## JICA and Corridor Development in South Asia

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**Canonical URL:** [JICA and Corridor Development in South Asia](https://www.imf.org/-/media/files/oap/oap-home/2020/2-1-hara-shohei.pdf)

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### JICA presence and financing in South Asia
- ODA Loans (F'2014-2018) — figures shown (JPY 100 Million) and shares:
  - Values: 2,607; 6,119; 5,384; 6,241; 7,785; 2,537; 2,827; 2,856; 4,341; 4,445
  - Share of South Asia in Total ODA Loan Commitment: 26%; 29%; 37%; 34%; 62%
  - Fiscal years referenced: FY14 FY15 FY16 FY17 FY18 (Provisional)
- Technical Cooperation and Grant Aid (FY14-18) — figures (JPY 100 Million) and shares:
  - Technical Cooperation values: 194.16; 228.56; 341.16; 233.62; 244.32
  - Grant Aid Commitment values: 170.37; 175.69; 187.26; 167.86; 147.03
  - Shares: Share of South Asia in Total Technical Cooperation: 11%; 12%; 16%; 12%; 13%
  - Share of South Asia in Total Grant Aid Commitment: 15%; 16%; 19%; 15%; 15%
  - Fiscal years referenced: FY14 FY15 FY16 FY17 FY18 (Provisional)

### JICA projects and geographic corridors
- JICA loan projects and corridor-related interventions listed:
  - Kaladan Multi-Modal Transit Transport Project
  - Gelephu-Dalu Corridor
  - Cross-Border Road Network Improvement Project
  - Western Bangladesh Bridge Improvement Project
  - Jamuna Bridge Project and new Jamuna Railway Bridge Construction Project
  - Power Systems Master Plan 2040 for optimisation of development plans in hydro power sector
  - North East Road Network Connectivity Improvement projects:
    - NH 54 (Mizoram, India)
    - NH 40 (Meghalaya, India)
    - Dhubri-Phulbari Bridge of NH 127B (Assam and Meghalaya, India)
    - NH 51 (Meghalaya, India)
  - The Bay of Bengal Industrial Growth Belt (BIG-B) for industrial agglomeration, including Matabari-Moheshkhali area development
- Transport web and routes referenced:
  - Cities/locations: Kolkata, Sittwe, Dhaka, Chittagong, Cox’s Bazar, Teknaf, Dawki, Benapol, Aizawl, Tuipang, Tura, Gelephu, Dalu
  - Sea Route: 539km
  - East-West Corridor
  - Asian Highway Route
  - Sea Route connecting India, Myanmar, Bangladesh, Bhutan, North Eastern Region of India

### Analytical framework and methodology — Proposed Framework: “FIT-2-DEEDS”
- Components of FIT-2-DEEDS:
  - The Flow of expected results: the chain from corridor to benefits
  - The Intervention Design: supporting a fairer distribution of greater benefits
  - Typology of impacts: organizing multiple impacts into a hierarchy
  - 2 sorts of complementary interventions: policies and institutions
  - Deed: devising a viable financing strategy for a given design
  - Deed: successfully managing the implementation of the program
- Analytical Methodology:
  - Network Analysis based on regional data sets
  - Reduced Form Regressions
  - Structural General Equilibrium Modelling
  - Spatial Econometrics
  - etc

### Priorities, benefits, and downsides of corridor development
- Established framework for project appraisal:
  - Cost benefit analysis of the projects based on vehicle operating costs including time and environmental savings, increases in trade, reduction of traffic accidents, etc.
- Wider Economic Benefits (WEB) considerations:
  - Agglomeration effects, spill over and network effects are not well captured by conventional analyses
  - Improved availability of spatial data and spatial econometric methods allows for more rigorous and comprehensive analysis
  - Need for complementary policy interventions: trade facilitation services, ensuring market mechanisms, improved governance, access to social services, etc.
- Downsides and trade-offs:
  - Environmental impacts on health and carbon emissions
  - Regional inequality
  - Balancing with “geopolitics” or “strategic plans”

### Case studies and spotlight topics
- Case studies referenced:
  - Viet Nam NH-5 Corridor
  - Japan’s Pacific Ocean Belt and trade offs
- “Spotlights” — short case studies and themes:
  - “Financing Priority Transport Corridors in South Asia”
  - “Private Investment in Corridor Infrastructure”
  - “The Role of PPP in Developing South Asia's Corridors”
  - “The Impact of Highways on Micro, SMEs: Anecdotal Evidence from Bhutan, Sri Lanka, and India”
  - “Do Highways Help Women?”
  - “Appraising Proposed Transport Corridors Using Spatial Econometrics”
  - “Agriculture Finance and Technical Assistance to Enhance the Wider Economic Benefits of Transport Connectivity for Rural Areas”
  - “Cross-Border Infrastructure Projects: Challenges and Lessons Learned from the Unrealized Sava Waterways Rehabilitation Program in Southeast Europe”
  - “The Influx of Workers and Followers in a Transport Project: Lessons in Gender Risks from a Road Project in Uganda”

### Key take-aways and quality considerations
- Fiscal and policy trade-offs:
  - Fiscal space for infrastructure investment, O&M costs (and rehabilitation and replacement costs), and debt service versus much needed (and complementary) public expenditures for health, education, social safety nets, improved governance, etc.
- Prioritization and quality:
  - Prioritization of plans and initiatives requires rigorous appraisal with a view to WEB
  - “Quality” matters in: Preparation (Master plans and feasibility studies); Designing (engineering, social considerations and sustainability); Financing (adequate risk allocation between public and private funding); Procurement (transparency, timelines, lifecycle costing); Implementation (timely execution, hands on management for capacity development “Learning by doing”); Operations and maintenance
  - Reference to G20 Principles for Quality Infrastructure Investment

### G20 Principles for Quality Infrastructure Investment (listed)
- Principle 1: Maximizing the positive impact of infrastructure to achieve sustainable growth and development
- Principle 2: Raising Economic Efficiency in View of Life-Cycle Cost
- Principle 3: Integrating Environmental Considerations in Infrastructure Investments
- Principle 4: Building Resilience against Natural Disasters and Other Risks
- Principle 5: Integrating Social Considerations in Infrastructure Investment
- Principle 6: Strengthening Infrastructure Governance

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_Source: https://www.imf.org/-/media/files/oap/oap-home/2020/2-1-hara-shohei.pdf_