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Completion Report

Project Number: 32058 Loan Number: 1891 October 2008

Pakistan: Road Sector Development Program

CURRENCY EQUIVALENTS

Currency Unit – Pakistan rupee/s (PRe/PRs)

At Appraisal At Program Completion 20 September 2001 30 June 2007

PRe1.00 = $0.0173 $0.0156 $1.00 = PRs 57.92 PRs 64.07

ABBREVIATIONS

ADB – Asian Development Bank CWD – Communication and Works Department MOC – Ministry of Communications MOCR – Ministry of Communications and Railways MOF – Ministry of Finance N5 – national highway 5 NH&MP – National Highways and Motorway Police NHA – National Highway Authority NHSC – National Highway Safety Committee NTC – National Trade Corridor NTP – national transport policy RAMD – Road Asset Management Directorate RAMS – Road Asset Management System RMF – road maintenance fund RSDD – Road Sector Development Directorate RSDP – Road Sector Development Program SOP – standard operating procedure TA – technical assistance

NOTES

(i) The fiscal year (FY) of the Government of Pakistan ends on 30 June.

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

(iii) For an explanation of rating descriptions used in ADB evaluation reports, see: ADB. 2006. Guidelines for Preparing Performance Evaluation Reports for Public Sector Operations. Manila.

Vice President X. Zhao, Operations Group 1 Director General J. Miranda, Central and West Asia Department Director H. Wang, Infrastructure Division, Central and West Asia Department Team Leader B. R. Bathula, Transport Specialist, Central and West Asia Department

CONTENTS

Page BASIC DATA i MAP I. PROGRAM DESCRIPTION 1 II. EVALUATION OF DESIGN AND IMPLEMENTATION 2

A. Relevance of Design and Formulation 2 B. Program Outputs 3 C. Program Costs 5 D. Disbursements 5 E. Program Schedule 6 F. Implementation Arrangements 6 G. Conditions and Covenants 6 H. Related Technical Assistance 6 I. Consultant Recruitment and Procurement 6 J. Performance of Consultants, Contractors, and Suppliers 6 K. Performance of the Borrower and the Executing Agency 7 L. Performance of the Asian Development Bank 7

III. EVALUATION OF PERFORMANCE 7 A. Relevance 7 B. Effectiveness in Achieving Outcome 7 C. Efficiency in Achieving Outcome and Outputs 9 D. Preliminary Assessment of Sustainability 10 E. Impact 10

IV. OVERALL ASSESSMENT AND RECOMMENDATIONS 11 A. Overall Assessment 11 B. Lessons Learned 11 C. Recommendations 12

APPENDIXES

1. Program Framework of Road Sector Development Program – National Policy Reform Program Component

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2. Development of National Transport Policy Document 153. Weigh Stations 174. National Policy Reform Program – Policy Matrix and Final Status 215. Status of Compliance with Loan Covenants 286. Benefits of Maintenance Investments 307. Weigh Stations and Operations 318. Organization of the National Highway Authority 349. Traffic Accident Statistics in Pakistan 35

BASIC DATA

A. Loan Identification 1. Country 2. Loan Number 3. Program Title 4. Borrower 5. Executing Agency 6. Amount of Loan 7. Program Completion Report Number

Pakistan 1891 Road Sector Development Program Islamic Republic of Pakistan Ministry of Finance (MOF) ¥6,079,300,000 (equivalent to $50 million) 1064

B. Loan Data 1. Appraisal – Date Started – Date Completed 2. Loan Negotiations – Date Started – Date Completed 3. Date of Board Approval 4. Date of Loan Agreement 5. Date of Loan Effectiveness – In Loan Agreement – Actual – Number of Extensions 6. Closing Date – In Loan Agreement – Actual – Number of Extensions 7. Terms of Loan – Interest Rate – Maturity (number of years) – Grace Period (number of years) 8. Terms of Relending (if any) – Interest Rate – Maturity (number of years) – Grace Period (number of years) – Second-Step Borrower

10 September 2001 10 November 20011 21 November 2001 24 November 2001 19 December 2001 1 February 2002 2 May 2002 27 June 2002 1 30 June 2007 30 June 2007 0 London interbank offered rate 15 3 Not applicable

1 The pre-appraisal mission started on 10 September 2001 (upgraded to appraisal mission). The Mission was

demobilized from 21 September to 14 October 2001 because of increased security problems related to 11 September 2001.

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9. Disbursements

a. Dates

Initial Disbursement 28 June 2002

Final Disbursement 28 November 2003

Time Interval 18 months

Effective Date 27 June 2002

Original Closing Date 30 June 2007

Time Interval 5 years

b. Amount ($50 million)

Original Allocation Last Revised Allocation Amount Disbursed Category or Sub-loan

Yen US Dollar Yen US Dollar Yen US Dollar

01 6,018,500,000 49,513,288 6,018,500,000 50,276,588 6,018,500,000 50,276,588 02 60,800,000 486,712 60,800,000 486,712 60,800,000 486,712 Total 6,079,300,000 50,000,000 6,079,300,000 50,763,300 6,079,300,000 50,763,300 10. Local Costs (Financed) - Amount ($) 0.00 - Percent of Local Costs 0.00 - Percent of Total Cost 0.00 C. Program Data 1. Program Cost ($50 million)

Cost Appraisal Estimate ($ million)

Actual ($ million)

Foreign Exchange Cost 50.000 50.763 Local Currency Cost 0.000 0.000

Total 50.000 50.763 2. Financing Plan ($ million)

Cost Appraisal Estimate Actual Implementation Costs

Borrower Financed 0.000 0.000 ADB Financed 50.000 50.763 Other External Financing 0.000 0.000

Total 50.000 50.763 ADB = Asian Development Bank

3. Cost Breakdown by Program Component

Component Appraisal Estimate Actual Road Sector Development Program 49,513,288 50,276,588 Front-End Fee 486,712 486,712

Total 50,000,000 50,763,300

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4. Program Schedule

Item Appraisal Estimate Actual

Date of Contract with Consultants Not applicable Not applicable Completion of Engineering Designs Not applicable Not applicable Civil Works Contract Not applicable Not applicable

Date of Award Not applicable Not applicable Completion of Work Not applicable Not applicable

Equipment and Supplies Not applicable Not applicable Dates

First Procurement Not applicable Not applicable Last Procurement Not applicable Not applicable Completion of Equipment Installation Not applicable Not applicable

Start of Operations Completion of Tests and Commissioning Not applicable Not applicable Beginning of Start-Up Not applicable Not applicable

Other Milestones 5. Program Performance Report Ratings

Ratings Implementation Period Development

Objectives Implementation

Progress From 27 June 2002 to 30 June 2007 Satisfactory Satisfactory D. Data on Asian Development Bank Missions

Name of Mission Date No. of Persons

No. of Person-Days

Specialization of Members

Fact-Finding Mission 15 Feb–14 Mar 2001 7 40 b, d, e, h, i, j, l, o Pre-Appraisal Mission 10–20 Sep and 15 Oct–

10 Nov 2001 9 33 a, b, c, d, e, g, j, k,

n, Consultation Mission 16–21 Feb 2002 2 12 b, f Review Mission 19–27 Nov 20022 2 18 f, p Special Program

Administration Mission 16–17 Jun 2003 1 2 j

Project Completion Review

24 Jun–2 Jul 20083 2 8 m, o

a = resident representative/country director (Pakistan Resident Mission); b = senior transport specialist; c = senior program officer; d = senior environment specialist; e = senior investment officer; f = senior project specialist; g = senior program officer (Pakistan Resident Mission); h = resettlement expert; i = poverty reduction coordinator; j = project implementation officer; k = financial management specialist; l = gender specialist; m = transport specialist; n = assistant program analyst (Pakistan Resident Mission); o = associate project analyst/consultant; and p = assistant project analyst.

2 ADB. 2001. Report and Recommendation of the President to the Board of Directors on Proposed Loans to Pakistan

for the Road Sector Development. Manila (Loans 1892/1893-PAK); ADB. 2002. Report and Recommendation of the President to the Board of Directors on a Proposed Loan to Pakistan for the Punjab Road Sector Development Project. Manila (Loan 1928-PAK); and ADB. 2002. Technical Assistance to Pakistan for Preparing the Balochistan Road Development Sector Project. Manila (TA 3897-PAK) approved on 24 July 2002 for $550,000.

3 The mission discussed the project completion report information with National Highway Authority officials, Ministry of Communications, National Trade Corridor Task Force, and National Highways & Motorway Police. The mission inspected the weigh stations on motorways (M1 & M2) and the national highway (N5).

I. PROGRAM DESCRIPTION

1. The Asian Development Bank (ADB) approved the Road Sector Development Program (RSDP) loan for $200 million to the Islamic Republic of Pakistan on 19 December 2001. The aim of the RDSP was to increase the efficiency of the road sector at the national and provincial levels. Policy reforms initiated at the national level were to provide the framework for overall development of the sector. The RSDP included (i) a program loan of $50 million for the national policy reform program, and (ii) a project loan of $150 million for the provincial sector development project. The framework for program loan of the RSDP is in Appendix 1. This project completion report is confined to the national policy reform program. 2. The objective of the national policy reform program was to support continuing initiatives in the road sector to define national policy directions, establish efficient resource management systems, preserve road assets, increase road safety, and improve governance. The principles of change were embodied in five policy themes: (i) transport policy, (ii) road sector resource management, (iii) road asset preservation, (iv) institutional efficiency improvements, and (v) road safety. The expected main output of these policies was implementation of reforms identified in accordance with key target dates. 3. Policy reforms were critically needed to increase the efficiency of the road sector at national and provincial levels. Reforms initiated at the national level were to provide the framework for overall sector development. The national policy component was mainly intended to support continuing efforts of the National Highway Authority (NHA) to adapt current business processes to those demanded of contemporary road agencies. The national policy reforms program aimed to support capacity building of NHA so that it could grow into an efficient service provider to road users, and ensure safe and comfortable travel on the national highways. 4. The national policy reform program largely reflected the commitment of the principal agency (NHA) to change and adapt. The policy framework supported actions relating to the reform process in national and provincial road agencies, and involved (i) rationalizing staffing; (ii) developing standard operating procedures (SOPs); (iii) enhancing staff accountability in project management; (iv) prioritizing investment based on economic principles; (v) generation of funds for maintenance needs; and (vii) adopting a comprehensive approach to road safety, including public awareness and stakeholder consultation. An estimate 1 of the costs of adjustment associated with the national sector reform process is in Table 1. ADB financed a portion of the adjustment costs associated with the national road sector policy reforms.

1 ADB. 2001. Report and Recommendation of the President to the Board of Directors on the Proposed Loans to

Pakistan for Road Sector Development Program. Manila.

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Table 1: Estimated Cost of Adjustment of National Policy Reforms Item Cost

($ million) 1. Establishment and operation of the Road Asset Management Directorate 2.0 2. Implementation of toll collection program on national highways 15.0 3. Installation of weigh stations on the national highways for axle-load control 15.0 4. Nationwide Road Safety and Axle Load Awareness Program 1.0 5. Establishment and operating cost of National Highways and Motorway Police 10.0 6. Establishment and operating costs of accident reporting centers nationwide 8.0 7. Staff rationalization program in the National Highway Authority 2.5 8. Black spot mapping and road safety audits on the national highway network 5.0 9. Establishment and operating cost of secretariat for the National Road Safety and

Urban Transport Council 2.2

10. Establishment and operating costs of driving instructor training schools nationwide 14.0 11. Establishment and operating costs of accident evaluation laboratories nationwide 2.5 12. Establishment and operating cost of police officers’ training wing 5.0 13. Nationwide stakeholder consultations by the National Highway Authority 1.0 Total 83.2 Source: ADB. 2001. Report and Recommendation of the President to the Board of Directors on the Proposed Loans to Pakistan for Road Sector Development Program. Manila.

II. EVALUATION OF DESIGN AND IMPLEMENTATION

A. Relevance of Design and Formulation

5. The national policy reform program was a reflection of NHA’s commitment to change and sustainability. The Program was built around five policy themes: (i) transport policy, (ii) road sector resource management, (iii) road asset preservation, (iv) institutional efficiency improvement, and (v) road safety. Resource management was a key feature of the reforms, focusing on efforts to utilize budget allocations effectively, and to generate maintenance funding from off-budget mechanisms. NHA established a road maintenance fund (RMF) with SOPs to ensure that funds generated and placed under the RMF were used for maintenance and road safety works. The toll revenues that were financing the RMF had been substantially increased at the 38 toll stations, and it was expected that these would increase to nearly PRs3.0 billion by the end of FY2002. 6. The Road Asset Management Directorate (RAMD), set up in March 2000 to provide a stable source of off-budget financing, had few staff and was expected to be strengthened to carry out its mandate effectively—as well as to assume development functions such as implementing the National Highway Improvement Program, part of which will be financed by the World Bank under the Highway Rehabilitation Project. 7. Conserving road assets was another major theme of the national reform program. NHA was implementing an axle-load program, involving civil works for 30 weigh stations and a nationwide awareness campaign. Enforcement was expanded gradually by the National Highways and Motorway Police (NH&MP), which had 500 staff. Institutionally, NHA was to undergo a transformation in its organizational structure, with changes to accountability and financial management standards. Staff restructuring, though a key feature of the exercise, was needed to be accompanied by ensuring the proper mix of skills. Finally, the need to recognize road safety issues had assumed significant proportions, with planned greater awareness campaigns and establishment of driving instructor training schools, accident reporting centers,

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and accident evaluation laboratories. The national road sector reform program matrix identifies milestones achieving targets. 8. NHA made an explicit commitment to improve its efficiency by rationalizing staffing, developing SOPs, enhancing staff accountability in project management, prioritizing investments based on economic principles, generation of funds for maintenance needs, and adopting a comprehensive approach to road safety, including public awareness and stakeholder consultations. These are reflected in the policy matrix. 9. Efficient transport systems and networks contribute to economic growth and prosperity. Investment and noninvestment interventions in this network ultimately help tackle poverty. Under the first multitranche financing facility for Pakistan,2 the investment program was to improve existing road network assets, create new ones, and advance policy reform—the latter to create an enabling environment for private sector participation in the system. B. Program Outputs

10. Transport Policy. The Government developed a national transport policy framework to establish long-term strategic vision and ensure commitment to effective practices by all transport agencies. The policy actions were complied with and objectives were achieved. The national level transport policy, formulated with ADB assistance,3 is under review at the Ministry of Communications (MOC). The transport policy will ensure the establishment of intermodal priorities and targeting the investment programs. The development stages of the national transport policy are in Appendix 2. 11. Road Sector Resource Management. The policy’s objectives are being achieved and the actions have been implemented. Portfolio management has improved significantly. NHA has prepared a long-term financial business plan 2007–2020 for approval by the Government, to ensure a sustainable and credible financial resource envelope for implementation of the development program. The plan is being presented to the National Highway Executive Board for approval. The budget allocation is based on the medium-term development framework of NHA.4 Each five-year planning period reflects the increasing need of the sector, so the public sector development program allocation is being enhanced every year. The Government’s endorsement of the business plan and resolution of the cash development loan issue will meet the increasing demand of the sector on a more sustainable basis. 12. Most of the national highways have been brought under a tolling regime. The toll revenue has ensured a stable and secure source of funding for network conservation and maintenance. Road maintenance account (RMA) receipts increased from PRs2.86 billion in FY2003 to PRs8.4 billion in FY2007. About 70% of RMA revenue is attributable to tolls. The network maintenance needs are increasing with the enhancement in service level, addition of new roads and expansion of existing roads. The toll revenue is still not adequate to meet the network’s maintenance demand. A toll policy is being formulated to revise the toll rates, with a view to enhancing the revenue. 2 ADB. 2005. Report and Recommendation of the President to the Board of Directors on the Proposed Multitranche

Financing Facility and Proposed Loan for the National Highway Development Sector Investment Program (Loan 2210(SF)/2231-OCR). Manila.

3 ADB. 2004. Technical Assistance to the Islamic Republic of Pakistan for Transport Policy Support. Manila (TA No. 4400-PAK). Further work on Transport Policy was completed under this TA.

4 NHA. 2008. Business Plan 2008 to 2012 with Business Projections up to 2020. Islamabad.

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13. The RMA rules have been notified and SOPs approved. The RMA is being operated under clear financial rules with appropriate safeguards to include eligible expenditure, financial, and technical audits; and enhanced accountability. The transformation of the RMA into a third generation RMF is under consideration with its own executive board. The NHA investment program has remained within the Medium Term Budgetary Framework. More than two thirds of total portfolio investment is economically viable. The remainder is based on geographic equity considerations and the regional/sub-regional connectivity requirement. 14. About 65% of total NHA expenditure is being directed toward network conservation, which has led to a significant improvement in the overall network condition. RAMD is fully functional. The annual maintenance plan is now based on detailed condition surveys and Highway Development and Management (HDM) IV network level strategy and program analysis focusing on preventive maintenance. Public consultation on road maintenance is held every year in each of the provinces. The RMA is financing about 60% of stable network maintenance needs, which has to be increased to 100%. A comprehensive Road Asset Management System has been established with the assistance of Finnroad.5 15. Road Asset Preservation. The policy actions were complied and objectives achieved. The National Highway Safety Ordinance has been enacted. NH&MP was created under this ordinance, which has been responsible for traffic management along motorways and national highway 5 (N5). The enforcement has reduced traffic violations and accidents, and has contributed to the axle load control. The axle load awareness program was initiated during August 2000–February 2001 and continued from August 2002 onward. Legislation has been in force since January 2003 for the national highway network. 16. The construction of 112 weigh stations at strategic locations has been planned in three phases (Appendix 3). Forty-two weigh stations have been constructed and are operational. The weigh stations are contributing to axle load control. A fine collection system is being implemented at weigh stations on national highways and motorways and the awareness program has developed well. The number of multi-axle trucks has increased. Overloading persists on national highways but it has been controlled on motorways. NHA carried out a study on the axle load control regime and its recommendations are being considered for implementation. 17. Institutional Efficiency Improvements. NHA operates as a complete business entity, set up with its own organizational structure and operating framework. Its management and operation involve a complete cycle of transactions focused on executing the two areas of operations: (i) development of the national highways network, and (ii) maintenance and upgrading of the developed network. NHA concentrates on the core mandate and outsources to the commercial sector. The main outsourced functions include: (i) maintenance, (ii) construction, (iii) toll collection, and (iv) design/feasibility study. 18. Policy actions have been complied with and the objectives achieved. NHA institutional reform and the corporate strengthening program are under way. NHA has evolved financial management and administrative manuals; and has revised the NHA code to establish enhanced efficiency, transparency, and accountability. SOPs have been revised, and financial management experts are being recruited (chartered accountants and other financial management professionals are on staff). The financial manual conforms to revised SOPs.

5 NHA. 2006–2007. Road Asset Management System Consultant – to develop annual maintenance plans under

World Bank assistance.

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19. NHA initiated the rightsizing exercise and reduced staff in 2003. To cater for increasing demand caused by the increased highway network, rehabilitation, and developmental projects, reorganization was done in 2007. Additional staffs (176 in phase 1) were recruited as a result of restructuring carried out in 2008. Currently, there are around 1200 staffs in NHA. About 463 project-specific jobs are planned to be created within the next 2 years (phase 2). 20. Road Safety. The National Highway Safety Council was established in 2001, for road safety and implementation coordination on the national highways. It is a dormant organization, as it does not have a permanent secretariat. The secretariat was temporarily established but was closed because funds were not available. A safety cell has been established in RAMD and the design section of NHA. Road safety audits have also been introduced as part of RAMD’s function and design review. The NH&MP wing was established to enforce the traffic regulations, accident data collection and services, and road safety awareness. The number of road fatalities has reduced along national highways. 21. The stakeholders’ consultation is held regularly, and this has contributed to road safety awareness. Some of the policy actions have not been fully implemented by MOC, federal and provincial government departments, so this has been partially complied with. Basic setups were established but are not progressing sustainably due to inadequate funds, and commitment at higher level, and lack of coordination among the institutions involved. C. Program Costs

22. The total appraised program cost was estimated at $83.2 million, comprising various costs of establishment and adjustment for national policy reforms. The approved loan amount was ¥6,079,300,000 ($50.0 million equivalent), based on the estimate at the time of appraisal and was provided from ADB’s ordinary capital resources. However, because of appreciation of the Japanese yen against the US dollar during administration of the Program, the total amount disbursed was the equivalent of $50,763,300, which was $763,300 more than appraisal estimates. Out of the total amount disbursed, $486,712 was debited by ADB as front-end fee from the loan account on program effectiveness. 23. The policy loan of $50.0 million for the national policy reform program component was released in two tranches, based on fulfillment of tranche conditions set out in the national policy reform program matrix (Appendix 4). On meeting these conditions, the Ministry of Finance (MOF) and MOC provided reports to ADB on the status of compliance for individual milestones in the national policy reform program matrix. These reports were verified through ADB review missions.6 D. Disbursements

24. A total of ¥6,079,300,000 ($50,763,300 equivalent) was disbursed in two tranches, out of which ¥60,800,000 ($486,712 equivalent), representing a front-end fee, was debited by ADB from the loan account upon loan effectiveness. The first tranche amounting to ¥4,255,475,000 ($34,065,602 equivalent) was disbursed on 28 June 2002. Part of the second tranche amounting to ¥1,632,075,000 ($15,000,000 equivalent) was disbursed on 14 November 2003 and ¥130,950,000 ($1,210,986 equivalent) was disbursed on 28 November 2003, completing

6 ADB. 2003. Road Sector Development Program Progress Report – Release of Second Tranche. Manila (Loan

1891-PAK); and back-to-office reports of Review Mission in November 2002 and Special Project Administration Mission in June 2003.

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the disbursements of the full US dollar equivalent under the Program. The additional amount disbursed was primarily due to appreciation of the Japanese yen (the currency of the loan) and the release was approved by the President on 25 November 2003. 25. Because of the delay in complying with the requirements for loan effectiveness by four months, the first tranche was released on 28 June 2002, a day after the loan effectiveness date. There was a significant delay of about 17 months (actual release in November 2003 against the June 2002 target) in the release of the second tranche because of the Government’s delayed compliance with relevant policy actions. E. Program Schedule

26. The program loan for the national policy reforms was approved on 19 December 2001, became effective on 27 June 2002, and was closed on 30 June 2007. MOC/NHA implemented various policy reforms (Appendix 4) from January 2002 to December 2006. There was no procurement of goods and civil works under the Program, except the importation of eligible goods for government requirements financed under the loan. Importation of such goods followed normal government procurement procedures. F. Implementation Arrangements

27. The national policy reform program was implemented through MOF, as the Executing Agency, with the support of MOC and NHA in monitoring the policy loan covenants. There were some delays in compliance with the required covenants for each tranche, which affected the release of loan tranches. With timely assistance from ADB, the problems were resolved and all the funds were released (final release on 28 November 2003). MOF, with the support of MOC and NHA, ensured the implementation of policy loan conditions. G. Conditions and Covenants

28. Compliance with the requirements for loan effectiveness, as a condition for the release of the first tranche, was delayed. This affected the release of the first tranche by 4 months, from the original scheduled release of February 2002. The second and final tranche, released in November 2003, was 17 months later than the target of June 2002. This was due to the Government’s delay in completing the second tranche policy actions. The compliance status on covenants and conditions are in Appendix 5. H. Related Technical Assistance

29. There was no technical assistance (TA) related to this Program. I. Consultant Recruitment and Procurement

30. No consultants were recruited for the Program, as there was no requirement. J. Performance of Consultants, Contractors, and Suppliers

31. The Program allowed financed importation of required goods/materials for the implementation of reforms by the Government. Suppliers and contractors did not encounter any problems related to the supply of various goods and materials. Procurement of eligible goods financed under the Program followed normal government procurement procedures.

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K. Performance of the Borrower and the Executing Agency

32. MOF was the Executing Agency and implemented the national policy reforms with the support of MOC and NHA. The performance was “satisfactory” in utilizing the borrowed loan amounts for implementation of reform policies in general. However, the implementation of some of the road safety policy components has not had the expected impact and sustainability. This is due to lack of availability of counterpart funds, coordination among inter-ministerial departments, and common legislation among federal and provincial governments on their road networks. MOC recognizes these drawbacks; it is seeking funding resources and TA to strengthen road safety further and to develop an implementation document/manual for transport policy. L. Performance of the Asian Development Bank

33. The Program was administered by different officers in ADB, and monitoring could have been better. Although the tranche conditions were satisfied, ADB’s review could have been more periodic to avoid partial compliance actions by the executing agency. ADB provided assistance in a timely manner, which helped to facilitate actions taken by the government agencies in complying with tranche conditions required for the release of loan tranches. ADB administered program implementation through reviews of the progress reports and fielding missions. Three missions were fielded for program administration. ADB’s performance under the Program can be rated “satisfactory.”

III. EVALUATION OF PERFORMANCE

A. Relevance

34. The policy program and its timing is assessed “very relevant” for Pakistan. The Program’s aim and purpose were consistent with the Government’s development strategies and ADB’s country assistance plans for Pakistan (2001-2003). All components of the Program were appropriate. The program inputs were generally sufficient to produce the planned outputs. However, implementation of the road safety components did not fulfill expectations. Suitable TA should have been included. B. Effectiveness in Achieving Outcome

35. Establishment and implementation of the required policies were mostly complied with. However, because of lack of resources, continued implementation of some of the established policies was not pursued. The Government acknowledges the objectives of the policy loan and ADB assistance. The effectiveness of reform policies implemented is detailed below. The overall program was “effective” in achieving the outcome. 36. Transport Policy. The transport policy document has been finalized for submission to the cabinet after inter-ministerial discussion. It provides an enabling environment that will address both thematic and sectoral requirements as expected. Therefore, it contributes to a transport system that provides efficient, safe, reliable, equitable, and environmentally friendly access and mobility for people and goods. 37. Road Sector Resource Management. A system/mechanism has been established to utilize the revenues generated for the road sector efficiently and rationally for road development and maintenance. The investments in roads are based on economically viable projects having resources for preservation of assets. The resources are being used efficiently for the

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conservation of road assets. The road asset management system has been developed, and is ensuring that the road sector agencies carry out asset management and preservation of road assets effectively. According to the medium-term (5-year) sector investment plan,7 NHA has to prioritize projects based on economic returns, complete ongoing priority projects before starting new ones, and improve the balance between network expansion and conservation. Budget allocations needs rationalizing through revenue sources, so that an appropriate balance between revenues and allocation for the roads sector is maintained. 38. NHA can now supplement government budget resources through off-budget initiatives, such as road tolls and through the adoption of SOPs for the RMF established within NHA. Two thirds of the projects considered for implementation by NHA are roads with high economic returns and adequate funding. Higher allocations are planned for road maintenance to achieve higher financial returns. The road asset management system was established, and is being updated and integrated in consultation with stakeholders. 39. Road Asset Preservation. An axle load control program was introduced to protect and increase the service life of road assets. Legislation was enacted to restrict maximum axle loads on the national highway network. However, there is no such legislation on the provincial highways. The operational parameters for enforcement were identified and NH&MP is responsible for enforcement. The policy reform is being monitored through the development of awareness programs, and measuring axle load levels at regular intervals on the network. An enforcement procedure and institutional framework were established. Associated penalties for violation of load levels are set and are being levied. 40. Institutional Efficiency Improvement. NHA has moved toward a commercial road agency to have economy and efficiency in operations, i.e., operating on a fee-for-service basis. NHA’s organizational structure has undergone a change in January 2008 and institutional capacity building is continued to improve operational, management, and financial performance. NHA has established a financial management system and expertise to ensure proper accountability and efficiency. Under ADB support8, NHA will further enhance their capacity for human resource, safeguard, and corridor management among others. 41. Road Safety. Various measures were introduced to reduce road accidents in Pakistan. NHA and NH&MP are trying to improve the knowledge, capability, and training of personnel associated with accident prevention. Efforts were made to increase road safety awareness among road users and communities. National agencies were established to oversee road safety efforts at policy, operational, community, and agency levels to conduct black spot (accident prone locations) mapping, establish road design standards, and conduct road safety audits. The enforcement, monitoring, and evaluation procedures for road safety initiatives were established. With the assistance of nongovernment agencies, NHA has engaged in structured stakeholder consultations on a regular basis with feedback on performance in road services.

7 NHA. 2008. Business Plan 2008 to 2012 with Business Projections up to 2020. Islamabad. 8 ADB. 2005. Multitranche Financing Facility1: National Highway Development Sector Investment Program -

Capacity Development Component (Loan 2231/2210-PAK). Manila; ADB. 2007. Multitranche Financing Facility2 and Technical Assistance Grant: National Trade Corridor Highway Investment Program - Capacity Development Component (Loan 2400/2401-PAK). Manila.

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C. Efficiency in Achieving Outcome and Outputs

42. The efficiency of implementation of the reform policies is detailed below. The overall policy reform program is rated “efficient” in achieving the outcome and outputs within the resources availability. 43. Transport Policy. The draft transport policy has been updated, taking stakeholders’ observations into account. It has been circulated to concerned ministries to consider their comments for finalizing the policy. MOC has finalized the national transport policy under ADB technical assistance. The developed transport policy is comprehensive, integrated, and can serve as a catalyst for development of the transport sector to ensure that the sector continues to play an effective role in the country’s development. 44. Road Sector Resource Management. A medium-term plan was approved by the National Highway Council. The road sector revenues for road development and maintenance are being generated in accordance with the plan. NHA has established a financing mechanism for road maintenance through tolls collected on the motorways and national highways. SOPs for the RMF were developed and approved by NHA’s board and notified by the Government. The allocation for maintenance of NHA roads has increased drastically. The Road Asset Management Directorate at NHA is fully functioning with core staff. Maintenance expenditure allocations are based on the Road Asset Management System. The road condition now is far better than that in 2001. The benefits from maintenance investments are shown in Appendix 6. 45. Road Asset Preservation. A National Highway Safety Ordinance was enacted. NHA initiated a nationwide axle load awareness program and consultations. Weigh stations were installed at strategic locations in the national highway system and on motorways, and were integrated with the fine collection system. Appendix 7 shows operations at weigh stations—both static and mobile. The jurisdiction of the NH&MP, for enforcing road safety and axle load control on the national highways, is being extended regularly in phases. 46. Institutional Efficiency Improvement. NHA has performed rightsizing exercises and staff positions are procured on a demand basis. The organizational structure of NHA is in Appendix 8. The SOPs have been revised and updated. NHA has qualified financial management expertise, which enhances the in-house financial management capability. The financial manual was developed in accordance with updated SOPs. 47. Road Safety. The National Highway Safety Committee was established in 2001 for road safety and implementation coordination on the national highways. NHA has continued a comprehensive nationwide stakeholder consultation process with regular biannual meetings. An accident database is maintained by NH&MP, but not at the accident reporting center, which has not been created. No driving instructor training school has been established, but NH&MP arranges training programs for the public as well as for private establishments. An accident evaluation laboratory for forensic investigations has not yet been established. The accident victims are being treated at local general hospitals and trauma centers. Pakistan traffic accident statistics are in Appendix 9. 48. More intensive efforts in educating and training drivers, together with awareness building, are required to address the high fatality rates. Under the North-West Frontier Province (NWFP)

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Road Development Sector and Sub-regional Connectivity Project,9 the NH&MP was to start a pilot project on road safety for sections of the national highway in NWFP. D. Preliminary Assessment of Sustainability

49. The policy reform program has fulfilled most of the objectives and some are ongoing, which shows preliminary sustainability. The Program is made sustainable by the developed transport policy, NHA’s accountability mechanism in place, sustainable maintenance planning and execution through RAMD, developed SOPs, asset preservation awareness/enforcement, revenue generation through fines and tolls, NHA’s business plan/strategy and their restructuring, NHA’s financial management system, road safety stakeholder awareness programs, and safety improvements. However, enhancement and continuation of sustainability will require commitment of Government to make NHA a financially viable entity. Reforms in toll policy and the resolution of the outstanding cash development loans and treatment of future development funds must be determined. The involvement and acceptance of various stakeholders in the implementation and enforcement of reforms and policies is also essential. ADB has been providing continued support to the sector and the availability of long-term resources, and TA from ADB and other donors will be necessary to continue the current pace towards sustainability and stand-alone viability. 50. The Government is trying its best to sustain the actions initiated under this Program. Because of the lack of resources and TA, some actions were not implemented and some objectives could not be achieved. Additional external assistance would be necessary for complete implementation of all policy actions and establishment of alternative funding source for their continuity. This would improve the Program’s performance, sustainability, and intended benefits. E. Impact

51. The transport policy can derive a strategy document influencing transport infrastructure development in Pakistan. A public sector development program for NHA is being implemented based on the medium-term plan and founded on financing of economically viable projects. Allocations for road maintenance increased from 38% to 50%. Road assets have been preserved by restricting overloading, through installation of weigh stations at strategic locations on national highways. The initial constraint was that truck transporters were not happy with partial implementation covering only some of the networks—weigh stations installed on national highways only. The weigh stations program is encouraging provincial governments to start installing weigh stations. The main issue remaining is that the enforcement of legal loading is not fully operational. NHA has implemented the fine collection system on national highways and an annual average of PRs395 million in fines was collected from July 2002 to May 2008. 52. NHA is continuing with the rightsizing exercise by restructuring the organization. Maintenance is being planned and executed scientifically with best practices. The network condition has improved, and roughness has been reduced to the targets. The network lengths requiring immediate rehabilitation/reconstruction have been reduced. A maintenance manual was developed. The Government did not create an accident reporting center, but this function is being performed through traffic police and hospitals. No centralized database for traffic

9 ADB. 2004. Report and Recommendation of the President to the Board of Directors on a Proposed Loan to the

Islamic Republic of Pakistan for the North-West Frontier Province Road Development Sector and Subregional Connectivity Project. Manila (Loan 2103/2104 for $301.2 million).

11

accidents has been established; however data is collected through the NH&MP. The driver instructor training school was not established because of lack of funds but the required site has been identified for the purpose. An accident evaluation laboratory was not established because of lack of funds but the services of NH&MP and local hospitals are being utilized for this purpose. 53. Regular consultations with stakeholders are being carried out, and positive results are experienced on road serviceability. Poor to very poor condition reduced from 49% in 2000 to 27% in 2007; travel time has fallen by 9% (target of 10% by 2009); fatalities have decreased to 44% (target of 10% by 2009) of total accidents; and the pavement condition band has been reduced. The network pavement condition changed from 8.0–10.0 on the International Roughness Index (a measure of pavement unevenness/roughness) in 2000 to 4.3 in 2007. The network has increased from 9,000 kilometers (km) to 25,000 km competing for maintenance. The extent of road network requiring rehabilitation/reconstruction changed from 2,926 km in 2005 to 1,054 km in 2007. The main outcome/output is that maintenance is being implemented in a sustainable manner. There was no user awareness at the beginning, but this has improved. 54. Overall, the Policy Program’s impact on socioeconomic development can be perceived as moderate. Considering the effectiveness and efficiency of outputs and outcomes, the policy program is expected to result in a “sustainable” impact over the long term.

IV. OVERALL ASSESSMENT AND RECOMMENDATIONS

A. Overall Assessment

55. The objectives of policies are generally achieved and most of the policy actions were complied with, except for road safety. The national transport policy formulated by MOC, with ADB assistance, is being submitted for cabinet approval. Additional funds and TA are required to transform the transport policy document into an implementation document for each sector. Some of the road safety policy actions were not fully implemented, so these were partially complied with. No comprehensive road safety framework has been developed for the entire road network because of lack of funds and lack of coordination among the institutions involved. Policy reforms related to road sector resource management, road asset preservation, and institutional efficiency improvements were implemented well. 56. In general, the Program was implemented as conceived. However, the Government should ensure that the policy reforms are continued in the long term to ensure sustainable operations. The design of the Program and monitoring framework were provided adequately. However, continued implementation of some of the reforms has suffered because of lack of funds. Considering overall progress made in achieving the effectiveness, efficiency, and impact of the policy conditions, the policy program can be rated “satisfactory.” B. Lessons Learned

57. One of the basic problems in the sector is the lack of coordination, collaboration, and cooperation among the government agencies involved. This needs to be addressed before implementing policy reforms that require the participation of inter-ministerial departments. Different types of roads are under provincial and district governments. There is a need for legislative dialogue to implement policy reforms for the entire country. 58. The Program as conceived was good. However, the Borrower did not fully analyze the resources required for implementation of some components, which started but could not

12

continue because of lack of funds. This will result in wasted scarce resources if not implemented in a sustainable manner. Continuity would be dependant of establishing stable source of funds to finance the components. 59. The policy program should have been implemented with TA—particularly for the transport policy and road safety. However, transport policy TA was later sponsored on the Government’s request and this contributed to the national transport policy document. Road safety component was included in a pursuant intervention (NWFP) but was not implemented due to the difficult location. ADB is in discussion with the Government to implement the component in another province. C. Recommendations

1. Program Related

60. Future Monitoring. The Government has made considerable progress in meeting the policy actions. Most of the policy actions have been fulfilled and some require the intervention of inter-ministerial departments. However, three outstanding road safety issues require the Government’s attention to strengthen and sustain the reform. Three first tranche conditions require further actions to ensure full compliance. The Government should accelerate efforts to establish the (i) accident reporting center, (ii) driver instructor training school, and (iii) accident evaluation laboratory. 61. Covenants. The covenants and conditions have been generally complied with but some of them have been only partly complied with. There are no target dates included in the covenants for their compliance. There should be a set of mechanisms associated with covenants to guide and ensure their compliance. 62. Further Action/Follow-Up. A national institution with core staff committed to road safety programs, including research and development (R & D) in road safety, is needed. There is also a need to coordinate, through relevant federal and provincial government organizations, for implementation of the road safety program on the entire road network. MOC is seeking funds and TA to launch a sustainable mechanism to maintain such an institution. ADB should pursue with the Government to strengthen the existing facility, and develop as a core institution with a road safety framework for the entire country. Funding resources must be explored from the existing and future ADB or other donor assistance considering the current resource constraints and the importance of this intervention. 63. Additional Assistance. To improve the reform program’s performance and make it sustainable, additional assistance—in terms of loan/grants and TA—is necessary. Particularly, the positive impacts in road safety will encourage MOC/NHA to achieve improvements in the road sector. NHA is committed to continuing improvements in institutional efficiency and reforms in the management of the national road network. 64. Timing of the Program Performance Evaluation Report. Most of the covenants have been complied with, which triggered the release of the final tranche. However, further implementation of required actions cannot be pursued because of lack of readily available resources. The program performance evaluation report can be conducted within the next year, taking into account any further developments.

13

2. General

65. ADB should continue its policy dialogue with the Government, as part of ongoing lending in the road sector in Pakistan. Funds being allocated may not be sufficient to utilize optimally. Institutional capacity building is also required to improve the system. 66. While preparing future programs, it is recommended to set program targets so that they are clearly measurable and quantifiable. If any of the program components require a set of loan covenants, these should be clearly aligned with their outcomes. 67. The program administration and review by ADB should emphasize close monitoring of the executing agency and ensure continuity of staff in the administration team.

14 Appendix 1

PROGRAM FRAMEWORK OF ROAD SECTOR DEVELOPMENT PROGRAM – NATIONAL POLICY REFORM PROGRAM COMPONENT

Design Summary Project Targets Monitoring Mechanisms Risks/Assumptions

Overall Goal • Improve management of road

network

• Preserve road assets • Improve Institutional effectiveness • Ensure road safety

• Road network data by National

Highway Authority (NHA) Road Asset Management Directorate

• Accident statistics by agencies involved—police, health, CWD

Purpose • Continue improvement in NHA’s

ability to manage and maintain the national road network

• Improved network condition,

through better institutional management and maintenance practices

• Consultant’s reports; project

management unit reports; Asian Development Bank (ADB) review missions; detailed benefit monitoring (traffic, road condition, social indicators, accident reports, enforcement data)

• Capital of knowledge-based

industries • Land acquisition, clearance, and

resettlement to proceed expeditiously

• Construction to be completed within cost and on schedule

• CWD and local governments to maintain roads in serviceable condition

Outputs • Implementation of a national road

sector reform program

• Implement reforms identified in

national road sector reform matrix, and achieve key target dates

• Assessment by government

officials and ADB staff of national road sector reform process against targets

Appendix 2 15

DEVELOPMENT OF NATIONAL TRANSPORT POLICY DOCUMENT

1. The transport sector in Pakistan has experienced tremendous growth and has been one of the driving forces behind national economic growth. Recognizing the need for a comprehensive transport policy, the Government has undertaken several initiatives to develop a comprehensive national transport policy for Pakistan. 2. In November 2003, it requested technical assistance (TA) from the Asian Development Bank (ADB) to support its efforts to frame a comprehensive transport policy for Pakistan. The Asian Development Bank (ADB) agreed to provide two-stage TA for finalizing the national transport policy. An ADB consultant worked on the first stage during November-December 2003 in Pakistan. 3. The report 1 observed that, although a transport policy document was not formally approved, the de facto policy reflects the recommendations of several initiatives taken by the Government to frame the transport policy periodically. 4. The report prepared under stage I identified lack of coordination among agencies as the main weakness in the transport sector. For effective coordination, the TA proposed a three-tier mechanism comprising a transport council, transport coordination committee, and task force to include experts/specialists and stakeholders.

5. The stage I report also reviewed infrastructure shortfalls and included policy guidelines. In addition, it proposed terms of reference for a follow-up study (stage II). However, since the transport economist was not mobilized, in-depth review of the sector could not be undertaken in stage 1.

6. ADB provided additional TA2 in October 2004 to support finalization of the national transport policy document. Revised terms of reference were finalized and the additional secretary of the Ministry of Communications (MOC) was designated project director. 7. A comprehensive Pakistan Transport Plan Study3 was undertaken with TA supported by the Japan International Cooperation Agency (JICA). It started in June 2005 and was completed by June 2006. ADB analyzed the study’s terms of reference. In October 2005, it concluded that many issues to be covered in the transport policy overlapped with this study. Therefore, it revised the terms of reference for TA 4400-PAK. 8. Subsequent to the completion of the JICA’s Report as mentioned above, the work on stage II started by international consultants in association with domestic consultants. 9. Finally, a draft national transport policy document (NTP-I) was prepared in May 2007. It was based on a series of discussion papers and detailed consultations, including two workshops in February and April 2007. It was circulated among all concerned stakeholders for their examination and comments. 1 ADB. 2003. National Transport Policy-Assessment of Critical Transport Sector Needs. Manila. 2 ADB. 2004. Technical Assistance to the Islamic Republic of Pakistan for Transport Policy Support. Manila (TA No.

4400-PAK) approved on 30 September 2004 for $290,000. 3 Nippon Koei Co. Ltd/Almec Corporation. March 2006. Final Report: Pakistan Transport Plan Study in the Islamic

Republic of Pakistan. Japan International Cooperation Agency (JICA) and National Transport Research Centre (NTRC).

16 Appendix 2

10. The following basic principles underpinned the transport policy:

• Ensure that existing transport infrastructure is managed and maintained optimally before embarking on new infrastructure investment, which should be rigorously justified by engineering, economic, financial, environmental, and land acquisition/resettlement evaluations.

• Develop reliable traffic forecasts, based on a sound database of existing traffic, costs, and condition; and realistic growth rates for explanatory variables.

• Discontinue most nonviable services, which cause heavy subsidies from the Government and inefficient cross-subsidies from other, profitable services.

• Ensure that public sector transport providers concentrate on their core business activities.

• Give high priority to safety regulations. • Ensure careful monitoring of the pricing and investment decisions of public sector

monopolies, duopolies, and oligopolies. • Set up institutional arrangements so that there is efficient coordination between

transport modes. 11. Revised policy documents (NTP-II and NTP-III) were prepared, taking stakeholders’ comments into account. Then, a detailed presentation on the national transport policy document was made to the deputy chair of the Planning Commission and members of the National Trade Corridor (NTC) Task Force Committee on 19 December 2007. 12. Pursuant to the presentation, ADB acquired the services of a transport infrastructure policy specialist, who visited Islamabad from 8 to 11 April 2008 and held detailed consultations with the Planning Commission, MOC, Ministry of Ports and Shipping, Ministry of Railways, Civil Aviation Authority, Infrastructure Project Development Facility, and other stakeholders to evolve a consensus transport policy document. The draft NTP-IV document was prepared and circulated to concerned ministries, departments, and other stakeholders for their examination and comments by 22 May 2008. 13. To finalize the NTP document before 31 May 2008 (the closing date for technical grant assistance), the consultant visited Pakistan from 20 to 27 May 2008 and made a presentation to stakeholders. However, the proposed presentation to NTC members and the deputy chair of the Planning Commission could not be made as they were engaged in developing the annual budget. The NTP-V document was drafted by the consultant in the last week of May 2008, based on input received on the NTP-IV (April 2008) document. 14. The next step is a detailed presentation by the consultant to the NTC Task Force Committee, headed by the deputy chair of the Planning Commission. With the presentation of the NTP-IV document and its approval by the NTC Task Force Committee, it may be possible to steer the process further for cabinet approval. Following this, implementation and regular monitoring—for which besides, institutional arrangement as outlined in NTP-IV—need to be set in place, along with performance indicators for regular monitoring. For this, MOC proposes that the extension of ADB technical grant assistance for implementing the institutional mechanism needs to be taken up for discussion with ADB.

Appendix 3 17

WEIGH STATIONS

Table A3.1: Permissible Load Limits as per NHSO-2000

Sr. No. Truck Type Permissible Loads (Tons)

1 2 Axle (Bedford) 17.5

2 2 Axle (Hino/Nissan) 17.5

3 33 Axle 27.5

4 3 Axle 29.5

5 4 Axle 39.5

6 4 Axle 39.5

7 4 Axle 41.5

8 5 Axle 48.5

9 5 Axle 49.5

10 5 Axle 51.5

11 5 Axle 51.5

12 6 Axle 58.5

13 6 Axle 61.5

18 Appendix 3

Table A3.2: Weigh Stations Under Phase- I, II, and III

Sr. No.

Highways/ Motorways

Installed Weigh Stations Phase-

I

Planned Weigh Stations Phase-

II (2008-2009)

Planned Weigh Stations Phase-III (2009-2010)

Total

1 M-1 - 15 - 15 2 M-2 15 13 5 33 3 M-3 3 - 2 5 4 M9 2 - 1 3 5 N-5 12 2 11 25 6 N-10 (MCH) - - 3 3 7 N-25 2 2 1 5 8 N-35 - - 3 3 9 N-40 2 - - 2

10 N-50 - - 2 2 11 N-55 4 - 3 7 12 N-65 2 - 3 5 13 N-70 - - 4 4 Total 42 32 38 112

Appendix 3 19

20 Appendix 3

Appendix 4 21

NATIONAL POLICY REFORM PROGRAM – POLICY MATRIX AND FINAL STATUS

Policy Theme Policy Objectives Policy Directions Actions First Tranche

Second Tranche Final Status/Remarks

Transport Policy

To establish a transport system that provides efficient, safe, reliable, equitable, and environmentally friendly access and mobility for people and goods, thereby supporting the Government's goal of increasing public welfare through economic growth, human development and poverty reduction

Finalize transport policy for submission to cabinet. The policy provides an enabling environment that will address the following: Thematic • Policy and governance • Institutional development • Implementation and

management capabilities • Infrastructure financing,

investment, and maintenance Sectoral • Improved efficiencies in

railways • Effective road asset

management • Viable urban transport

options • Commercialized port

operations based on the landlord concept

• Improved shipping Operations • Liberalized open skies for

civil aviation • Multimodal planning systems • Trade facilitation

Draft transport policy to clear inter-ministerial review

* Complied with. The first draft of the transport policy paper was prepared in May 2007 and has been revised, taking into account all the comments from concerned agencies and stakeholders. The fourth version of the draft policy paper is under final review and is awaiting endorsement from the Planning Commission and National Trade Corridor Task Force for submission to the cabinet for approval. Cabinet approval is expected in September 2008.

22 Appendix 4



Road Sector Resource Management

Ensure that resources mobilized through revenue collection for the road sector are efficiently and rationally utilized to meet road development and maintenance needs

Prepare a medium-term (5-year) sector investment plan for the National Highway Authority (NHA) that prioritizes projects on the basis of economic returns, completes ongoing priority projects before starting new ones, and improves the balance between network expansion and conservation

Medium-term plan to be agreed and approved by all agencies concerned

* Complied with. NHA's 5-year medium term investment and maintenance plan was prepared and approved by the executive board. Activities in accordance with the 5-year medium-term investment and maintenance plan are being implemented.

Investments should primarily be made in roads that are economically viable and for which stable and secure resources for preservation of assets are available

Rationalize budget allocations through appropriate revenue sources so that an appropriate balance between revenues and allocation for the roads sector is maintained and in each planning period reflects the increasing needs of the sector

Allocation of road sector revenues for road development and maintenance to be based on medium-term plan

* Complied with. From FY2003 onward, the public sector development program for NHA is being implemented and is based on the medium-term investment plan.

To ensure that resources are used most efficiently, the main focus of road sector development should be on conservation or road assets rather than expansion of the network

National road agency to supplement resources through off-budget initiatives, such as road tolls, and through adoption of standard operating procedures (SOPs) for the road maintenance fund (RMF) being established within NHA

NHA to initiate a financing mechanism for road maintenance through tolls on the national highway system

* Complied with. A road maintenance account financed through tolls collected on the national highways and motorways has been functioning since February 2001. However, the budgetary allocation and fees collected are not enough for the required road maintenance, as the network is increasing.

SOPs for RMF approved by NHA board and submitted to the Government for notification

* Complied with. The SOPs were approved by the NHA executive board in May 2002 and are being implemented.

Appendix 4 23



Establish policy that only those roads will be considered that have high economic returns and for which adequate funding is available

NHA to formally adopt approach

* Complied with. The medium-term plan is based on financing of economically viable projects.

Commit higher allocations to road maintenance, reflecting the understanding that returns to well-maintained roads are of high economic value.

Overall road maintenance allocations for NHA roads to increase to PRs2.5 billion in FY2002

* Complied with. Under the medium-term plan, the allocations for road maintenance increased from 38% of the development budget to 50%. A total of PRs8.4 billion has been allocated for maintenance during 2007–2008.

Road asset management systems should be developed to ensure that road sector agencies carry out asset management and preservation mandates effectively

Develop road asset management systems and set up institutional framework

Road Asset Management Directorate (RAMD) at NHA fully functioning with core staff

* Complied with. RAMD established in 2002 and is now fully operational.

Road Asset Management System (RAMS) to be used as the basis for allocating FY2002 maintenance expenditures (31 October 2001)

* Complied with. RAMD now undertakes condition surveys and prepares maintenance expenditure allocations.

Road Asset Preservation

Introduce an axle load control program to protect and increase the service life of road assets

Prepare and approve legislation for restricting maximum axle loads on national and provincial highways, and identifying operational parameters for enforcement

National Highway Safely Ordinance to be enacted

* Complied with. The National Highway Safety Ordinance was promulgated by the Government in September 2000 and continues to be implemented.

24 Appendix 4



Initiate actions to enforce legislation • Develop awareness

programs • Measure vehicle load levels

Nationwide axle load awareness program to be initiated by NHA, including consultations under the World Bank-sponsored Transport Sector Development initiative

* Complied with. The axle load awareness program was initiated from August 2000 to February 2001 and continues to be implemented.

Weigh stations to be installed at 30 strategic locations in the national highway system during 2002

* Complied with. A total of 421 weigh stations under phase 1 have been installed on the national highways and motorways and are operational. NHA has programmed the installation of 112 weigh stations until 2010. Phase 2 with 32 units is under construction, with scheduled completion in mid-2009. Construction of the remaining 38 will follow thereafter, scheduled to be completed by 2010.

Establish enforcement procedure and institutional framework

Ministry of Communications and Railways (MOCR) to extend the jurisdiction of the National Highway and Motorway Police (NH&MP) for enforcing road safety and axle load control to the national highways, starting with 320 kilometers (km) of the national highway 5 (N5), which will be increased by 300–400 km each

* Complied with. NH&MP’s jurisdiction was increased in October 2001 to include 320 km of N5. Subsequently, jurisdiction was extended to 1,630 km. In addition, NH&MP covers a total of 783 km along the M-1, 2, and 3 and at N-10.

Appendix 4 25



year until fully covered by 2004

Set schedule of penalties for violation of load levels

Fine collection system to be set up for the weigh stations

* Complied with. NHA has implemented the fine collection system on motorways and national highways. A yearly average of PRs395 million in fines was collected from July 2002 to May 2008.

Institutional Efficiency Improvement

Road agencies should operate on the principles of economy and efficiency in operations—move to a commercial road agency, i.e., operating on a fee-for-service basis

NHA should review its organizational structure and initiate measures under a formal institutional reform process to improve operational, management, and financial performance

NHA to begin rightsizing exercise, and reduce staff strength from 1,670 to 1,299—a 22% reduction in officers and 28% reduction in staff below grade 16

* Generally complied with. NHA is continuing with the rightsizing exercise. In the first phase, NHA reduced the staff level to 1,299. However, NHA is not in favor of further reducing staff levels since more roads are being added and would therefore need enough staff for proper maintenance and operation. This is being addressed through reorganization.

NHA should establish sound financial management practices that ensure proper accountability for use of funds

NHA to revise SOPs * Complied with. NHA has framed SOPs for financial management, introduced manuals and some new administrative regulations.

Qualified financial management expertise to be recruited to enhance in-house financial management capability

* Complied with. Financial management experts have been recruited. With operating procedures and professional staff in place, NHA has met the basic requirement of a good

26 Appendix 4



financial management system.

Technical review of NHA financial manual to be completed to ensure revision and conformity with updated SOPs

* Complied with. The financial manuals developed are in compliance with the approved SOPs.

Road Safety

Introduce measures to reduce the unacceptability high toll of deaths and accidents on roads in Pakistan

Establish national and provincial agencies to oversee road safety efforts at policy, operational, community, and agency levels • Set up secretariat(s) • Conduct strategic plan(s)

National Highway Safety Committee (NHSC) to be established in 2001 for road safety and implementation coordination on the national highways

* The National Road Safety Secretariat under the Ministry of Communications (MOC) was established in September 2006. However, implementation of its tasks is a major issue and is not happening because of lack of resources.

Improve the knowledge, capability, and training of personnel associated with accident prevention in the fields of accident analysis, traffic engineering, and the design of low-cost road accident countermeasures.

• Assign institutional (road agency) responsibilities:

• Conduct black spot mapping • Establish road design

standards • Conduct road safety audits

* Generally complied with. Being carried out on national highways network as of part of engineering design.

Establish and strengthen enforcement, monitoring, and evaluation procedures for road safety initiatives

Accident reporting center to be established in 2002 for creating a comprehensive accident database

* Partly complied with. Accident reporting center was not created. However, this is being done through traffic police and at local hospitals. No centralized database has been established.

Appendix 4 27



Driving instructor training school to be established in 2002

* Partly complied with. The driving instructor training school was not established because of lack of funds. However, the required site has been earmarked for the purpose.

Accident evaluation laboratory for forensic investigations to be established

* Not complied with because of lack of funds. However, the services of local hospitals are being utilized for this purpose.

Increase awareness of road safety among road users and communities

With the assistance of nongovernment organizations, NHA to engage in structured stakeholder consultations on regular basis as part of institutional public awareness campaigns and feedback on performance in road services

NHA to continue its comprehensive nationwide stakeholder consultation process with regular biannual meetings commencing in 2002

* Complied with. Regular consultations with stakeholders and public awareness campaigns are being implemented. The responses are positive and the NHA is able to work through the issues and problems of stakeholders.

1 An additional 8 mobile weighing stations are operational at strategic locations where construction of weighing stations is ongoing.

28 Appendix 5

STATUS OF COMPLIANCE WITH LOAN COVENANTS

Covenants/Conditions Reference in Loan Agreement

Status of Compliance

1. The Borrower shall cause the Program to be carried out with due diligence and efficiency and in conformity with sound administrative, financial, environmental, and road development practices.

Article IV, Section 4.01

Generally complied.

2. The Borrower shall make available, promptly as needed, the funds, facilities, services, land and other resources which are required, in addition to the proceeds of the Loan, for the carrying out of the Program and for the operation and maintenance of the Program facilities.

Article IV, Section 4.02; Schedule 5, para 7

Partly complied; funds were not made readily available thereby affecting the implementation of road safety policy actions mainly.

3. The Borrower shall ensure that the activities of its departments and agencies with respect to the carrying out of the Program and operation of the Program facilities are conducted and coordinated in accordance with sound administrative policies and procedures.

Article IV, Section 4.03

Generally complied. The coordination among relevant departments needs improving.

4. The Borrower shall maintain, or cause to be maintained, records and documents adequate to identify the Eligible Items financed out of the proceeds of the Loan and to indicate the progress of the Program.

Article IV, Section 4.04 (a); Schedule 5, para 3

Generally complied.

5. The Borrower shall furnish, or cause to be furnished, to ADB all such reports and information as ADB shall reasonably request concerning the implementation of the Program, including the accomplishment of the targets and carrying out of the actions set out in the Policy Letter.

Article IV, Section 4.05; Schedule 5, para 6

Generally complied, with exception of meeting target dates.

6. The Borrower shall (a) ensure that the policies adopted and actions taken prior to the date of the Loan Agreement, as described in the Policy Letter, including the Policy Matrix attached to it, continue in effect for the duration of the Program period and subsequently, and (b) promptly adopt or cause to adopt the other policies and take other actions indicated in the Program specified in the Polity Letter and the Policy Matrix, and ensure that such policies and actions continue in effect during the Program period.

Schedule 5, para 1

Generally complied.

7. MOF shall be the Executing Agency of the Program, and shall coordinate and monitor the Program and administer the utilization of the Loan proceeds. MOCR and NHA shall support MOF in ensuring that the Program conditionalities are met.

Schedule 5, para 2

Complied.

Appendix 5 29

Covenants/Conditions Reference in Loan Agreement

Status of Compliance

8. The Borrower shall continue timely policy dialogue with ADB on problems and constraints encountered during implementation of the Program and on desirable changes to overcome or mitigate such problems and constraints, and on further reforms to strengthen the judicial and police sector.

Schedule 5, para 4 Generally complied. However, the reforms to strengthen judicial and police sector were not initiated during this Program.

9. Medium term plan to be agreed and approved by all agencies concerned.

Item (a) of Attachment 2 to Schedule 3

Generally complied.

10. Allocation of road sector revenues for road development and maintenance to be based on medium term plan.

Item (b) of Attachment 2 to Schedule 3

Complied.

11. Standard operating procedures (SOPs) for road maintenance fund approved by NHA Board and submitted to Government for notification.

Item (c) of Attachment 2 to Schedule 3

Complied.

12. Road Asset Management Directorate at NHA fully functioning with core staff.

Item (d) of Attachment 2 to Schedule 3

Complied.

13. Weigh stations to be installed at 30 strategic locations in the national highway system during 2002. Five weigh stations completed and functional.

Item (e) of Attachment 2 to Schedule 3

Complied.

14. Fine collection system to be set up for the weigh stations.

Item (f) of Attachment 2 to Schedule 3

Complied.

15. NHA to begin rightsizing exercise, and reduce staff strength from 1,670 to 1,219. 22 percent reduction in officer cadre and 28 percent reduction in staff below Grade 16.

Item (g) of Attachment 2 to Schedule 3

Generally complied.

16. NHA to revise Standard Operating Procedures (SOPs).

Item (h) of Attachment 2 to Schedule 3

Complied.

17. Technical review of NHA financial manual to be completed to ensure revision and conformity with updated SOP.

Item (i) of Attachment 2 to Schedule 3

Generally complied.

18. NHA to continue its comprehensive nationwide stakeholder consultation process with regular biannual meetings commencing 2002.

Item (j) of Attachment 2 to Schedule 3

Complied.

30 Appendix 6

BENEFITS OF MAINTENANCE INVESTMENT

37

54

65

85

100

112

128140

0 20 40 60 80 100 120 140 160

PRs billion

1

2

3

4

5

6

7

8

9

Budg

et S

cena

rioPR

s bi

llion

per y

ear

Decrease in Vehicle Operating Cost (Year 1-5)

Appendix 7 31

WEIGH STATIONS AND OPERATIONS

Figure A7.1: Approaching to weigh-in-motion type weigh station

Figure A7.2: Static weigh bridge and associated infrastructure on Motorway 2

32 Appendix 7

Figure A7.3: Mobile weighing system-approach to slip entry to Motorway 1

Figure A7.4: Weigh station under construction

Appendix 7 33

Figure A7.5: Weigh station and associated infrastructure on National Highway 5

Figure A7.6: Close view of weigh bridge during operation at National Highway 5

34 Appendix 8

ORGANIZATION OF THE NATIONAL HIGHWAY AUTHORITY

GM = general manager, NHA = National Highway Authority. Source: NHA.

National Highway Council

National Highway Executive Board

Chairman

Budget and Accounts

Finance

GM Construction

Operation and Maintenance

NHA Regional Offices

Planning Design Procurement and Contract

GM (NHIP)

Personnel Establishment General

Director (Inspection Monitoring)

General Manager (Internal Audit)

Public Relations Officer Director (Legal)

Member (Motorway)

Member (Finance)

Member (Operations)

Member (Planning)

Secretary (NHA)

Dir. General (Administration)

Appendix 9 35

TRAFFIC ACCIDENT STATISTICS IN PAKISTAN

Year Fatal Non-Fatal Total Killed Injured Total 2002 4,413 5,507 9,920 6,623 10,150 16,773 2003 4,138 5,735 9,873 4,959 11,808 16,767 2004 4,411 5,864 10,275 5,495 13,342 18,837 2005 4,239 5,514 9,753 4,733 12,379 17,112 2006 4,193 5,932 10,125 4,971 10,378 15,349

Source: National Police Bureau.

road sector development program · 2014-09-29 · ntp – national transport policy ramd – road...

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