India: North Karnataka Urban Sector Investment Program, Tranche 1
sector: Water and Other Urban Infrastructure and Services | country: India
This validation agrees with all the lessons identified in the project completion report (PCR), particularly on the early commencement of community development activities. Additional consideration could be given to the following, which address particular problems encountered:
(i) Cost estimation-most of the reasons provided for the cost escalation were predictable, such as (i) higher bid premiums for civil works packages relative to engineering estimates, (ii) bidder concerns over timely payments (as the implementing agencies were small municipalities), (iii) difficulties in mobilizing resources for interior towns, and (iv) more thorough review of possible price risks was required. The frequent fluctuations in the rupee-dollar exchange rates during the project design period (2007-2008) may not have been so predictable but adequate contingency planning could mitigate this risk.
(ii) Frequent changes of key government personnel-including program consultant specialists and project-level engineers-affected project continuity. Thus, ways to retain key government personnel for the project implementation period and beyond needed to be agreed with the government while excessive consultant staff turnover could carry more stringent contract penalties.