The project has been annually audited by independent external auditors. However, APFS covering only the physical implementation period may not capture all project-related expenses and loan disbursements. To facilitate the reconciliation of ADB records with the APFS on which the auditors have provided a qualified opinion, financial auditing was continued until project financial closure.
Not all safeguards monitoring reports were submitted under this project and the ADB loan disbursement records and latest audited project financial statement (APFS) remained unreconciled at project completion review mission. These non-compliances may have been mitigated through the participation of safeguards and financial management staff in review missions.
The need for some project outputs can decline over time, leading to changes in scope. Such changes should be documented and reflected in the DMF to ensure that they are properly considered and would not compromise the validity and reliability of project monitoring reports and performance evaluation.
Since some of the capacity building-related components under output 2 were linked to the transmission line and substation components under output 1, no separate arrangements for consultant engagement were made for output 2. With the project management unit (PMU) focusing on output 1, the two output 1-related capacity building activities were implemented. The others were not also due to the changed needs during implementation, but this was not brought to ADB’s attention. In the absence of consultants, the EA should have included staff from relevant divisions in the PMU to at least help in output 2 progress reporting.
In the initial stages of the project, the absence of a safeguards consultant resulted in the EA unable to submit some semiannual safeguards monitoring reports. This was timely rectified and based on the monitoring reports produced during implementation, the project did not come across safeguards issues significant enough to alter its outcome or outputs.
Although it traversed mostly rural and agricultural land, the construction of a new transmission line under this project was objected to by some locals. The objections were manifested between April 2017 and March 2018, delaying construction by 226 days. The issue was cleared when the High Court came out with a verdict in favor of the executing agency (EA). The experience highlights the importance of engaging in extensive stakeholder consultations and information dissemination early enough to address issues and concerns that may impede implementation. Mitigation measures, including minimizing the slack time and cost implications of objections and complaints, should also be mapped out and implemented as soon as possible.
Against an estimated $183.2 million, the total project cost at completion amounted to $202.1 million. The cost increase was prompted by minor modifications to the technical design of the project components. The modifications also required a longer implementation period than estimated at loan appraisal. The modifications enhanced system stability and reliability and made the project more relevant. They were addressed through loan reallocations and a 6-month extension in loan closing.
The flaw in the wording in one of the agreements could have been avoided. ADB needs to thoroughly review all legal documents, particularly those that could cause it financial or reputational harm.
The project clearly demonstrated the importance of strong and committed project sponsors to help ensure the success of a project. Telenor had the technical competence, managerial skills, and extensive telecommunications experience to run a world-class telecommunications operation in Bangladesh. Grameen Bank, for its part, had the brand recognition and distribution network to help market Grameenphone’s services in both urban and rural areas. Both companies have also observed high ethical standards. These are the types of sponsors that ADB should be looking for in future private sector projects.
The container cargo volume currently being handled is already well above the capacity of the CTMS. Although a prolonged operational standstill has not occurred, the risk of a system breakdown will grow as increased usage strains CTMS capacity. The rapidly changing nature of the IT environment requires that the IT infrastructure (e.g., operating systems, core data processing applications, network, and telecommunications technologies) have enough flexibility in terms of their compatibility, connectivity, and modularity to reflect advances in technology. The possible lifespan of a given system in a ports project needs to be assessed regularly and, if necessary, the system should be upgraded. Such a review could identify whether a particular piece of IT infrastructure is likely to become obsolescent, and the need for future hardware and software upgrades or replacements. Regular reviews and replacements would be preferable to waiting for an IT system to reach full or overcapacity.
Greater priority should have been given to ensuring that socioeconomic and baseline data were collected and reported, especially during the appraisal period. Data that should have been collected included: (i) benchmarking figures that would have provided objective reference points for evaluation corresponding with the needs of the port management and users, (ii) socioeconomic benefit monitoring data to ensure that the project benefits actually accrue to the port users, and (iii) post-project performance evaluation data to assess overall project performance. In the absence of measurable baseline data, it is difficult to continuously monitor and update indicators throughout and after project implementation. This evaluation was hampered by the absence of these baseline indicators.
Ingress and egress to the port area are critical to the efficiency of transport infrastructure and services. Most of the major ports in Asian countries are located in major urban centers, which initially did not pose any problem since cargo volumes were still small. As cargo volumes have increased because of economic and population growth, port areas have expanded while local transport networks have failed to keep pace. There is a need to fully utilize existing and potential intermodal connectivity to serve existing and future cargo growth. The growth of roads, rail, and water transport should coincide with the growth in cargo traffic, with each mode providing its share of transport capacity.
In the case of Chittagong Port, connector and port access roads were built under the project. Other projects involving double tracking of the Dhaka–Chittagong rail route and a capacity expansion of the Dhaka–Chittagong Highway, are being undertaken to improve port connectivity. In hindsight, Chittagong Port could have benefited from a holistic approach that considered the evolving demands of the trade logistics chain in Bangladesh and adjacent landlocked countries and matched the capacity of the various modes to transport Chittagong port traffic volume. Future project design should take into account the need for better integration with intermodal networks.
City development efforts should consider the impact of likely growth in port traffic on both intra- and inter-city traffic. Port and city authorities should draw up coordinated short- and medium-term infrastructure plans to accommodate urban and port growth. Chittagong City has been experiencing growth in its population, the number of commercial establishments and industries, and vehicular city traffic. Chittagong Port’s cargo traffic, the lack of container off-docks, the limited capacity of rail, and the amount of port-related vehicular traffic contribute to traffic congestion within the city and hinder traffic flow to and from the port. Investments, in port capacity should carefully take into account the need for parallel investments in intra-city circulation roads to avoid urban traffic congestion.
More time should have been spent during project design to ensure there was a common understanding on the following questions: What activities are required for the adaptive approach? What is the difference between the adaptive approach and O&M? Who is responsible for the implementation of the adaptive approach and O&M? How is the adaptive approach to be implemented after the project? At the design stage, ADB and BWDB need to agree on whether the adaptive approach was part of capital expenditure or operational expenses; and which budgets would be used for the adaptive approach and O&M.
Such riverbank protection work requires persistent commitment and continuous effort, unlike a one-time physical investment. Effective mitigation measures using geo-bags along riverbanks requires the implementation of an adaptive approach. O&M activities, including routine maintenance, need to be continuously implemented in parallel.
Greater clarity is needed on what a riverbank erosion management system (REMS) consists of and what institutional setting is required to make it sustainable. Effective operation of a REMS needs to be based on a crystal-clear consensus on the roles of local stakeholders, implementation arrangements, and Bangladesh Water Development Board (BWDB) coordination and financial commitment. This would have enabled the adaptive approach to the protection works to have been more effective and sustainable, coping with the development of river channels that will potentially be impacted by climate change.
PRAN is a flagship company in Bangladesh with sufficient corporate experience, resources, and knowledge to develop and deliver agribusiness projects. Through its newly established group company, SAL, the project was constructed to appropriate standards on time and under budget. All the required permissions were obtained, and the project complied with government regulations and ADB requirements. Contract farmers and factory staff benefited from the project. Liquid glucose and starch production operations have stabilized and are profitable. These operations are supporting the introduction of cassava to Bangladesh at a commercial scale and PRAN is continuing to work toward optimizing the cassava crop for Bangladesh. In addition to the work carried out directly through this project, PRAN’s Habiganj Industrial Park site has participated in the Skills for Employment Investment program, which is co-sponsored by ADB and has employed workers at SAL. This evaluation recognizes the importance of selecting projects for ADB financing that are implemented by sponsors who are qualified to manage them and willing to work with ADB toward shared development objectives.
The evaluation recognized that this was the first agribusiness project done by ADB private sector operations since 1985 and that familiarity with contract farming may have been limited at the time of appraisal. The target of 25,000 contract farmers for SAL’s operations appears to have been formulated based solely on the starch plant’s capacity, rather than on specific analysis of likely farmer participation. No risk in the appraisal is noted regarding farmer participation; rather, the appraisal found that the contract farmers would be the mitigation to the risk of raw materials as PRAN would source its own raw materials. The contractual arrangements appear to be standard and fair practice for contract farming and PRAN’s experience with contract farming was established and significant, but greater analysis farmers’ willingness to participate in growing a new crop was needed and appropriate support planned for and provided to produce sufficient quantities of cassava to support the plant’s operations at full capacity. At the time of appraisal, PRAN had 42,000 farmers under contract across all of its crops; therefore, to target an additional 25,000 farmers to support SAL’s starch operations seemed very ambitious. The project set a target of 500 employees at the factory. It is unclear how this target was arrived at as factory operations typically require a known number of staff. At present, the factories are operating at two-thirds capacity with 190 staff, so the target of 500 employees is not going to be achieved. The evaluation recognizes that setting the gender target for factory workers at 30% was an important addition to the project design, encouraging SAL management to focus on this development outcome and to bring more women into the workforce.
The project design did not provide a clear definition of contract farmers. It was therefore unclear whether only the lead contract farmer should be counted toward the outcome target number of farmers, or whether the group of farmers represented by the lead farmer should be included, or whether the entire cohort of lead farmers, lead farmer groups, and seasonal workers was covered by the term. The records provided by SAL showed only the lead farmer’s name, father’s name, and district. It was not clear whether the district was the farmer’s residence or the location of the farm. No information was provided as to which crop the farmer was growing (potatoes or cassava), how many farmers the contract supported, or whether the farmer was continuing with the program. Given that SAL is seeking to increase farmer participation in cassava growing, it would have been useful to track why some farmers left the program and whether this was because of farmer performance, issues related to growing cassava, or because the land was needed for other purposes. The evaluation estimated farmer and seasonal worker participation in the program (paragraph 16), but, given that SAL is paying farmers for crops, more information should have been readily available, so the benefits that contract farming brings to the rural population could be tracked.
This project was ADB’s first private sector agriculture project since 1985 and at the time of appraisal very few recent private sector approvals had been made in Bangladesh. The gender and poverty impact studies were undertaken at ADB’s request to identify the importance of the project for women, factory workers, and contract farmers. These were high-quality assessments and provided recommendations, some of which were incorporated into the second ADB loan to SAL. The recognition by ADB of the need for these assessments and the coordination within ADB to identify and appropriate external resources through regional TA is a good practice. Such assessments help to deepen ADB’s understanding of the project’s context and to confirm that projects are producing the benefits identified at appraisal and provide an opportunity for ADB and the borrower to make changes during implementation if they are not. Such impact studies should be considered for a range of projects, sectors, or developing member countries where staff experience with specific situations may be limited.
Through the project, PRAN has introduced cassava in Bangladesh at commercial scale. Its first approaches to farmers were in 2014. PRAN has accessed support from multilateral development banks and nongovernment organizations to develop the crop but interaction with the government appears to have been limited. The evaluation recognizes that government agencies such as the Ministry of Agriculture and the Department of Extension have little knowledge to share, as the level of cassava growing is at such a small scale that the BBS does not report on the crop in its annual agricultural sector reports. In practice, PRAN’s selected crop of cassava has required more fertilizer than expected, and fewer farmers were willing to join the program than planned, leading PRAN to undertake some cassava growing on its own. Stronger links between PRAN and the government may have helped to increase the crop testing and the number of farmers participating in the program.