The World Bank First Phase of the Central Asia Road Links Program (P132270) REPORT NO.: RES39271 RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF FIRST PHASE OF THE CENTRAL ASIA ROAD LINKS PROGRAM APPROVED ON APRIL 22, 2014 TO MINISTRY OF FINANCE OF THE KYRGYZ REPUBLIC TRANSPORT EUROPE AND CENTRAL ASIA Regional Vice President: Cyril E Muller Country Director: Lilia Burunciuc Regional Director: Lucio Monari Practice Manager/Manager: Binyam Reja Task Team Leader(s): Muhammad Zulfiqar Ahmed, Aidai Bayalieva The World Bank First Phase of the Central Asia Road Links Program (P132270) ABBREVIATIONS AND ACRONYMS The World Bank First Phase of the Central Asia Road Links Program (P132270) Note to Task Teams: The following sections are system generated and can only be edited online in the Portal. BASIC DATA Product Information Project ID Financing Instrument P132270 Investment Project Financing Original EA Category Current EA Category Partial Assessment (B) Partial Assessment (B) Approval Date Current Closing Date 22-Apr-2014 15-Nov-2019 Organizations Borrower Responsible Agency Ministry of Finance of the Kyrgyz Republic Ministry of Transport and Roads Project Development Objective (PDO) Original PDO The Central Asia Road Links (CARs) program is the result of a collaborative effort initiated by respective governments in the Central Asia region which has been developed as a regional, multi-phase program considered as a regional transformational project under IDA 16 and IDA 17. The program has the overall objective to increase transport connectivity between neighboring countries in Central Asia along priority cross-border road links whilst supporting improvements in road operations and maintenance practices. The project development objective (PDO) of the First Phase of the Central Asia Road Links Program (CARs-1) is to increase transport connectivity between the Kyrgyz Republic and Tajikistan along priority cross-border road links in Batken Oblast whilst supporting improvements in road operations and maintenance practices. The road sections to be financed under CARs-1 prioritize connectivity between the Osh and BatkenOblast in the Kyrgyz Republic and Sugd Oblast in Tajikistan as they build lateral spurs from the Osh-Isfana axis to the Tajik border. OPS_TABLE_PDO_CURRENTPDO The World Bank First Phase of the Central Asia Road Links Program (P132270) Summary Status of Financing Net Ln/Cr/Tf Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed IDA-54300 22-Apr-2014 25-Jul-2014 14-Dec-2014 15-Nov-2019 36.80 22.90 10.38 IDA-H9340 22-Apr-2014 25-Jul-2014 14-Dec-2014 15-Nov-2019 8.20 7.35 .04 Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No Note to Task Teams: End of system generated content, document is editable from here. I. PROJECT STATUS AND RATIONALE FOR RESTRUCTURING 1. The Board approved the SDR 29.3 million (equivalent to USD 45.0 million) credit and grant for the First Phase of the Central Asia Road Links Program (CARs-1) on April 22, 2014 and it became effective on December 14, 2014 with an original closing date of April 30, 2019 revised to November 15, 2019. Implementation after preliminary delays is now progressing satisfactorily. Cumulative disbursement of the Bank credit and grant now stands at USD 30.25 million (74 % disbursement ratio). Progress towards achieving the PDO is rated Satisfactory while the Implementation Progress is rated as Moderately Satisfactory. The project stays compliant with legal covenants, as well as Bank fiduciary and safeguard policies. There are no overdue audits under the project, and previous audit reports were found acceptable to the Bank. Arrangements for financial management under the Project, including planning and budgeting, accounting, financial reporting, internal controls, funds flow and external auditing are overall adequate and continue to be overall acceptable to the Bank. 2. According to the projections, the Ministry of Transport and Roads (MOTR) of the Kyrgyz Republic expects savings amount of the Credit equivalent to SDR 3,585,000 million and Grant equivalent to SDR 0.00 that will remain after all requisite payments are made under the aforementioned project. In this regard, the Ministry of Finance (MOF) has issued a request letter to the World Bank (dated November 12, 2019) to consider reallocation and partial cancellation of project funds. II. DESCRIPTION OF PROPOSED CHANGES 1. The reallocation and partial cancellation of project funds are recommended as follows: a) in accordance with Section 6.01 of the General Conditions for Credits and Grants applicable to the Financing Agreement, the Association hereby cancels, as of November 12, 2019, the amount of the Credit proceeds equivalent to SDR 3,585,000 million from Category (1) Works for Part 1 of the Project; The World Bank First Phase of the Central Asia Road Links Program (P132270) b) Reallocate the amount of Credit proceeds equivalent to SDR 905,739 from Category (1) Works for Part 1 of the Project to Category (2) Goods, non-consulting services, consultants' services, Training and Incremental Operating Costs (including audit) for the Project; and c) Reallocate the amount of Grant proceeds equivalent to SDR 16,000 from Category (1) Works for Part 1 of the Project to Category (2) Goods, non-consulting services, consultants' services, Training and Incremental Operating Costs (including audit) for the Project. Note to Task Teams: The following sections are system generated and can only be edited online in the Portal. III. SUMMARY OF CHANGES Changed Not Changed Cancellations Proposed ✔ Reallocation between Disbursement Categories ✔ Implementing Agency ✔ DDO Status ✔ Project's Development Objectives ✔ Results Framework ✔ Components and Cost ✔ Loan Closing Date(s) ✔ Disbursements Arrangements ✔ Disbursement Estimates ✔ Overall Risk Rating ✔ Safeguard Policies Triggered ✔ EA category ✔ Legal Covenants ✔ Institutional Arrangements ✔ Financial Management ✔ Procurement ✔ Implementation Schedule ✔ Other Change(s) ✔ Economic and Financial Analysis ✔ The World Bank First Phase of the Central Asia Road Links Program (P132270) Technical Analysis ✔ Social Analysis ✔ Environmental Analysis ✔ IV. DETAILED CHANGE(S) OPS_DETAILEDCHANGES_CANCELLATIONS_TABLE CANCELLATIONS Value Reason Current Cancellation New Ln/Cr/Tf Status Currency Date of for Amount Amount Amount Cancellation Cancellation LOAN IDA-54300- Disburs RESTRUCTUR XDR 23,900,000.00 3,585,000.00 12-Nov-2019 20,315,000.00 001 ing ING, COST SAVINGS LOAN IDA-H9340- Disburs RESTRUCTUR XDR 5,300,000.00 0.00 12-Nov-2019 5,300,000.00 001 ing ING, COST SAVINGS OPS_DETAILEDCHANGES_REALLOCATION _TABLE REALLOCATION BETWEEN DISBURSEMENT CATEGORIES Financing % Current Allocation Actuals + Committed Proposed Allocation (Type Total) Current Proposed IDA-54300-001 | Currency: XDR iLap Category Sequence No: 1 Current Expenditure Category: Works for Part 1 of the Project 19,868,739.00 12,442,589.40 15,378,000.00 82.00 82.00 Current Expenditure Category: Goods, Non-Consulting Services,Consultants' iLap Category Sequence No: 2 Services,Training, and IOC,audit 4,031,261.00 4,164,088.24 4,937,000.00 100.00 100.00 Total 23,900,000.00 16,606,677.64 20,315,000.00 The World Bank First Phase of the Central Asia Road Links Program (P132270) IDA-H9340-001 | Currency: XDR iLap Category Sequence No: 1 Current Expenditure Category: WORKS for Part 1 1,940,000.00 1,923,979.69 1,924,000.00 82.00 82.00 iLap Category Sequence No: 2 Current Expenditure Category: GO, NON-CS, CS, TR, IOC, AUDIT 3,360,000.00 3,238,928.53 3,376,000.00 100.00 100.00 Total 5,300,000.00 5,162,908.22 5,300,000.00 .