Srinagar, Jul 01 : The government of Jammu & Kashmir has informed the Department of Economic Affairs, Union Finance Ministry that there will be no potential savings available for cancellation under the World Bank’s Jehlum Tawi Flood Recovery Project (JTFRP).
Documents in possession of news agency—Kashmir News Observer (KNO) reveal that government of Jammu & Kashmir has informed the Department of Economic Affairs on April 12, 2022, that based on their assessment there will be no potential savings for cancellation.
The government had carried assessment about project commitments and likely savings after it was directed to do so.
The WB had asked the government of J&K and Department of Economic Affairs to finalize an assessment by March 31, 2022, of the likely savings under the credit (the funds that would potentially remain unutilized by December 31, 2022) factoring in the implementation progress, contract variations and exchange rate variations.
It had asked the government to submit a request through Department of Economic Affairs for cancellation of the identified savings under the credit by April 15, 2022.
According to documents, the WB team estimates about US$ 20 million may remain unutilized by the new proposed closing date of December 31, 2022.
“Need for canceling uncommitted credit has been discussed with the counterparts since FY20. Based on the current level of progress and performance outlook on a few high-value civil works contracts, the team estimates about US$20 million may remain unutilized by the new proposed closing date of December 31, 2022. The Bank team will continue close supervision with monthly review of the project,” read the documents.
According to the documents, the government of Jammu & Kashmir indicated that about US$5.5 million remains uncommitted under the project which they are keen to utilize for scaling up contingent emergency response component (CERC) activities for COVID management/boosting healthcare services, supporting further expansion of the Bone and Joint Hospital and accommodating the cost variations received on several civil contracts.
The Rs 1500 crore project was approved by the World Bank in 2015 for reconstruction of damaged infrastructure by 2014 floods and strengthening J&K’s disaster management mechanism.
From the beginning, the project has faced complex challenges due to political uncertainty, volatile security situation, and frequent changes in leadership and staffing in all implementing agencies (IAs). The IAs lack of familiarity with Bank financed projects and weak contractor presence, capacity and participation added further delays in implementation—(KNO)