The World Bank Andhra Pradesh Disaster Recovery Project (P154847) REPORT NO.: RES35729 RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF ANDHRA PRADESH DISASTER RECOVERY PROJECT APPROVED ON JUNE 17, 2015 TO REPUBLIC OF INDIA URBAN, RESILIENCE AND LAND SOUTH ASIA Regional Vice President: Hartwig Schafer Country Director: Junaid Kamal Ahmad Regional Director: John A. Roome Practice Manager/Manager: Christoph Pusch Task Team Leader: Deepak Singh, Atishay Abbhi The World Bank Andhra Pradesh Disaster Recovery Project (P154847) ABBREVIATIONS AND ACRONYMS APCOSMIC Andhra Pradesh Critical Operations Strategic Management and Incident Command APDRP Andhra Pradesh Disaster Recovery Project APEPDCL Andhra Pradesh Eastern Power Distribution Company Limited APSDMA Andhra Pradesh State Disaster Management Authority DPR detailed project reports GoAP Government of Andhra Pradesh GST Goods and Services Tax MPCS Multi-Purpose Cyclone Shelters NCRMP National Cyclone Risk Mitigation Project The World Bank Andhra Pradesh Disaster Recovery Project (P154847) BASIC DATA Product Information Project ID Financing Instrument P154847 Investment Project Financing Original EA Category Current EA Category Full Assessment (A) Full Assessment (A) Approval Date Current Closing Date 17-Jun-2015 30-Sep-2020 Organizations Borrower Responsible Agency Revenue and Disaster Management Department, Republic of India Government of Andhra Pradesh Project Development Objective (PDO) Original PDO The Project Development Objectives (PDO) are to restore, improve, and enhance resilience of public services, environmental facilities, and livelihoods in Targeted Communities, and to enhance the capacity of state entities to respond promptly and effectively toan eligible crisis or emergency. OPS_TABLE_PDO_CURRENTPDO Summary Status of Financing Net Ln/Cr/Tf Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed IDA-56940 17-Jun-2015 16-Jul-2015 28-Aug-2015 30-Sep-2020 250.00 69.70 180.30 Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No The World Bank Andhra Pradesh Disaster Recovery Project (P154847) I. PROJECT STATUS AND RATIONALE FOR RESTRUCTURING 1. The Restructuring Paper seeks approval for to restructure the Andhra Pradesh Disaster Recovery Project to revise the costs and results framework, by cancelling IDA US$21.83million. 2. Context: The Project was prepared to support the Government of Andhra Pradesh’s (GoAP) recovery efforts after the very severe cyclone storm Hudhud made landfall on the coast of Andhra Pradesh in 2014. The Project’s Development objective is to restore, improve, and enhance resilience of public services, environmental facilities, and livelihoods in targeted Communities, and to enhance the capacity of state entities to respond promptly and effectively to an eligible crisis or emergency. 3. The project is achieving the stated objective through six components: (i) reducing the vulnerability of the city’s electrical network by laying the power distribution system underground; (ii) restoring connectivity and shelter infrastructure through investments in permanently restoring, upgrading, and increasing resilience towards future disasters of roads (rural and major district roads) and cyclone shelters; (iii) restoring and protecting beach front in the city of Vishakhapatnam; (iv) restoring environmental services and facilities including restoration/creation of shelterbelts/windbreaks, support to farm forestry/plantations through nursery support for poor/vulnerable coastal families, regeneration of critical patches of mangroves along the coast to build disaster resilience, and restoring/supporting livelihood opportunities in the cyclone affected areas; (v) enhancing the capabilities of GoAP entities and other stakeholders in managing disaster risks, enhancing preparedness, and achieving resilient recovery; and (vi) Project implementation support. Project Status 4. The achievement towards the PDO and Implementation Progress are rated Moderately Unsatisfactory. Over 28% of the IDA Credit, or $69.47 million, has been disbursed. Total IDA commitments are around $165 million. As assessed during the September 2018 MTR of the project and the Deep Dive Review between GoAP, GPURL and the CMU in January 2019, the PDO, scope and its components as initially designed continue to remain relevant but there is a need to restructure to drop activities that cannot be implemented within the project timeframe. The GoAP has decided to cancel $21.83 million of IDA credit, for which this restructuring is being undertaken. This restructuring does not affect the PDO. 5. Under Component 1 (Resilient Electrical Network), underground cable network comprising of 33KV, 11KV, 415V, 230V to replace the existing overhead lines are being laid. Out of a target of 534 kms of 33KV and 11KV, around 150kms of underground cable network has been laid. Over 420 consumer accounts have been covered by the underground cable network so far. 6. Under component 2 (Restoration of connectivity and shelter infrastructure), around 294,300 out of originally targeted 1.75 million people have been provided access to restored and improved rural roads. Around 358 kms out of the original target of 800 kms of rural roads have been rehabilitated. The target for rural roads will be reduced to 665 kms since the cost of works has increased since Project approval due to increased safety measures and other rate changes (see rationale for change section for more details). Rehabilitation is also underway for 4 out of 5 bridges. Procurement process is underway for the remaining bridge. Of the 250 kms of non-rural (major The World Bank Andhra Pradesh Disaster Recovery Project (P154847) district) roads, 186kms has been rehabilitated. All roads packages are expected to complete within the project timeframe. 7. Under component 3, preliminary report (deliverable 3 out of a total of 6 deliverables) on the conceptual solutions for the shore protection works has been prepared, however with considerable delay. Tendering process for RK Beach in Beach front restoration has been initiated; the second package is expected to be ready to tendered subject to CRZ clearances The third package will not be bid out as part of the project. 8. Under component 4, as part of the livelihoods support sub-component, around 8766 men and 5469 women gained employment, a total of 192,462 work days were generated for men and 265,609 for women from work in planting and maintaining of Shelterbelts, mangroves and nurseries. Around 746 ha out of a total of 876 ha Casuarina shelterbelt has been planted. Palmyrah brakes have been dibbled for 15 km in Vizianagram and 50 Ha in Srikakulam. The total shelter belt including Casuarina and Palmyrah comes to 811 ha. Out of a total of 150 ha of Mangroves identified for restoration 110 ha have been planted and an additional 40 ha will be planted this year, October onwards. The Forest Department has set a target of 57.30 million saplings to be raised under the project, 46.33 million saplings have been raised of which 31.7 million have been distributed. A total of 35 field nurseries and 4 high-tech nurseries have been identified for intervention, of which establishment of 25 field nurseries is underway. Regarding the Re-development of Indira Gandhi Zoological Park, a new agency has been contracted to carry out the balance work. The tendering documents for the Redevelopment Kambalakonda eco- tourism park are in an advanced stage of completion. 9. Under component 5, activities are underway to build the capacity of the APSDMA and the communities in disaster risk management. Inception reports for setting up a Geospatial Lab and the AP Critical Operations Strategic Management and Incident Command (APCOSMIC) have been submitted. The two will be set up and functioning within the project timeframe. Contract has been signed to implement the Community Based Disaster Risk Management activities. Procurement of LiDAR data, search and rescue equipment, and consultancies for establishment of APSDMA data center, multi-hazard risk assessment, and risk insurance studies is underway. II. DESCRIPTION OF PROPOSED CHANGES AND RATIONALE 10. This paper proposes changes in component and its cost, through the cancellation of IDA Credit of $21.83 million, revising the total Project cost to $228 million and the following activities will be dropped (i) repair of multi-purpose cyclone shelters (sub-component 2.1), (ii) shore protection works (sub-component 3.1) (iii) DRM in school curriculum (sub-component 5.1). Detailed proposed changes and explanation Change in Component and Costs 1. Sub-component 2.1: The sub-component (US$40.5million) finances permanent restoration, reconstruction, strengthening and widening of damaged rural roads including cross-drainage structures, and repair of old multi-purpose The World Bank Andhra Pradesh Disaster Recovery Project (P154847) cyclone shelters (MPCS). It includes restoration of rural roads and multi-purpose cyclone shelters (MPCS). Given that vulnerability assessment of cyclone shelters has not yet been undertaken due to delays in hiring of consultant, the restoration activity will not be completed within the project timeframe. Hence the restoration of MPCSs will be dropped and the allocated IDA of US$ 1.44 million will be cancelled from the component. 2. Sub-component 3.1: The sub-component (US$17 million) is aimed at supporting the appropriate solutions for the protection of the shore. The preliminary report on the conceptual solutions for the shore protection prepared was delayed due to non-payment to the consulting firm, which further delayed the preparation for shore protection works. Given the insufficient time left for implementation, the works would not be undertaken within the project and the sub-component would be dropped, cancelling the allocated US$14.4 million IDA credit (due to exchange rate depreciation) from the project. 3. Sub-component 5.1: The sub-component on capacity management for disaster risk management (US$17 million) includes financing of activities such as: (i) strengthening the state’s disaster response systems and mechanisms, (ii) curriculum development on disaster risk reduction for schools and (iii) establishing a Community-Based Disaster Risk Management (CBDRM) program. The school curriculum has been prepared by the GoAP through technical and financial support from Save The Children, hence the activity is no longer required to be financed by the project and allocated $0.67 million will be cancelled from the component. 4. Component 6: Since the State Project Implementation Unit (SPIU) for NCRMP acts as the Project Management Unit (PMU) for the project, initial cost sharing has allowed the GoAP to save around IDA US$5.32 million in administrative costs. An equivalent amount will thus be cancelled from the project. CANCELLED IDA ALLOCATIONS (US$1 = Rs 70.4) Components Original Component Cancelled cost (IDA) Cost ($ M) ($M) Sub-component 2.1 40.5 1.44 Sub-Component 3.1 17 14.40 Sub-Component 5.1 17 0.67 6 17 5.32 Total IDA Cancelled 21.83 III. SUMMARY OF CHANGES Changed Not Changed Components and Cost ✔ Cancellations Proposed ✔ Reallocation between Disbursement Categories ✔ Implementing Agency ✔ DDO Status ✔ The World Bank Andhra Pradesh Disaster Recovery Project (P154847) Project's Development Objectives ✔ Results Framework ✔ Loan Closing Date(s) ✔ Disbursements Arrangements ✔ Disbursement Estimates ✔ Overall Risk Rating ✔ Safeguard Policies Triggered ✔ EA category ✔ Legal Covenants ✔ Institutional Arrangements ✔ Financial Management ✔ Procurement ✔ Implementation Schedule ✔ Other Change(s) ✔ Economic and Financial Analysis ✔ Technical Analysis ✔ Social Analysis ✔ Environmental Analysis ✔ IV. DETAILED CHANGE(S) OPS_DETAILEDCHANGES_COMPONENTS_TABLE COMPONENTS Current Current Proposed Proposed Cost Action Component Name Component Name Cost (US$M) (US$M) Resilient electrical network Restoration of connectivity and shelter infrastructure Restoration and protection of the beach front Restoration of environmental services and facilities and livelihood support The World Bank Andhra Pradesh Disaster Recovery Project (P154847) Capacity building and Technical support for disaster risk management Project implementation support Contingency emergency response TOTAL 0.00 0.00 OPS_DETAILEDCHANGES_CANCELLATIONS_TABLE CANCELLATIONS Value Reason Current Cancellation New Ln/Cr/Tf Status Currency Date of for Amount Amount Amount Cancellation Cancellation BORROWER' S REQUEST IDA-56940- Disburs 250,000,000.0 228,170,000.0 USD 21,830,000.00 09-Sep-2019 FOR 001 ing 0 0 COUNTRY REASONS OPS_DETAILEDCHANGES_REALLOCATION _TABLE REALLOCATION BETWEEN DISBURSEMENT CATEGORIES Financing % Current Allocation Actuals + Committed Proposed Allocation (Type Total) Current Proposed IDA-56940-001 | Currency: USD iLap Category Sequence No: 1 Current Expenditure Category: Gds,Wks,NCS,CS,Trng,IOC, oth th CER 250,000,000.00 69,701,387.37 228,170,000.00 68.00 68.00 iLap Category Sequence No: 2 Current Expenditure Category: Emergency Expenditures for CER comp 0.00 0.00 0.00 100.00 100.00 Total 250,000,000.00 69,701,387.37 228,170,000.00 . The World Bank Andhra Pradesh Disaster Recovery Project (P154847)