Bhutan: Road Network Project II

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Lessons

Contract and project durations and cost estimates for road projects in Bhutan should consider the steepness of terrain, whether the civil works are greenfield or brownfield, and impacts of the monsoon season.

. The project was marked by cost overruns and implementation delays. The detailed design estimated the cost of all contracts at 12.8% higher than at appraisal. During implementation, the actual cost of the civil works rose by about 32.9% more than the contract price, mainly because of price escalation and additional works. Civil works contract periods were set at 32 months regardless of the contract value, location, and site conditions, including topographical and geotechnical. This uniform contract duration proved unachievable, as the project encountered significant physical hindrances during construction, primarily heavy rainfall during the monsoon seasons, which caused the cessation of project activities for 3–4 months and largely prompted the extension of all civil works contracts by 92–410 days. The experience highlights the importance of carefully considering the steepness of terrain, whether civil works are greenfield or brownfield, and impacts of the monsoon season in the preparation of future road projects in Bhutan. Such factors can significantly impact the contract and project durations and the cost estimates of future similar interventions.

Project Cycle Stage:

Preparation

Road maintenance should be incorporated in future road projects financed by the Asian Development Bank (ADB) in Bhutan.

The design of this project focused on road construction. To ensure sustainability, future ADB-financed projects in the country should aim to incorporate a road asset management and maintenance system. This is particularly important considering that road maintenance in Bhutan is constrained by budget, equipment, and labor. Performance-based maintenance contracts, proven in several ADB member countries to be more economical than method-based or conventional contracts may be explored, and sound pavement selection and survey enhancement should be worked out. Use of aggregates from landslide material to widen road sections that, according to representatives from the project executing agency, the Department of Roads (DOR), has been widely applied in Bhutan, providing a win-win solution for issues with unstable geology, may also be considered in future projects.

Project Cycle Stage:

Preparation

The environmental impacts and climate change resilience of roads constructed with ADB financing must be continually monitored and followed up.

The project constructed wildlife underpasses to mitigate wildlife and biodiversity conservation risks. Cameras were installed in select underpasses to monitor wildlife movement and use of the underpasses. As of February 2017, an ADB monitoring report revealed that human presence and obstructions near the underpasses had reduced their use by the target species, particularly elephants. ADB appreciates the importance of government support facilities such as immigration and forestry check posts and anti-poaching camps and patrol, especially near the border, in addressing wildlife and security concerns. Efforts to prevent wildlife collection, transport, and illegal trade should continue in the project areas. So should the integration of climate change risks in future road interventions, omission of which from this project’s design has led to damages in several drainage structures and instigated the preparation and mainstreaming of climate resilience guidelines by the DOR.

Project Cycle Stage:

Preparation

Implementation

Background

At project appraisal in 2009, accessibility was a major development constraint in Bhutan. The road network provided inadequate connectivity and coverage. Travel between the east and west regions relied on either a single national highway in the north or on Indian road connections south of the Bhutan–India border. Road conditions were poor, with narrow roads built into steep hillsides prone to landslides. Under the Tenth Five Year Plan, 2008−2013, the government decided to construct the southern east–west highway as a development priority, in support of which, the Asian Development Bank (ADB) approved a $38.76 million grant for the Road Network Project II in November 2009.

Comprising the second ADB intervention in Bhutan’s highway network expansion, the project sought to provide an alternative to the existing east–west national highway through the northern part of the country. By connecting the project areas with their primary markets and facilitating increased passenger and freight transport, it aimed to accelerate the industrial development of the southern region and boost regional trade. Its intended outcome was expanded road transport capacity in the southern areas, facilitating efficient and safe transport within the region and with India, and through India to Bangladesh and Nepal. It had two planned outputs: (i) critical sections along the southern east–west corridor upgraded and connected, and (ii) capacity of the Department of Roads (DOR), the project executing agency, in road engineering technologies and road asset management strengthened.

Against a 180 kilometer- (km) target, the project constructed 131.4 km of national highways and 55 km of feeder roads in 5 critical sections of the southern east–west corridor. Drainage structures and bridges were built; culverts were installed; and road safety measures such as widening of curves, truck passing zones, guard rails, road markings and signs, and crash barriers were incorporated into the road design.

The project also provided equipment to enhance road sector capacity in quality control, survey and design, and control of overloading and vehicle emissions and financed the procurement of corrugated galvanized steel arches for four galvanized steel truss bridges. An attached technical assistance grant strengthened DOR capacity in road technologies and road asset management. A workable road asset management system was developed, and so were toolkits and field guides to improve the management of the country’s road network and foster the sustainability of physical investments.

Completion of the project has effectively improved connectivity and mobility in Bhutan’s southern areas. The completed national highways now form part of the east–west national highway corridor. On the all-weather roads, vehicles may now travel at average speeds of 30–40 km per hour and traveling distances have fallen substantially. Average travel time savings along the project roads range from 2.6 to 6.7 hours.

Traffic on the project roads consequently increased by an average of 28% in 2017 over 2016. The total import and export value rose by 9.7% in 2015 and 4.5% in 2016. The contribution of the transport and storage sector to the total gross domestic product rose to 10.3% in 2016, against 8.5% in 2005. Higher cash crop production rates and levels of industrial activity in the mining sector and factories have also been noted.

Additional project impacts not anticipated at appraisal have brought about significant changes in the life of the communities. These include the establishment of dairy cooperatives, new connections to essential services such as electricity and mobile telephone services in remote areas, and the setting up of roadway forestry check points and anti-poaching units. Overall, the project had a positive development impact, providing evidence of a road-induced socioeconomic transformation.

The project had the DOR as executing agency. The project management office for the first phase of the project was retained to oversee day-to-day implementation.

Project Information

Project Name:

Road Network Project II

Report Date:

June, 2019

Main Sector:

Transport

Country:

Bhutan

Project Number:

39225-022

Report Type: