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CURRENCY EQUIVALENTS
ABBREVIATIONS
Team leader Rajesh Yadav, Senior Project Officer (Natural Resources and
Agriculture), INRM, SARD
In preparing any country program or strategy, financing any project, or by making any designation
of or reference to a particular territory or geographic area in this document, the Asian
Development Bank does not intend to make any judgments as to the legal or other status of any
territory or area.
CONTENTS
Page
BASIC DATA I
I. PROJECT DESCRIPTION 1
II. DESIGN AND IMPLEMENTATION 1
A. Project Design and Formulation 1
B. Project Outputs 3
C. Project Costs and Financing 5
D. Disbursements 5
E. Project Schedule 6
F. Implementation Arrangements 6
G. Technical Assistance 7
H. Consultant Recruitment and Procurement 7
I. Safeguards 8
J. Monitoring and Reporting 9
III. EVALUATION OF PERFORMANCE 10
A. Relevance 10
B. Effectiveness 10
C. Efficiency 11
D. Sustainability 11
E. Development Impact 12
F. Performance of the Borrower and the Executing Agency 13
G. Performance of the Asian Development Bank 13
H. Overall Assessment 14
IV. ISSUES, LESSONS, AND RECOMMENDATIONS 14
A. Issues and Lessons 14
B. Recommendations 15
APPENDIXES
1. Design and Monitoring Framework 16
2. Project Cost at Appraisal and Actual 24
3. Project Cost at Appraisal and actual by Financier 25
4. Project Implementation Schedule 29
5. Disbursement of ADB Loan and Grant Proceeds 30
6. Contract Awards of ADB Loan and Grant Proceeds 31
7. Status of Compliance with Loan Covenants 32
8. Project Economic and Financial Reevaluation 44
9. Performance of Coastal Protection Structures 58
10. Safeguards 70
BASIC DATA
A. Loan Identification
1. Country India
2. Loan number and financing source 2679, ordinary capital resources
3. Project title Sustainable Coastal Protection and
Management Investment Program –
Tranche 1
4. Borrower India
5. Executing agencies Public Works, Ports and Inland Water
Transport Department, Government of
Karnataka; and Maharashtra Maritime
Board, Government of Maharashtra
6. Amount of loan $51.555 million
7. Financing modality multitranche financing facility
B. Loan Data
1. Appraisal
– Date started March 2007
– Date completed September 2010
9. Terms of loan
– Interest rate London interbank offered rate plus 0.60%
– Maturity (number of years) 25 years
– Grace period (number of years) 5 years
ii
10. Disbursements
a. Dates
Initial Disbursement Final Disbursement Time Interval
16 December 2011 20 December 2018 84 months
b. Amount ($)
C. Project Data
4. Project schedule
Item Appraisal Estimate Actual
Date of contract with consultantsa
Maharashtra 20 Dec 11 23 Jan 12
Karnataka 1 Jan 11 20 Dec 11
Completion of engineering designs
Maharashtra 31 Dec 12 30 Jun 17
Karnataka 31 Dec 12 30 Jun 17
Civil works contract: Maharashtra
Mirya Bay reef: award 1 Mar 11 5 Nov 11
Completion of construction 1 May 13 27-Feb 16
Mirya Bay beach nourishment: award 1 Oct 11 19-Aug 16
Completion of construction 1 May 12 20-Mar 17
Civil works contract: Karnataka
Ullal reef: award 1 Mar 11 07-Nov 14
Completion of construction 1 Jan 13 30-Jun 17
Ullal inshore berms: award 1 Mar 11 14-Feb 13
Completion of construction 1 Jan 13 01-Jun 18
Ullal breakwater: award 1 Mar 12 31-Jul 14
vi
1. India has a coastline of 7,525 kilometers (km). About 20%–25% of its population lives
within 50 km of the coast, with 70% of the coastal population residing in rural areas. All of India’s
coastal states are affected by coastal erosion, which has intensified on the west coast, including
in the states of Karnataka and Maharashtra on which the investment program has focused. In
these states, about 50% of the 1,000 km of coastline is facing erosion. At the time of assessment,
about 520 km were prone to erosion and 320 km required protection.1 Sea level rise is projected
to be from 15 centimeters to 38 centimeters in the Indian subcontinent by 2050,2 and with
increased stormy weather expected with climate change, improved coastal protection is needed.
2. India’s Ministry of Jal Shakti (MOJS) initiated the National Coastal Protection Project to
coordinate coastal protection activities at the national and state levels. The Sustainable Coastal
Protection and Management Investment Program was designed as a multitranche financing
facility (MFF) supporting the government’s sustainable coastal management strategy. Separate
arrangements were made for the two participating states of Karnataka and Maharashtra.
3. The investment program had the following envisaged impact: improved income and
reduced poverty of the coastal communities in the subproject areas of the coastal states of Goa,
Karnataka, and Maharashtra.3 The investment program had the following envisaged outcome:
protected and managed shorelines in the three states, meeting the needs of stakeholders and
protecting the environment. The outcome was to be achieved through the following outputs: (i)
sustainable plans and management for shorelines developed, (ii) coastal erosion and instability
managed and reduced, and (iii) capacity for shoreline planning and development enhanced. The
MFF was appraised covering the states of Goa, Karnataka, and Maharashtra. Tranche 1 included
Karnataka and Maharashtra.
4. At the time of project formulation, a key theme of the Government of India’s Eleventh
Five Year Plan, 2007–20124 was the integration of environmental concerns into policy, planning,
and development activities, underscoring the need to address the impacts of sea level rise,
particularly for coastal agriculture, as well as the management of seawater ingress into coastal
areas. Considering the government’s development priorities, the country partnership strategy
(CPS) for India, 2009–2012 of the Asian Development Bank (ADB) emphasized sustainable
measures for coastal protection, with a focus on the enhanced capacity of state authorities to
design, implement, monitor, and finance coastal protection and management measures.5 The
CPS supported the use of advanced technologies, innovative business, and financing options.
The report and recommendation of the President for the MFF program (footnote 1) provides a
road map and policy framework, of national and state governments on integrated and sustainable
1 Asian Development Bank (ADB). 2010. Report and Recommendation of the President to the Board of Directors:
Proposed Multitranche Financing Facility to India for the Sustainable Coastal Protection and Management Investment
Program. Manila.
2
ADB. 2019. Reference Manual on Climate Change Adaptation Guidelines for Coastal Protection and Management
in India. Consultant’s report. Manila (TA 8652-IND).
3 While MFF included three states, Goa did not eventually participate in the investment program.
4 Government of India, Planning Commission. Eleventh Five Year Plan, 2007–2012. New Delhi.
5
ADB. 2009. Country Partnership Strategy: India, 2009–2012. Manila.
2
coastal protection and management, preparation of state shoreline management plans (SMPs),
and improved public–private partnerships (PPPs) in coastal management. 6
5. Coastal management responsibilities in India lie with both the environmental agencies and
the public works authorities. While identifying appropriate government partners at project
formulation, the program team concluded that for implementation of the physical works, the more
appropriate partner would be the state organizations for public works, rather than the line
departments of the Ministry of Environment, Forests and Climate Change (MOEF&CC). While
the planning controls for activity in the coastal zones lie with the coastal zone management
organizations under the MOEF&CC, technical review and approval processes are the
responsibility of the MOJS and its organizations namely the Central Water Commission (CWC)
and the Central Water and Power Research Station (CWPRS), which work closely with
organizations such as the selected state executing agencies the Public Works, Ports and Inland
Water Transport Department of Karnataka and the Maharashtra Maritime Board (MMB). A World
Bank project on coastal zone management works with the MOEF&CC at that time, but ADB
decided to partner with MoJS for this MFF. The selection made remains appropriate in hindsight,
but a lack of collaboration between the two systems of management for the coastal zone resulted
in some issues in project implementation (para. 39). 7
6. The project remained relevant at completion. Pillar 3 of ADB’s CPS for India, 2018–2022
addresses environmental degradation through mitigating the negative impacts of climate change
and promoting sustainable natural resource use in project design, and the Sustainable Coastal
Protection and Management Investment Program is strongly allied to this objective.8 ADB’s
Strategy 2030 focuses on seven operational priorities, including tackling climate change, building
climate and disaster resilience, and enhancing environmental sustainability.9 The project
remained relevant to State planning at completion, for example the Maharashtra Government
policy has environmental sustainability at the base of its strategy.10
7. The MFF modality was appropriate, addressing the perceived need for long-term support
required for coastal management planning and implementation, including continued engagement
and capacity building of state executing agencies and other stakeholders. This approach allowed
the detailed design of interventions to be developed under the program, and it fostered stronger
support for the capacity building of the state executing agencies (SEAs). The project design had
three tranches for development. This was later revised to two tranches because of slow progress
made under tranche 1; tranche 3 is being subsumed into tranche 2 to better enable the
achievement of project completion within the lifetime of the agreed loan program.
8. Preparation of the project design was supported by an ADB technical assistance (TA).11
The design focused on the development of a new approach to coastal management through a
planned transition from hard coastal protection structures (e.g., sea walls) to an approach of
participative planning and integrated development of environmentally appropriate, sustainable,
and socially accepted solutions (Appendix 9). Priority projects were developed to address urgent
6
These policies include the 1986 Environmental Protection Act and the 1991 Coastal Regulation Zone Notification.
7 World Bank. 2010. India: Integrated Coastal Zone Management Project. Washington, DC.
8 ADB. 2017. Country Partnership Strategy: India 2018–2022—Accelerating Inclusive Economic Transformation.
Manila.
9
ADB. 2018. Strategy 2030: Achieving a Prosperous, Inclusive, Resilient, and Sustainable Asia and the Pacific.
Manila.
10 Planning Department, Government of Maharashtra. 2017. Vision 2030. Mumbai.
11 ADB. 2007. Technical Assistance to India for Preparing the Sustainable Coastal Protection and Management Project.
coastal management issues identified by the state governments, including the following: (i)
protecting land and beaches from erosion, (ii) addressing the causes of erosion, and (iii) providing
natural protection using dunes or mangroves.12 The project was supported by both state
governments, with strong institutional involvement. Communities benefiting from the project
needed detailed briefings about the project before they supported it. While a separate design and
monitoring framework (DMF) was developed for tranche 1, there were some weaknesses in its
formulation (para. 44).13 For the outcome, in addition to the of two major targets (length of
coastline protected, and community involvement in coastal protection), other targets (number of
businesses at intervention beaches and increase in coastal fishing and fish landings) were hard
to document and lacked baseline. Change in scope and revision of DMF were not done during
implementation.
B. Project Outputs
9. The project had 3 outputs with 22 performance targets. Overall, 18 targets were achieved,
3 were partially achieved and 1 not achieved.14 The tranche 1 DMF is in Appendix 1.
11. In Maharashtra, 7 targets were achieved and 1 was partially achieved. SMPs were
developed for the five coastal districts and for the state as a whole. These were prepared and
endorsed by the state government, with some delays because of slow administrative procedures.
The state SMP was approved on 19 July 2017. The CMIS was established in 2013 and is still in
use. The PPMS was established in 2014, although it is basic. The state executing agency (the
MMB) preferred to submit quarterly CMIS reports (without the aid of the PPMS) covering project
implementation and execution along with progress. A financial management reporting manual
was also developed early in the investment but was not used, and submission of audited project
financial statements by MMB was sometimes significantly delayed. Design work for tranche 2 had
not been completed at the time of the contract termination of the project management and design
consultant (PMDC) but designs for the 16 subprojects were complete as of 2016. Agreement was
reached in 2016 between the borrower and MMB that tranche 2 in Maharashtra would not go
ahead because of insufficient remaining time under MFF, with the investment to be reorganized
under a stand-alone program.
12 Appendix 9, Annex 1 provides the long-listed projects considered by the project preparatory TA consultants.
13 See Appendix 1
14 In Karnataka, 19 targets were achieved, 2 partially achieved, and 1 not achieved. In Maharashtra, 18 targets were
12. Output 2: Coastal erosion and instability reduced. Of the four performance targets,
two were achieved, one was partially achieved, and one was not achieved. In Karnataka, the
target related to coastline erosion was achieved, with the 2016 survey by the Government of India
indicating that the length of eroding coastline has been reduced to 70 km from a baseline of 250
km at appraisal. The target related to community and local government resolution for the
maintenance of projects was achieved with the creation of active shoreline management
organizations (SMOs). The target related to community engagement in coastal erosion and
instability reduction was addressed through the formation and support of SMOs, established as
registered cooperative organizations with established office bearers, bank accounts, and
management committees. SMOs have been established in Bengre and Ullal, using start-up
project funding. However, women’s representation in the SMOs is only 15%. Women’s
membership is being gradually increased to meet the target of 30%. For tranche 1, policies and
guidelines for encouraging private sector investment into coastal protection and management
were planned and actual investments by the private sector were not envisaged. Though there
were no specific enabling policies and guidelines developed under the project, related policies for
tourism and public private partnership (PPP) which promoted PPP modality in tourism and
transport sectors (minor ports and harbors, and inland water transport subsectors) were
developed by the state.15 These peripheral policy measures would be helpful in future for
encouraging adoption of integrated coastal protection and management by private sector into
such the investments.
13. In Maharashtra, two targets were achieved, one was partially achieved, and one was not
achieved. The target related to coastline erosion was achieved, with the length of eroding
coastline having been reduced from 263 km at appraisal to the 2016 estimate of 178 km. The
target related to community engagement for supporting project maintenance was achieved with
the creation of the SMO role. Seven SMOs in different locations were formed and became fully
operational in 2018–2019. The project provided seed funding to help establish the SMOs, which
continue to be active beyond project closure. However, women’s participation has not met the
targeted 30%. The project completion report (PCR) mission undertook community consultation
with the Mirya SMO at Ratnagiri, Maharashtra, confirming their continued activities using an office
in government premises. As in Karnataka, policies and guidelines for private sector engagement
were planned under the tranche but actual investments were not envisaged. There were policies
prepared by the state outside of the project which complement the objective of developing
enabling policies and guidelines for encouraging private sector investment into coastal protection
and management. In particular, the maritime development policy promotes private sector
participation in development of coastal infrastructure such as ports with provision of handholding
and viability enhancement support etc.; and the tourism policy includes adoption of PPP model
for promoting coastal tourism. 16
14. Output 3: Enhanced capacity for integrated shoreline planning and development.
Of the 10 performance targets, 9 were achieved and 1 was partially achieved in Karnataka and
in Maharashtra. In Karnataka, a coastal infrastructure management unit (CIMU) was established
with named officers through a state government order in 2015, but all officers identified continued
in their earlier roles and did not spend significant time in their new roles. Orientation training was
15 Department of Tourism, Government of Karnataka. 2015. Karnataka Tourism Policy 2015-2020. Karnataka.; and
Infrastructure Development Department, Government of Karnataka. 2015. Karnataka Infrastructure Policy 2015.
Karnataka
16 Maharashtra Maritime Board, Government of Maharashtra. 2016. Maharashtra Maritime Development Policy 2016 .
Maharashtra; and Department of Tourism and Culture Affairs, Government of Maharashtra. 2016. Tourism Policy of
Maharashtra 2016. Maharashtra.
5
conducted for all district administration and local bodies (GPs and municipalities) in three districts,
covering about 600 participants. SMO activities were fully achieved and financially supported
during the project, including many community-based activities such as a beach festival at Ullal.
The target related to the approval of formal mandates of the SEAs was achieved, and the newly
created Karnataka state maritime board incorporates offices of the ports departments, including
the CIMU. The shoreline planning target was achieved. In Maharashtra, enhanced shoreline
management capacity has been addressed, achieving the target of training provision and
achieving the target of the CIMU being operational. Enhanced capacity targets have been fully
met for training state and central government personnel. The target related to community
involvement in beach management was partly successful in meeting the target for involvement of
local bodies, as the SMOs with this responsibility did not achieve the gender balance required.
The SMO activity target was achieved. SMOs continue to be active in supporting local
management of beaches. Training was provided to all seven SMO committees and members.
Responsibility for operation and maintenance of project assets was given to the MMB engineering
wing, and the approved formal mandate target was achieved, as the target of approved shoreline
planning and management policy was met.
15. The appraised and actual project costs are presented in Appendix 2 for each state for the
tranche 1 project, and the cost breakdown by financier is provided in Appendix 3.
16. Karnataka. At appraisal, the total cost of the tranche 1 project was estimated to be $48.6
million, of which $7.5 million (15.5%) was to be provided by the Government of Karnataka, with
$41.0 million to be provided by the ADB loan. Actual expenditure costs totaled $41.686 million,
with the state government contributing $9.025 million (21.65%) and ADB $32.661 million. Civil
works expenditures were lower than estimated at appraisal, with about $4.85 million of loan
funding for civil works not spent (para. 32), including the unutilized amount from not undertaking
beach nourishment works. A physical contingency provision of $2.576 million was also not used.
17. Maharashtra. At appraisal, the total cost of the tranche 1 project was estimated to be
$14.124 million, with the Government of Maharashtra contributing $3.589 million (25.4%) and the
ADB loan being $10.535 million. The actual expenditure (Appendix 2) shows total costs to be
$8.56 million, with the state government contributing $4.74 million, and only $3.82 million of the
ADB loan being used. The state government’s contribution included enhanced contributions for
staff and associated costs, and funding for consultancy services to replace the loan consultants
following their withdrawal from the project. Unutilized loan resulted from the reduced size of the
offshore reef, reduced volumes of sand used for beach nourishment, and the reduced scale of
consultancy services (para. 33). The partial loan cancellation was approved in March 2016,
reflecting a reduction of $2.72 million on civil works, $2.19 million on consultancy costs, and $0.81
in unallocated costs that were not used.
D. Disbursements
18. Total disbursement for tranche 1 amounted to $36.484 million, or 71% of the original loan
of $51.555 million. The loan disbursement projections at appraisal and the actual disbursements
are summarized in Appendix 5. Delays in project implementation, which occurred largely because
of technical issues delaying progress in the major construction contracts (paras. 23–25),
contributed to the large gap in projected and actual cumulative disbursements.
6
19. For Karnataka, loan disbursements totaled $28.7 million for civil works, $3.9 million for
consulting services, and minor sums for community initiatives and equipment. Total
disbursements of $32.7 million were about 78.9% of the amount anticipated in the FAM. For
Maharashtra, loan disbursements included $2.6 million for civil works and $1.11 million for
consulting services. The total disbursement of $3.82 million was about 36.2% of the $10.54 million
disbursement anticipated during preparation of the FAM. For Maharashtra, disbursements for civil
works were 49.3% of the budgeted amount, and 34.6% for consulting services (para. 17).
20. The timeline of contract awards is in Appendix 6, comparing the actual contract award
profile with the appraisal plan. Slow contract awards resulted from poor contractor response to
invitations to bid, and the need to redesign some of the major civil works (Appendix 9).
21. Disbursements were made in accordance with ADB’s Loan Disbursement Handbook
(2007, as amended from time to time), and no imprest advance was used. Both statement of
expenditure and reimbursement procedures were used for withdrawal of funds. The statement of
expenditures procedure was used to reimburse or liquidate eligible expenditures.
E. Project Schedule
22. Tranche 1 was declared effective on 28 November 2011, with an expected completion
date of 30 June 2014. The loan closing date was extended twice and was finally closed on 30
June 2018, 48 months behind schedule. A 30-month extension was granted in July 2014 because
of delays in awarding the principal works contracts. A second extension of 12 months was
approved in July 2017. A timeline of the implementation schedule is provided in Appendix 4.
23. In both states, major modifications in reef design delayed construction. Other issues
included PMU understaffing; the need for extensive coordination with all state, district, and
community departments; the need to obtain prior approval from the advisory committee of the
MOJS; a temporary ban on the extraction of sand in Maharashtra; withdrawal of the PMDC; and
local protests against construction. Payment and reimbursement of a local tax on the use of sand
was an additional administrative issue that took time to resolve for the construction of the reef
(Appendix 9).
F. Implementation Arrangements
24. At appraisal, it was planned that each state would have a different SEA with responsibility
for overall project management and implementation. The government of each state was required
to establish a program steering committee, to be chaired by the SEA departmental secretary. A
PMU, headed by a full-time project director, was to be established in each state.
25. Karnataka. These implementation arrangements were largely followed in Karnataka, but
the project director for the PMU was only a part-time position. This led to some delays in decision-
making but did not directly impact the delivery of project outputs. A state-empowered committee
was created in 2011 to coordinate the project. The PMU lacked the personnel planned at
appraisal, and staffing issues continued and were documented in the findings of ADB missions.
The CIMU was to be formed by 2012 to take over constructed facilities, manage the CMIS, and
participate in project implementation to harness the benefits (to be delivered through the project)
of technology transfer and capacity building. While the official CIMU was established by the state
government in Karnataka through an order dated 17 April 2015, with seconded officers from the
PMU, the CIMU has not yet become fully active. This did not directly impact the project’s outcome
7
and outputs. Shoreline management is a formal mandate of the Karnataka Maritime Board
(KMB),17 which incorporates offices of the ports departments, including the CIMU.
26. Maharashtra. The MMB established a PMU for project implementation. During the
midterm review mission in June 2013, it was noted that only 8 posts out of 28 identified during
inception had been filled, and that the PMU had difficulty recruiting and retaining staff. The key
post of project director was not filled on a full-time basis. These PMU staffing issues persisted
and were compounded by issues within the PMDC team (para. 29). A concept framework for the
CIMU was prepared in September 2012 and was discussed during ADB missions in 2013 and
2014, with an initial setup date of 31 March 2014 established during the January 2014 mission.
PSC approval for the CIMU establishment was obtained in September 2014 and during the April
2016 mission it was promised staff would be in place by 15 May 2016. During the May 2018
mission, the EA informed ADB that the CIMU would not be created and assets would be managed
by the executive engineer of the MMB Ratnagiri office. This may have an impact on sustainability
of the outcomes, as institutional development associated with project implementation was not
optimally transferred to the office of the executive engineer of the MMB Ratnagiri office.
G. Technical Assistance
27. In September 2007, ADB approved a TA in the amount of $1,000,000, with financing from
the Japan Special Fund to prepare the project (footnote 11). In April 2009, supplementary TA was
approved amounting to $200,000 from the Technical Assistance Special Fund to support
additional project preparatory activities. The TA closed in March 2011. Summary of the TA’s
findings and proposed design is found in Appendix 9.
28. Consulting services. The project design provided for consultancy services in the form of
the PMDC to be procured by the PMUs in Karnataka and Maharashtra.
29. In Karnataka, appointment of the PMDC was made on 20 December 2011, 1 year behind
schedule. Initial PMDC activities were affected by issues related to slow mobilization of key
experts. The delay in the start of the PMDC also impacted the timely resolution of design issues
related to key structures for the main construction works for the Ullal offshore reef (para. 32).
Nonetheless, the PMDC has been effective in support of the PMU.
30. In Maharashtra, the PMDC contract was signed on 30 January 2012. Differences
developed between the PMDC and the PMU concerning the quality of the deliverables, availability
of the experts fielded by the PMDC, and over slow payments made by the PMU to the consultants.
The PMU questioned the PMDC’s performance and issued a letter in September 2013, seeking
replacement of 11 of its 17 national experts. The PMDC served a notice of termination of their
contract on 30 October 2013 over payment issues, with termination becoming effective on 28
November 2013. Subsequent efforts to amicably resolve the dispute did not yield agreement.
Later, it was agreed that the PMU would use its state funds to engage a design and supervision
consultant to complete work required under the original PMDC terms of reference, including
preparation of tranche 2 detailed project reports. The lack of a PMDC after November 2013
delayed preparation of SMPs and tranche 2 designs.
17
Created under the Karnataka Maritime Bill, 2015.
8
31. Works packages. The works and works packages were largely unchanged from the
arrangements agreed at appraisal.
32. Karnataka. The key civil works packages for Karnataka were for (i) construction of two
multipurpose geotextile reefs and four inshore berms at Ullal; (ii) shortening and rehabilitation of
the southern breakwater, extension and rehabilitation of the northern breakwater, and crest
protection at Ullal; and (iii) dredging and beach nourishment. The new technologies impacted the
contractor procurement process, with low contractor interest in bidding for the works and technical
issues delaying tendering and bid evaluation, requiring rebidding for the main reef contract
(Appendix 9). For the beach nourishment element, the works were canceled, as a good beach
developed behind the offshore reef without the need for additional sand. Works related to the
shortening and rehabilitation of the breakwaters at the old port of Mangalore were redesigned,
but this did not affect construction progress. Output quality was satisfactory overall.
33. Maharashtra. The main civil works in Maharashtra comprised (i) construction of one
multipurpose geotextile reef at Mirya, and (ii) dredging and beach nourishment using bulk sand
stockpiled on the beach and from dredging of the fishing harbor. The contract for the construction
of the geotextile reef was awarded in October 2011, with the contractor undertaking surveys and
a design review. Subsequent changes to the proposed surveys and to the design to improve
constructability and sustainability (Appendix 9) and community resistance to the construction of
the reef delayed progress, leading to the suspension of work. Following the departure of the
PMDC, an individual consultant was engaged by the PMU to supervise the civil works, which were
completed in February 2016. Following a monsoon in 2017, one geotube of the reef was lost and
another was deflated because of sand leakage. The contractor rectified the damage during the
defect liability period under the contract. Works related to beach nourishment were done following
completion of the reef as planned, with the contract award in August 2016, and completion in
March 2017. The volume of sand used was less than planned because of reduced availability of
suitable sand, but the outcome remained satisfactory. Output quality was also satisfactory.
34. Goods procurement. Goods procured under the loan were minimal. Some multifunctional
printers were procured in Karnataka for about $8,000.
I. Safeguards
35. The project has been classified environmental category A, the interventions expected to
improve the natural environment of the shoreline by stabilizing and even restoring the natural
beaches. ADB’s Environment Policy (EP), 2002 is applicable for this loan. The SEIA was
amended in December 2012 to reflect the change pertaining to the type of materials proposed for
the construction of the Ullal reefs and dropping of Goa state component from the scope (that took
place after SEIA issuance). Potential adverse effects of proposed structures were considered
during the design stage and measures were included to minimize them. The environmental
management plan addressed possible effects during the construction and operation phases.
Public consultation and disclosure were completed in each subproject area and placed on ADB
website, in a timely manner. More details are provided in Appendix 10.
36. The subproject interventions were carried out offshore or on the shoreline. There were no
settlements in these areas and, as a result, none of the subprojects required any land acquisition
or resettlement of people. In the subproject areas, there were no indigenous peoples or ethnic
minority groups. The project was therefore classified category C for involuntary resettlement and
indigenous peoples, and no related complaints were received. All safeguard requirements were
9
37. ADB review missions flagged some concerns on statutory environmental compliance by
the project. Appropriate environmental clearance for construction under the coastal regulation
zone notifications was obtained following the normal process. The key issue was the non-receipt
of clearance earlier following project redesign. The PCR mission was informed that for
Maharashtra, clearances had been granted at all levels except final confirmation from the
MOEF&CC, and MMB were following this up.
39. Compliance with loan covenants was regularly monitored during the ADB review missions.
Of the 66 covenants (and subdivisions of covenants), 57 were fully complied with, 2 were partially
complied with (related to women’s representation within the SMOs and receipt of final
environmental clearance from coastal regulation zone authorities for revised designs), 2 were not
complied with (related to the involvement of PPPs in coastal management), and 5 were no longer
relevant (mostly because no resettlement was needed). The need for environmental clearance
from coastal regulation zone authorities was flagged late (in July 2017), but the application for
this clearance immediately followed. However, application by other government departments
encountered administrative delays and the clearance is yet to be received. These shortcomings
in relation to compliance with loan covenants had little direct impact on overall project
performance. Participation and investment by the private sector were envisaged, up to 7% of the
project cost, for MFF and there were no investments envisaged or cost allocated to private sector
in project 1. Both states have included measures for promotion of private sector participation and
PPP into coastal economic activities through peripheral policies for tourism and maritime
development which may help in encouraging future private sector participation in the integrated
coastal protection and management. The project’s general and special covenants and the
compliance with these covenants are described in Appendix 7.
40. Quarterly progress reports were routinely submitted by both PMUs, although there were
occasional delays. Semiannual environmental reports were submitted by both SEAs, although the
initial reports for both states were delayed, with the Karnataka report for August 2011–June 2014
submitted in March 2015, and the Maharashtra first report was submitted in May 2016.
Thereafter, reporting was regular, and on time. Reports were uploaded to the ADB website. No
external monitor for safeguards was engaged.
41. Monitoring and reporting systems implemented in each state were not as originally
envisaged, and there were delays in establishing these reporting systems. In Karnataka, the
PPMS was to be established within 3 months of project effectiveness, but implementation was
delayed, as the system was to be developed by the PMDC, which was appointed about 12 months
late. The PMDC then developed a simplified reporting system using an Excel spreadsheet, which
was later updated to a database system in 2018 (para. 10). In Maharashtra, a simplified PPMS
spreadsheet system was developed in 2013–2014 and was used thereafter (para. 11).
10
42. Financial management of the SEAs was impacted by their failure to employ appropriate
full-time staff at the deputy director level. There were no reported issues with financial
mismanagement identified by audit, but problems with obtaining audited project financial
statements in a timely manner were flagged by review missions, especially for Maharashtra. A
finance and administration unit was established in each of the state PMUs to ensure the rules and
regulations and reporting formalities of ADB were followed. The annual audit reports were
prepared for each SEA and included the audit of the SGIA and the SOE procedure, and a separate
audit opinion on the use of loan proceeds, the operation of the SGIA, and compliance with SOE
procedures and loan covenants. Detailed consolidated annual project accounts (as maintained
by the SEAs through their PMUs) were audited by independent auditors and were submitted to
ADB. Of the 16 audited project financial statements received during fiscal year (FY) 2012 to
FY2019 from Karnataka and Maharashtra separately, 3 reports were received on time. The others
were delayed by 0.2 to 4.1 months, with an average delay of 1.15 months. All qualifications to
reports were later resolved. Specific opinions on the use of funds were also issued.
A. Relevance
43. The project is relevant. It was relevant at appraisal (para. 4) and at completion. It is in line
with pillar 3 of the CPS, 2018–2022, which addresses environmental degradation through
mitigating the negative impacts of climate change and promoting sustainable natural resource
use in project design (footnote Error! Bookmark not defined.). It is also in line with ADB’s
Strategy 2030, particularly operational priority 3 on tackling climate change, building climate and
disaster resilience, and enhancing environmental sustainability (footnote Error! Bookmark not
defined.). The project introduced an innovative way of managing erosion of the coast through
construction of offshore reefs and recommended novel designs and schemes such as the use of
offshore reefs to conserve beaches (Appendix 9). But since the approach was new, unanticipated
problems at appraisal were experienced during implementation which caused delays in the
delivery of the schemes. Nonetheless, the new approach proved to be successful, and resulted
in rapid beach recovery. The coasts at Ullal and Mirya bay are now better protected and the
adopted approach has the potential for replication in other states and to influence national
strategies to include coastal protection.
44. The project design had some weaknesses as reflected in the DMF targets (para 8). The
private sector participation indicator of the outcome remained peripheral to project implementation
and was difficult to achieve as there is little experience in such participation in coastal
management in India. The output and outcome targets for private sector investment were more
appropriate to the DMF of the facility. The DMF also lacked baselines and quantifiable targets,
had too many output indicators, and indicators that would have been better served as activities
(such as consultant engagement). Despite these, prevention of coastal erosion remains a priority
for the governments of Maharashtra and Karnataka, which continue to seek support from
international financial institutions to develop projects in this area. This project has developed
environmentally-friendly approaches to coastal protection that have proven to work well, and are
in accordance with the recommendations for coastal protection and management endorsed by
the MoJS.18 Overall, the project is assessed as relevant.
B. Effectiveness
18
https://www.adb.org/news/videos/restoring-beaches-through-sustainable-coastal-protection-and-management
11
45. The project is rated effective. There has been substantial progress in addressing the
problem of shoreline erosion and increasing community involvement in coastal protection and
management, with 3 of the 4 outcome targets achieved and 1 substantially achieved. The
outcome of protecting targeted vulnerable coastline based on the DMF was achieved.19 A total of
8.3 km of coastline is protected and better managed in Ullal and Mirya bay. Enhancing community
involvement has been achieved in both states with representatives of well over the target 50
communities participating in project activities. Exact figures to measure actual increases in
businesses, local fish catches, and coastal shipping are sparse, but significant additional activities
in these areas developed under tranche 1 are evident in the project sites. Business activities at
intervention beaches have greatly increased, with Ullal rising from no activity and Mirya Bay
reporting significant improvements following increase in footfall for tourism. In Karnataka, 20 to
30 families are now gainfully employed in beach tourism and 10-15 new vendors and micro
retailers use peripatetic stalls to earn livelihood. Coastal shipping and fish landings have also
expanded. In Maharashtra, purses seiners operating along the Ratnagiri coast increased by 18%
and combined average landing of Indian mackerel and oil sardine grew from 9% to 23%. Even at
appraisal for tranche 1, project focus on private sector involvement in coastal management was
secondary and it remained peripheral throughout implementation. Nonetheless, this did not affect
the achievement of the overall outcome of protecting and managing shorelines to meet the needs
of the stakeholders and the environment. Overall, 82% of the output indicators were achieved for
tranche 1 (paras. 10-14).20 The continued implementation of SMPs for the entire coastline in
Karnataka and Maharashtra will strengthen coastline protection. Coastal erosion and instability
have been reduced in both areas, and capacity of states in shoreline planning and development
has been improved. Safeguard compliance reporting, monitoring, and management were also
generally satisfactory: environmental reporting was done, no environment-related grievances
were raised, except the delay in revised environmental clearances (para 37). No other safeguard
issues were flagged.
C. Efficiency
46. The project is rated efficient. During appraisal, the calculated economic internal rate of
return (EIRR) for the base case for the Mirya Bay works was 16.8%, and the net present value
(NPV) at a discount rate of 12% was calculated to be ₹89.2 million. For the present analysis of
the Mirya Bay scheme, and to estimate the benefits delivered by the scheme, the EIRR is
calculated to be 35.9%, with an NPV of ₹1,199 million. At appraisal, the Ullal sub-project had an
EIRR of 14.5% with a NPV of ₹180 million. In the reappraisal, the base case for Ullal is calculated
to be an EIRR of 15.2% with an NPV of ₹348 million. For the combined scheme, the EIRR is
21.9% with an NPV of ₹1,547 million. The economic reevaluation is described in Appendix 8. With
respect to process efficiency, there were significant initial implementation delays because of
challenges in procurement and staff capacity, slow mobilization of key experts, and termination
of a consulting contract. The use of new technologies reduced bidder interest; technical issues
delayed tendering and bid evaluation; and unforeseen geotechnical conditions endangered the
stability of the offshore structure, which led to a 3.5-year extension (a 50% overrun). The EIRR
re-estimation accounted for the time overrun, although the project is still found to be efficient.
D. Sustainability
19 Remeasurement of the actual length of the coastline to be protected shows that it is only 8.3 km compared to the 10
km target given in the DMF. In essence, it is considered that the full length was achieved. However, the DMF target
was not updated.
20
Of the 22 output targets for tranche 1, 18 were achieved, 3 were partially achieved.
12
47. The project is rated likely sustainable. The technical solutions adopted by the project are
likely to be sustained given their effectiveness and the acceptance within CWPRS and CWC
which provide key advice on engineering of coastal protection measures. Project implementation
has provided opportunities for interaction and collaboration among key specialists in the CWC
and CWPRS, which enhanced the ownership and capability of both these institutions to
continuously promote and lead the communities toward sustainable protection and management
of India’s coastline.
48. The sustainability of the project outputs was assessed separately for the participating
states as their institutional arrangements are different. For both states, the project is rated likely
sustainable. While the new technologies introduced pose a challenge in terms of appropriate and
sufficient operation and maintenance (O&M) of the structures, the project supported the
development of an O&M manual to sustainably maintain these assets. The budgetary
requirements are relatively small, and the responsible agencies have extensive experience in
general management of coastal structures. Technical and institutional challenges to project
sustainability are discussed in Appendix 9.
49. Karnataka. An O&M manual for the maintenance of the project assets has been provided
to the SEA, and it is important this is used together with appropriate staff and financial resources
for the proper maintenance of the structures created. During the PCR mission, the SEA confirmed
that project assets will remain with the Public Works Department for the initial years of operation
until the KMB is further developed. The agency has sufficient O&M budget to meet project O&M
requirements.21 The handover will take place once KMB has the capacity to effectively manage
these assets. The sustainability of the community initiatives in shoreline management through the
SMOs developed remains uncertain, as the internal revenue streams have yet to be
demonstrated. More details are provided in Appendix 9.
50. Through its participation in tranche 2, Karnataka will have more opportunities to further
demonstrate the benefits of effective shoreline management, community involvement in decision-
making, and investments along the coastline; and contribute to institutional capacity building.
51. Maharashtra. The MMB has limited engineering and project implementation capacity and
does not have ongoing tranche 2 support to assist capacity building to enhance its ability to
manage the project outcome following project completion. MMB has a functioning department of
civil engineering to undertake construction and maintenance of the assets created, and the new
project under development is expected to significantly enhance the sustainability of tranche 1.22
The MMB has confirmed adequate budget23 for undertaking O&M of the created assets.
E. Development Impact
52. The development impact of the project is rated satisfactory. The impact indicators in the
DMF were targeted after 5 years of project completion, or in 2019, but because of delays, this
assessment was made about 2 years after completion, and so the impact might not be as
developed as originally envisaged. While there are no specific targets in the DMF at the impact
level, the contributions of the project to higher per capita income and increase in GDP were made
through improvements in fishing and tourism activities in addition to reduction in damages caused
by coastal flooding and erosion arising from coastal protection interventions. There have been
21 The O&M budget requirement represented 0.02% of the Public Works Department’s annual budget in 2019.
22 A new project – the Maharashtra Sustainable Coastal Protection and Management Project is under development.
23
The O&M requirement was about 1% of the MMB’s O&M expenditure in 2019.
13
no reports of flood damage in the protected areas since project completion, and fish landings
have increased between 9% and 23%. The development of beaches at Mirya Bay and Ullal has
led to restart of tourist visits and generation of economic activities. The works at Ullal have
strengthened the management of the old port in Mangalore, encouraging the growth of traffic
through this port. The enhanced coastal resilience at Ullal was demonstrated during Cyclone
Ockhi as the shoreline infrastructure minimized damage in the region when the cyclone hit
southern India in December 2017. Other states have shown interest in these soft hybrid protection
measures for new investments.
53. The environmental impact of the project was positive, as it addressed environmental
degradation through coastal erosion. Tourism in Ullal witnessed noticeable growth. In addition,
the clam mussel population on Ullal reef increased, allowing profitable fishing for fisherfolk, and
dolphins are being sighted near the reef. These indicate environmental sustainability and potential
economic sustainability over the long term. Contribution of the project to ADB Strategy 2030 can
be found in Appendix 8.
54. The performance of the borrower is rated satisfactory. No adverse issues arose through
the borrower’s actions. The MOJS and its agencies (the CWC and CWPRS) provided
considerable support to project implementation and made a significant contribution to overall
project success. Overall, the performance of the SEAs is considered satisfactory.
55. Karnataka. The performance of the SEA is rated satisfactory. The PMU provided strong
support and guidance to overcome many challenges encountered during implementation such as
in managing the need for design changes and additional site investigations (within the constraints
of its own procedures for clearing design changes and managing procurement processes). Loan
covenant noncompliance was a minor issue, and the SEA made strong efforts to achieve
compliance.
56. Maharashtra. The performance of the SEA is rated less than satisfactory because of the
accumulation of issues relating to the management of the PMDC and reef construction contracts.
Implementation of the project suffered from significant negative impacts from contract-related
disputes, which could have been better managed. Persistent problems with lack of staff within the
PMU to effectively manage contracts were also flagged during review missions. For example,
during project implementation, the SEA constructed a new Mirkarwada fisheries jetty within Mirya
Bay without any assessment of how it would impact project performance. Loan covenant
noncompliance was a minor issue, and the SEA to made strong efforts to achieve compliance.
57. During project implementation, ADB fielded one inception mission, one midterm review
mission, one consultation mission, five loan review missions, and one safeguards review mission.
On average, missions occurred about once every 8 months. These missions provided strong
support and clear direction for project implementation as ADB staff had in-depth technical
knowledge and strong country experience, and their suggestions enabled the PMUs to fast-track
project implementation. The mission members helped flag potentially troublesome issues and
resolve internal and external bottlenecks. The collaboration between the SEAs and ADB resulted
in the improved performance of the PMUs. The overall performance of ADB was satisfactory.
14
H. Overall Assessment
59. Overall, the tranche 1 project is rated successful. It was relevant and provided impetus for
the development of sustainable coastal management practices in India relevant to both
government and ADB policies. It was effective in achieving the target outcomes, and significant
outputs were achieved towards delivering environmentally sustainable and effective protection to
key beaches. The project was economically efficient and is likely to be sustainable with existing
institutional capacity for coastal management and O&M of project outputs.
Overall Ratings
Criteria Rating
Relevance Relevant
Effectiveness Effective
Efficiency Efficient
Sustainability Likely sustainable
Overall Assessment Successful
Development impact Satisfactory
Borrower and executing agency Satisfactory
Performance of ADB Satisfactory
ADB = Asian Development Bank.
Source: ADB.
60. Delays in consultant engagement. The SEAs suffered delays during the procurement
of their PMDC technical support consultancy teams, and both contracts for consultancy services
were awarded about 12 months behind schedule, leading to slow implementation of the project.
Consultancy contracts administration proved problematic, with delayed payments, output quality
issues, and a lack of trust on the services rendered. This could be addressed either by factoring
such possible delays in project timelines or providing additional support to executing agencies to
manage procurement of consultancy services.
62. DMF quality. The DMF contained a number of weaknesses, and opportunities to improve
the DMF were missed during project implementation. This has made project evaluation less
precise. In the future, more care is needed in considering how project should be most
appropriately monitored and evaluated, both in design and at midterm review.
15
63. Utilization of SMPs. The preparation of SMPs was successfully achieved, but there is no
mandatory requirement for government agencies to use SMPs for planning coastal intervention
activities. The need to widen interdepartmental coordination, for increasing usefulness of the
planning document, needs to be addressed.
B. Recommendations
64. To address issues of delays caused by design changes, the design and build contract
approach could be used. This type of contract is used successfully in India, but with much larger
contracts than those under the project. Additional time should also be allowed to implement such
changes.
65. In designing projects, enough time should be allotted to account for the learning curve
within SEAs to complete procurement, especially if they have little experience in engaging
consulting services effectively. Proceeding with initial procurement without having support for the
SEAs available through consulting services has risks and can lead to significant delays. This
should be recognized in establishing implementation schedules within the project design. With
structures to be built that are beyond the experience of the PMU team, it is important that good
advice is available to the PMU until the arrival of the long-term TA team.
66. When institutional arrangements for post-project asset management involve creation of
new organizations or significant reorganization of existing institutions, these actions should occur
early (i.e., before the midterm review), and institutional development and training provided under
the project should be directed to reach those holding post-project responsibilities.
67. For better follow-up on compliance with the submission of audited project financial
statements, a financial management specialist should be part of project missions to monitor and
support the mission leaders and executing agency/implementing agency. Audit issues should be
more closely followed up on while the project is still being implemented.
68. Future monitoring. Continued monitoring of project performance will be needed for
Karnataka during implementation of tranche 2. Collection of information to assess delivery of the
project impact may require the commissioning of social surveys to collect specific data to quantify
the level of achievement of performance targets on completion of tranche 2. Monitoring is also
needed to promote compliance with all remaining regulatory issues.
69. With construction of offshore reefs, the navigational hazards that these structures present
should be minimized. The reefs should be identified with marker buoys and located on nautical
charts. Checks should be made to confirm these tasks have been done.
70. The design of the Mirya Bay project in Maharashtra was reduced to one layer from original
two-layer geotube reef, and significant reduction was made in the sand volume for beach
nourishment. When suggesting the design changes, the CWPRS stressed the need to monitor
the impact of the reduced structure and make further changes if needed. Such monitoring is
required in the future. Nevertheless, the investment remained successful in achieving its main
objective of bay stabilization, despite the construction of a fisheries jetty that was not part of the
investment plan, reducing sediment circulation within the bay (Appendix 9). The MMB should
continue to monitor the beach in case future maintenance measures are needed.
71. Timing of the project performance evaluation report. The project performance
evaluation report should be prepared after completion of tranche 2 of the program.
16 Appendix 1
Number of business at
intervention beaches increased Achieved. Number of Businesses at intervention beaches The businesses have increased
by 15% businesses have have increased by at least 100%. There significantly due to increased footfall
increased were no facilities or visitors at the start for tourism and related economic
of the project as beach was eroded, but activities for a net positive impact.d
now 20 to 30 families are gainfully (Source: EA PCR; PMU Reports)
employed in beach tourism during
weekends, with enhanced income of ₹
6,000 to 10,000 per month and 10 to 15
new vendors and micro retailers use
peripatetic stalls to earn their livelihood
with earning of ₹ 2,000/ to 3,000/ per
day during weekends. (Source: SMO)
10% increase in coastal
shipping and fish landings at
intervention districts
Achieved. Number of
coastal shipping and
fish landings have In Karnataka, enriched population of The purses seiners operating along
increased “clam mussels” in the Ullal reef allows the Ratnagiri coast (Marine Fisheries
gainful employment to 15 families Census, 2010) increased by 18%
18 Appendix 1
Outputs
Output 1: Sustainable
Plans and
Management for
shoreline developed All plans are completed and Achieved with delay. All SMPs prepared and discussed All SMPs prepared and discussed
endorsed by local bodies as All SMPs completed with stakeholders, endorsed and with stakeholders, endorsed and
1.1 Participatory stakeholders and relevant and endorsed by local cleared by authorities. By 2017, cleared by authorities. By 2017,
shoreline planning authorities by 2013 bodies by 2017. three district SMP and one State five district and one State SMPs
management plans SMP prepared. (Source: PMU completed. See MMB website
to meet the long reports) (Source: PMU reports)
term needs for
shoreline
management for 3
State coastlines
prepared and
endorsed
1.2 Coastal Coastal management Achieved. Coastal Coastal Management Information Coastal Management Information
management information system is functional Management Systems have been developed by the Systems have been developed by
information system in each state with linkages to information system is end of the project and continue to be end of the project and continue to
to support planning central agencies functional in the 2 actively used. These have evolved be actively used. These have
and management states. from rudimentary systems initially evolved from rudimentary systems
established used, to more sophisticated systems initially used, to more sophisticated
Appendix 1 19
PMU established, staffed PMU established and staffed in 2010. PMU established and staffed in
Achieved. PMU 2010.
(2010) established and
staffed in 2010.
Output 2: Coastal
erosion and
instability reduced
2.1 Coastal erosion and Coastline subject to erosion is Achieved. Coastline Separate target for Karnataka not Separate target for Maharashtra
instability reduced reduced to 380 km from the subject to erosion was provided, but length of eroding coast not provided, but length of eroding
present level of 530 kme reduced to 248 km. at appraisal for Karnataka estimated coast at appraisal for Maharashtra
to be 250 km. A recent Government estimated to be 263 km. Latest
report gives length of eroding coast estimate for length of eroding
for Karnataka of 70 kmf coastline in Maharashtra is 178 km.
l
Responsibility for management and
2.2 Community and Community/local government Achieved. Responsibility for management and maintenance of completed projects
private sector engaged resolution for purposes of Management and maintenance of completed projects lies with the MMB in Maharashtra.
in coastal erosion and maintenance of completed maintenance are lies with the Coastal Infrastructure SMO responsibilities established
instability reduction projects being handled by Management Unit (CIMU), which was with local Gram Panchayat offices
local government operational in 2015. Shoreline to provide link with local
agencies. Management Organisations (SMOs) government and local communities.
established to support work of CIMU.
Coastal communities active in
Coastal communities active in coastline management activities
50 communities with up to 30% Partially Achieved. coastline management activities and
women beneficiaries at each While communities and have been supported through
have been supported. 5 SMOs. Representatives of 53
intervention district supported are supported, Representatives of 600 communities
participation of communities represented within the
attended training events. SMO committees. These SMO
women in some of the Participation of women in some of organizations are the local Gram
Appendix 1 21
Coastal Infrastructure Achieved with delay. CIMU was established and staffed
Management Unit (CIMU) CIMU has been CIMU was established in Karnataka
vide Government Order GO on 17 within MMB in June 2015.
operational by 2012
April 2015 with roles and
22 Appendix 1
Training of SEA staff has been Training of SEA staff has been
Adequate numbers of provided by the PMDC teams. provided by the PMDC teams.
State/ Districts agencies, Achieved. A total of
3.2 Enhanced capacity 18 staff trained from Fourteen training events held SMO and local expert/agencies
local experts/ agencies, providing training for PMU, SMO and were provided training in coastal
for State/district the 2 states on
local bodies and other stakeholder staff, including management issues, including visit
agencies local climate resilient
stakeholders trained in attendance in an international study to operating Kovalum Beach in
experts/agencies, local coastal protection
bodies and application of new tour. In addition, 13 PMU staff Kerala. Technical training for PMU
using softer
stakeholders to provide technologies. attended training on new Guidelines and SEA staff was provided by
technologies such as
specialist support for use of offshore reefs for Coastal Management over 3 days consultants. In addition, 5 PMU
planning, modeling, and coastal dunes in Mangalore. staff attended training on new
design, checking and guidelines for Coastal Management
review for coastal over 3 days in Pune.
protection and 50 staff at CWC, CWPRS and
Training provided as described for
management other central agencies trained Core CWPRS and CWC staff were Karnataka.
Achieved. A total of given orientation training. Core staff
116 staff trained were completely involved in the
project design and approval process
with involvement of CWC, CWPRS
and other central agency staff. Three
major training events held, with total of
116 participants from central
agencies, university departments.
SMOs have been established and
functional in 2 locations in the State,
Shoreline Management involving local bodies. Representation SMOs have been established and
3.3 Beaches are involving local bodies as Partially Achieved.
of women is below 30%, but efforts are functional in 7 locations in the State,
managed and stakeholders with at least 30% SMOs have been
involving local bodies.
maintained by the representatives from women established but
Representation of women is below
Appendix 1 23
Shoreline management active SMO members at all sub-project sites SMOs at all sub-project sites remain
at each sub-project site Achieved. Shoreline remain active, providing information active and in regular contact with
management is a on performance of coastal protection the CIMU. PCR Mission
formal mandate of the works and identifying local interviewed one SMO chairman,
maritime board in the management issues or developing confirming on-going role for the
2 states. problems. SMO.
A. Investment Costs
1. Turnkey contract
2. Civil works 36.838 36.838 36.463 36.463
3. Mechanical and equipment 0.55 0.55 0.008 0.008
4. Environment and social mitigation 1.129 1.129 0.058 0.058
5. Consultants
a. Project management 7.255 7.255 3.2531 2.3787 5.6318
b. Capacity development 0.324 0.324 0.054 0.054
6. Training 0.324 0.324
7. Community initiatives 0.264 0.264 0.11 0.11
8. Studies and surveys 0.235 0.235 0.85 0.85
Subtotal (A) 46.684 46.684 3.2531 39.9217 43.1748
B. Recurrent Costs
1 Salaries 1.474 1.474 2.95 2.95
2 Accommodation 2.59 2.59
3 Equipment operation and maintenance
Subtotal (B) 1.474 1.474 5.54 5.54
Total Base Cost (A+B) 48.158 48.158 3.2631 45.4577 48.7108
C. Contingencies 4.98 4.98
D. Financial Charges During Implementation 1.534 0.23
Total Project Cost (A+B+C+D) 53.138 53.138 4.797 45.4577 50.255
Source: ADB and EA PCR documents
Appendix 3 25
Subtotal (B)
Total Base Cost (A+B) 36,870 88.2% 4,933 11.8% 41,803 3,532
C. Contingencies 4,150 99.5% 20 0.50% 4,170
D. Financial Charges During Implementation 2,576 100.0% 2,576
Total Project Cost (A+B+C+D) 41,020 84.5% 7,529 15.5% 48,549 3,532
Note:
Numbers may not sum precisely because of rounding.
Source: ADB
26 Appendix 3
Notes:
1. Numbers may not sum precisely because of rounding.
2.Local Government expenditure on salaries and accommodation
Source{s}: ADB and Government of Karnataka
Appendix 3 27
Notes:
1. Numbers may not sum precisely because of rounding.
Source: ADB and Government of Maharashtra
28 Appendix 3
($ ‘000)
Total Project Cost (A+B+C+D) 3,820 44.6% 4,740 55.4% 8,560 100.0%
Note:
1. Numbers may not sum precisely because of rounding.
Source: ADB and Government of Maharashtra
Task / Activity 2011 2012 2013 2014 2015 2016 2017 2018 2019
I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV
i. Mirya Bay Reef, Maharashtra
= original schedule
= actual schedule
Source: ADB
30 Appendix 5
Disbursement Curve
70
60
Cumulative disbursement ($ million)
50
40
30
20
10
0
2010 2011 2012 2013 2014 2015 2016 2017 2018
Table 6.1: Annual and Cumulative Contract Awards of ADB Loan Proceeds
($ million)
Annual Contract Awards Cumulative Contract Awards
Amount Amount
Yeara ($ million) % of Total ($ million) % of Total
Figure 6.1: Projection and Cumulative Contract Awards of ADB Loan Proceeds
($ million)
50
40
30
20
10
0
2010 2011 2012 2013 2014 2015 2016 2017 2018
Actual Planned
32 Appendix 7
Loan Agreement
4.01. (a) The Borrower shall cause the States to LA Article IV Complied with.
carry out the Project with due diligence and
efficiency and in conformity with sound applicable
technical, financial, business, and development
practices.
(b) In the carrying out of the Project and operation
of the Project facilities, the Borrower shall
perform, or cause to be performed, all obligations
set forth in Schedule 5 to this Loan Agreement.
4.02. The Borrower shall make available to the LA Article IV Complied with. Project funds were included
States, promptly as needed, the funds, facilities, in the departmental budget by the state.
services, and other resources, as required, in
addition to the proceeds of the Loan, for the
carrying out of the Project.
4.03. The Borrower shall ensure that the activities LA Article IV Complied with.
of its departments and agencies with respect to
the carrying out of the Project and operation of the
Project facilities are conducted and coordinated in
accordance with sound administrative policies
and procedures.
4.04. The Borrower shall take all actions which LA Article IV Complied with.
shall be necessary on its part to enable the States
to perform their respective obligations under the
Project Agreements, and shall not take or permit
any action which would interfere with the
performance of such obligations.
4.05. (a) In relation to the Project, the Borrower LA Article IV Complied with. Regular fund flow was
shall exercise its rights under the financing assured by the SEA. No instances of fund
arrangements in such a manner as to protect the shorted faced by PMU
interests of the Borrower and ADB and to
accomplish the purposes of the Loan.
(b) In relation to the Project, no rights or
obligations under the financing arrangements
shall be assigned, amended, abrogated or waived
without the prior notice to ADB.
Establishment of Imprest Account; use of LA Sch 3 Complied with.
Statement of Expenditure.
5. (a) Except as ADB may otherwise agree, the Provision for imprest account, direct
Borrower may establish, and cause to be payment and reimbursement procedure was
established, immediately after the Effective Date, put in place. Compliance was based on
(i) a first generation imprest account at the preferred disbursement procedure of the
Reserve bank of India, and (ii) a second State Government.
generation imprest account for each SEA in a
commercial bank acceptable to ADB (collectively, The state had opted for reimbursement
“imprest accounts”). The imprest accounts shall procedure and direct payment.
be established, managed, replenished, and
liquidated in accordance with ADB's Loan
Disbursement Handbook, and detailed
arrangements agreed upon between the
Borrower and ADB. The currency of the first
generation imprest account shall be the Dollar,
and the currency of the second generation
imprest accounts shall be Indian Rupees. The
aggregate amount to be deposited into the
imprest accounts shall not exceed the lower of (i)
Appendix 7 33
transmitted diseases and HIV/AIDS as part of provisions of labor (including equal pay for
health and safety measures for those employed equal work), health, safety, sanitation,
during construction; (ii) do not use children as welfare and working conditions. PMU was
labor; and (iii) follow legally mandated provisions responsible for monitoring this.
of labor (including equal pay for equal work),
health, safety, sanitation, welfare and working
conditions. The contracts will also include clauses
for termination in case of any breach of these
provisions by contractors.
(b) Each State shall ensure that its SEA ensures
that the anticorruption provisions acceptable to
ADB are included in all bidding documents and (b) Complied with.
contracts, including provisions specifying the right
of ADB to audit and examine the records and Anticorruption provisions were included in all
accounts of the executing and implementing bidding documents.
agencies and all contractors, suppliers,
consultants, and other service providers as they
relate to the Project.
11. Each State shall take all necessary steps to LA Sch. 5 Complied with. GO was issued for the
empower the SEAs to coordinate all coastal formation of CIMU on 21 February 2014. An
protection and management programs. Towards office order was also issued on 17 April 2015
this the capacity of the SEAs shall be enhanced with roles and responsibilities of the
under the Program. Establishment of a coastal identified CIMU officers. The services of the
information management unit (CIMU) within the identified persons was utilized on need
SEAs shall support the coordination of MIS. basis.
In Maharashtra, MMB is fulfilling role.
12. Each State shall ensure evaluation of LA Sch. 5 Complied with. Project funds were included
adequacy of budgetary requirements for in the departmental budget by the state
necessary expenditures, in particular for
operations and maintenance of subprojects. To
ensure availability of the funds required to meet
such expenditures, each State shall take into
consideration various funding sources, including
subsidies, financial performance of local bodies,
introduction of schemes as necessary, to ensure
financial sustainability through introduction of
appropriate taxes as required and feasible.
Counterpart Support and Financial LA Sch. 5
Management (a) Complied with. Project funds were
13. (a) Each State shall ensure that its budget included in the departmental budget by the
incorporates annual funding requirements of the state.
project for its contribution and the release of
funds. (b) Complied with. Regular fund flow was
(b) Each State shall ensure that sufficient assured by the SEA. No instances of fund
counterpart funds are available from its budget for shorted faced by PMU
each fiscal year, in a timely manner, for the
efficient implementation of the Projects under the
Facility.
14. A finance and administration unit shall be LA Sch. 5 Complied with.
established in each Project Management Unit of Deputy Controller Finance was posted within
relevant SEA to ensure compliance with Rules the PMU for ease of fund disbursement
and regulations and reporting formalities to ADB.
The Project finance manager shall be responsible
for overseeing budgeting, accounting, and
reporting of all financial transactions relating to
the implementation of the Project under the
overall supervision of the Project Director.
Performance Monitoring and Progress Reports LA Sch. 5 Complied with.
15. Within 3 months of the Effective Date, each Web based PPMS has been fully established
State through its SEA shall establish an IPPMS for reporting
for the Facility as also PPMS for the Project, both
in form and substance acceptable to ADB. The
PPMS shall track the Investment Program and
Project implementation activities, corresponding
target dates, expected outcomes, and assigned
responsibilities under a monitoring mechanism
that can be used to track progress on specific
activities. The IPPMS and PPMS shall
respectively aim to detect any deficiency and
discrepancy between the plan and the execution
of the Investment Program and Project in using
the resources efficiently in order to ensure that
timely corrections can be made to adjust the
design of the Investment Program and Project as
feasible.
16. Without limiting the generality of Section 2.08 LA Sch. 5 Complied with.
of the Project Agreement, each State through its
Appendix 7 37
SEA shall prepare and provide ADB with quarterly Each EA shared their quarterly progress
progress reports on implementation of the Project reports to ADB. However, sometimes there
and the Investment Program within 45 days of were delays in submissions, but the reports
each quarter, that shall include report on progress included physical and financial progress
made during the period of review, changes if any achieved, and output wise progress
on implementation schedule, problems or achieved till such dates.
difficulties encountered and remedial actions
taken, work to be undertaken and
Subprojects/Components to be proposed for
financing in the coming quarter. The reports shall
also include a summary financial account for each
SEA, expenditures to date, and report on benefit
monitoring undertaken pursuant to previous
paragraph of this Schedule.
Review and Reports LA Sch. 5
17. (a) Based on a review of quarterly progress (a) Complied with. Periodical Missions were
reports submitted in accordance with the undertaken to review implementation status
preceding paragraph, ADB and the State, as as per requirement.
required, will meet to discuss progress of the
Investment Program and the Project, any
changes to implementation arrangements or
remedial measures required to be undertaken
towards achieving overall objectives of the Project (b) Complied with. Midterm review was
and the overall Investment Program. carried out from 12 to 27 June 2013.
(b) In addition to regular reviews including a
midterm review for the Project a mid-term review
of the Investment Program shall be undertaken, in
July 2014 by ADB, the Borrower and the State.
The mid-term review shall include a detailed
evaluation of the respective Project and
Investment Program scope, implementation
arrangement, any outstanding issues,
environment, resettlement and other safeguard
issues, achievement of scheduled targets, and
other issues, as appropriate.
18. Within 3 months of physical completion of the LA Sch. 5 Complied with.
Project, the respective SEAs shall with intimation
to the Borrower submit to ADB Project completion
report. Likewise, within 3 months of physical
completion of all the projects under the Facility,
the respective SEAs shall with intimation to the
Borrower submit to ADB Facility completion report
Project Agreements for Karnataka and Maharashtra
Section 2.01. (a) The State shall carry out the PA Article II (a) Complied with.
Project with due diligence and efficiency, and in
conformity with sound administrative, financial,
engineering, environmental and development
practices.
(b) In the carrying out of the Project and operation (b) Complied with.
of the Project facilities, the State shall perform all
obligations set forth in the Loan Agreement to the
extent applicable.
Section 2.02. The State shall make available PA Article II Complied with. Regular fund flow was
promptly as needed, the funds, facilities, services, assured by the SEA. No instances of fund
equipment, land and other resources which are shorted faced by PMU
required, in addition to the proceeds of the Loan,
for the carrying out of the Project.
38 Appendix 7
Section 2.03. (a) In the carrying out of the Project, PA Article II (a) Complied with. PMU employed PMDC
the State shall employ competent and qualified and contractors following ADB procurement
consultants and contractors, acceptable to ADB, guidelines.
to an extent and upon terms and conditions
satisfactory to ADB.
(b) Except as ADB may otherwise agree, all (b) Complied with.
Goods, Works and consulting services to be
financed out of the proceeds of the Loan shall be
procured in accordance with the provisions of
Schedule 4 to the Loan Agreement. ADB may
refuse to finance a contract where Goods, Works
or consulting services have not been procured
under procedures substantially in accordance
with those agreed between the Borrower and
ADB or where the terms and conditions of the
contract are not satisfactory to ADB.
Section 2.04. The State shall carry out the Project PA Article II Complied with.
in accordance with plans, design standards,
specifications, work schedules and construction
methods acceptable to ADB. The State shall
furnish to ADB, promptly after their preparation,
such plans, design standards, specifications and
work schedules, and any material modifications
subsequently made therein, in such detail as ADB
shall reasonably request.
Section 2.05. (a) The State shall take out and PA Article II Complied with.
maintain with responsible insurers or make other
arrangements satisfactory to ADB for insurance of
Project facilities to such extent and against such
risks and in such amounts as shall be consistent
with sound practice.
(b) Without limiting the generality of the foregoing,
the State undertakes to insure, the Goods to be
imported for the Project and to be financed out of
the proceeds of the Loan against hazards incident
to the acquisition, transportation and delivery
thereof to the place of use or installation, and for
such insurance any indemnity shall be payable in
a currency freely usable to replace or repair such
Goods.
Section 2.06. The State shall maintain, records PA Article II Complied with.
and accounts adequate to identify the Goods,
Works and consulting services financed out of the
proceeds of the Loan, to disclose the use thereof
in the Project, to record the progress of the Project
(including the cost thereof) and to reflect, in
accordance with consistently maintained sound
accounting principles, its operations and financial
condition.
Section 2.07. (a) ADB and the State shall PA Article II Complied with.
cooperate fully to ensure that the purposes of the
Loan will be accomplished.
(b) The State shall promptly inform ADB and the
Borrower of any condition which interferes with, or
threatens to interfere with, the progress of the
Project, the performance of its obligations under
this Project Agreement, or the accomplishment of
the purposes of the Loan.
(c) ADB and the State shall from time to time, at
the request of either party, exchange views
Appendix 7 39
Increased PPP in coastal protection FFA Sch 1 Not complied with. In Karnataka PPP options
for dredging and survey vessels were
explored by the SEA. However, PPP options
were not pursued further due to the relatively
high maintenance costs.
In Maharashtra, various PPP options and
modalities were explored for future sub-
projects. The next investment has not
materialized due to less implementation
period remaining under the program.
Training and capacity building to prepare FFA Sch 1 Complied with. Training was provided to
shoreline plans project staff on preparing coastal data
supported shoreline plans.
Beneficiary stakeholder including local bodies FFA Sch 1 Complied with. The SMO framework has
engaged in the management and maintenance of been established following multiple levels of
subprojects. consultation with various stakeholders.
In Karnataka. Two SMOs have been formed
(Ullal and Bengre). They were engaged
through a detailed work plan. They are also
involved in the management and
maintenance of berms, breakwaters, and
beaches mainly from tourism and livelihood
perspective.
In Maharashtra, 7 SMOs involved and taken
up community-based shoreline management
activities.
Community development and shoreline economic FFA Sch 1 Complied with. Community development and
development initiatives established. shoreline economic development initiatives
have been initiated. SMOs were involved in
income generation using beach maintenance
and tourism promotion activities.
Promotion of private sector participation in the FFA Sch 1 Not complied with. PPP options for dredging
Coastal protection and management, to be and deployment of survey vessel were
incorporated into the project planning and explored. However, PPP was not a preferred
development. This would include a preliminary option due to high maintenance cost and low
plan for PPP in the coastal protection and revenue generation potential. Coastal
management, scoping of investor opportunities, protection being a public cause, PPP model
contracts and agreements for specific projects. for coastal protection and management was
not pursued.
Private sector involvement in coastal
management is peripheral at this stage with
inclusion of measures for promotion of
private sector participation and PPP into
coastal economic activities through
peripheral policies for tourism and maritime
development which would be helpful for
encouraging private sector participation in
the integrated coastal protection and
management in the future
1. Introduction
1. This re-analysis of the economic returns on the investment made in Tranche 1 of this
project has been based on the approach used for the PPTA25 and which was updated for the
RRP26. This update uses actual project costs and updated analysis of project benefits.
2. The project has successfully developed measures to combat coastal erosion at two
locations, introducing techniques that are internationally recognized as appropriate for coastal
management and sustainable ways to create climate-resilient protection to coastal infrastructure.
Early monitoring data confirms the effectiveness of the solutions to the coastal erosion problems
that have been adopted27.
3. The project provides a key step for India towards developing coastal management
systems that will stabilize the present issues of coastal erosion, particularly in the face of
challenges presented by climate change. The project has worked with key expert institutes of
India, therefore assisted in the development of widespread benefits from the new approach
throughout India.
4. Analysis of the main sub-schemes has been made separately. In Maharashtra, the
Tranche 1 work has been focused on the Mirya Bay scheme, and in Karnataka the Tranche 1
works have been at Ullal, near Mangalore.
25 ADB 2007. Technical Assistance to India for Sustainable Coastal Protection and Management. Manila,
26 Sustainable Coastal Protection and Management Investment Program (RRP IND 40156-01)
27
Black, K.P.; Reddy, K.S.K.; Kulkarni, K.B.; Naik, G.B.; Shreekantha, P., and Mathew, J., 2020. Salient evolution and
coastal protection effectiveness of two large artificial reefs. Journal of Coastal Research, 00(0), 000–000. Coconut
Creek (Florida), ISSN 0749-0208.
28 India: Orissa Integrated Irrigated Agriculture and Water Management Investment Program – Project 1. Project
for Indian projects published in 2019 and 202029 adopt a value of 1.04. This value was adopted
for the re-analysis.
9. It is noted the unskilled labor element of construction costs is small: for example, for the
Gujarat Solar Power PCR30 assumed 18% of works costs represented skilled labor and 2%
unskilled labor. Jha (2011)31 found that in India the labor element is about 10% to 15% of
construction costs, and so it has been assumed for this project 15% of construction costs being
attributable to labor, and 30% of the labor costs being for unskilled labor. This produces an
adjustment factor for construction costs of 0.989. The impact of both SERF and SWRF are
marginal in the outcomes of the economic analysis.
3. Benefit Estimates
3.1. Nature of the Benefits
10. The primary benefits from the project works derive from management of coastal erosion,
reductions of threats from coastal flooding through development of more resilient coastal
protection systems, and the saving of land from coastal erosion. These benefits have been
identified and quantified in the work of the PPTA study and are described in more detail in the
following sections, by sub-scheme. The areas protected by the scheme at both Ullal and Mirya
Bay are precisely those assumed by the PPTA study.
11. There are considerable secondary benefits from the Tranche 1 work that has been
completed. These have also been identified by the PPTA work in part, but not been directly
quantified. Secondary benefits include:
Greater sense of security for those living along the bay, leading to increased investments
in land, housing and local enterprise.
It will improve the shoreline, creating opportunities related to tourism and the stability of
shoreline and harbors for fishing industry, both in the immediate vicinity of the schemes
constructed, but also throughout both States due to the state-wide system of shoreline
management planning introduced during the project, including development of district and
State shoreline management plans for both States.
Environmental benefits relating to the environment of the reef, including new ecosystems
that can be exploited around the reefs.
Development of institutional skills and capacity to effectively manage the coastline within
each state.
Development of Tranche 2 projects. Significant effort of the Tranche 1 consultancy teams
has been focused on development designs and documentation of letting contracts to be
funded under Tranche 2 of the loan.
12. Within the DMF an outcome anticipated from the project is an increase in coastal shipping
and fish-landings due to stabilized coasts in the project areas.
29 Examples are from the PCR for projects National power Grid Development, Gujarat Solar Power Project and
Rajasthan Urban Sector Development
30 ADB 2019. India: Gujarat Solar Power Transmission Project Completion Report. Manila
31 Jha, K N. Construction Project Management: Theory and Practice. Pearson Education India, 2011. Data collected
from responses to questionnaire to identify labor component of construction costs through India, and these were 10-
15% of all costs consistently across all construction sectors.
46 Appendix 8
13. The quantification of benefits has used more recent data – where available. Where more
recent data could not be easily obtained the values used in the PPTA study have been revised to
2019 prices by using the Indian wholesale price index (WPI) values. These have been the website
of the office of the economic advisor32 and the Reserve Bank of India33.. The value of the multiplier
to obtain 2019 prices used is 1.482.
14. It is understood that routine maintenance of existing structures and dredging ceased on
start of the civil works, and the shoreline stabilization started once substantial elements of offshore
reefs had been constructed. It has been assumed that benefits from these schemes started with
these milestones.
32
https://eaindustry.nic.in/
33 https://dbie.rbi.org.in/DBIE/dbie.rbi?site=home
34 It is noted that the Appraisal analysis used a factor of 3.2% for the annual benefit of avoiding an event with a risk of
80% chance of occurring in 25 years. This is believed to be an error, with the 6.3% factor described being the correct
calculation.
Appendix 8 47
feasibility of a Tranche 2 project in Karnataka35 used a value for land protected at the coast, in a
similar situation to Mirya, at ₹19,400 per m2. This was adopted as a conservative estimate of land
value at Mirya for benefit estimation. Building replacement costs provided by MMB indicate an
average of ₹400,000 per building, an increase over the appraisal estimate of ₹260,000 per
building.
20. Dredging costs are the “without project” dredging regularly done to maintain navigation
into the harbors in the bay, and rates for dredging costs have been provided for 2019 by MMB of
₹435/m3. Resettlement is the cost associated with resettling victims of housing damage from
storms in the “without project” scenario, and the PPTA rates adjusted for inflation have been used
for these.
21. With the project implemented, growth of tourism is anticipated, driven by improved
beaches and proximity to Goa. The calculated tourism benefit is based on an average of an
increase of 500 visitors a day (current MMB estimate) for 150 days a year, growing at 5% per
annum, with daily spend of 50% of the average daily spend of domestic tourists in Goa. Current
(2019) expenditure by domestic tourists on the west coast have been given by holiday budget
websites36 as about ₹1,200 a day. Current value of a domestic tourist visit per day has been
assumed to be 50% of this value. The Appraisal assumptions concerning season duration (150
days per year) and growth have been adopted in this analysis.
22. One element not taken into account in the 2009 analysis was increases in local fish
landings and coastal shipping that are targeted as project outcome in the DMF. If these were to
happen, the additional benefits accrued might be estimated to 2 000 to 3 000 tons of fish landed
(using figures provided in the 2009 report for fish catches at Mirya Bay). With a value of INR
65,000 per tonne, and assuming cost of fish production represents 80% of the landed value, this
represents additional benefit of between 2.60 and 3.90 million rupees a year. These are small
compared to the identified primary benefits of the scheme. These have not been included in the
assumed benefits and are part of secondary benefits.
3.3. Ullal
23. The PPTA report identified benefits of the scheme as:
• Protection of the spit on the southern side from breaching
• Protection of land and buildings south of the existing breakwaters from damage and
erosion
• Avoidance of resettlement costs arising from loss of land and buildings from erosion
• Enhancement of tourism.
24. These are still considered to be the primary benefits of the scheme.
25. The benefits from protecting against breach of the spit are largely due to the fish
processing plants located at the end of the spit, and their associated landing points. The 2009
study identified 14 works which would be isolated should the spit be seriously breached, and the
breach is assumed to lead to total loss of these works (as they would no longer be accessible),
plus loss of 1 year’s production while replacement works are constructed elsewhere. The risk of
breach was estimated to be an 80% chance in the 25-year period meaning a 6.3% chance of
35 Sustainable Coastal Protection and Management Investment Program Tranche -2 Sub-Project Mukkachery Tranche-
2 Sub Project Rehabilitation of Existing Seawall with 2.5T Tetrapods and RCC retaining wall Detailed Project Report.
January 2019.
36
Websites such as https://www.budgetmytravel.com/
48 Appendix 8
occurrence each year (see paragraph 18). The benefit to the project of avoiding the breach is
therefore computed as 6.3% of the costs each year. In addition, the on-going maintenance works
undertaken to protect the spit from breach can be saved with permanent protection from the
constructed scheme. Other derived benefits were calculate using similar assumptions to those
described for Mirya Bay above.
26. Tourism at Ullal is already established but has declined in recent years due to erosion of
the beach. While tourism benefits per visitor are similar to the situation at Mirya Bay, potential
numbers of tourists were assumed slightly lower (a base of 400 per year) at Appraisal, and this
assumption has been continued for this analysis. It was also assumed at Appraisal that tourism
growth would be slower than at Mirya Bay – at 2% per year. This again appears a reasonable
and conservative assumption, and so was assumed for this analysis.
27. The projects will also provide secondary benefits, including it will improve the shoreline,
creating opportunities related to tourism and the stability of shoreline and harbors for fishing
industry, plus environmental benefits relating to the environment of the reef, including new
ecosystems that can be exploited around the reefs.
28. Again, it has been assumed the project will stimulate 10% increase in coastal shipping
and fish landings. With fish landings of the order of 80 000 tons in south Kannada district (reported
in 2009 report), with a value of about 6300 million rupees. The 10% increase – assuming
production costs 80% of the value, provides a net benefit of about 13 million rupees a year. This
is insignificant compared to the primary project benefits, and has not been included in the
assumed project benefits
4. Project Costs
29. The costs incurred during the implementation of Tranche 1 of the project have been
assumed all applicable to the two sub-projects being evaluated. Costs incurred have been
adjusted to 2019 prices using the WPI index. The key elements of the costs include:
• Construction costs for the 5 major contracts let – two for Mirya Bay, and three for Ullal.
These were all contracted in Indian rupees, without foreign payment element.
• Consultancy contracts. One main international consultancy contract in each State.
These were paid both in rupees and in international currencies (US dollars and euros).
In Maharashtra, because the main consultant withdrew part way through, an additional
consultancy was contracted in local currency to support project implementation.
• Minor equipment procurement and support funds for local NGOs supporting local
coastal management. These were all paid in local currency.
• Government project costs – salaries and other costs of the PMUs
30. In the development of the project, it was agreed that the State Government would cover
9% of the construction costs (91% being covered by the ADB loan) as it was estimated that the
9% was the equivalent of the tax element of the construction costs. It has therefore been assumed
in the reappraisal that the 9% payment by the States continues to be equivalent to the tax payment
element of these costs.
31. It has been assumed that all consultancy payments, and minor payments, have all been
without tax element and direct tax payments would have been made separately by the State
authorities.
32. Tradeable currency payments have been adjusted by the SERF to determine economic
costs and converted to equivalent rupees using exchange rates for each calendar year identified
Appendix 8 49
from ADB data on loan withdrawals. Construction costs have also been adjusted for SWRF
(paragraph 9).
33. The key project costs are summarized in Table 1.
34. For the analysis, another important cost is the operating costs of the schemes. Operation
and maintenance costs for the schemes have been assumed using the information provided in
the RRP report of 2010 (see Table 2 below). There are annual cost streams associated with both
the “without scheme” and the “with scheme” scenarios. With the scheme, the O&M costs are
largely associated with the level of routine maintenance needed to secure the stability and utility
of the structures. Without the scheme, O&M costs would be associated with routine repair of
damage done to the weaker defenses, and associated costs such as dredging to maintain
channels to ports and the like and other areas where costs might be impacted by the constructed
schemes.
Table 2: With and Without Project O&M Requirements Assumed (2010)
Project Present Annual Future Annual O&M Net change O&M Responsibility
O&M Costs Costs of O&M
Costs
Mirya Bay O&M dredging of None Reduction of Present and future: state
harbor: $162,000 Geotextile reef does not $162,000 per government (Maharashtra
per annum require maintenance year Maritime Board)
Ullal Saved cost of Maintenance of the rock Savings in Present shoreline protection:
shore rock entrance breakwaters would shoreline rock 50% from state government plus
protection along cost $1,450,000 every 5 protection 50% from private factories
Ullal spit: $340,000 years. Maintenance of would be Future 5-year repairs and/or
per annum Geotextile reefs have no about the maintenance: rock entrance
Rock entrance maintenance costs same as the breakwaters would be done by
breakwaters: no No further beach new costs to state government
maintenance is nourishment required once maintain the Some shift of maintenance
presently carried remodeling/ realignment of entrance responsibilities to state
out breakwaters has been breakwaters. government
completed
Source: RRP Economics Annex
37
Before correction to 2019 prices
50 Appendix 8
35. The Operation and Maintenance (O&M) manuals provided for the completed structures
identify the expected work to be done to maintain and operate the schemes, and this has been
used to identify likely recurrent costs, over and above existing O&M requirements for the “without
project” situation. Savings on O&M due to construction is identified as benefit and itemized within
that category. Where additional O&M is required, this is included in the analysis as an additional
cost. These are taken to be:
Annual inspections required for reef and groin structures: assume a few days’ work for a
senior engineer and a minor survey to cost ₹100,000 per annum per State
Maintenance of rock entrance breakwaters as described in the Appraisal report (Table 2)
adjusted for inflation through the WPI
40. The economic viability of this scheme is not very sensitive to changes in the benefits, with
switching values for individual benefits being in excess of 100%.
5.2. Ullal
41. The table at the end of this Appendix illustrates the base case analysis of the economic
viability of the completed Tranche 1 scheme in Karnataka.
Appendix 8 51
42. In the PPTA analysis, the Ullal sub-scheme had an EIRR of 14.5% with a NPV of 180
million rupees, calculated at a discount rate of 12%.
43. In the reappraisal the base case for Ullal economic returns has been calculated to be an
EIRR of 15.2%, with an NPV of 348 million rupees using a discount rate of 12%. This is a broadly
similar result to the earlier study but is achieved through a combination of significant cost savings
in construction, but this is off-set by delayed completion and so later arrival of project benefits.
44. Sensitivity analyses conducted on the cost and benefit streams are summarized in the
following table.
Table 6: Discounted Cash Flows for Subprojects Ullal, Mirya and Combined Project
(₹ million)
Ullal Mirya Combined
Costs Costs Costs
Year Total Net Total Net Total Net
Capital O&M Total Benefits Benefits Capital O&M Total Benefits Benefits Capital O&M Total Benefits Benefits
Costs Costs Costs Costs Costs Costs Costs Costs Costs
2011 28.37 28.4 -28.4 77.78 77.8 -77.8 106.15 106.15 -106.1
2012 76.11 76.1 -76.1 74.15 74.2 -74.2 150.26 150.26 -150.3
2013 126.84 126.8 -126.8 80.21 80.2 -80.2 207.05 207.05 -207.0
2014 422.78 422.8 -422.8 36.03 36.0 -36 458.81 458.81 -458.8
2015 434.97 435 25.9 -409 84.16 84.2 -84.2 519.14 519.14 25.9 -493.2
2016 630.3 630.3 25.9 -604.4 57.07 57.1 296.7 239.6 687.37 687.37 322.6 -364.7
2017 464.72 464.7 417.1 -47.6 127.31 127.3 296.7 169.4 592.03 592.03 713.8 121.8
2018 271.31 271.3 400.9 129.6 20.93 20.9 296.7 275.8 292.24 292.24 697.6 405.4
2019 - 400.9 400.9 296.7 296.7 697.6 697.6
2020 0.1 0.1 400.9 400.8 0.1 0.1 296.7 296.6 0.2 0.2 697.6 697.4
2021 0.1 0.1 400.9 400.8 0.1 0.1 296.7 296.6 0.2 0.2 697.6 697.4
2022 105.6 105.6 436.9 331.3 0.1 0.1 341.7 341.6 105.66 105.66 778.6 672.9
2023 0.1 0.1 437.6 437.5 0.1 0.1 346.2 346.1 0.2 0.2 783.8 783.6
2024 0.1 0.1 438.3 438.2 0.1 0.1 351.2 351.1 0.2 0.2 789.5 789.3
2025 0.1 0.1 439.1 439 0.1 0.1 356.6 356.5 0.2 0.2 795.7 795.5
2026 0.1 0.1 439.9 439.8 0.1 0.1 362.6 362.5 0.2 0.2 802.4 802.2
2027 105.6 105.6 440.6 335.1 0.1 0.1 369.2 369.1 105.66 105.66 809.8 704.2
2028 0.1 0.1 441.4 441.3 0.1 0.1 376.4 376.3 0.2 0.2 817.9 817.7
2029 0.1 0.1 442.2 442.1 0.1 0.1 384.4 384.3 0.2 0.2 826.6 826.4
2030 0.1 0.1 443.1 443 0.1 0.1 393.2 393.1 0.2 0.2 836.2 836
2031 0.1 0.1 443.9 443.8 0.1 0.1 402.8 402.7 0.2 0.2 846.7 846.5
2032 105.6 105.6 444.8 339.2 0.1 0.1 413.4 413.3 105.66 105.66 858.2 752.5
Appendix 8 53
2033 0.1 0.1 445.7 445.6 0.1 0.1 425.1 425 0.2 0.2 870.7 870.5
2034 0.1 0.1 446.5 446.4 0.1 0.1 434.9 434.8 0.2 0.2 881.4 881.2
2035 0.1 0.1 447.5 447.4 0.1 0.1 446 445.9 0.2 0.2 893.4 893.2
2036 0.1 0.1 448.4 448.3 0.1 0.1 458.5 458.4 0.2 0.2 906.8 906.6
2037 105.6 105.6 449.3 343.8 0.1 0.1 472.5 472.4 105.66 105.66 921.8 816.2
2038 0.1 0.1 450.3 450.2 0.1 0.1 488.3 488.2 0.2 0.2 938.6 938.4
2039 0.1 0.1 451.3 451.2 0.1 0.1 505.9 505.8 0.2 0.2 957.2 957
2040 0.1 0.1 452.3 452.2 0.1 0.1 525.6 525.5 - 0.2 0.2 977.9 977.7
2041 0.1 0.1 453.3 453.2 0.1 0.1 547.6 547.5 - 0.2 0.2 1,000.90 1,000.70
2042 105.6 105.6 454.4 348.8 0.1 0.1 572 571.9 - 105.66 105.66 1,026.40 920.8
2043 0.1 0.1 455.5 455.4 0.1 0.1 599.3 599.2 - 0.2 0.2 1,054.70 1,054.50
Net Present Value (NPV) 349 Net Present Value (NPV) 1,199 Net Present Value (NPV) 1,547
Economic Internal Rate of Return
15.20% Economic Internal Rate of Return (EIRR) 35.90% Economic Internal Rate of Return (EIRR) 21.90%
(EIRR)
Discount Rate 12% Discount Rate 12% Discount Rate 12%
54 Appendix 8
6. Financial Analysis
46. A Standard financial cost-benefit financial analysis is not appropriate undertaken for the
project as the project is not income-generating. Project benefits lie only in the avoidance of costs
otherwise incurred through damage to infrastructure and livelihoods. Following guidelines,
financial sustainability assessment showing fiscal capacity of Karnataka and Maharashtra
Maritime Board to support project O&M expenditure is prepared. The assessment results are
presented in Section 6, Appendix 9.
7. DMF Targets
47. The Design and Monitoring Framework (DMF) for the project identifies a number of
parameters to be used to evaluate project impact, outcomes and outputs.
48. For the evaluation of impact, the DMF identifies indicators of:
• Higher per capita income in sub-project areas
• Contribution from tourism to state GDP increased
• Poverty incidence in coastal communities reduced.
49. The collation of publicly available data to support these parameters takes time, so there
is some delay in making appropriate data available for such assessments. Because of delays in
completion of the schemes, direct data to assess impact of Tranche 1 is not yet available.
Anecdotal evidence suggests increases in local businesses in the sub-project areas related to
improved beaches, plus greater security from erosion and flooding will provide the impact
expected, and this should be re-assessed once appropriate data are available.
50. For outcome assessment physical measures of length of coastline protected can be
identified and provided. Measurements have been provided by the EAs (at 1.6 km in Maharashtra
and 6 km in Karnataka) of the length of shoreline protected. Measurements made via Google
Earth have indicated a length of protected coastline in Mirya Bay of 2.8km, and at Ullal of 4.2 km.
However, This is also the total length of shoreline intended to be protected by the project
schemes, so the source of the target measurement of 10 km is questioned, and while the achieved
total measurement of 7 km coastline protected is less than the 10km target, it is nevertheless
observed that the full target has actually been achieved.
51. Levels of community participation in shoreline management have also been provided by
the PMUs to confirm outcome. Measures of levels of coastal shipping and fish landings have also
been sought, but again there is a problem in the time taken to compile such data, and delayed
scheme completion meaning the expected outcome is also delayed.
52. Outputs from the schemes have been assessed directly, with data sought to confirm
completed activities and levels of participation in project activities. Key weaknesses in scheme
outputs include:
• Levels of participation of women in shoreline management activities
• Involvement of private sector in shoreline management activities
• Investments made by private sector in shoreline management
53. Otherwise, outputs have very largely been satisfactorily achieved.
Appendix 8 55
With full consultancy costs and Government costs in million rupees in 2019 prices
land loss building damage
Net Total causeway resettle-
Year Costs O&M Total Benefits Benefits Dredging north middle north middle replacement ment Tourism
2011 -7 77.78 77.8 - 77.8 0
2012 -6 74.15 74.2 - 74.2 0
2013 -5 80.21 80.2 - 80.2 0
2014 -4 36.03 36.0 - 36.0 0
2015 -3 84.16 84.2 - 84.2 -
2016 -2 57.07 57.1 239.6 296.7 30.5 17.0 2.4 141.8 47.3 45.8 12.0 -
2017 -1 127.31 127.3 169.4 296.7 30.5 17.0 2.4 141.8 47.3 45.8 12.0 -
2018 0 20.93 20.9 275.8 296.7 30.5 17.0 2.4 141.8 47.3 45.8 12.0 -
2019 1 - - 296.7 296.7 30.5 17.0 2.4 141.8 47.3 45.8 12.0 -
2020 2 0.1 0.1 296.6 296.7 30.5 17.0 2.4 141.8 47.3 45.8 12.0
2021 3 0.1 0.1 296.6 296.7 30.5 17.0 2.4 141.8 47.3 45.8 12.0
2022 4 0.1 0.1 341.6 341.7 30.5 17.0 2.4 141.8 47.3 45.8 12.0 45.0
2023 5 0.1 0.1 346.1 346.2 30.5 17.0 2.4 141.8 47.3 45.8 12.0 49.5
2024 6 0.1 0.1 351.1 351.2 30.5 17.0 2.4 141.8 47.3 45.8 12.0 54.5
2025 7 0.1 0.1 356.5 356.6 30.5 17.0 2.4 141.8 47.3 45.8 12.0 59.9
2026 8 0.1 0.1 362.5 362.6 30.5 17.0 2.4 141.8 47.3 45.8 12.0 65.9
2027 9 0.1 0.1 369.1 369.2 30.5 17.0 2.4 141.8 47.3 45.8 12.0 72.5
2028 10 0.1 0.1 376.3 376.4 30.5 17.0 2.4 141.8 47.3 45.8 12.0 79.7
2029 11 0.1 0.1 384.3 384.4 30.5 17.0 2.4 141.8 47.3 45.8 12.0 87.7
2030 12 0.1 0.1 393.1 393.2 30.5 17.0 2.4 141.8 47.3 45.8 12.0 96.5
2031 13 0.1 0.1 402.7 402.8 30.5 17.0 2.4 141.8 47.3 45.8 12.0 106.1
2032 14 0.1 0.1 413.3 413.4 30.5 17.0 2.4 141.8 47.3 45.8 12.0 116.7
2033 15 0.1 0.1 425.0 425.1 30.5 17.0 2.4 141.8 47.3 45.8 12.0 128.4
2034 16 0.1 0.1 434.8 434.9 27.4 17.0 2.4 141.8 47.3 45.8 12.0 141.2
2035 17 0.1 0.1 445.9 446.0 24.4 17.0 2.4 141.8 47.3 45.8 12.0 155.4
2036 18 0.1 0.1 458.4 458.5 21.3 17.0 2.4 141.8 47.3 45.8 12.0 170.9
2037 19 0.1 0.1 472.4 472.5 18.3 17.0 2.4 141.8 47.3 45.8 12.0 188.0
2038 20 0.1 0.1 488.2 488.3 15.2 17.0 2.4 141.8 47.3 45.8 12.0 206.8
2039 21 0.1 0.1 505.8 505.9 12.2 17.0 2.4 141.8 47.3 45.8 12.0 227.5
2040 22 0.1 0.1 525.5 525.6 9.1 17.0 2.4 141.8 47.3 45.8 12.0 250.2
2041 23 0.1 0.1 547.5 547.6 6.1 17.0 2.4 141.8 47.3 45.8 12.0 275.2
2042 24 0.1 0.1 571.9 572.0 3.0 17.0 2.4 141.8 47.3 45.8 12.0 302.7
2043 25 0.1 0.1 599.2 599.3 - 17.0 2.4 141.8 47.3 45.8 12.0 333.0
With full consultancy costs and Government costs in million rupees in 2019 prices
prevention of spit washout
Net Total lost saved spit Land Buildings resettlement incremental
Year Costs O&M Total Benefits Benefits factories production maintenance replacement protection protection saved tourism
2011 -7 28.37 28.4 - 28.4 0
2012 -6 76.11 76.1 - 76.1 0
2013 -5 126.84 126.8 - 126.8 0
2014 -4 422.78 422.8 - 422.8 0
2015 -3 434.97 435.0 - 409.0 25.9 25.9
2016 -2 630.30 630.3 - 604.4 25.9 25.9
2017 -1 464.72 464.7 - 47.6 417.1 51.3 186.7 25.9 71.3 - 36.0 45.8
2018 0 271.31 271.3 129.6 400.9 51.3 186.7 25.9 71.3 4.8 15.0 45.8
2019 1 - 400.9 400.9 51.3 186.7 25.9 71.3 4.8 15.0 45.8
2020 2 0.1 0.1 400.8 400.9 51.3 186.7 25.9 71.3 4.8 15.0 45.8
2021 3 0.1 0.1 400.8 400.9 51.3 186.7 25.9 71.3 4.8 15.0 45.8
2022 4 105.6 105.6 331.3 436.9 51.3 186.7 25.9 71.3 4.8 15.0 45.8 36.0
2023 5 0.1 0.1 437.5 437.6 51.3 186.7 25.9 71.3 4.8 15.0 45.8 36.7
2024 6 0.1 0.1 438.2 438.3 51.3 186.7 25.9 71.3 4.8 15.0 45.8 37.5
2025 7 0.1 0.1 439.0 439.1 51.3 186.7 25.9 71.3 4.8 15.0 45.8 38.2
2026 8 0.1 0.1 439.8 439.9 51.3 186.7 25.9 71.3 4.8 15.0 45.8 39.0
2027 9 105.6 105.6 335.1 440.6 51.3 186.7 25.9 71.3 4.8 15.0 45.8 39.7
2028 10 0.1 0.1 441.3 441.4 51.3 186.7 25.9 71.3 4.8 15.0 45.8 40.5
2029 11 0.1 0.1 442.1 442.2 51.3 186.7 25.9 71.3 4.8 15.0 45.8 41.4
2030 12 0.1 0.1 443.0 443.1 51.3 186.7 25.9 71.3 4.8 15.0 45.8 42.2
2031 13 0.1 0.1 443.8 443.9 51.3 186.7 25.9 71.3 4.8 15.0 45.8 43.0
2032 14 105.6 105.6 339.2 444.8 51.3 186.7 25.9 71.3 4.8 15.0 45.8 43.9
2033 15 0.1 0.1 445.6 445.7 51.3 186.7 25.9 71.3 4.8 15.0 45.8 44.8
2034 16 0.1 0.1 446.4 446.5 51.3 186.7 25.9 71.3 4.8 15.0 45.8 45.7
2035 17 0.1 0.1 447.4 447.5 51.3 186.7 25.9 71.3 4.8 15.0 45.8 46.6
2036 18 0.1 0.1 448.3 448.4 51.3 186.7 25.9 71.3 4.8 15.0 45.8 47.5
2037 19 105.6 105.6 343.8 449.3 51.3 186.7 25.9 71.3 4.8 15.0 45.8 48.5
2038 20 0.1 0.1 450.2 450.3 51.3 186.7 25.9 71.3 4.8 15.0 45.8 49.4
2039 21 0.1 0.1 451.2 451.3 51.3 186.7 25.9 71.3 4.8 15.0 45.8 50.4
2040 22 0.1 0.1 452.2 452.3 51.3 186.7 25.9 71.3 4.8 15.0 45.8 51.4
2041 23 0.1 0.1 453.2 453.3 51.3 186.7 25.9 71.3 4.8 15.0 45.8 52.4
2042 24 105.6 105.6 348.8 454.4 51.3 186.7 25.9 71.3 4.8 15.0 45.8 53.5
2043 25 0.1 0.1 455.4 455.5 51.3 186.7 25.9 71.3 4.8 15.0 45.8 54.6
1 THE CONCEPT
1. In the PPTA Study (2009)1 it was stated that design of coastal protection systems were
changing, and that “shoreline protection using hard engineering structures such as groynes,
seawalls and breakwaters cannot be supported as long-term strategies”. Consequently,
alternative approaches were suggested, notably the construction of offshore reefs to provide
“economically viable protection works using environmentally and socially appropriate solutions”.
2. The PPTA consultants proposed construction of offshore reefs for Mirya Bay and Ullal.
The projects considered are listed in Annex 1 to this Appendix. The outline schemes considered
in detail were:
3. Mirya Bay. The problem of erosion in the northern part of the bay was identified to be
accumulation of sand in front of the breakwaters constructed for the fishing harbors in the southern
part of the bay – trapping sand that would no longer circulated to the northern part of the bay,
thus reducing the beach and hence protection in the northern bay. Construction of the reefs would
create a zone behind the reefs where sand would naturally be deposited, reducing erosion. This
was to be supported by removal of sand accumulated at the southern end to be used by
placement in the shadow of the new reef to encourage build-up of the new beach.
1 “India: Sustainable Coastal Protection and Management”, PPTA Final Report, April 2009. ANZDEC Limited in
association with ASR Maritime Consulting and Research, New Zealand. For ADB, Manila.
Appendix 9 59
4. The reef was specified in the PPTA report as 260 m offshore, in water 2.5-3.0 m in depth,
with a crest level the same as lowest astronomic tide level, and a length of 360 m. The reef was
proposed to be constructed from geotextile bags, filled with sand.
5. Ullal. Erosion has been a problem to the south of the main harbor entrance for Mangalore
old port, where breakwaters have been constructed in 1995 to protect the entrance, interrupting
movement of sand southward along the coast, creating development of sand deposits to the north
of the port entrance, and leading to erosion of the Ullal spit and beaches to the south. The
intervention concept proposed in the PPTA report was fourfold:
i. Shortening and repair of the southern breakwater to allow better bypassing of sand
ii. 220 m extension of the north breakwater wall (with re-alignment) also to improve sand
by-passing
iii. Beach nourishment to the south
iv. Construction of off-shore artificial reefs to trap sand on Ullal beach
6. The off-shore reefs proposed were to be three in number, located 700 to 900 m off-shore
where water depths were about 7 m, with the total reef length being 660 m. The reefs were
proposed to be cup-shaped and made from geotextile tubes filled with dredged sand. The
geotextile tubes were to be up to 2.7 m diameter and 20 m long and laid in three layers.
7. At the time of making these proposals, the PPTA Consultants drew on experience in
development of off-shore reefs constructed from sand-filled geotextile containers reported in
technical literature, particularly developments on Gold Coast, Australia and Mount Maunganui,
New Zealand. A review of abrasion-resistance of the geotextile material, and settlement of the
structures in soft alluvial material typically found in shallow, offshore locations was undertaken.
The application of these techniques in India raised further issues because of the monsoon
conditions and the stresses imposed by these conditions in the near-shore environment.
60 Appendix 9
2.3 Ullal
14. While the original intention was that the offshore reefs and the inshore berms would be let
as a single ICB contract, this was revised to having two contracts.
15. The Ullal tenders for the offshore reefs were floated in April 2011. The bidding was not
extended, with bids opened on 6 June 2011. However, only one bid was received for the Ullal
reefs, and was rejected because of a conflict of interest issue.
16. For the Ullal reefs, the Inception Mission design review recommended changing the reef
design to constructing the reefs from concrete and rock rather than geo-textile bags. The re-
design work was agreed to be carried out by CWPRS, in a process that included using physical
modelling. This was a process that the Mission was told would take about 4-5 months, and so
would be complete by August/September 2012.
17. At the time of the August 2012 Mission it was noted that the Ullal reef redesign was
proceeding slowly, with significant delays in resolving the contract for the CWPRS design work,
with this starting only in late July 2012. Following problems with model testing, the final design
review report was provided by CWPRS in May 2013, some 8 months later than the agreed
schedule. In the Mid-term review mission of June 2013, it was noted that the re-design of the
reefs would also require technical clearance and approvals before construction. The revised
design was approved by the Project Steering Committee in July 2013 and tenders floated.
Unfortunately, only one bid was received, and this was much higher than the Engineer’s estimate
for the work, and in March 2014 ADB agreed with the SEA request to allow the contract to be re-
bid with a revised Engineer’s estimate. This rebidding again produced a single bid, and this was
accepted, and the contract was signed in November 2014.
18. For the onshore berms, the Inception Mission design review identified no problems with
the proposed design of 1.7 m diameter geo-bags with lengths of 18 and 9 meters. The mission
confirmed that detailed design and bidding documents would be prepared by ADB-funded
individual consultants.
19. Designs for the rehabilitation of the north and south breakwaters of the old Mangalore
harbor were not changed by the Inception Mission review. The Mission flagged that additional
modelling and design work was needed from the newly appointed PMDC team of consultants,
and CWPRS technical clearance of the finalized design would be needed.
and placing of geo-bags. Construction of the reef (first layer) was achieved in the second working
season, in February 2016.
21. Post-completion, the reef at Mirya Bay suffered damage. In 2016, damage to 1 geo-tube
was noted, and this was replaced by the Contractor under warranty. In 2017 monsoon, two further
geo-tubes were damaged (one was missing, one deflated) and these were also replaced by the
contractor under warranty.
22. Beach nourishment was carried out under a separate contract, following completion of the
reef. The amount of sand used to nourish the beach was only 120,000m3, largely because this
was the volume of sand available locally that could be used. Sand availability was further reduced
by its interception by the Mirkarwada Fisheries Harbor breakwaters recently constructed by MMB
within the bay. Nevertheless, adequate beach has developed to protect against erosion and so
the work done has been effective.
3.2 Ullal Breakwater
23. The award of construction contract and execution of the contract to remodel the northern
breakwater and to reduce the length of the southern breakwater proceeded without serious
issues, and in accordance with the designs finalized by CWPRS. The contract was awarded in
July 2014, with completion by May 2017.
3.3 Ullal Offshore Reefs
24. At Ullal, the initial challenge which confronted the contractor was the geotechnical survey
revealing extensive marine clay, with poor bearing capacity leading to fears for stability of the
structure as designed. CWPRS reviewed the information, and feared settlement might be in
excess of 1 m, and so remedial measures would be needed to ensure the integrity of the structure.
Stabilization of the foundation was extensively discussed and eventually a solution using a system
of polypropylene gabions overlying a composite layer of geogrid and geotextile was adopted. The
soil stabilization for the south reef was completed by December 2015. Full completion of
construction was achieved in June 2017.
3.4 Ullal Inshore Berms
25. The contract for the construction of the inshore berms was awarded in February 2013.
26. The design of the inshore berms was subsequently revised on the advice of the CWPRS,
citing construction difficulties in developing the dog-legged shape of berm, and advising a T-
shaped berm instead. Later, the number of berms was increased from 4 to 6 to increase the
extent of the beach improvement as a result of berm performance, and utilizing the geo-bags
earlier procured for the longer, dog-leg design in the original contract.
27. Later, the number of inshore berms was increased to eight, on advice from CWPRS to
laterally extend and consolidate the benefits of erosion control provided by the offshore reefs.
28. The completed works at Ullal are identified in the following Figure.
Appendix 9 63
4 OUTCOME
29. The impact of the offshore reefs at Ullal and Mirya Bay are reportedly better than expected.
30. A recent paper by Black et al4 drew a conclusion that “The offshore reefs are providing
successful restoration of the beach, with rapid and substantial sediment accumulation in their lee.
The reefs have induced permanent beach widening plus sand accumulation on the inner shelf,
including during the monsoon”.
31. The impact of the Mirya Bay reef has also benefitted from the beach nourishment element
of the project, but this has had limited impact. Available sand for beach nourishment was less
than anticipated, with only 120,000 m3 being relocated to the northern beaches compared to the
planned 450,000 m3. The construction of the northern breakwater Mirkerwada harbor (under an
unrelated project) has also trapped sand, creating an additional fillet of sand in the southern part
of the bay, removing more sand from circulation within the sediment cell, and thus reducing the
4 Black, K.P.; Reddy, K.S.K.; Kulkarni, K.B.; Naik, G.B.; Shreekantha, P., and Mathew, J., 2020. Salient evolution and
coastal protection effectiveness of two large artificial reefs. Journal of Coastal Research, 00(0), 000–000. Coconut
Creek (Florida), ISSN 0749-0208.
64 Appendix 9
amount of sand available for natural deposition on the northern beaches. Measures to mitigate
the impact of this development could not be implemented before closure of the loan.
32. The key impact of the works at Ullal has been the recovery of the beach. This is shown
in the figure below.
34. The 2019 beach profiles at Ullal are compared to the pre-project profiles in following
figures5.
5
From presentation to CPDAC sub-committee
Appendix 9 65
5 LESSONS
35. The project has contributed significantly to the development of the use of offshore, artificial
reefs as a technique for protecting beaches in India from erosion. This method ticks all the right
boxes for being an environmentally friendly, sustainable, and resilient methodology for coastal
protection, particularly with changes in the coastal environment due to climate change. The
technical assistance for CRCPMP, associated with tranche 2 investment strongly endorsed such
methods for much wider adoption around the Indian coast. The contribution of this project is
therefore very important for these reasons.
36. There are other lessons that can be drawn from this project experience.
1) The lack of coordination on the Mirya Bay situation within MMB for undertaking the
cumulative impact assessment during construction of additional Jetty, is a big
disappointment and suggest the need for much stronger technical skills and
communication. The use of shoreline management planning should have prevented this
problem by way of assessing larger impact area for suggested additional interventions.
2) Monitoring of sea conditions, and performance of marine and coastal structures is not
undertaken enough in India, and pooling of data in appropriate databases and data
repositories is still insufficient. The Mirya Bay structure was re-designed with the
recommendation that the performance of the reduced structure is carefully monitored so
that the height of the structure can be increased if needed, but there is little evidence of
such monitoring being done. The project has sought to establish databases to share such
data, but this is not developing quickly.
3) Problems with the procurement of the construction of the reefs have caused considerable
delay in project delivery, and for several reasons. The main issues have been:
Availability of high-specification geotextile material;
Poor knowledge of geotechnical conditions prior to letting contracts;
66 Appendix 9
37. In conclusion, the project has demonstrated very important new techniques of sustainable
and environmentally friendly coastal management in India, showcasing the effectiveness of these
approaches and showing a very important lead into the widespread adoption of these new
methods of coastal management. Tranche 2 works are expected to develop and emphasize these
advantages, and lead to a very positive change in the methods of coastal management employed
in India, providing very considerable benefit to the nation’s beaches and the preservation of the
natural beauty of most of the coastline.
6 SUSTAINABILITY
6.1 Structures
38. Following completion of the project, it is important that the structures built are properly
maintained and operated. The engineering department under both state organizations undertakes
construction and maintenance of the created assets. The concerned unit taking on the
responsibility for operation and maintenance are:
In Maharashtra, the office of the Executive Engineer, Ratnagiri of the MMB
In Karnataka, the office of the Director, Ports, and Inland Water Transport, (pending
development of the Karnataka Maritime Board)
39. These offices and personnel have not been directly involved in the project
implementation, but it is hoped that the organization will pass on knowledge, training and share
O&M manual provided under the project. There are established institutional links with specialist
Appendix 9 67
centers of expertise such as the CWPRS, and so reliable technical advice on developing problems
should be obtainable for the responsible agencies.
40. Operation and Maintenance manuals have been prepared for the reefs. These identify
routine maintenance requirements, which are predominantly surveys of the structures to identify
developing problems with the structures so repairs can be affected. Some repairs will need to be
undertaken by specialist contractors – for example with experience of construction with
geotextiles, or marine repair work.
41. Survey work will involve visual inspection and physical survey of reefs and groynes, and
in Ullal geophysical survey of the off-shore reefs to identify if tetrapods have been displaced. The
Mirya Reef manual indicates a requirement to undertake surveys of the offshore reef and on-
shore berms twice a year for damage, and to promptly repair or replace any damaged geotube or
tetrapod.
42. The budgetary requirement for this type of work is estimated to be:
Mirya Reef. Twice a year visual inspection and topographic survey at low tide.
Carried out by experienced engineer plus surveyor with total station. Cost about
₹50,000 per survey, or ₹100,000 per year. Budget needed in case geotube
replacement needed. This would need to be carried out by specialist contractor.
Budget for ₹1 million once in five years.
Ullal Reefs. Annual inspection with boat-mounted geophysical sounding and survey
equipment. Cost about ₹500,000 per year. Not expected to require significant
maintenance.
Ullal Groynes. Physical inspection twice a year: say ₹100,000 per year. Budget for
repair by specialist contractor if geotubes need replacement. Allow for ₹3 million once
in five years for this work.
Ullal Breakwater. Routine inspection and minor repairs, similar in scope to budget
and skills already being used for this task.
43. MMB have provided an overview of the budgets of the Departments with responsibility for
asset management. These are indicated in the table below.
44. The table above confirms adequate financial resources to undertake and maintenance or
repair of the project assets. In Karnataka, the PWD section with maintenance responsibilities have
68 Appendix 9
much larger budgets and expenditure and similarly the workload added by the project will be
easily covered by existing budgets.
ANNEX 1
SAFEGUARDS
1. Environmental Safeguards
1. The first Tranche works of the project have been given Category A status because of
concerns that the design of the initial works was based on model simulations and less field
monitoring data than ideal. While Category A is normally kept for projects likely to have significant
adverse environmental impacts that are irreversible, diverse, or unprecedented, these are not
expected within the Tranche 1 schemes. The design of these schemes is with the intention of
creating a positive environmental impact, making a sustainable positive improvement in the
impacted coastline. ADB’s Environment Policy (EP), 2002 is applicable for this Loan.
2. As a category A project, a full environmental impact assessment was undertaken for each
scheme, with appropriate environmental management plan (EMP) and environmental
management and monitoring plans (EMMP) for each construction contract. The SEIA was
amended in December 2012 to reflect the change pertaining to the type of materials proposed for
the construction of the Ullal reefs and dropping of Goa state component from the scope. This
amended SEIA incorporated a description of the proposed changes, the rationale for the changes
and possible environmental and other implications of the change in materials for the Ullal offshore
reefs).
3. The India national requirements for environmental review under the Environmental
(Protection) Act, 1986, requires an EIA and Environmental Clearance from MOEF&CC prior to
start of construction. For work in the coastal area, there are further regulations under the 1991
Coastal Zone Regulation Notification requiring clearance from the appropriate State Coastal Zone
Management Authority and the MOEF&CC.
4. For all major construction contracts these clearances were obtained prior to start of
construction, and prior to the arrival of the technical assistance consultants. Because the design
of the interventions changed after clearances were obtained, under the regulations revised
clearances were required. This was understood by the PMUs after some delay, and appropriate
post-event clearances for the revised designs were sought.
5. The ADB procedures for environmental safeguarding of the project were all followed, with
some delays in the processing. A Safeguards mission to Karnataka in January 2015 noted that
there were significant deficiencies in the safeguarding process, including a lack of environmental
reporting required under ADB procedures, with the initial submitted report covering the period
January 2012 to June 2014 being dated in February 2015. Later reports were submitted in a
satisfactorily timely manner.
6. Key environmental concerns during the implementation of Tranche 1 schemes included:
Sources of rock material from Government approved quarries, and appropriate
management of these quarries
Transportation of materials to site
Site management, especially health and safety procedures and dust management
Identification of appropriate sources of sand for beach nourishment, clearance for the use
of the sand, and procedures to be used to transport and deposit sand for most effective
beach restoration.
7. These issues were all carefully addressed and managed under the construction contracts.
The safeguards mission to Karnataka had identified several issues related to health and safety
Appendix 10 71
procedures, but follow-up visits confirmed all recommended improvements had been
implemented.
8. A further issue flagged in the review of safeguards was the lack of experienced
environmental officers to oversee the implementation and monitoring of the EMPs. The PMUs
experienced considerable difficulties in identifying and retaining appropriate staff, and provisions
for technical assistance in this area under the PMDC contracts were not sufficient to provide
enough support in these circumstances. The situation improved following the January 2015
review.
9. There was no appointment of an external monitor for safeguards, and the environment
specialist from the ADB project team undertook the necessary due diligence. Also, the technical
support available from the PMDC in terms of the subject expertise and reassessment of the
environmental aspects during implementation, the need for engagement of an external monitor
was not observed essential.
10. No written grievances have been received by the project, and there is no record of other
grievances either.
11. The management of public interfaces and administration of the public grievance system
improved during the implementation of the project. Early on, Maharashtra had problems with the
public restricting contractor activity led by a lack of understanding of the project, and there were
improvements needed to establish a grievance redressal process in each State. No significant
grievances were, however, received.
12. In Karnataka there was one incident during reef construction when the contractor’s barge
ran aground on the reef and had to be salvaged. The management of this incident was managed
and resolved by the contractor, although the process took time to implement. No significant impact
on the environment resulted from this incident, and no lasting damage was done.
13. The outcome impact of the construction of Tranche 1 sub-projects has been assessed as
very positive, with recovered beaches and improved habitats and amenity.
2. Social Safeguards
14. The Tranche 1 projects have been approved for Category “C” for involuntary resettlement
and indigenous people categories. It was confirmed that none of the sub-projects had any
significant impacts in these areas.
15. The DMF for the Tranche 1 project has a number of outcomes and outputs liked to local
communities and participation in shoreline management. Efforts made under the project to
improve outcomes included several training events, and establishment and support of shoreline
management organizations (SMOs). This work proved effective in several ways, but the level of
participation in coastal management by local organizations was not as great as hoped for, and
the gender ratios of the supported SMOs did not reach the target 30% level.
16. The compliance with the social and environmental loan covenants by both States was
largely complete.
Table 1: Safeguards documents disclosed on the ADB website
Title Document Type Document Date
Sustainable Coastal Protection and Summary Environmental Mar 2010
Management Investment Program - Summary Impact Assessments
Environmental Impact Assessment
72 Appendix 10