in Haldwani

2. SUB-PROJECT TOWN : Haldwani

3. TRANCHE : 2

4. SUB-SECTOR : Water Supply

5. SUB-PROJECT INTRODUCTION AND RATIONALE:

A. Background

The Financing Framework Agreement (FFA) between India and ADB dated 21 November 2007 is to finance Uttarakhand Urban Sector Development Investment Program (UUSDIP). The total estimated cost of program is US$ 500 millions, out of which US$ 350 million will be financed by ADB. The program is to be implemented in 4 tranches over a period of 8 years. Each tranche constitutes a separate loan. The Tranche-1 of UUSDIP (Loan 2410-IND) is under implementation. This subproject is proposed under Tranche-2 (Project-2) of UUSDIP. The primary objective of UUSDIP is to promote balanced regional socio-economic development and poverty reduction through improvements in urban governance, management and infrastructure and service provision in selected towns of Uttarakhand. The investment Program is based on Multi-Tranche Financing Facility (MFF) to improve delivery of basic services such as water supply, sewerage and solid waste management in 31 towns of the state. UUSDIP will also improve service delivery capacity of the State urban agencies by developing an Institutional Development Program. Haldwani is a tehsil head-quarter of Nainital District and situated at a distance of 275 km from the National capital of New Delhi on Delhi-Nainital road. The nearest air port is Pant Nagar at a distance of 20 km. Haldwani lies between 29021’6 to 29013’ North longitude of 700 51’67 - 790-31’ East latitude. Its average elevation is 424 m. The town is about 10.62 sq km. Haldwani is well connected by road network to Delhi, F and Lucknow. The railway stations of Haldwani and Kathgodam fall in the limit of Haldwani-Kathgodam. The population of town, as per 2001 census is 1,27,603 and present projected population is 1,66,534. Proximity of Haldwani town to the hills gives it a temperate climate, which is very susceptible to sudden changes of weather in the hills. Weather is moderately cold in winters and hot in summers. The minimum temperature varies from 50 – 100C and maximum from 380 – 420C. Average annual rainfall recorded is approximately 1,505 mm. Piped water supply in Haldwani was introduced in 1948 from Shitlahat spring, which still continues as one of the sources of water supply. In course of time, water supply system and distribution network grew to cover the entire area of the town, but the expansion was adhoc and no systematic development took place. There is adequate availability of water sources (both ground water within city and surface water on periphery of the city). Total production capacity of treated water is 56.70 MLD but actual production is 38.40 MLD due to withdrawal constraints from Irrigation Department in Gola canal and lack of adequate pumping in Gola head works. With estimated losses of approx. 40%, the water reaching to the consumer is 23.1 MLD. The present water demand is 26.85 MLD based on 135 lpcd norm and 15% line losses. With additional production from 4 new tube wells (5.32 MLD) under construction, total water available to the consumer will be 28.42 MLD which is more than adequate even with 40% line losses.

‐ 2 ‐ 

      

However there is shortage of service reservoirs. There are 2 no water distribution zones and present GLSR/OHSR can serve only 4 zones with adequate pressure. Therefore there is additional requirement of service reservoirs to serve adequately the entire city.

B. The Need of the Project A detailed assessment of existing situation was carried out, which concludes that the present water production capacity of 38.4 MLD is sufficient for year 2013, but with additional 5.32 MLD from under construction of tube wells, and with extended hours of operation along with increase pumping capacity of raw water, it will roughly meet the requirement of 2028. However, this is insufficient for the ultimate Year (2043) and afterwards. Present demand-supply gap in the water supply system is due to (i) irrational zoning of the town, (ii) poor water supply reticulation system, (iii) old and leaking distribution pipes, and (ii) inadequate storage facility. These issues need to be addressed immediately to provide water supply to the citizens of Haldwani town as per the national standards. The table below shows the major demand-supply gap of different parameters. Table 1: Demand - Supply Gap

Parameters Present Status Requirement / Demand Gap 2013 2028 2043

Population covered with city water supply system Floating Population per day

1,66,534 16,250

1,81,990 18,200

2,83,654

28,366

4,42,109

36,211

2013: 15,466 2028: 1,17,120 2043: 2,75,575

Population receiving water as per GoI standard

nil (Quantity & quality not conforming)

1,81,990 2,83,564 4,42,109 2013: 1,81,990 2028: 2,83,564 2043: 4,42,109

Service delivery standards at the consumer end (i) Average per

capita supply (ii) Duration (iii) Quality

135 lpcd 5 hrs Average

135 lpcd 24 hrs GoI Standard

135 lpcd 24 hrs GoI Standard

135 lpcd 24 hrs GoI Standard

2013: 41 lpcd 2028: 41 lpcd 2043: 41 lpcd

Production of potable water (iv) Surface water (v) Ground water

Total

28.00 MLD 10.40 MLD 38.40 MLD

15.09 MLD 16.21 MLD 31.30 MLD

25.54 MLD 23.31 MLD 48.85 MLD

70.28 MLD 5.32 MLD 75.60 MLD

2013: NIL 2028: 10.45 MLD 2043: 37.20 MLD

Physical losses Total water available at consumer end

40% 15.3 MLD 23.10 MLD

15% 4.7 MLD 26.60 MLD

15% 7.30 MLD 41.55 MLD

15% 11.30 MLD 64.30 MLD

Reduction by 25%

Transmission line (Rising +Connecting Mains

Length: 1.50 km Condition: Very Poor (It needs replacement)

11.59 km Good

11.59 km Good

11.59 km Good

2013: 11.59 km 2028: 11.59 km 2043: 11.59 km

Distribution line Length: 129.30 km Condition: Poor (needs replacement)

179.30 km Good

179.30 km Good

179.30 km Good

2013: 179.30 km 2028: 179.30 km 2043: 179.30 km

Storage requirements

9.64 ML 21.89 ML 21.89 ML 21.89 ML 2013: 12.25 ML 2028: 12.25 ML 2043: 12.25 ML

House connection 16,650* (It cannot be reused)

24,500 40,522 63,158 2013: 24,500 2028: 40,522 2043: 63,158

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Parameters Present Status Requirement / Demand Gap 2013 2028 2043

Water meters nil 24,500 40,522 63,158 2013: 24,500 2028: 40,522 2043: 63,158

*Includes 320 nos. non-domestic connections

C. Reasons of the Demand and Supply Gap The following are the main reasons for demand supply gap: (a) With the increase in population, demand has increased; (b) Resource constraints for systematic upgradation of the system; (c) The existing water transmission and distribution system suffers from defects and huge system

losses as these have also outlived their design life and have become insufficient to cope with increased water demand of the town;

(d) Due to non-availability of OHTs, direct pumping is done into distribution system, resulting into intermittent supply due to erratic power situation and heavy losses in lines as the pipelines are not laid to withstand heavy pumping head

(e) Due to long and unscheduled power cuts and deficit of storage tanks, the tube wells are unable to meet the hourly peak demands of the areas despite their adequate production capacity.

(f) WTP has outlived its design life and therefore is not functioning at its full capacity; and (g) There is no water metering system at consumer end and therefore there is indiscriminate usage of

water and losses in water supply and revenue. 6. SUBPROJECT RATIONALE

From the above assessment it is clear that investment is needed for water supply system of Haldwani town to address the service level disparities in water supply compared to the national average and national standard and will also contribute in achieving India’s 11th Five-year plan target to provide potable water supply to the entire urban population of India.

7. DESCRIPTION

D. Subproject Area Haldwani is developing more rapidly than before. The haphazard development and reckless construction activities created more stress on the civic amenities. The present population of the town as per 2011 is 1,66,534 and it is projected that the population of Haldwani will become 2,83,654 and 4,42,109 by 2028 and 2043 respectively. The subproject will cover an area of 10.62 sq km falls within the municipal limits. The key features of the subproject area are as under: Climate: Haldwani experiences a relatively moderate temperature; average minimum annual temperature varies from 5°C to 10°C and maximum 38°C to 42°C. Average annual rainfall recoded is approx. 1,505 mm. Topography: Haldwani town has a gentle slope towards south; i.e., Nainital Bareilly road and toward south west i.e., Haldwani – Rampur Road. The south-west gradient is 1 in 100 whereas the south-west ward gradient is 1 in 120. Soil Conditions: Haldwani is a part of Bhabhar zone. The soil strata of town generally constitute clay, mixed with bajri and boulders. The ground water table level is at 200 m. Road: Total road length of the town is 170 km, which is all black top, i.e., bituminous. Width of the roads varies from 5 m to 7.5 m.

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E. Assessment of Existing Situation

Water Source: The source of water is combination of ground and surface water (from Gola River). Ground Water: There are 13 nos. working tube wells with total rated discharge of 18.72 MLD. Additional 4 nos. tube wells are being installed by UPJN with total rated discharge of 5.32 MLD. Past records (maintained by UPJN / UJS) has not shown decline in the discharge of the tube wells. Existing tube wells are in good condition and do not require any rehabilitation. The Central Ground Water Board or any other organization of the related field does not have the data of capacity/Recharging rate of the ground water table of Haldwani. However, the UJS and UPJN informed that there is no depletion of the ground water levels in the tube wells. Moreover, no addition of tube wells is envisaged in the sub-project. Surface Water: The surface water source is Gola Canal. The minimum availability of raw water is 87.26 MLD (Source: Discharge measurement data obtained from Uttarakhand Irrigation Department) Population: Total: 1,66,534 (year 2011) Covered with city water supply: 1,66,534 None of the consumers are receiving water as per GoI quantity (@ 135 lpcd) and quality guidelines. Water Quality: Ground Water: Test results (sampling & testing conducted by DSC-II) have revealed that water quality parameters are well within permissible limits and ground water does not require any specific treatment except chlorination. Surface Water: Raw water drawn from Gola Canal is of acceptable standard, and requires only conventional water treatment. Intakes: Existing intake on Gola canal has a design capacity of 28 MLD. Transmission: Table 2: Detail of Existing Transmission Mains

S. No.

From To Length (m) Dia (mm) Year of Laying

Material

1. Gola headworks Shitlahat WTP 1,000 m 150 mm 1980 ERW 2. Khandelwal Park TW Direct supply 30 m 200 mm 2000 ERW 3. Azad Nagar TW Azad Nagar OHSR 20 m 250 mm 2000 ERW 4. Rajpura TW Direct supply 20 m 200 mm 2005 ERW 5. Awas Vikas TW Direct supply 50 m 200 mm 2006 ERW 6. Sheesh Mahal TW Direct supply 30 m 200 mm 2006 ERW 7. Degree College TW Direct supply 100 m 200 mm 2006 ERW 8. KMVN TW Direct supply 100 m 200 mm 2006 ERW 9. Indra Nagar TW Direct supply 100 m 200 mm 2006 ERW 10. Ujala Nagar TW Direct supply 150 m 200 mm 2007 ERW 11. Heera Nagar TW Direct supply 250 m 200 mm 2007 ERW 12. Subhash Nagar TW Direct supply 100 m 200 mm 2008 ERW 13. Indra Nagar (13 Bigha) TW Direct supply 150 m 200 mm 2009 ERW 14. Hydel Gate TW Direct supply 150 m 200 mm 2010 ERW

Except for one transmission line (laid in 1980), others were laid after 2000. Transmission line laid in 1980 is in poor condition and buried deep due to subsequent rise in road level. This cannot be repaired conveniently nor can be retrieved economically. It is also undersized as per the design demand of the zone to be fed from this WTP. Therefore, it needs replacement.

‐ 5 ‐ 

      

Water Treatment Plants: There are two water treatment plant (WTP) located in the town as detailed below: Table 3: Details of WTPs

WTP Location Age (Years) Installed Capacity (MLD) Present Capacity (MLD) Shitlahat 57 3.5 1.0 Sheesh Mahal 36 34.5 27.0

Physical condition of the WTP is very poor; particularly the clariflocculator is not functioning well. Filter units and disinfection systems are also very poor. This rehabilitation works will be taken up in UUSDIP-Tranche-3 to improve the quality of water as water production is limited to maximum 28 MLD. Table 4: Details of Tube Wells

Tube Wells: (Existing) Total number : 13 Average life : 40 years Average depth : 200 m Total design yield : 18.72 MLD Tube well (Under construction by Pey Jal Nigam) Total number : 4 Average depth : 200 m Total anticipated yield : 5.32 MLD Quality and treatment : Good, only chlorination Operating hours per day : 16 hrs No. of tube wells needs redevelopment nil

Pumps and Pumping Equipment: There is one raw water pump house having 3 nos. pumps. The pump house was constructed in 1954. Physical condition of raw water pump house is satisfactory. Storage Capacity: Inadequate storage capacity is the major bottleneck in the water supply system. Presently there are 11 service reservoirs in Haldwani town, out of which 10 are GLSR and 1 is OHSR and all are operational. Aggregate storage capacity of all 11 Service Reservoirs is 9.64 ML. Physical conditions of these reservoirs are good, but they require minor retrofit. Additional 12.25 ML storage capacity is required to be developed. Distribution System: The total distribution network is about 129.3 km, laid periodically. The pipe material used in the existing distribution lines is GI/PVC/AC/CI. The distribution system is quite old and in depleted condition and needs replacement. The system is also not conforming to the water supply zones and is interconnected. The replacement will be included in Tranche-3. Table 5: Details of Existing Distribution Mains

S. No. Description of Pipe Length (km) 1 AC Pipe 500 mm Dia. 4.5 350 mm Dia. 3 300 mm Dia. 6 200 mm Dia 11 150 mm Dia. 18 2 CI Pipe Class LA 200 mm Dia 5.3 150 mm Dia. 6.5 3 GI Pipe Medium 150 mm Dia 7.5 80 mm Dia. 18.5 4 PVC Pipe

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S. No. Description of Pipe Length (km) 110 mm Dia 31 90 mm Dia 18 Total 129.3

 Stand Posts: There are 30 stand posts in Haldwani town. House Connections: Presently there are 16,650 house service connections using GI pipes of 15/20 mm sizes. System Losses: Study has revealed that approx. 40% system losses are taking place at present. Power Situation: Availability of electric power in Haldwani is erratic and intermittent; on average 16 hours power supply is available in the town. Energy Consumption: At present the existing water supply system consumes approximately 216.30 KVAH/ML of water produced. The proposed system will consume 97.30 KVAH/ML of water produced. Thereby, there will be a saving of 119 KVAH/ML of water produced, or, 55% in power consumption. Operation and Maintenance: Water supply is operated and maintained by Uttarakhand Jal Sansthan (UJS). Total annual budget of overall O&M is approx. INR 46.8 million (Source: Uttarakhand Jal Sansthan, Haldwani). Break-up of the budget is as follows: Table 6: Details of O&M Expenditure

S. No. Items Current O&M Expenditure Rs. Million

1 Works (Civil + E&M) 5.67 2 Materials / Chemicals 5.50 3 Power 12.00 4 Human Resource 21.20 5 Fuel 0.81 6 Others 1.62 Total O&M Cost 46.80

Total collection against above cost is Rs. 44.4 million, thereby collection efficiency is 95%. O&M of Water Supply & Sewerage is being carried out by Jal Sansthan, a GoU undertaking with its HQ at Dehradun. Jal Sansthan is also responsible for billing and collection. It is headed by a Chief General Manager who is assisted by a number of senior level Engineers and Officers from other disciplines such as Procurement, Administration Accounts etc. in HQ. The Jal Sansthan in Kumaon Region is headed by General Manager whose office is located in Nainital. At Haldwani, it is headed by respective EE whose office is located in Haldwani town. As per organisation chart, the EE is assisted by AEs, JEs and field staff (Pump Operators and Fitters etc.). Presently only three SEs are looking after all 6 districts. SE Nainital is also looking after district of Udham Singh Nagar, SE Almora is also looking after district of Bageshwar and SE Pithoragarh is also looking after district of Champawat. Table 7: Details of Manpower

S. No. Position Sanctioned Post

Actual Posting

Gap Contracted Manpower

Net Vacant post

1 SE (Nainital) 1 1 0 0

11 2 EE 1 1 0 0 3 AE 4 1 3 1 4 JE 12 1 11 2

‐ 7 ‐ 

      

F. What action government is taking to address the demand - supply gap

Table 8: Govt. Action to Address Demand-Supply Gap Parameters Gap in Infrastructure Tranche-II Other Government

Program Balance

Production of potable water

2013: NIL 2028: 10.45 MLD 2043: 37.20 MLD

- 2013- 5.32 MLD (By additional 4 tube wells 2028: 5.13 MLD (By increasing the drawl rate from TW)

2043-26.75 MLD From Jamrani Dam

Physical losses 2013: 4.70 MLD 2028 : 7.30 MLD 2043 : 11.30 MLD (25% reduction)

- nil

Availability of water at consumer end

No treatment and transmission/distribution works has been taken up in Tranche-2. Net water available at consumer end 41.55 MLD

Improvement works in WTP & transmission/distribution net work will be taken up in Tranche-3

Transmission line:

2013: 11.59 km 2028: 11.59 km 2043: 11.59 km

11.59 km nil nil

Distribution line 2013: 179.30 km 2028: 179.30 km 2043: 179.30 km

- nil *179.30 km (proposed under Tranche-3 in ADB)

Storage requirements

2013: 12.25 ML 2028: 12.25 ML 2043: 12.25 ML

12.25 ML nil nil

House Connection

2013: 24,500 nos. 2028: 40,522 nos. 2043: 63,158 nos.

- - *2013: 24,500 nos. 2028: 40,522 nos. 2043: 63,158 nos.

Meter 2013: 24,500 nos. 2028: 40,522 nos. 2043: 63,158 nos.

- - *2013: 24,500 nos. 2028: 40,522 nos. 2043: 63,158 nos.

Note: The renovation of water treatment plant will also be included in Tranche-3

G. Objective of the Subproject The objective of this subproject is to provide potable water at 135 lpcd to cater the requirement of population of Haldwani town at 17 m head except in specific cases having higher ground elevation where it will be minimum of 12 m. This subproject also aims to reduce energy consumption per ML of water produced. Beneficiaries: Total Design Population (beneficiaries) for Haldwani town can be summed up as: ▪ 2013 – 1,81,990 ▪ 2028 – 2,83,654 ▪ 2043 – 4,42,109 The floating population, which is 18,200, 28,366 and 36,211 at above three stages will also be benefited from the subproject. In addition, the project will also benefit the commercial and institutional establishments with approx. 4% water demand by additional water production over the requirement for resident and floating population.

‐ 8 ‐ 

      

Improved Service Level:

▪ Per capita supply at consumer end – 135 lpcd; ▪ Quality of the potable water as per GOI standard; ▪ Physical losses: reduced from present 40% to 30%; ▪ Reduce energy consumption by 55%; ▪ Reduce commercial losses by introducing consumer meters; ▪ Wholesome potable water supply to commercial and institutional units; and ▪ Adequate fire fighting provisions

H. Subproject Components

Intake Works: No intake works are proposed; only existing intake structure will be used. Minor renovation / rehabilitation is proposed at Gola head works. Transmission Mains: ▪ Existing raw water and clear water transmission mains will be discarded. ▪ New raw water transmission mains, (total length 1,500 m), size 350 mm, DI K-9 material, will be laid

from existing Gola Headworks at Gola Canal to existing WTP at Shitlahat. The transmission mains will augment raw water withdrawal from present 3.5 MLD to 4.25 MLD at the end of design year.

▪ New clear water transmission mains will be laid from existing tube wells (TW) (at different location) to proposed zonal OHSR, details are below:

Table 9: Details of Proposed Clear Water Transmission Mains

Sl. No. From (PH/CWR/TW) To (OHSR) Zone to be Served

Length of Transmission

Mains (m)

Dia. (DI K-9) (mm)

1 Gola Headworks Shitlahat WTP A & B 1,500.00 350 2 CWR at Sheesh Mahal OHSR, Hydle

Gate D 1,000.00 250

3 CWR, at Sheesh Mahal OHSR, Sheesh Mahal

E 210.00 200

4 CWR at Khandelwal Park OHSR, Subhash Nagar

G 700.00 200

5 CWR at Khandelwal Park OHSR, M. Degree College

J 1,500.00 250

6 Tube Well No 2, at Khandelwal Park

OHSR, at Subash Nagar

G 700.00 200

7 Tube Well No 3, at Sheesh Mahal

OHSR, Sheesh Mahal

E 55.00 150

8 Tube Well No 4, at Awas Vikas

OHSR, at Awas Vikas

F 200.00 200

9 Tube Well No 5, at Degree College

OHSR, at Degree College

I 55.00 200

10 Tube Well No 6, at Rajpura OHSR, at Rajpura

L 55.00 200

11 Tube Well No 7, at KMVN OHSR, at KMVN M 55.00 200 12 Tube Well No 8, at Indra

Nagar OHSR, at G.G.H School

P 250.00 200

13 Tube Well No 9, at Hira Nagar

OHSR, at Hira Nagar

N 55.00 200

14 Tube Well No.1 at Azad Nagar

OHSR at Azad Nagar

O - -

15 Tube Well No 10, at Ujala Nagar/ Dobhi Ghat

OHSR, at Ujala Nagar/ Dhobi Ghat

R 55.00 200

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Sl. No. From (PH/CWR/TW) To (OHSR) Zone to be Served

Length of Transmission

Mains (m)

Dia. (DI K-9) (mm)

16 Tube Well No 11, at J.S Tikonia

OHSR, at Jal Sansthan Trikonia

H 55.00 200

17 Tube Well No 12, at Hydle Gate

OHSR, at Hydle Gate

D 85.00 150

18 Tube Well No 13, at Indra Nagar 13 Bigha

OHSR, at Indra Nagar13 Bigha

Q 55.00 200

19 Tube Well No 14, at Pey Jal Nigam Colony

OHSR, at Zila Parishad Dak Bungalow

C 1,000.00 150

20 Tube Well No 15, near Cantt. Area

OHSR, Near Cantt. Area

K 55.00 200

21 Tube Well No 16, at Mahila Degree College

OHSR, at Mahila Deg. College

J 55.00 200

22 Tube Well No 17, at Tehsil OHSR, at Theshil

S 55.00 200

23 Over head tank bypass line 0.656 Total 8,406.00

Connecting Mains: The connecting mains from proposed 1 no. GLSR and 16 nos. OHSRs to existing distribution mains network are proposed to cater water supply from GLSR. OHSR to various zones. The total length of proposed connecting mains is 3.185 km and size of proposed pipes are 200 mm DI to 350 mm DI pipe of various connecting length of 50 m to 400 m to existing pipeline of CI, GI, AC and PVC of sizes between 80 mm to 300 mm. Table 10: Details of Proposed Service Reservoirs (GLSR/OHSR)

Sl. No. Proposed Service Reservoirs (GLSR/OHSR) Capacity (KL) 1. Shitlahat GLSR 1050 2. Subash Nagar OHSR, 750 3. Sheesh Mahal OHSR, 750 4. Awas Vikas OHSR, 600 5. Degree College OHSR, 600 6. Rajpura OHSR, 600 7. KMVN OHSR, 600 8. G.G.H School OHSR, 600 9. Hira Nagar OHSR, 600 10. Ujala Nagar/ Dhobi Ghat OHSR, 600 11. Jal Sansthan Trikonia OHSR, 600 12. Hydle Gate OHSR, 1250 13. Indra Nagar13 Bigha OHSR, 600 14. Zila Parishad Dak Bungalow OHSR, 400 15. Near Cantt. Area OHSR, 600 16. Mahila Deg. College OHSR, 1450 17. Tehsil OHSR, 600 Total 12250

Note: Azad Nagar OHSR (Existing), capacity is 700 KL

‐ 10 ‐ 

      

Table 11: Details of Existing Pumping Plants Sl. No. Location No of pumping

Plants Discharge (LPM)

1. Gola head works , PH 2W+1S 800+750+1,000 2. Khandelwal Park , TW 1 1,200 3. Sheesh Mahal, TW 1 1,000 4. Awas Vikas, TW 1 1,500 5. Degree College, TW 1 1,500 6. Rajpura, TW 1 1,500 7. KMVN, TW 1 1,500 8. Indra Nagar, TW 1 1,500 9. Hira Nagar, TW 1 1,500 10. Azad Nagar, TW 1 2,000 11. Ujala Nagar/ Dhobi Ghat, TW 1 1,500 12. Jal Sansthan Trikonia, TW 1 1,500 13. Hydle Gate, TW 1 1,500 14. Indra Nagar13 Bigha, TW 1 1,500

Table 12: Details of Proposed Pumping Plants

Sl. No. Location No of pumping Plants

Discharge (LPM)

1. Gola head works , PH

2W+1S 1980

2. Khandelwal Park , PH 1W+1S 1W+1S

1980 780

3. Sheesh Mahal, PH 1W+1S 1W+1S

780 2220

Table 13: Details of Connecting Mains

Zone Connection from Connection to Proposed Connecting Mains Pipeline Existing Dia.

& Type (mm) Length (m) Dia. (mm) &

Type A & B Shitlahat GLSR Kathgodam distribution main 150 CI 85 350 DI C Zila Parishad OHSR Kathgodam distribution

main 150 CI 250 200 DI

Zila parishad distribution main

80 GI 250 200 DI

D Hydle Gate OHSR Distribution main proposed near canal

150 GI 100 300 DI

E Sheesh Mahal OHSR

Sheesh Mahal distribution main

300 AC 50 250 DI

F Awas Vikas OHSR Awas Vikas distribution main

80 AC 50 250 DI

Awas Vikas distribution main

80 AC 50 250 DI

G Subhas Nagar OHSR

Subhas Nagar distribution main

100 GI 50 250 DI

Subhas Nagar distribution main

90 PVC 50 250 DI

H J.S.Tikoni OHSR Tikonia Zone distribution main

300 AC 50 250 DI

I Degree College OHSR

Degree College distribution main

300 AC 250 250 DI

Degree College distribution main

150 GI 250 250 DI

J Mahila Degree College OHSR

M.D.C. Zone distribution main

150 GI 200 300 DI

‐ 11 ‐ 

      

Zone Connection from Connection to Proposed Connecting Mains Pipeline Existing Dia.

& Type (mm) Length (m) Dia. (mm) &

Type K Cantt. Area OHSR Cantt. Area Distribution

main 100 GI 50 250 DI

Cantt. Area distribution main

125 AC 200 250 DI

L Rajpura OHSR Rajpura distribution main 150 GI 50 250 DI Rajpura distribution main 100 AC 50 250 DI

M KMVN OHSR KMVN zone distribution main

200 AC 400 250 DI

KMVN zone distribution main

100 GI 100 250 DI

KMVN zone distribution main

80 GI 100 250 DI

N Hira Nagar OHSR Hira Nagar zone distribution main

150 GI 100 250 DI

O Azad Nagar OHSR (Existing)

Distribution main - - -

P Indra Nagar, GGHS OHSR

Indra Nagar distribution main

150 GI 200 250 DI

Indra Nagar distribution main

80 GI 50 250 DI

Q 13 Bigha OHSR 13 Bigha distribution main 125 GI 50 250 DI R Ujala Nagar OHSR Ujala Nagar distribution

main 150 GI 50 250 DI

Ujala Nagar distribution main

80 GI 50 250 DI

S Tehsil OHSR Railway Bazar distribution main

250 AC 50 250 DI

Total 3,185

Pump House:

I. Existing Pump House Table 14: Details of Existing Pump House

Location Year of Constructio

n

No. of Pumps

Present Quality

Major Defect Renovation Proposed

Energy Requirement

Gola Headworks

1954 2W+1S Satisfactory except inlet pipes and size of sumps

1. Size of sump is very small

2. Inlet arrangement to sump not functioning

3. Excessive bends in suction pipe

1. Size of sump increased

2. Improvement in suction arrangement

35 KW

J. Proposed Pump Houses

Table 15: Details of Proposed Pump Houses

Location No. of Pumps Installed

To Pump Water From To

Shishmahal 1 W + 1 S Shishmahal CWR

1. Shishmahal proposed OHSR 2. Hydel Gate

Khandelwal Park 1 W + 1 S Khandelwal CWR 1. Subhash Nagar proposed OHSR 2. Mahila degree college proposed OHSR

‐ 12 ‐ 

      

K. Pumping Plant Table 16: Details of Proposed Pumping Plants

Location No. of Pumps

Installed

Year of Installation

Discharge (MLD)

Present Quality

Augmentation Proposed No. of Pumps

Disch. (MLD)

Head (m)

To

Gola Headworks

2W+1S 2 nos.-1954 1 no.-1995

1.00 Poor 2W+1S 4.25 104 Shitlahat

Shishmahal - - - - 1W+1S 1W+1S

0.74

2.12

33

34

Shishmahal OHSR Hydel Gate OHSR

Khandelwal Park

1W+1S 1W+1S

0.32

1.90

33

39

Subhas Nagar OHSR Mahila D.C. OHSR

House Connections and Water Meters: Nil under Tranche-2. This will be taken up under tranche-3.

L. Clearances and Land Acquisition No land acquisition is required. Permission for road cutting has already been granted through Government Order No. 50/111/(3)2011-905 (ADB/2011, Dated 9 Feb., 2011) of the state of Uttarakhand. No Forest land permission is required Risk and Assumptions for Implementation of Subproject: • Risk of potential contractor to work in Uttarakhand. • Limited availability of experienced construction agencies within the state, which might cause delay in

construction and affect the quality of work. • Resistance from local residents, shop vendors, adjacent private agricultural landowners if they are not

adequately compensated before the start of construction activity. However, to mitigate the above risks, following are the assumptions that will be provided by the implementing agency: • Business opportunity seminar. • NGOs will be deployed in the field to conduct awareness programs among the residents of the town

about the benefits of the project. • Training workshops for implementing agencies and contracting firms regarding various aspects of the

project, like quality & progress, and various safeguard policies of the Asian Development Bank. • Will obtain all necessary clearances before approval of Loan • Providing concessions and incentives to the contractors. • RP Implementing/CAPP NGO will involve officials from UPJN/IPMU/Nagar Nigam and will conduct

consultations with the APs and other residents to keep them informed about the project activities, impacts and benefits extended to them. A summary of SRP including the details of sub-project will also be made available to APs in local language.

• APs will be adequately compensated based on SRP before the start of construction activity.

8. DESIGN FEATURES

A. Design Period The design period is 30 years after implementation; Base Year is 2013, Intermediate Year 2028 and Ultimate Design Year 2043.

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B. Design Basis

The works under the subproject are proposed to be designed as per the norms recommended in CPHEEO Manual of Govt. of India. The coverage of the population is given below. Urban Population Coverage: - Present Urban Population (2011) 1,66,534 - Urban Population in Base Year (2013) 1,81,990 - Urban Population at Intermediate Year (2028) 2,83,654 - Urban Population in Ultimate stage (2043) 4,42,109

Population Presently Availing Services as per the GoI Standards - Population presently availing service as per GOI

standard water supply Nil (Quality & Quantity aspects)

Targeted Additional Population that will Avail Services as per the GoI Standards: - Target additional population that will be

Availing service of Government standard Water supply on completion of project 1,81,990

Capacity Improvement: Production of Water - Present production of water (2011) 25.98 MLD - At project completion (2013) 31.30 MLD

Service Level of Water Supply: - Present quantity 90 lpcd - Targeted quantity 135 lpcd - Present residual head 10 m - Targeted residual head 17 m - Present quality Contaminated - Targeted quality As per GoI Standard

System Storage Capacity: - Present 9,640 KL - Targeted 21,890 KL

Table 17: Other Design Features to be Considered

Pipe materials DI K-9/ MS-ERW/GI pipe material Head loss calculation based on Hazen William / Darcy Weisbach formula Pipe roughness coefficient C = 140, f = 0.024 WTP design criteria As per CPHEEO Manual. Distribution network design EPANET software

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9. Project Cost

A. Subproject Estimated Cost

Table 18: Cost of Subproject

S. No.

Component / Item Amount in INR (Million)

Amount in US $ (Million)

A Civil Works 1. Rehabilitation & augmentation of water supply

system including construction GLSR/ OHSR. 181.47 4.03

Civil Work Base Cost (A) 181.47 4.03 B Contingencies 1. Physical contingencies @ 5% 9.07 0.20 2. Price contingencies @ 10% 18.15 0.40 Sub Total B 27.22 0.60 Total A+B 208.69 4.56

Note: Conversion rate is considered at INR 45 = 1 US$

10. IMPLEMENTATION ARRANGEMENT

B. Implementation Period Table 19: Time line for the Subproject

Approval of this SAR July 2011 Completion of detailed engineering design April, 2011 Issuance of tender documents August, 2011 Contract award December, 2011 Commencement of contract February, 2012 Completion of contract January, 2014

C. Implementation Agency

The subproject will be implemented by the Investment Program Implementation Unit (IPIU) under direct administrative and financial control of Investment Program Monitoring Unit (IPMU), which will be the Executing Agency. The DSC-2 will assist IPIU in implementation; and M/s Wilbur Smith Associates retained as IPMC will assist IPMU on overall project management.

D. Design and Construction Supervision Agency M/s STUP Consultants & M/s SPAN Consultants JV is retained as Design and Supervision Consultant (DSC-2) under the control IPMU.

11. Procurement and Consultant Selection A. Procurement Method

The package shall be item rate contract package, under NCB mode. Bidding will follow ADB Single Stage Two Envelope procedure.

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12. Operation and Maintenance

A. Asset Owner after Completion

Uttarakhand Jal Sansthan (UJS) will be the asset owner after completion of construction of the subproject.

B. Estimated Annual O&M Cost The O&M cost for the work under this subproject worked as follows: Table 20: Details of O&M Expenditure for Water Supply Subproject, Haldwani

Component O&M Cost per year up

to 2023 O&M Cost per year up

to 2033 O&M Cost per

year up to 2043 O&M cost per year (average)

INR (Million) Electric power 16.53 17.36 18.23 17.37 Civil works 12.62 14.52 16.69 14.61 WTP Chemicals and material 6.62 7.61 8.76 7.66

Man power 24.59 27.05 29.75 27.13 Fuel 0.93 1.07 1.23 1.08 Others 1.90 2.18 2.51 2.20 Total 63.19 69.79 77.17 70.05

13. ECONOMIC AND FINANCIAL ANALYSIS

A. Economic Analysis

Estimated Economic Internal Rate of Return (EIRR) is 25.08% The main evaluation has indicated that the proposed water supply sub projects under Tranche-2 for Haldwani Town was found to be economically viable, with the calculated EIRR values exceeding the economic opportunity cost of capital. The sensitivity analysis has demonstrated the robustness of this result when the combination of changed assumptions was tested for viability. Furthermore, for the proposed water supply subproject, the calculated EIRR value is considered minimum estimates of economic return, as there are a number of economic benefits of reduced pollution, a cleaner city and improved waterway environment that have not been quantified. Table 21: Sensitivity Analysis for Water Supply Component (EIRR) – Haldwani Tranche-2

Details EIRR Main Evaluation (Base Case) a/ 25.08% Capital Cost Overrun b/ 22.21% Switching Value c/ 181.00% O&M Cost Overrun d/ 21.94% Switching Valuec/ 88.00% Decrease in Project Benefits e/ 19.28% Switching Valuec/ 42.00% One Year Delay in Implementation 25.07% All Four Tests Combined 14.22%

a/ From Base Cost b/ 20% increase in capital cost. c/ Calculated as the percentage change in a variable required for EIRR to reduce to 12%. d/ 20% increase in O&M cost. e/ Decrease in project benefits by 20%.

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B. Financial Analysis Financial sustainability and viability analysis and the sensitivity analysis results in terms FIRR are presented below. Table 22: Financial Viability Sensitivity Analysis Results – WS Subproject, Haldwani (Tranche-2)

Component Base Case Capital cost increase by

10%

O&M cost increase by

10%

Project Revenue decrease by 10%

Project Revenue delay by one

year WS – Tr 2, Haldwani

10.9% 9.9% 9.3% 8.6% 8.6%

The main evaluation has indicated that the proposed water supply sub projects for Haldwani under Tranche 2 is found to be financially viable, with the calculated FIRR values is above the WACC (3.5%), for the recommended user charges under FIAP. Also, the project ensures 100% O&M recovery from the operation start year. Detailed report is presented in Attachment 5.

14. ENVIRONMENTAL ASSESSMENT

A. Brief Description of Environmental Impact This proposed water supply subproject in Haldwani includes: • Replacing/laying of clear water transmission mains 8.4 km (250-350 mm diameter), and connecting

mains 3.2 km (200-350 mm diameter) • Augmentation of sump (storage) at Gola Headworks • New/rehabilitation of pumping systems • Construction of 17 nos of Overhead/Ground-level Service Reservoirs Subproject is located in Haldwani Town of Nainital District. Located in the foot hills, this town is the main centre and gateway to all the hill towns in the southern and eastern part of the state. The main works proposed are laying of new transmission mains and rehabilitation of existing mains. Since the sub-project is only an optimisation of the existing water supply system, no design impacts are anticipated. The subproject is designed in such a way that the supply demand gap will be met through reduction of losses by measures such as replacement of old, damaged and profusely leaking mains. The subproject does not involve any source augmentation measures and therefore no major impacts envisaged. All the service reservoirs will be designed according to seismic zoning guidelines. Pumping systems will be installed within the existing facilities. The service reservoirs will be constructed on government owned land parcels. The proposed mains will be laid alongside the roads and will be buried at least 1 m below the road surface. It will be ensured that pipe alignment is chosen in such a manner that the pipeline does not pass below the sewer lines to avoid contamination. Construction impacts include, impacts associated with the site cleaning, earth works, physical construction related materials movements and works, machinery, vehicles and workers. Major impacts envisaged are dust generation, from disposal of surplus soil, silt run off, noise and air emission from construction, blockage of access to houses and commercial area, damage to other infrastructure etc. As the work is to be implemented within city area, general public is likely to be exposed to dust and noise generated during construction, access obstruction to residential/ commercial buildings and affection of temporary livelihood

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in some cases. Construction impacts are likely to be significant as most of the roads are narrow. Most of these are common impacts of construction in urban areas, and there are well developed methods for their mitigation such as beneficial use for waste material; dust suppression; covering soil and sand during transportation; planning work to minimise disruption of traffic and communities, providing temporary access across trenches, and prior public information etc. Besides, best construction methodology will be adopted to minimize the impacts. There may be issues due to labour from other areas and also from the need for labour camps. Local workers will be employed as much as possible to avoid these. Detection, and repair of leaks and pipe bursts is another main activity. These are however likely to be minimal as proper design, and selection of good quality pipe material should mean that leaks are minimal. No notable impacts envisaged during operation. Public consultation has been conducted to understand the local issues and public views regarding the overall project and possible impacts. The IPMU will establish a mechanism to receive and facilitate resolution of affected persons’ concerns, complaints and grievances on subproject’s environmental performance.

B. ERA Assessment The ERA assessment on following Likely to be classified as:

Category A under the EIA Notification of 2006 of GoI Category B under the EIA Notification of 2006 of GoI No category / Environmental Clearance not required under EIA Notification, 2006

The project site is not:

Within 10 km from the boundary of protected areas, notified areas and inter-state and international boundaries as defined under EIA Notification of 2006 of GoI

A part of National Parks/Sanctuaries and Tiger Reserve areas (notified as defined under Indian Wildlife (Protection) Act, 1972)

Near to reserved forest or protected forest as defined under Forest (Conservation) Act, 1980 (amended in 1988)

The subproject does not require:

Consent for Establishment and Consent for Operation under the Water (Prevention and Control of Pollution) Act, 1974 and/or the Air (Prevention and Control of Pollution) Act, 1981

Authorization for waste processing and landfills under Municipal Solid Waste (Management and Handling) Rules, 2000 of GoI.

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Environmental Categorization Form

A. Instructions (i) The project team completes and submits the form to the Environment and Safeguards Division (RSES) for endorsement by RSES Director, and for approval by the Chief Compliance Officer (CCO). (ii) The classification of a project is a continuing process. If there is a change in the project components or/and site that may result in category change, the Sector Division submits a new form and requests for recategorization, and endorsement by RSES Director and by the CCO. The old form is attached for reference. (iii) In addition, the project team may propose in the comments section that the project is highly complex and sensitive (HCS), for approval by the CCO. HCS projects are a subset of category A projects that ADB deems to be highly risky or contentious or involve serious and multidimensional and generally interrelated potential social and/or environmental impacts. B. Project Data

Country/Project No./Project Title : India/Loan No-2410/UUSDIP Department/ Division : UUSDIP/IPMU Processing Stage : Draft SAR for Approval. Modality :

[ ] Project Loan [ ] Program Loan [ ] Financial Intermediary [ ] General Corporate Finance [ ] Sector Loan [ X ] MFF [ ] Emergency Assistance [ ] Grant [ ] Other financing modalities:

C. Environment Category [ X ] New [ ] Recategorization ― Previous Category�[ ]

Category A {X} Category B

Category C

Category FI

D. Basis for Categorization/ Recategorization (pls. attach documents): [ X ] REA Checklist as ANNEXURE A [ X ] Project and/or Site Description [ ] Other: __________________________ E. Comments Project Team Comments: The Proposed Project of construction of OHSR and appurtenant works for water supply system in Haldwani fall under the Environmental Category “B” as its potential adverse environmental impacts are less adverse than those of category A projects The impacts are site specific and can be mitigated readily through EMP.

RSES Comments The Project Category as per ADB Safeguard Policy ( SPS) 2009 is “B” and IEE is required.

F. Approval Proposed by: Environmental Specialist, DSC-2

Endorsed by: Team Leader, DSC-2

Project Team Leader, {Department/Division} Director, RSES Date: Date:

Approved by: Dy Program Director, IPMU

Endorsed by: Environmental Officer, IPMU

Highly Complex and Sensitive Project

Director, {Division} Chief Compliance Officer

Date: Date:

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15. INVOLUNTARY RESETTLEMENT

A. Brief Description of Resettlement Issues

This proposed subproject of water supply system is for the entire Haldwani town and designed in such a way so as to minimize land acquisition and resettlement impacts. Tranche-2 sub-project components such as augmentation/rehabilitation of sump and pumping system will be accommodated within the existing facilities’ premises and will not involve any permanent/temporary land acquisition and resettlement. For sub-project components such as construction of new OHSRs/GLSR, government/UPJN/institution land has been identified. Laying/replacement of clear water /connecting mains will also be undertaken within the existing RoW, however envisages temporary impacts for short periods on roadside (movable) vendors. During RP preparation, a detailed census survey will be conducted for temporarily affected people (APs) and all these will be adequately compensated based on the UUSDIP RF. Suitable temporary alternative sites will also be suggested to movable vendors to enable them to continue their economic activities during construction. RP Implementing/CAPP NGO will involve officials from UPJN/IPMU/Nagar Nigam and will conduct consultations with the APs and other residents to keep them informed about the project activities, impacts and benefits extended to them. A summary of RP including the details of sub-project will also be made available to APs in local language. The proposed sub-project components and associated land acquisition and resettlement impacts are given below. Details of Sub-project Component Land Acquisition and Resettlement Impact Construction of 16 nos. OHSRs

All identified sites for OHSRs belong to various government departments, educational institutions and a temple trust (Appendix-2). Each OHSR will require approximately 150-400 sqm of land. NOC for construction of OHSRs on government land has been obtained.

Construction of one ground level service reservoirs (GLSRs)

Identified site at Shitlahat for LSR belong to Uttarakhand Jal Sansthan (UJS) and permission/NOC has been obtained. The GLSR will require approximately 225 sqm. of land.

Construction of two new pump houses Identified sites for proposed pump houses belong to UJS and permission/NOC have been obtained.

Replacement of three damaged/old pumps and Rehabilitation of Gola headworks pump house

The sub-project component activity will be confined within the existing campus at Gola headworks and no land acquisition is required. Pipelines will be buried 1m. below in a trench on the edge of the road within the existing RoW. However, will have temporary impacts on roadside businesses.

Laying new connecting mains (27 pipelines from various OHSR/GLSR to distribution mains for 3.185 km); Replacement of old/damaged transmission mains (1.0 km); Replacement of under-road pipelines for (0.500 m); Laying of new clear water mains (22 pipelines in various stretches for 6.25 km

B. ERA Assessment

The ERA Assessment on following This Sub-project is unlikely to cause:

Loss of any private land for agricultural land, homestead land or vacant plot Loss of any government land for agricultural land, homestead land or vacant plot used by (i) legal or

(ii) illegal occupants

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Loss of residential structure including but is not limited to walls, fences, sheds, wells used by (i) legal or (ii) illegal occupants

Loss of commercial structure used by (i) legal or (ii) illegal occupants Loss of trees and crops Temporary loss of land Temporary disruption of livelihood Loss and temporary impacts on common resources

C. Involuntary Resettlement Category

Category A Category B Category C Category FI

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INVOLUNTARY RESETTLEMENT IMPACT CATEGORIZATION

Date: _________________ A. Instructions (i) The project team completes and submits the form to the Environment and Safeguards Division (RSES) for endorsement by RSES Director, and for approval by the Chief Compliance Officer (CCO). (ii) The classification of a project is a continuing process. If there is a change in the project components or/and site that may result in category change, the Sector Division submits a new form and requests for recategorization, and endorsement by RSES Director and by the CCO. The old form is attached for reference. (iii) In addition, the project team may propose in the comments section that the project is highly complex and sensitive (HCS), for approval by the CCO. HCS projects are a subset of category A projects that ADB deems to be highly risky or contentious or involve serious and multidimensional and generally interrelated potential social and/or environmental impacts. B. Project Data

Country/Project No./Project Title : India: Project-2 “Uttarakhand Urban Sector Development Investment Program Department/ Division : Urban Development Department Processing Stage : Draft SAR Approval Modality :

[ ] Project Loan [ ] Program Loan [ ] Financial Intermediary [ ] General Corporate Finance [ ] Sector Loan [ ] MFF [ ] Emergency Assistance [ ] Grant [ ] Other financing modalities: C. Involuntary Resettlement Category [ ] New [ ] Recategorization ― Previous Category [ ]

Category A

Category B

Category C Category FI

D. Comments Project Team Comments: The Sub-project involves temporary impacts on roadside (movable) vendors. A census survey and preparation of Short Resettlement Plan is under process and will be completed by May 2011.

RSES Comments: The sub project falls in “ B “ category of R & R as per SAP 2009 and a SRP will be required

E. Approval Proposed by: R & R Expert, DSC – II

Reviewed by: R & R Expert, IPMC

Project Team Leader, {DSC-II} Social Safeguard Specialist, RSDD/RSES Date: Date:

Endorsed by: SCDO, IPMU Director, RSES Date: Endorsed by: SCDO, IPMU

Approved by: Dy Program Director

Highly Complex and Sensitive Project

Director, {Division} Program Director Chief Compliance Officer Date: Date:

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16. INDIGENOUS PEOPLE DEVELOPMENT

A. Brief Description of Indigenous People

There are no IPs/ethnic minority groups (as defined by the ADB policy and by the Indian Constitution Article 342 and 366(25)) residing within sub-project locations/activity area.

B. The ERA Assessment on Following This Sub-project does not envisage any permanent/temporary impacts on IPs.

C. Indigenous People Development Category

Category A Category B Category C Category FI

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INDIGENOUS PEOPLES IMPACT CATEGORIZATION

DATE: _________________ A. Instructions (i) The project team completes and submits the form to the Environment and Safeguards Division (RSES) for endorsement by RSES Director, and for approval by the Chief Compliance Officer (CCO). (ii) The classification of a project is a continuing process. If there is a change in the project components or/and site that may result in category change, the Sector Division submits a new form and requests for recategorization, and endorsement by RSES Director and by the CCO. The old form is attached for reference. (iii) The project team indicates if the project requires broad community support (BCS) of Indigenous Peoples communities. BCS is required when project activities involve (a) commercial development of the cultural resources and knowledge of indigenous peoples, (b) physical displacement from traditional or customary lands; and (c) commercial development of natural resources within customary lands under use that would impact the livelihoods or the cultural, ceremonial, or spiritual use that define the identity and community of indigenous peoples. (iv) In addition, the project team may propose in the comments section that the project is highly complex and sensitive (HCS), for approval by the CCO. HCS projects are a subset of category A projects that ADB deems to be highly risky or contentious or involve serious and multidimensional and generally interrelated potential social and/or environmental impacts. B. Project Data

Country/Project No./Project Title : India: Project-2 “Uttarakhand Urban Sector Development Investment Program Department/ Division : Urban Development Department Processing Stage : Draft SAR for Approval Modality :

[ ] Project Loan [ ] Program Loan [ ] Financial Intermediary [ ] General Corporate Finance [ ] Sector Loan [ ] MFF [ ] Emergency Assistance [ ] Grant [ ] Other financing modalities: C. Indigenous Peoples Category [ ] New [ ] Recategorization ― Previous Category [ ]

[ ] Category A

[ ] Category B

[ ] Category C [ ] Category FI

D. Project requires the broad community support of affected Indigenous Peoples communities.

[ ] Yes [ ] No

E. Comments Project Team Comments: The sub-project will equally benefit all the population groups and consequently not differentially or adversely affect any group.

RSES Comments: IP category is “ C “ and no IPDP is required

F. Approval Proposed by: SDE, DSC – II

Reviewed by: CDE, IPMC

Project Team Leader, {DSC-II} Social Safeguard Specialist, RSDD/RSES Date: Date:

Endorsed by: SCDO, IPMU Director, RSES Date: Endorsed by: SCDO, IPMU

Approved by: Dy Program Director

Highly Complex and Sensitive Project

Director, {Division} Program Director Chief Compliance Officer Date: Date:

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17. OTHER ISSUES, if any

Nil

‐ 25 ‐ 

      

Attachment-1

INITIAL POVERTY AND SOCIAL ANALYSIS Subproject - Construction of OHSR and Appurtenant Works for Water Supply System in Haldwani

Initial Poverty Reduction and Social Strategy (IPSA):

A. Linkages to the Country Poverty Analysis

Sector identified as a National Priority in Country Poverty Analysis?

Yes Sector identified as a National Priority in Country Poverty Partnership Agreement

Yes

Contribution of the sector/sub sector to reduce poverty in India

The main objective of UUSDIP is to promote economic growth in Uttarakhand State through developments in basic Infrastructure services such as water supply, sewerage, sanitation, solid waste management, urban mass transport and other municipal functions in Haldwani and other important urban centers of the state. UUSDIP will also strengthen the service delivery systems of the responsible agencies of the State and urban local bodies through management reforms, capacity building and training.

Indians poverty reduction strategy explicitly recognizes that while economic growth and service delivery are crucial for poverty reduction. Infrastructure development is critical as a catalyst for generating economic activities, employment and accelerating growth and for providing better integration India's various state and regions. Increasing trade with neighboring countries facilitated amongst other means through,providing sanitation, drinking water and roads contributes to micro-economic stability and reduced risk of shocks for the vulnerable and poor.

B. National Sample Survey Organization (NSSO) Estimate of poverty are available from two main sources, one is the large surveys undertaken by the National Sample Survey Organization (NSSO) every five years and the second is from the State Government own surveys conducted to identify households below the poverty line for the express purpose of benefiting under poverty alleviation programs. The status of Human Development Index in Uttaranchal has been examined in the light of National Human Development Report-2001. Results for the NSSO are available, wherein two estimates have been given. One is the poverty line head count ration depending on the official poverty line and the other is as suggested by the Expert Group set up by the Planning Commission on estimates of poverty. While there is still some lack of certainty on the head count ration, the recommendations of Expert Group are used, as calculated by NSSO's special study. According to the state government of Uttaranchal about 4,16,018 persons were identified as living below the poverty line in the year 2002. Based on the total population being 84,79,562 as per Census-2001 and the percentage of people living below the poverty line notified by the Planning commission, the total number of persons living below the poverty line can be estimated around 29.28 lakh which in distinctly higher than the figures estimated by the state government of Uttaranchal and compare to neighbouring state of Himachal Pradesh. In the absence of data not being made available by NSSO on per-capita expenditure pertaining to special category state, the state government should use existing machinery to identify the exact number of persons or families living below the poverty line fixed by the Planning commission. Those not willing to believe the extent of poverty mainly in the 11 hill districts of Uttaranchal, must know that today people are surviving in this hill state because of an estimated INR 3,200.00 million of remittances coming yearly from migrant workers all over India and abroad. Poverty issues were also discussed with the local people during public consultations. The People living in this area welcomed. The

‐ 26 ‐ 

      

present water supply scheme of the city is implemented by Uttarakhand Pay Jal Nigam and maintained by Uttarakhand Jal Sansthan. Water and sanitation are key instruments in reducing poverty, improving livelihoods, and promoting economic growth. The project will help finance investments for pro-poor and community-based water, sanitation, and solid waste management initiatives through measures that sustain service delivery and strengthen the capacity of the government, utilities, and communities. People mentioned that construction and maintenance will help to raise the quality of life in the area as there will be an improvement of income and livelihoods due to the creation of direct and indirect employment opportunities due to the project. In addition to the improvement in the infrastructural facilities people perceive that educational and health facilities shall also be improved.

C. Participation Process Participation consultation and informational disseminate was incorporated at several level during planning of the project (i) while conduction poverty and social assessments in communities along the water supply project and immediate corridor of impact. (ii) validating principles on which entitlements for compensation levels specified, in the entitlement matrix for the project are based (iii) minimizing adverse impact . Uttarakhand Pay Jal Nigam and Uttarakhand Jal Sansthan will ensure that essential participation focuses to be adhered to during implementation that will involve local people in (i) preparing final listing for compensation for project affected persons (both title and non-title persons) if any, and (ii) monitoring and evaluation during implementation of resettlement plan.

D. Gender and Development Process Women will be benefited from the project through improved access to basic services like water, sanitation, health, etc. In the project areas gender balance will be ensured by means of equal women participation in various activities like women as a labour and equal wages to both the gender. The project will also sensitize them on safety and security measures and support them to develop a favorable and comfortable working culture at construction site. Therefore, project will have positive impact on women in terms of employment opportunity.

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Attachment-2

RAPID ENVIRONMENTAL ASSESSMENT (REA) CHECKLIST (REVISED)

Subproject - Construction of OHSR and Appurtenant Works for Water Supply System in Haldwani A. Screening Questions for Impact Categorization

Check the appropriate box (e.g. by double-clicking the box and selecting ‘checked’ in default vale) Screening Questions Yes/No Remarks

A. Project Siting

Is the project area…

Yes No

Haldwani is a densely populated town with narrow and congested streets. The subproject components are located outside the town, and pipeline connecting to clear water reservoirs will be laid within the town area. These main lines will be laid mostly on major/wider roads.

• Densely populated?

Yes No

There are no major development activities • Heavy with development activities?

Yes No

No • Adjacent to or within any environmentally sensitive areas?

Yes No

There is no cultural heritage site in the project area.

• Cultural heritage site

Yes No

No • Protected Area

Yes No

No • Wetland

Yes No

No • Mangrove

Yes No

No • Estuarine

Yes No

No • Buffer zone of protected area

Yes No

No • Special area for protecting biodiversity

Yes No

No • Bay

Potential Environmental Impacts Will the Project cause…

Yes No

No new source development/augmentation is proposed under the subproject; existing sources are being used and there are no pollution risks

• Pollution of raw water supply from upstream wastewater discharge from communities, industries, agriculture, and soil erosion runoff?

• Impairment of historical / cultural monuments / areas and loss / damage to these sites?

Yes No

There is no historical / cultural monument in the project location.

Yes No

No source augmentation proposed in the subproject

• Hazard of land subsidence caused by excessive ground water pumping?

Yes No

The subproject does not involve land acquisition or displacement.

• Social conflicts arising from displacement of communities?

Yes No

No source augmentation proposed in the subproject

• Conflicts in abstraction of raw water for water supply with other beneficial water uses for surface and ground waters?

• Unsatisfactory raw water supply (e.g. excessive pathogens or mineral constituents)?

Yes No

Raw water is fit for drinking; water will be supplied after disinfection. Raw water testing before and after treatment is routine practice by Jal Sansthan.

Yes No

Raw water will be given adequate treatment prior to supply into distribution system.

• Delivery of unsafe water to distribution system?

• Inadequate protection of intake works or Yes No source augmentation/developed proposed in

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Screening Questions Yes/No Remarks wells, leading to pollution of water supply?

No the subproject; existing sources are adequately protected

Yes No

No source augmentation proposed in the subproject; extraction will be at the existing levels

• Over pumping of ground water, leading to salinization and ground subsidence?

• Excessive algal growth in storage reservoir?

Yes No

Regular cleaning of storage reservoir shall be ensured to avoid algal growth in the reservoir.

Yes No

Sewerage system of adequate capacity including treatment will be developed under UUSDIP

• Increase in production of sewage beyond capabilities of community facilities?

Yes No

No WTP proposed in the subproject • Inadequate disposal of sludge from water treatment plants?

Yes No

Adequate buffer and protection will be ensured. • Inadequate buffer zone around pumping and treatment plants to alleviate noise and other possible nuisances and protect facilities?

Yes No

Temporary impairment with access roads is anticipated during construction. Restoration of damaged roads will be ensured as soon as the work is completed. Diversions shall be provided with consultation with local people where blocking of roads is needed.

• Impairments associated with transmission lines and access roads?

Yes No

Subproject does not involve such components • Health hazards arising from inadequate design of facilities for receiving, storing, and handling of chlorine and other hazardous chemicals.

Yes No

No chlorination facilities proposed under the subproject

• Health and safety hazards to workers from the management of chlorine used for disinfection and other contaminants?

Yes No

Subproject does not involve land acquisition or displacement. However, there may be temporary disturbance to business and squatters/vendors during laying of transmission mains in the town area. Appropriate measures will be suggested to mitigate the impact.

• Dislocation or involuntary resettlement of people

Yes No

Local workers shall be encouraged for engaging for different construction activities.

• Social conflicts between construction workers from other areas and community workers?

• Noise and dust from construction activities?

Yes No

Short term impact on air quality due to dust generation during construction activities is anticipated. Appropriate dust suppression measures will be taken to minimize dust generation due to construction activities at site. No significant increase in noise level is anticipated due to construction. All equipment and machineries will conform to the Statutory norms.

Yes No

Haldwani is a predominantly plain area. Work will mostly be conducted during dry season. No impacts envisaged; Proper back filling and followed by compaction should be ensured.

• Continuing soil erosion / silt runoff from construction operations?

Yes No

Proper traffic management and planning will be ensured during construction.

• Increased road traffic due to interference of construction activities?

• Delivery of unsafe water due to poor O&M treatment processes (especially mud accumulations in filters) and inadequate chlorination due to lack of adequate monitoring of chlorine residuals in distribution systems?

Yes No

Trained and skilled staff will be deployed for O&M. Also, quality of treated water will be regularly monitored through water sample testing to ensure delivery of safe water to consumers.

• Delivery of water to distribution system, which is corrosive due to inadequate attention to feeding of corrective chemicals?

Yes No

DI pipes will be used for water transmission mains and are non corrosive in nature.

• Accidental leakage of chlorine gas? Yes No chlorination facilities proposed under the

‐ 29 ‐ 

      

Screening Questions Yes/No Remarks No subproject Yes No

No source augmentation proposed in the subproject; extraction will be at the existing levels

• Excessive abstraction of water affecting downstream water users?

Yes No

No • Competing uses of water?

Yes No

Upgradation of sewerage system and sewage treatment facilities will be taken up under ADB program.

• Increased sewage flow due to increased water supply

Yes No

Upgradation of sewerage system and sewage treatment facilities will be taken up under ADB program.

• Increased volume of sullage (wastewater from cooking and washing) and sludge from wastewater treatment plant

Large population influx during project construction and operation that causes increased burden on social infrastructure and services (such as water supply and sanitation systems)?

Yes No

No such impact anticipated; local communities in the vicinity of the project would be employed as much as possible.

Risks to community health and safety due to the transport, storage, and use and/or disposal of materials such as explosives, fuel and other chemicals during operation and construction?

Yes No

Not applicable. Construction will not involve use of explosives and chemicals.

Community safety risks due to both accidental and natural hazards, especially where the structural elements or components of the project are accessible to members of the affected community or where their failure could result in injury to the community throughout project construction, operation and decommissioning?

Yes No

Operational area will be clearly demarcated and access will be controlled. Only worker and project concerned members will be allowed to visit the operational sites. During operation no such issues anticipated.

‐ 30 ‐ 

      

‐ 31 ‐ 

Climate Change and Disaster Risk Questions

Yes No Remarks

The following questions are not for environmental categorization. They are included in this checklist to help identify potential climate and disaster risks.

Is the Project area subject to hazards such as earthquakes, floods, landslides, tropical cyclone winds, storm surges, tsunami or volcanic eruptions and climate changes (see Appendix I)?

√ According to hazard zoning in the Vulnerability Atlas of India, the whole of Uttarakhand falls under “very high” to “high” category earthquake zone. All the structure designs confirm to seismic design, where applicable.

Could changes in temperature, precipitation, or extreme events patterns over the Project lifespan affect technical or financial sustainability (e.g., changes in rainfall patterns disrupt reliability of water supply; sea level rise creates salinity intrusion into proposed water supply source)?

√ No

Are there any demographic or socio-economic aspects of the Project area that are already vulnerable (e.g., high incidence of marginalized populations, rural-urban migrants, illegal settlements, ethnic minorities, women or children)?

√ No

Could the Project potentially increase the climate or disaster vulnerability of the surrounding area (e.g., by using water from a vulnerable source that is relied upon by many user groups, or encouraging settlement in earthquake zones)?

√ No such possibility of vulnerability increase of the surrounding area.

B. IPMU’s Assessment checklist, what is the IPMU’s assessment on the Categorization and Planning

Requirement for this subproject?

Category A. A proposed project is classified as category A if it is likely to have significant adverse environmental impacts that are irreversible, diverse, or unprecedented. These impacts may affect an area larger than the sites or facilities subject to physical works. An environmental impact assessment is required.

Category B. A proposed project is classified as category B if its potential adverse

environmental impacts are less adverse than those of category A projects. These impacts are site-specific, few if any of them are irreversible and in most cases mitigation measures can be designed more readily than for category A projects. An initial environmental examination is required.

Category C. A proposed project is classified as category C if it is likely to have minimal or

no adverse environmental impacts. No environmental assessment is required although environmental implications need to be reviewed.

Category FI. A proposed project is classified as category FI if it involves investment of

ADB funds to or through a FI.

      

INVOLUNTARY RESETTLEMENT IMPACT CATEGORIZATION CHECKLIST

Probable Involuntary Resettlement Effects

Yes No Not Known

Remarks

Involuntary Acquisition of Land 1. Will there be land acquisition? - - All sub-project replacement/new works will

be accommodated within the existing facility premises, on government/UPJN land and within the existing RoW and no permanent land acquisition and resettlement is envisaged.

2. Is the site for land acquisition known? - - - Not Applicable 3. Is the ownership status and current usage of land to be acquired known?

- - - Not Applicable

- - The existing RoW will be utilized for the laying of clear water mains and distribution lines.

4. Will easement be utilized within an existing Right of Way (ROW)?

5. Will there be loss of shelter and residential land due to land acquisition?

- - -

- - - 6. Will there be loss of agricultural and other productive assets due to land acquisition?

- - - 7. Will there be losses of crops, trees, and fixed assets due to land acquisition?

- - Laying/replacement of clear water and connecting mains may envisage temporary disturbance to roadside commercial activities.

8. Will there be loss of businesses or enterprises due to land acquisition?

- - Laying/replacement of clear water and connecting mains may envisage temporary disturbance to roadside (movable) vendors who have encroached on RoW.

9. Will there be loss of income sources and means of livelihoods due to land acquisition?

Involuntary restrictions on land use or on access to legally designated parks and protected areas - - The sub-project activities may temporarily

affect access to public utilities like electricity, telephone connectivity, water supply etc.

10. Will people lose access to natural resources, communal facilities and services?

- - The sub- project does not envisage any permanent change in the land use, affecting socio-economic activities.

11. If land use is changed, will it have an adverse impact on social and economic activities?

- - The sub-project activities will not affect any such access

12. Will access to land and resources owned communally or by the state be restricted? Information on Displaced Persons: Any estimate of the likely number of persons that will be displaced by the Project? [ ] No [ ] Yes If yes, approximately how many? ______________________ Number of APs will be known after completion of Census Survey Are any of them poor, female-heads of households, or vulnerable to poverty risks? [ ] No [ ] Yes Number of APs will be known after completion of Census Survey. At present it is not known if any of the APs are poor, female headed or vulnerable. Are any displaced persons from indigenous or ethnic minority groups? [ ] No [ ] Yes

‐ 32 ‐ 

      

Attachment-4

INDIGENOUS PEOPLES IMPACT SCREENING CHECKLIST

KEY CONCERNS (Please provide elaborations

on the Remarks column)

YES NO NOT KNOWN

Remarks

A. Indigenous Peoples Identification - - There are no IPs (as defined by the

ADB policy and the Government of India) within sub-project locations/activity area. The activities are mainly confined to urban and surrounding peri urban areas which has very small percentage of scheduled Tribe (ST) population. As per Census 2001, the STs in Uttaranchal are predominantly living in rural areas (94% in rural and just 6% in urban areas). The STs residing in sub-project area are not distinct but part of mainstream population. If such mainstreamed STs are found affected during preparation of SRP, will be treated as vulnerable category. They will be adequately compensated based on the UUSDIP RF.

1. Are there socio-cultural groups present in or use the project area who may be considered as "tribes" (hill tribes, schedules tribes, tribal peoples), "minorities" (ethnic or national minorities), or "indigenous communities" in the project area?

- - 2. Are there national or local laws or policies as well as anthropological researches/studies that consider these groups present in or using the project area as belonging to "ethnic minorities", scheduled tribes, tribal peoples, national minorities, or cultural communities?

3. Do such groups self-identify as being part of a distinct social and cultural group?

- - - Not Applicable

4. Do such groups maintain collective attachments to distinct habitats or ancestral territories and/or to the natural resources in these habitats and territories?

- - - Not Applicable

5. Do such groups maintain cultural, economic, social, and political institutions distinct from the dominant society and culture?

- - - Not Applicable

6. Do such groups speak a distinct language or dialect?

- - - Not Applicable

7. Has such groups been historically, socially and economically marginalized, disempowered, excluded, and/or discriminated against?

- - - Not Applicable

8. Are such groups represented as "Indigenous Peoples" or as "ethnic minorities" or "scheduled tribes" or "tribal populations" in any formal decision-making bodies at the national or local levels?

- - - Not Applicable

‐ 33 ‐ 

      

KEY CONCERNS (Please provide elaborations

on the Remarks column)

YES NO NOT KNOWN

Remarks

B. Identification of Potential Impacts

- - - 9. Will the project directly or indirectly benefit or target Indigenous Peoples? 10. Will the project directly or indirectly affect Indigenous Peoples' traditional socio-cultural and belief practices? (e.g. child-rearing, health, education, arts, and governance)

- - -

11. Will the project affect the livelihood systems of Indigenous Peoples? (e.g., food production system, natural resource management, crafts and trade, employment status)

- - -

- - - 12. Will the project be in an area (land or territory) occupied, owned, or used by Indigenous Peoples, and/or claimed as ancestral domain? C. Identification of Special Requirements Will the project activities include:

- - - 13. Commercial development of the cultural resources and knowledge of Indigenous Peoples?

- - - 14. Physical displacement from traditional or customary lands?

- - - 15. Commercial development of natural resources (such as minerals, hydrocarbons, forests, water, hunting or fishing grounds) within customary lands under use that would impact the livelihoods or the cultural, ceremonial, spiritual uses that define the identity and community of Indigenous Peoples?

- - - 16. Establishing legal recognition of rights to lands and territories that are traditionally owned or customarily used, occupied or claimed by indigenous peoples ? 17. Acquisition of lands that are traditionally owned or customarily used, occupied or claimed by indigenous peoples?

- - -

‐ 34 ‐ 

      

Attachment-5

ECONOMIC AND FINANCIAL ANALYSIS A. Economic Analysis 

Considering the existing water supply problems due to the increase in demand, increased level of UFW and inadequate infrastructure, resulting in high demand gap, the water supply sub-project identified under Tranche-2 in Haldwani town have sound rationale and justification for government intervention. For the present analysis, the sub projects identified under Tranches-2 was considered. Analysis Period: The analysis period of the project is taken as 33 years from the base year 2010, with 30 years operation period, as follows: • Base Year 2010-11 • Construction period – 2011-12 to 2013-14 • Project opened start year – 2014-15 • End of the analysis period –2043-44 No. of operating years after project improvement, considered for economic analysis – 30 years. Thus, 30 years of operation, in effect, from the operation start of the proposed project i.e. 2014-15, has been considered for economic evaluation for the project road. Economic Cost: Project financial cost (Base Cost) is estimated to Rs. 181 million. Considering the contingency and allowances of additional 12%, the total project financial cost was worked out to Rs 227 million and this is phased during the three year construction period. Considering the standard procedures recommended for economic feasibility analysis, the above financial cost was converted into economic cost for the analysis. Project Benefits: • Resource Cost Saving in non-incremental water • Reduction in house health expenditure and savings in earning loss during sick days • Reduction in time spent in water collection. Economic Feasibility Criteria: The cost – benefit analysis is carried out by using the discounted cash flow (DCF) technique to obtain the economic internal rate of return (EIRR) and economic net present value (ENPV) for the proposed investments and the likely quantified project benefits linked with the project during the defined project analysis period. Economic Opportunity Cost of Capital (EOCC): Given the complexity of estimating country-specific economic opportunity cost of capital (EOCC), a discount rate of 12% in constant economic prices is generally used as a proxy for EOCC in the economic analysis of ADB-financed projects. The EIRR must be compared with the economic opportunity cost of capital, for interpretation purpose of project feasibility. Results of the analysis are presented in below table and Appendix 1.

‐ 35 ‐ 

      

Economic Cost-Benefit Analysis for Water Supply Components (Tranche-2), Haldwani Details Present Value

(Rs. million) a/ Costs Capital costs Water Supply 157 O&M costs Water Supply 323 Total costs 480 Benefits Resource Cost savings for Non-incremental water 114 Avoided costs of -health care & earning lost due to illness 345 - reduced time in water collection 304 Total benefits 764 Economic Return Measures Net present value (Rs. Million) 284

25.08% EIRR (%) Note: a/ In 2009-10 prices. Discounted to 2010-11 at 12% real discount rate. Sensitivity Analysis: Sensitivity analysis was carried out to their economic feasibility results for the following scenarios: • Capital cost increase by 20% • O&M costs increased by 20% • Target beneficiaries reduced by 20% • Delay in accrual of benefit by 1 year • Combined adverse condition Results of the sensitivity analysis for the proposed project are summarized in below table. Sensitivity Analysis for Water Supply Component (EIRR) – Haldwani Tranche-2

Details EIRR Main Evaluation (Base Case) a/ 25.08% Capital Cost Overrun b/ 22.21% Switching Value c/ 181.00% O&M Cost Overrun d/ 21.94%

88.00% Switching Valuec/ Decrease in Project Benefits e/ 19.28% Switching Valuec/ 42.00% One Year Delay in Implementation 25.07% All Four Tests Combined 14.22%

a/ From Table - “Economic Cost-Benefit Analysis for Ws Components (Tranche-2), Haldwani”. b/ 20% increase in capital cost. c/ Calculated as the percentage change in a variable required for EIRR to reduce to 12%. d/ 20% increase in O&M cost. e/ Decrease in project benefits by 20%. Of the four sensitivity scenarios (cost overrun, O&M cost increase, reduced beneficiaries, delay in implementation) reduced beneficiaries is the most vulnerable to EIRR, followed cost overrun. Considering

‐ 36 ‐ 

      

the more sensitiveness of these variables, following implementation arrangements need to be focused more so as minimize the project risk: • Ensuring adequate project coverage of beneficiaries through advance commitment from HHs for

individual access or making mandatory for all individual access through project design; • Timely implementation of the project through appropriate procurement method in which incentive for

early completion may be included; • Adequate focus for LA related project components Conclusion: The main evaluation has indicated that the proposed water supply sub projects under Tranche-2 for Haldwani Town was found to be economically viable, with the calculated EIRR values exceeding the economic opportunity cost of capital. The sensitivity analysis has demonstrated the robustness of this result when the combination of changed assumptions was tested for viability. Furthermore, for the proposed water supply subproject, the calculated EIRR value is considered minimum estimates of economic return, as there are a number of economic benefits of reduced pollution, a cleaner city and improved waterway environment that have not been quantified.

B. Financial Analysis The revenue streams for the financial analysis of sub project include connection fee for new connections and a monthly charge. As property tax based levy (Water Tax) was abolished in the state1, it was not considered for the analysis. A decision on implementing the above discussed revenue stream (monthly charge and connection fee) is critical to project sustenance. Apart from a revision on completion of the capital works, it would be necessary to revise the sewer user charges periodically so as to compensate the increasing O&M cost. The key assumptions used for analysis include: • maintaining the existing user charges for domestic and applying a differential rate for non-domestic

irrespective of above; • revision to the user charge periodically; • maintain tax collection percentages at least 80% of the demand, • implementing the project on schedule Initial project capital cost (Base Cost) is estimated to Rs. 181 million to be implanted during the three year constriction period. Project Capital Cost - Rs Million – (Tranche-2)

Details Total Base Cost 181 Landed Cost 227

Financial sustainability and viability analysis and the sensitivity analysis results in terms FIRR are presented in below table and Appendix 2. In the outset, even after implementing the proposed user charges, the project was financially viable considering the present WACC of 3.5%. Also, the project revenue stream will meet the 100% O&M recovery from the operation start year.

                                                            1 The Uttarakhand assembly passed a bill abolishing water and sewer tax in the state in 2008 but with the

proposals to increase water price and sewer connection by 15 per cent after every two years.

‐ 37 ‐ 

      

Weighted Average Cost of Capital (%) - Uttaranchal

ADB Loan Counterpart Equity

WACC Govt. of India Onlending b

Govt. of India Grant a

Govt. of India Grant a

Govt. of Uttaranchal d Item

Amount weighting 7% 63% 20% 10% Nominal cost 4.31% 8.50% 8.50% 8.50% Tax Rate 0 0 0 0 Tax-Adjustable Nominal Cost 4.31% 8.50% 8.50% 8.50%

Inflation Rate c 0.70% 5.00% 5.00% 5.00% Real Cost 3.61% 3.50% 3.50% 3.50%

Weighted Component of WACC 0.25% 2.21% 0.70% 0.35% 3.51% WACC = weighted average cost of capital, a - Nominal cost of Government of India grant is estimated at 8.5%, based on the Government’s long-term bond rate.

b - Indicative Lending Rates for Loans under the LIBOR-Based Loan Facility & Cap/Collar Premiums for Floating Rate Loans, Treasury Department, ADB, May 2011. From this 20 year period rate is considered.

c - Global Price escalation is based on - INTERNATIONAL COST ESCALATION FACTORS 2008–2012, World Bank, Table 1.1 The global outlook in summary. Global Development Finance 2008: The Role of International Banking, page 8.

d - State terms for counterpart equity of 10% rate with 10 years repayment is considered.

Financial Viability Sensitivity Analysis Results – WS Subproject, Haldwani (Tranche-2)

Component Base Case Capital cost increase by

10%

O&M cost increase by

10%

Project Revenue decrease by 10%

Project Revenue delay by one

year WS – Tr 2, Haldwani 10.9% 9.9% 9.3% 8.6% 8.6% Note: Base Case refers to the Scenario with the assumption of implementing FIAP user charge proposals, without sensitivity test. Of the four sensitivity scenarios (cost overrun, O&M cost increase, reduced beneficiaries, revenue delay by one year) Project Revenue delay by one year is the most vulnerable to FIRR, followed by reduced beneficiaries and cost overrun. Considering the more sensitiveness of these variables, following implementation arrangements need to be focused more so as minimize the project risk: • Timely implementation of the project user charges through appropriate method; • Timely implementation of the project through appropriate procurement method in which incentive for

early completion may be included; • Ensuring adequate project coverage of beneficiaries through advance commitment from HHs for

individual access or making mandatory for all individual access through project design; • Adequate focus for LA related project components Conclusion: The main evaluation has indicated that the proposed water supply sub projects for Haldwani under Tranche 2 is found to be financially viable, with the calculated FIRR values is above the WACC (3.5%), for the recommended user charges under FIAP. Also, the project ensures 100% O&M recovery from the operation start year.

‐ 38 ‐ 

      

‐ 40 ‐ 

Appendix 2: Financial Feasibility Analysis – Water Supply Component - Haldwani all values in Rs. Million

Year Capital Cost O & M Cost User Charges

Connection Fee for New Connections

Total Net Revenue

2010-11 - - 0.00 0.00 0.00 0.00 2011-12 56.70 - 0.00 0.00 0.00 -56.70 2012-13 113.39 - 0.08 0.00 0.08 -113.31 2013-14 56.70 - 31.75 0.00 31.75 -24.95 2014-15 - 57.29 50.34 3.08 53.42 -3.87 2015-16 - 57.29 50.84 0.32 51.16 -6.13 2016-17 - 57.29 51.35 0.32 51.67 -5.62 2017-18 - 57.29 59.64 0.37 60.01 2.72 2018-19 - 57.29 60.24 0.37 60.61 3.32 2019-20 - 57.29 60.84 0.38 61.22 3.93 2020-21 - 57.29 70.67 0.44 71.11 13.82 2021-22 - 57.29 71.38 0.44 71.82 14.53 2022-23 - 57.29 72.09 0.45 72.54 15.25 2023-24 - 57.29 83.73 0.52 84.25 26.96 2024-25 - 57.29 84.57 0.53 85.09 27.80 2025-26 - 57.29 85.42 0.53 85.95 28.65 2026-27 - 57.29 99.21 0.62 99.83 42.53 2027-28 - 57.29 100.20 0.62 100.82 43.53 2028-29 - 57.29 101.20 0.63 101.83 44.54 2029-30 - 57.29 117.55 0.73 118.28 60.99 2030-31 - 57.29 118.72 0.74 119.46 62.17 2031-32 - 57.29 119.91 0.74 120.66 63.36 2032-33 - 57.29 139.28 0.87 140.14 82.85 2033-34 - 57.29 140.67 0.87 141.54 84.25 2034-35 - 57.29 142.08 0.88 142.96 85.67 2035-36 - 57.29 165.02 1.03 166.05 108.76 2036-37 - 57.29 166.67 1.04 167.71 110.42 2037-38 - 57.29 168.34 1.05 169.38 112.09 2038-39 - 57.29 195.52 1.21 196.74 139.45 2039-40 - 57.29 197.48 1.23 198.71 141.42 2040-41 - 57.29 199.45 1.24 200.69 143.40 2041-42 - 57.29 231.67 1.44 233.11 175.81 2042-43 - 57.29 233.98 1.45 235.44 178.15 2043-44 - 57.29 236.32 1.47 237.79 180.50

Total 226.79 1,718.73 3,706.23 25.59 3,731.82 1,786.30 NPV at 3.37% 204.55 916.73 1,728.18 12.89 1,741.07 619.79

FIRR (%) 10.9%

 

Attachment-6

COMPLIANCE WITH THE SUBPROJECT ELIGIBILITY CRITERIA

S. No. Eligibility Criteria Compliance

Item 1. Technical Criteria The subprojects are identified through the town and infrastructure master plans and any changes thereafter are consistent with it. The subproject is technically sound and preliminary design will have been prepared.

Subproject is prepared in line with Water Supply Master Plan submitted. Subproject is being prepared considering all technical parameters and designs accordingly to make them technically sound.

1a.

1b. The subprojects are designed seismic resistant in accordance with relevant Indian codes.

Yes, wherever applicable.

Large scale ground abstraction for augmenting water supply in Haldwani will be undertaken only if there is adequate availability of ground water in the command area with no adverse depletion records of the water table in past 5 years to be established through a hydro-geological investigation followed by opinion of Central Groundwater Board before going for undertaking the subcomponent. For other towns as the ground water abstraction is in the lower range, a general study of ground water table shall be carried out taking experiences of the local inhabitants and report prepared and approved by GoU prior to undertaking the subcomponent.

Subproject envisages use of only existing tube wells and Gola River Canal already in use by Uttarakhand Jal Sansthan. The source augmentation under present subproject involves augmentation of raw water intake at Gola Headworks (Gola Canal) from present 1.0 MLD to 4.25 MLD.

1c.

1d. Water supply and sewer lines are laid on two different sides of the road and water supply lines are always laid at a higher level than the sewers.

Water supply and sewer lines are proposed to lay on two different sides of the road, However, the water supply lines will be laid at higher level than the sewers wherever they will be laid on the same side of road.

1e. Separate accounting is established by the service provider for urban water supply and sewerage prior to commencement of civil works.

Separate O&M model shall be applied for water and sewerage infrastructure.

1f. Civil works of subprojects be synchronized for least disruption in works and required quality.

QA/AC manual will be prepared for the project in line to take care of such issues.

Item 2. Financial and Institutional Criteria Subprojects for which funding was sanctioned under JNNURM or any other program with grant funding are not eligible for funding under the Investment Program.

The Subproject does not receive any funding under JNNURM or other grant funding.

2a.

2b. Subprojects must demonstrate financial and institutional sustainability.

Financial and institutional sustainability examined and found adequate.

The EA will demonstrate financial soundness of the investment into subproject by preparing a financial management assessment and analysis, in accordance with Chapter 3, 4 and 5 of Handbook for Borrowers on the Financial Management and analysis of Projects (2006). Financial Management assessment will be conducted for both each implementing body of the works and each owner of the asset created by each subproject. Financial analysis will be conducted for each subproject and owner of the asset who will be responsible for operation and maintenance (O&M)

Financial analysis is undertaken and found to be sound.

2c.

2d. The respective ULBs/utility agencies shall agree to take over It is agreed that Uttarakhand Jal Sansthan

 

 

S. No. Eligibility Criteria Compliance O&M of infrastructure assets and facilities created under the Investment Program along with existing facilities and make sufficient provision for O&M in their budget.

will take over the operation and maintenance.

Item 3. Economic Criteria The subprojects selected will be based on a) consumer demand analysis indicating that people are

willing to pay the connection charges and monthly tariffs to access the improved services,

b) project rationale identification, c) project alternative identification and least cost analysis, d) cost and benefit analysis indicating the economic internal

rate of return equal or exceeding the economic opportunity cost of capital (EOCC) for the State of Uttarakhand,

e) assessment of project sustainability and sensitivity and risk analysis, and

f) tariff analysis including equity consideration in tariff structure, willingness to pay and affordability in case of a revenue generating subproject.

a) Based in CPHEEO standards b) Based on projected needs for 30 years c) Undertaken d) Cost benefit analysis used discounted cash flow to obtain EIRR and found above EOCC, which was taken as 12% e) Project sustainability, sensitivity and risk analysis undertaken f) Analysis considered findings based on surveys conducted

3a.

3b. The EIRR of the water supply subprojects should be at least 12%.

The EIRR is 25.08 %

Item 4. Social Criteria 4a. All subprojects should have resettlement plan(s) in

accordance with ADB’s Resettlement Framework of the Investment Program.

The Sub-project involves temporary impacts on roadside (movable) vendors and agricultural landowners. A census survey and preparation of Short Resettlement Plan is under process and will be completed by May 2011.

All subprojects should have indigenous peoples development plans in accordance with the Indigenous Peoples Development Framework of the Program, wherever applicable.

There are no IPs/ethnic minority groups (as defined by the ADB policy and by the Indian Constitution Article 342 and 366(25)) residing within sub-project locations/activity area. The proposed sub-project does not require any IPDP.

4b.

Item 5. Environmental Criteria All subprojects should meet environmental subproject selection guidelines and will have initial environmental examination (IEE) including environmental monitoring plan (EMP) in accordance with environmental assessment and review framework (EARF) as per ADB guidelines and shall have sufficient budget allocation to meet the cost.

The subproject complies with ADB guidelines.

5a.

Item 6. Procedures 6a. All necessary India and GoU approvals are in place No approval from Central Government is

necessary. Approval from State Government is already obtained.

6b. GoU will facilitate providing required land free of any encumbrances to the implementing agencies for implementation of the subprojects.

All temporarily affected people will be adequately compensated based on the SRP and informed to move to other suitable locations prior to the start of construction activity.

 

 

 

Attachment-7

SITE CLEARANCES TIMEFRAME

Name of the Subproject: Construction of OHSR and Appurtenant Works for Water Supply System in Haldwani

Clearances To be obtained from Notification to

be issued to competent authority

(Date)

Surveys and hearing of objection /

observation (Date)

Deposit of payment, if any (Date)

Obtaining final clearances (Date)

Target

Actual

Target

Actual Target

Actual

Target Actual

Environmental Nil Land acquisition Nil Temporary Land Clearance

None NA NA April 2011

April 2011

May-June 2011

May-June 2011

NA NA

Utility Shifting Nil. However, utilities like telephone cables or water connection (house service connections may be encountered during execution, which will be taken care of. Right of Way Acquisition National Highway

National Highway Authority of India, Delhi

Permission required for laying of transmission mains along NH-121 (Ranikhet road) in a length of approx. 300 m only at Kathgodam.

1-May-11

NA NA NA

State PWD Roads

State Public Works Department

Permission for road cutting has already been obtained through GO No. 50/111/(3)/2011-905 (ADB/2011, dated 9 Feb., 2011.

City Roads Nagar Palika Parishad, Haldwani

Comprehensive proposal for all pipes to be laid on drawing and location is to be submitted to get a general NOC / Permission for road cutting for laying of transmission mains and distribution mains.

1-May-11

NA NA

NA