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Rural Roads Sector II Investment Program (Project 3): Project Completion Report

sector: Transport | country: India

The project was the third package under the investment program. It has helped the central and state governments gain more experience and identify capacity gaps and areas for improvement through various project implementation activities. Some of the lessons learned are listed below, and could be considered for ongoing and future projects in the sector.

Implementation delays. The project experienced substantial implementation delays, which led to extra project costs and postponed the project’s anticipated socioeconomic benefits. The government should analyze the reasons for these and develop practical measures to prevent recurrence of the same issues, including careful scheduling of project implementation, better contract management, and on-site monitoring of contractor performance. Subprojects with land donation issues might require longer time to resolve; this could be identified during the subproject selection for inclusion in the subsequent tranches under the investment program, for example.

Fostering the local contractor industry. All civil works contractors for the project were local, and some were small companies with limited access to equipment, financial resources, and skilled and qualified staff. Due to the increasing length of PMGSY (Pradhan Mantri Gram SadhakYojana or Prime Minister’s Rural Roads Program) roads to be constructed, the overall industry was overstretched in the project areas. This was a major reason for project implementation delays and became an outstanding issue in the country. While fostering the local contractor industry by providing more capacity building programs and necessary technical and financial support, the government should engage with local contractors to understand their current capacity for contract management and project delivery during the contract packaging process.

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