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Lesson
To avoid unnecessary financing commitments and fund allocations, it is important to undertake a detailed needs assessment of all planned components. The project cost was 31% lower than estimated because of lower bid prices received under the international competitive bidding, the transfer of part of the project scope to another tranche project, and non-implementation of some project activities. ADB financing was 22% lower than its $50 million loan commitment.

Project Number: 47101-002
Project Name: Assam Power Sector Investment Program - Tranche 1
Report Date:
Lesson
Overestimated project costs lead to unutilized loan amounts and wastage of commitment fees. At appraisal, the investment program was estimated to cost $920.0 million, comprising ADB loans of $730.0 million (79.4%) and government contributions of $190.0 million (20.6%). At completion, the program cost totaled $669.3 million, of which ADB provided $253.8 million (37.9%).

Project Number: 42039-033, 42039-036
Project Name: Power Transmission Investment Program
Report Date:
Lesson
A detailed market assessment is necessary to come up with reliable cost estimates. The actual costs deviated significantly from the original estimates, aggregating to only $29.35 million or 49% of the $60 million total estimated cost. This was mainly because of the nearly 30% drop in the actual cost of equipment realized through the international competitive bidding process, the reduction in the number of distribution transformers installed, and the reduction in the scope of underground cable installation actually undertaken.

Project Number: 47101-003
Project Name: Assam Power Sector Investment Program - Tranche 2
Report Date:
Lesson
Compliance with financial covenants on institutional reforms and asset valuation and reconciliation, need a high level of commitment, capacity, and resources from the executing agency. Further, substantial changes in state-owned enterprises take time to get implemented in full. Despite efforts made by executing agency, the Assam Power Generation Corporation Limited (APGCL), lack of capacity and resources resulted in some of loan covenants to be achieved only partially.

Project Number: 47101-002
Project Name: Assam Power Sector Investment Program - Tranche 1
Report Date:
Lesson
Timely planning of project extensions and a more realistic extension period will improve loan utilization. Undisbursed amounts under this project resulted largely from new government policies as well as contextual and operational factors. Various activities were canceled because of government restrictions on the use of loan proceeds for soft components (e.g., training, workshops, etc). Non-disbursements were also associated with other policy modifications, such as restrictions on the recruitment of international consultants. But contextual and operational factors also played a role.

Project Number: 44265-013
Project Name: Second Health Care in the Central Highlands Project
Report Date:
Lesson
Including ADB financial management staff in project implementation teams will facilitate compliance to ADB financial reporting requirements. the first two annual audited project financial statements was delayed in the absence of complete information. ADB’s financial management staff should have been part of the project implementation team from the inception stage to review and monitor project financial performance and provide timely advice.

Project Number: 45084-002
Project Name: Coastal Climate-Resilient Infrastructure Project
Report Date:
Lesson
Engaging capable design institutes, backed by sufficient budget and time allocations, will result in better quality technical designs that in turn will facilitate construction progress, reduce the need for contract variations, and optimize construction costs. There were significant variations in some of this project's civil works contracts. These variations resulted mainly from poor quality of technical designs, with errors and omissions in the construction drawings.

Project Number: 45507-003
Project Name: Yunnan Chuxiong Urban Environment Improvement Project
Report Date:
Lesson
Reducing or avoiding implementation delays would require, among others: (i) ensuring that project and/or subproject implementation is a high priority for local governments and counterpart funds are provided in government annual budgets, and (ii) starting resettlement activities as early as possible and providing adequate funds for these activities.

Project Number: 45507-003
Project Name: Yunnan Chuxiong Urban Environment Improvement Project
Report Date:
Lesson
The financial health of key project agencies needs to be thoroughly assessed at project preparation to determine their viability and identify the proper risk mitigation measures. Although a financial management assessment was conducted for the implementing agency, the United Water Supply Company of Georgia Limited Liability Company (UWSCG) during project preparation, the assessment only pointed to a need for training in accounting and reporting, preparing business plans, determining tariffs and procurement.

Project Number: 43405-023
Project Name: Urban Services Improvement Investment Program - Tranche 1
Report Date:
Lesson
Instituting a dedicated project account can instill cash flow discipline and ensure the exclusive use of payments for the project thus avoiding cash flow problems that can hinder work progress. Contractors in road construction projects in India generally face cash flow issues while executing the project because the funds they receive are diverted from the project to other purposes. This disrupts progress.

Project Number: 49125-001
Project Name: Second Jharkhand State Road Project
Report Date:
Lesson
Project partnership agreements with government on human resources and funding are critical to effective implementation and sustainability. While initially the project national project implementation unit had issues on staffing, procurement, and implementation, these were resolved with incremental additional staffing, recruitment of a small core team of individual consultants, and restructuring to a subproject management unit. The non-recruitment of a social development specialist; to be funded by the government, affected the Gender action plan monitoring and planned survey update.

Project Number: 44130-022
Project Name: District Capitals Water Supply Project
Report Date:
Lesson
Sufficient funding must be ensured to cover all investment needs for rehabilitation and expansion of water supply infrastructure. This requires rigorous assessment of technical and institutional capacity (including for operation and maintenance or O&M) of the implementing agency and economic aspects (including life cycle costing) to determine whether to invest in a total new system at higher initial capital cost or to utilize parts of existing infrastructure to enable lower capital cost but likely higher levels of O&M costs.

Project Number: 44130-022
Project Name: District Capitals Water Supply Project
Report Date:
Lesson
Timely partial cancellation of unutilized loan funds should be undertaken to save on commitment charges. Disbursement projections at effectiveness were not met because of initial procurement delays. However, the projections revised during implementation were realistic, with over 90% of loan amount disbursed by project closure in 2017. When it was anticipated that entire loan funds may not be utilized even within extended loan period, the executing agency (EA) could have undertaken partial cancellation of loan funds. This would have allowed some savings in commitment charges.

Project Number: 38254-053
Project Name: North Karnataka Urban Sector Investment Program - Tranche 3
Report Date:
Lesson
Regular scrutiny of the financial statements by ADB, coupled with periodic training of finance and project accounts staff, will help expedite financial closure. The financial management arrangements of the recipient and executing agency were robust. Even then, financial closure of the grant account took 1.15 years from the grant closing date because of delays in the liquidation of advances and additional time needed to resolve the statement of expenditures review findings. Financial closing was further exacerbated by COVID-19 in-country lockdown measures.

Project Number: 44240-014
Project Name: Thimphu Road Improvement Project
Report Date:
Lesson
Government resource mobilization efforts to raise supplementary funds to meet the cost of additional components outside the project scope demonstrate its ownership of and commitment to the project and increase the resulting benefits. Footpaths for the road widening works were not included in the original road design but were constructed by the Thimphu thromde using parallel financing. The footpaths enhanced the road design and improved road safety.

Project Number: 44240-014
Project Name: Thimphu Road Improvement Project
Report Date: