evaluation approach paper integrated water management

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Evaluation Approach Paper Integrated Water Management: Sector-wide Evaluation of ADB’s Water Policy and Program (2011–2020) October 2021 Team Leader: Srinivasan Palle Venkata, Senior Evaluation Specialist (email: [email protected])

A. Introduction 1. This paper sets out the approach and methodology for an independent evaluation of the Asian Development Bank’s (ADB) 2001 Water Policy, 1 and ADB’s support for water sector operations in developing member countries (DMCs) during 2011–2020. The evaluation timing coincides with the completion of the period of ADB’s Water Operational Plan 2011–2020. Consultations with ADB’s Board of Directors and Management have informed the scope and outline of the evaluation. The purpose of this evaluation is to (i) provide the Board of Directors and Management with an independent evidence-based review of the ADB 2001 Water Policy and evaluation of the water operations that ADB has supported under its Water Policy from 2011 to 2020; and (ii) identify lessons and make suggestions to Management and the Board, as inputs to future water operations and possible updates to the Water Policy, and inform the ADB Water Sector Framework, 2021–2030, which is under preparation. 2. There have been many changes in the water context in the region since ADB established its Water Policy in 2001. The region has seen rising economic growth, which has put pressure on the available freshwater resources. Rapid urbanization has put a strain on meeting the rising demand for water supply and sanitation services and addressing public health issues and environmental and ecological sustainability of natural resources. These issues are not new but tackling them has acquired greater urgency as changes in climate and climate variability are aggravating water-related disaster risks and contributing to rising water scarcities, both spatially and temporally and affecting irrigated agriculture and food security. Incorporating climate change adaptation and disaster resilience into the integrated water resource management process will add to the complexity in design and implementation of projects. Building adaptive capacity to climate change and disaster impacts will require innovative governance arrangements and practices, institutional strengthening, and ensuring an enabling environment in the DMCs to tackle the new challenges. Other developments include the evolving new technologies such as artificial intelligence, big data, and internet of things that are increasingly becoming accessible to DMCs. Some examples include smart meters, leak detection systems for pipe networks, data driven monitoring and control systems,2 filtration systems, chemical and biological treatment processes for reuse of wastewater and technologies used in water supply and sanitation or temperature and moisture sensors, and aerial images and GPS technology used in agriculture. In ADB’s newly adopted long-term corporate strategy (Strategy 2030), water cuts across all the seven operational priorities. 3 These changes suggest that the Water Policy may need a relook, and different approaches may be needed in supporting ADB’s DMCs to address their water challenges.

1 ADB. 2001. Water for All: The Water Policy of the Asian Development Bank. Manila. 2 Global Water Intelligence. 2016. Water’s Digital Future: The outlook for monitoring, control and data management

systems. www.globalwaterintel.com 3 ADB. 2018. Strategy 2030: Achieving a Prosperous, Inclusive, Resilient, and Sustainable Asia and the Pacific.

Manila.

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1. Water Sector Context 3. The 2021 World Water Development Report of the United Nations (UN) identifies population growth, urbanization, and increased industrialization as leading factors behind increased competition for water use among sectors, threatening agricultural production and food security.4 Agricultural use constitutes 69% of demand for global freshwater resources, followed by industry (19%), and municipalities (12%). Water withdrawals for irrigation are a major driver of groundwater depletion worldwide. Globally, freshwater use is growing roughly at a rate of 1% per year. In Asia, water use in agriculture is closer to 80%. Water insecurity is likely to worsen due to the impacts of climate change and underinvestment in water management and storage. Floods and extreme rainfall events have increased by more than 50% over the past decade. Water quality has deteriorated because of pollution in nearly all major rivers in Asia. An estimated 80% of all industrial and municipal wastewater globally is released into the environment without any prior treatment. Climate change and lack of access to quality water supply and sanitation has disproportionate impact on women’s lives, livelihoods, time poverty, care work, and health. All these imply that integrated approaches promoting efficient use of water, reuse of wastewater, and tackling water pollution require greater attention. 4. The 2020 Asian Water Development Outlook estimates that around 1.5 billion people in rural areas and 0.6 billion in urban areas still lack adequate water supply and sanitation in Asia and the Pacific region.5 Sound water management and access to reliable service delivery remain vital to inclusive economic growth and social well-being. The coronavirus disease (COVID-19) pandemic has reconfirmed all over the world the urgency of ensuring water and sanitation services of adequate quality to all. Water management is key to achieving the Sustainable Development Goals (SDG), particularly SDG 1: eliminating poverty, SDG 2: zero hunger, SDG 3: good health and wellbeing, SDG 5: gender equality, SDG 6: access to clean water and sanitation, SDG 9: build resilient infrastructure, SDG 11: create sustainable cities and communities, and SDG 13: climate action. Water is critical to production and socioeconomic activity, such as food and agriculture, energy and industry, business and employment, and gender equality; and is also valued for recreational, cultural, and spiritual needs. Improving productivity of water use in agriculture and energy is essential for sustained economic growth, food security, and rural poverty reduction. 5. Challenges faced by ADB’s DMCs include inadequate infrastructure, insufficient attention to operations and maintenance and asset management, lack of access to good hydrological data, inadequate formulation and implementation of policies, weak public institutions and capacity, and lack of enabling environment for private sector investments. There is increasing competition between different users of water (agriculture, industry, energy, and environment); growing demand for clean water; and increasing volumes of wastewater due to rapid urbanization. Degradation of water resources leads to increasing costs of treatment for water supply. Untreated urban wastewater released into water bodies affects irrigation water quality and freshwater dependent ecosystems. Water can be a major source of fragility and conflict as in the case of large-scale infrastructure meant for producing hydropower and providing water storage which affects downstream agro-ecological systems and involve human resettlements. Increasing frequency of floods and droughts due to climate change makes water availability increasingly variable. Projections made for different levels of global warming in the latest report of the Intergovernmental Panel on Climate Change (IPCC) suggest that average and heavy precipitation

4 United Nations. 2021. The United Nations World Water Development Report 2021: Valuing Water. Paris: UNESCO. 5 ADB. 2020. Asian Water Development Outlook 2020: Advancing Water Security Across Asia and the Pacific. Manila.

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will increase over much of Asia (high to medium confidence).6 Glacier runoff in the Asian high mountains will increase up to mid-21st century (medium confidence), and regional mean sea level will continue to rise (high confidence). Addressing these challenges requires cross sectoral cooperation with different water user sectors and an integrated approach that manages different aspects of water cycle (upstream river water pollution management, water supply, sanitation, wastewater treatment, and stormwater and flood management) holistically within the context of the river basin and not dealing with each aspect in isolation.

2. Other Multilateral Development Banks’ Policies and Strategies 6. The evaluation will bring in the experience of other multilateral development banks (MDBs) in supporting water sector interventions in their member countries. Comparisons will be made between ADB and other MDBs with respect to the approaches used, implementation experiences, and lessons learned. ADB, African Development Bank (AfDB), European Investment Bank (EIB), and Islamic Development Bank (IsDB) have a water sector policy while other MDBs, including the World Bank Group, have either a strategy or sector framework or strategic action plan (Table 1). AfDB and ADB are among the earliest to have a water policy. A review of the policy and strategy statements of different MDBs revealed that they share common objectives: improving water security; building resilience to climate change, floods, and droughts; and ensuring sustainable management of water resources (Attachment 1 has more details).

Table 1: Policy and Strategy Documents for Water: ADB and Other Multilateral Development Banks

MDB Year Title Type Time Frame ADB 2001 Water for All: The Water Policy of the Asian

Development Bank Policy Not specified

2011 Water Operational Plan Operational plan 2011–2020 AfDB 2000 Policy for Integrated Water Resources Management Policy Not specified

2021 Policy on Water Policy Not specified AIIB 2020 Water Sector Strategy Strategy EIB 2008 Water Sector Lending Policy Policy Not specified IADB 2017 Water and Sanitation Sector Framework Sector framework 2017–2020 IsDB 2020 Water Sector Policy: Sustainable and Resilient Water

and Sanitation Systems for All Policy Not specified

WBG

1993 Water Resources Management: Policy Paper Policy Not specified 2004 Water Resources Sector Strategy: Strategic directions

for World Bank Engagement Strategy Not specified

2019 Working Together for a Water Secure World Strategic action plan

Not specified

ADB = Asian Development Bank, AfDB = African Development Bank, AIIB = Asian Infrastructure Investment Bank, EIB = European Investment Bank, IADB = Inter-American Development Bank, IsDB = Islamic Development Bank, MDB = multilateral development bank, WBG = World Bank Group. Source: Asian Development Bank (Independent Evaluation Department).

6 IPCC. 2021. Climate Change 2021: The Physical Science Basis. Contribution of Working Group I to the Sixth

Assessment Report of the Intergovernmental Panel on Climate Change. Cambridge University Press. https://www.ipcc.ch/report/sixth-assessment-report-working-group-i/

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B. ADB’s 2001 Water Policy, Related Operational Plans, and Water Program 2011–2020

1. ADB’s Water Policy and Related Operational Plans

7. The current Water Policy of ADB was approved in 2001 in response to high water stress levels due to increasing demand and decreasing per capita water availability of water in many DMCs. It recognized the need for holistic and integrated investments promoting efficient water use, set in the context of managing water resources within river basins.7 Investments in water infrastructure including irrigation and drainage, water supply and sanitation, flood control, and water management will factor in the interdependencies across sectors. For example, excessive use of agrochemicals in agriculture leads to the deterioration of surface and groundwater quality. Similarly, enhancing water supplies to cater to the growing needs of urban population with insufficient attention to wastewater treatment and disposal causes serious environmental problems. 8. The seven key elements of the Water Policy are (i) promoting a national focus on water sector reform (policies, laws, institutional capacity building, information management, and sector coordination); (ii) fostering the integrated management of water resources particularly in river basins; (iii) improving and expanding the delivery of water services (involving the private sector and emphasizing equity in access to water for the poor); (iv) fostering the conservation of water and increasing system efficiencies; (v) promoting regional cooperation and increasing the mutual beneficial use of shared water resources within and between countries; (vi) facilitating the exchange of water sector information and experiences including public–private–community–nongovernmental organization partnerships; and (vii) improving governance in public sector institutions and promoting decentralization. 9. Development of the Water Policy considered the linkage of water challenges to poverty reduction, regional development, and the need to manage water both as a resource and as a service. It was recognized that water stress can be addressed by increasing efficiency in irrigation and water supply, managing pollution from industrial and municipal effluents and rural and urban stormwater runoff and better management and allocation of available resources at a watershed level. The water policy provides for the involvement of the poor in water conservation and management. It recognizes that the poor must be empowered to influence decisions that affect their access to water for both consumptive and productive uses. The Water Policy stated that ADB will work on transboundary water management based on joint requests from riparian countries. 10. An expert review panel report in 20068 identified eight major priority areas requiring attention to improve implementation of ADB’s Water Policy: “(i) raising the status of water in the DMCs and ADB; (ii) improving governance and addressing institutional constraints; (iii) improving donor harmonization to optimize investment benefits; (iv) mitigating adverse social and environmental impacts; (v) developing capacities and addressing constraints within ADB (institutional, financial, human); (vi) improving the alignment of the country strategy and program and updates and DMCs’ water sector roadmaps with ADB’s Water Policy; (vii) ensuring affordability and equity in water service delivery; and (viii) targeting efficiency and cost

7 ADB. 2001. Water for All: The Water Policy of the Asian Development Bank. Manila.

https://www.adb.org/sites/default/files/institutional-document/32042/water-policy.pdf 8 ADB. 2006. Water for All: Translating Policy into Action—The Review Panel’s Final Report and Recommendations.

Manila. https://www.adb.org/sites/default/files/institutional-document/33027/files/water-all-review-report.pdf

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effectiveness in water service delivery.” It made the following recommendations: (i) increase ADB’s commitments and develop ADB’s capacities, (ii) develop long term partnerships with DMC stakeholders and donors, (iii) focus the implementation of integrated water resources management (IWRM) on stakeholder needs and ownership, (iv) promote “business unusual” by leveraging innovations, and (v) improve processes to ensure effective policy implementation. ADB accepted these recommendations made by the review panel. The review had also indicated that the there was a need to close the gap between policy and practice in the next 5–10 years and that it would be crucial to translate ADB’s Water Policy into an operational strategy to guide the investment program. ADB acted upon this suggestion to formulate the Water Operational Plan (WOP) in 2011. 11. The WOP was also informed by ADB’s Independent Evaluation Department’s (IED’s) evaluation of ADB’s water policy and related operations in 2010.9 IED’s evaluation found the water policy to be consistent with ADB's corporate strategy and DMC national priorities and supported international consensus on IWRM and water and sanitation related to MDGs, and the lending operations to be generally reflecting the policy well. It also found the policy to be largely consistent with those of other MDBs. Principal weaknesses identified by the evaluation included broad and ambitious nature of the policy, insufficient guidance for implementation, and lack of results framework for monitoring and evaluating water sector program performance. Management agreed to all recommendations. 12. The WOP provided operational guidance in achieving the goals of the water policy.10 While maintaining that ADB’s water operations will continue to be based on the fundamental principles laid out in the Water Policy, the WOP prioritized the following solutions to deal with water stress: (i) increased efficiencies in water use across the range of users; (ii) expanded wastewater management and reuse, including sanitation; (iii) embedded IWRM, including improved risk management to mitigate floods, droughts, and other water-related disasters; (iv) expanded knowledge and capacity development that uses technology and innovation more directly; and (v) enhanced partnerships with the private sector.11 The WOP recognized that water is central to serving the three agendas of Strategy 2020—inclusive economic growth, environmentally sustainable growth, and regional integration and is also integral to Strategy 2020’s five drivers of change: private sector development and private sector operations, good governance and capacity development, gender equity, knowledge solutions, and partnerships. It specified a results framework to track the progress of ADB’s water financing program in achieving the outcomes: (i) accelerated policy and institutional reforms to support improved water use efficiency across the range of users; (ii) increased efficiency and productivity in the delivery of water services, delivering improved level of service; (iii) accelerated and expanded implementation of IWRM, delivering improved water security and enhance efficiency and productivity. 13. Apart from the WOP, ADB’s water operations were guided by other documents such as the Urban Operational Plan (UOP) formulated in 2012. The UOP is expected to provide the urban context for catalyzing, expanding the implementation, and increasing the impact of WOP through

9 IED. 2010. Special Evaluation Study: Water Policy and Related Operations. Manila. 10 ADB. 2011. Water Operational Plan, 2011–2020. Manila. 11 Correspondence between the focus areas of WOP and Water Policy: (i) and (ii) of WOP correspond to focus area 4

of Water Policy—fostering the conservation of water and increasing system efficiencies; (iii) of WOP corresponds to focus area 2 of Water Policy—fostering the integrated management of water resources particularly in river basins; (iv) of WOP corresponds to focus area 6 of Water Policy—facilitating the exchange of water sector information and experiences including public–private–community–nongovernmental organization partnerships; and (v) of WOP corresponds to focus area 3 of Water Policy—improving and expanding the delivery of water services (involving the private sector and emphasizing equity in access to water for the poor).

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more coherent urban region planning. It is also expected to provide the integrated planning context to improve the efficiency of water use and wastewater systems, and of wastewater recycling/reuse under the WOP. 14. The Operational Plan for Agriculture and Natural Resources (2015–2020),12

and an earlier Operational Plan for Sustainable Food Security in Asia and the Pacific (2010–2014)13

provided guidance for ADB’s agriculture, natural resources, and rural development (ANR) sector operations in increasing productivity through agriculture water management and climate change and disaster-resilient infrastructure, and enhancing management and climate resilience of water resources, among other priority areas. The Environment Operational Directions 2013–2020 promote development of water infrastructure that is low carbon, environmentally sustainable and resilient to climate change, as well as promote adaptation and mitigation responses to climate change. More generally, ADB’s Strategy 2020 priorities guide the water program in 2011–2020, except in the last 2 years of the period when operations are guided by Strategy 2030 and its seven Operational Priorities. Strategy 2020 did not consider agriculture and IWRM under ADB’s core areas of business which might have affected the implementation of related priorities in the Water Policy.

2. Water Sector Program, 2011–2020 15. During 2011–2020, ADB committed total financing of $30.9 billion (20% of the total commitments by ADB) to support 336 loans and grants for projects with water components in the water and other urban infrastructure services (WUS) and ANR sectors.14 This comprised a mix of sovereign loans ($27.5 billion, 89%); sovereign grants ($1.5 billion, 5%); and nonsovereign financing ($1.8 billion, 6%). Apart from this, the 10-year portfolio comprised 351 TA projects with a financing amount of $401.3 million. Further details on the analysis of ADB’s approved water portfolio are presented in Attachment 2 and the list of sovereign, nonsovereign, and TA projects is presented in Supplementary Attachment 1. Excluding the financing devoted to non-water components, the net financing committed for water components during 2011–2020 is $23.2 billion. The scope of this evaluation is limited to ADB’s support for water components alone. A breakdown of the $23.2 billion support by ADB regional departments and by water subsectors is given below. 16. Commitments by regional departments. The regional spread of water operations shows that financial commitment was the largest in South Asia, amounting to $8.59 billion comprising 94 loans and grants, or 37% of total commitments (Figure 1). This was followed by Central and West Asia (19%) with 60 loans and grants, Southeast Asia (18%) with 78 loans and grants, and East Asia (17%) with 54 loans and grants. Financing for private sector operations amounted to $1.56 billion for 23 loans and grants. India, the People’s Republic of China (PRC), Pakistan, Viet Nam, and Bangladesh are the top borrowers in that order together accounting for 56% of the net financing commitments for the water components.

12 ADB. 2015. Operational Plan for Agriculture and Natural Resources: Promoting Sustainable Food Security in Asia

and the Pacific in 2015–2020. Manila. 13 ADB. 2009. Operational Plan for Sustainable Food Security in Asia and the Pacific. Manila. 14 This evaluation covers urban water projects classified under the WUS subsectors: (i) urban water supply; (ii) urban

sanitation; (iii) urban sewerage; (iv) urban flood protection; and (v) urban policy, institutional and capacity development; as well as rural water projects classified under the ANR subsectors: (vi) water-based natural resources management; (vii) irrigation and drainage; (viii) rural flood protection; (ix) rural water supply services; (x) rural sanitation; (xi) rural water policy, institutional and capacity development; and (xii) hydropower generation. Of the 336 loans/grants 180 are from the WUS sector and 156 from the ANR sector.

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17. Commitment by subsectors. Total commitment in 2011–2020 for urban water subsectors was $12.93 billion, accounting for about 56% of total (rural plus urban) (Table 2). A large part of the support is for the urban water supply subsector with $6.37 billion or 49% of total urban water. This was followed by urban sewerage accounting for $2.99 billion (23%), urban flood protection accounting for $1.60 billion (12%), and urban sanitation accounting for $1.05 billion (8%).

18. Commitments for rural water subsectors totaled $10.27 billion, 44% share of the total (rural plus urban). Irrigation and drainage had the largest share (40%) of assistance to rural water subsectors, with total commitment of $4.11 billion. This was followed by water-based natural resources with $2.26 billion (22%), hydropower with $2 billion (20%), and rural flood protection with $0.94 billion (9%) (Table 2).

Table 2. ADB Financing for Water by Subsectors, 2011–2020

Subsector Financing Volume

($ million) % Share within Rural

or Urban Water % Share of Total

(Rural plus Urban) Urban Water Supply 6,368.49 49.23% 27.45% Urban Sewerage 2,997.91 23.18% 12.92% Urban Sanitation 1,050.68 8.12% 4.53% Urban Flood Protection 1,604.86 12.41% 6.92% Urban Policy, Institutional, and Capacity Development

913.29 7.06% 3.94%

Total Urban Water 12,935.22 100.00% 55.76% Irrigation and Drainage 4,110.61 40.06% 17.72% Rural Flood Protection 941.07 9.17% 4.06% Rural Water Supply Services

529.29 5.16% 2.28%

Rural Sanitation 132.89 1.29% 0.57% WBNR 2,262.43 22.05% 9.75% Rural Water Policy, Institutional Capacity Development

276.15 2.69% 1.19%

Hydropower 2,009.31 19.58% 8.66% Total Rural Water 10,261.76 100.00% 44.24% Total (Rural plus Urban) 23,196.99 100.00%

WBNR = water-based natural resources. Source: Asian Development Bank.

Figure 1: Commitments by Regional Departments, 2011–2020 ($ billion)

CWRD = Central and West Asia Department, EARD = East Asia Department, PARD = Pacific Department, PSOD = Private Sector Operations Department, SARD = South Asia Department, SERD = Southeast Asia Department. Source: Asian Development Bank.

8.5

9

4.4

5

4.2

7

4

1.5

6

0.3

2

S A R D C W R D S E R D E A R D P S O D P A R D

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19. Technical assistance by subsectors. Urban water TA projects totaled 174, with $238.17 million in funding and distributed over 5 subsectors (Table 3). There were 177 rural water projects, with $163.15 million in funding and distributed over 9 subsectors.

Table 3: Urban and Rural Water Technical Assistance by Subsector

Subsector TA Count TA Amount ($ million) Urban Water Urban policy, institutional, and capacity development 88 102.13 Urban water supply 35 68.48 Urban flood protection 26 41.09 Urban sanitation 14 17.43 Urban sewerage 11 9.04 Subtotal (Urban Water) 174 238.17 Rural Water Water-based natural resources management 81 70.87 Irrigation 50 56.03 Large hydropower generation 14 10.93 Rural flood protection 11 7.75 Rural water policy, institutional, and capacity development 7 4.90 Renewable energy—small hydropower 6 6.25 Rural water supply services 4 3.93 Agricultural drainage 2 1.40 Rural sanitation 2 1.10 Subtotal (Rural Water) 177 163.15 Total TA 351 401.31

TA = technical assistance. Source: Asian Development Bank.

3. Available Evaluative Evidence

20. The evaluation will use evidence from previous evaluation assessments carried out at various levels of detail. It will also review the experiences of other MDBs and compare them with those of ADB. 21. Evaluation lessons from ADB. In 2010, IED assessed the performance of the 2001 Water Policy for relevance and responsiveness and the performance and results from the operations during 2001–2009.15 Some of the key lessons were: (i) it is unrealistic to expect ADB’s DMCs to introduce IWRM in a 5- or 10-year period since it is difficult, time-consuming, and expensive to introduce as indicated by international experience; (ii) a top-down solution to IWRM (i.e., with an apex organization and major river basin organizations [RBOs]) may not always be appropriate to basin planning, particularly in water-rich countries; local initiatives may be more manageable and successful); and (iii) exploiting the private sector investment potential requires institutional environments and regulation that is fair to both consumers and water service companies. 22. IED’s sector-wide evaluation of ADB’s support for ANR operations suggested that ADB needs to improve performance of investments in water infrastructure and expand focus on broader water resources management and climate actions.16 It also noted that ADB must support

15 IED. 2010. Special Evaluation Study: Water Policy and Related Operations. Manila: ADB.

https://www.adb.org/sites/default/files/evaluation-document/35409/files/ses-oth-2010-47.pdf 16 IED. 2018. Sector-wide evaluation: ADB Support for Agriculture, Natural Resources, and Rural Development.

https://www.adb.org/sites/default/files/evaluation-document/410991/files/se-anrrd-final.pdf

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greater resilience through adaptation investments since water-related stresses, including floods and droughts, are among the most significant impacts of climate change.

23. On sustainability, IED topical paper noted the following lessons: (i) sustainability or financial viability of water supply and sanitation (WSS) operations is affected by the low willingness to pay among consumers and the unwillingness or inability of local authorities to charge the right tariffs; 17 and (ii) institutional reforms that contributed to more sustainable operations included greater commercial orientation of utilities, private participation in water supply, and corporatization of municipal utilities.18

24. Some of the factors identified as responsible for the success of ADB supported urban sanitation projects were institutionalized policy regulatory system and rules for private sector investment in sanitation (e.g., the PRC); national campaigns for investment in sanitation (e.g., India); combining water supply and sanitation institutions and cost recovery mechanism (e.g., Colombo, Sri Lanka).19 Factors of failure in sanitation projects included lack of planning for providing services to the poor; no thorough capacity assessments of local implementing agencies (e.g., municipalities in decentralized government systems); and no support for small-scale independent sanitation providers for fecal sludge management.20 25. Sector evaluations for specific countries. Findings on water related operations from the WUS and ANR sector assessments in the last six country assistance program evaluations (CAPEs) will inform this report. These are the CAPEs for Bangladesh (2011–2020), Indonesia (2005–2018), Azerbaijan (2011–2017), India (2007–2015), Sri Lanka (2006–2015), the People’s Republic of China (2006–2014), and Papua New Guinea (2001–2014). 26. Cross-sectoral, thematic, and corporate evaluations. Evaluative evidence on the design, implementation, and performance of ADB’s water operations relating to cross-cutting issues can be gleaned from the available sector, corporate, and thematic level evaluations. Such evaluations include ADB Support for Action on Climate Change, 2011–2019; Public–Private Partnerships, 2009–2019;21 and Agriculture, Natural Resources, and Rural Development, 2005–2017.22

27. Project-level evaluations. At the project level, IED validated a total of 101 project completion reports (PCRs) of sovereign operations in the water sector: 58 WUS and 43 ANR during 2011–2020. Twenty more PCRs will be validated in 2021. In addition to validation reports, IED produced 11 project performance evaluation reports for sovereign projects: 4 WUS and 7 ANR. There was a total of 267 technical assistance completion reports (105 WUS and 162 ANR)

17 Low willingness to pay is generally due to the poor quality of the services provided and may improve with

improvements in the quality of services. 18 IED. 2015. Topical Paper: Sustainability of Urban Water Supply and Sanitation Operations: Findings and Lessons.

Manila: ADB. https://www.adb.org/sites/default/files/evaluation-document/177679/files/topical-sustainability-urban-water.pdf

19 IED. 2018. Topical Paper: Leading Factors of Success and Failure in Asian Development Bank Urban Sanitation Projects. Manila: ADB.

https://www.adb.org/sites/default/files/evaluation-document/349801/files/tp-urban-sanitation.pdf 20 Wastewater infrastructures have much lower sustainability due to the complex technology and operations and

maintenance needs. 21 IED. 2020. Thematic Evaluation: ADB Support for Public-Private Partnerships, 2009–2019. Manila: ADB.

https://www.adb.org/sites/default/files/evaluation-document/509691/files/ppp-redacted.pdf 22 IED. 2018. Sector-wide Evaluation: ADB Support for Agriculture, Natural Resources, and Rural Development. Manila:

ADB. https://www.adb.org/sites/default/files/evaluation-document/410991/files/se-anrrd-final.pdf

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circulated during 2011–2020. IED validated 11 of them in 2020 (8 ANR and 3 WUS).23 IED also carried out impact evaluation studies in 201324 and 201825 respectively, covering irrigation and water supply services (both in Nepal). For nonsovereign operations, IED validated 4 extended annual review reports during 2011–2020. The list of completed and validated projects is in Supplementary Attachment 2. In addition to the validation reports, this evaluation will look at projects that have been recently completed (with or without a PCR), and those under advanced stages of implementation (about 5 years past loan signing). Among the active projects during 2011–2020, 144 were in advance stages of implementation: 86 WUS and 58 ANR.26 The list of projects in advanced stages of implementation is in Supplementary Attachment 3. 28. Lessons from other MDBs. In the case of support for irrigation service delivery, the Independent Evaluation Group of the World Bank identified the following lessons. 27 With increasing water scarcity, it is critical for all investments to track water use outcomes in terms of efficiency and productivity. Fostering awareness and promoting behavior change among decision makers, technical staff, irrigators, potential investors, and the wider community are key to adopting the expanded results framework which tracks water productivity and quality of services in terms of reliability and water quality.

29. The lessons on urban sanitation included the following. Cross-sectoral impacts of poor solid waste and urban flood management on surface and ground water pollution need greater attention in the design of wastewater and sanitation projects.28 Early community and household engagement is important in raising awareness of sewerage connections among the households and the community and for the service provider to better understand current drivers of household behaviour.29 It is important to design a connection program that considers contextual challenges and opportunities (the heterogeneity among and within cities across the social, financial, policy, institutions, and regulations, and technical dimensions of a connection program) with the overall objective of maximizing household connections. Urban WSS projects need integrated water cycle and sanitation value-chain approaches if they are to maximize water supply results and resolve sanitation issues.30 Urban sanitation requires an integrated handling through its three main pillars: wastewater collection and treatment; faecal sludge management (compost, biogas, and electricity); and commercialization.

23 The low number is due to the fact that IED started validating TA completion reports only from 2020. 24 IED. 2013. Impact Evaluation Study: Shallow Tube well Irrigation in Nepal: Impacts of the Community Groundwater

Irrigation Sector Project. Manila: ADB. 25 IED. 2018. Impact of Cost-Shared Water Supply Services on Household Welfare in Small Towns: Ex-

Post Impact Evaluation of a Project in Nepal. Manila: ADB. 26 This ANR classification included projects that covered both WUS and ANR subsectors. 27 Independent Evaluation Group. 2019. World Bank Support for Irrigation Service Delivery: Responding to Emergent

Challenges and Opportunities. Washington, DC: World Bank. https://ieg.worldbankgroup.org/sites/default/files/Data/Evaluation/files/Irrigation_Service_Delivery.pdf 28 Independent Evaluation Group. 2017. A Thirst for Change: World Bank Group’s Support for Water Supply and

Sanitation, with Focus on the Poor, FY2007–16. Washington, DC: World Bank. https://openknowledge.worldbank.org/bitstream/handle/10986/29345/123270-WP-

PUBLIC.pdf?sequence=5&isAllowed=y 29 Kennedy-Walker, Ruth, Nishtha Mehta, Seema Thomas, and Martin Gambrill. 2020. Connecting the Unconnected:

Approaches for Getting Households to Connect to Sewerage Networks. Washington, DC: World Bank. https://openknowledge.worldbank.org/bitstream/handle/10986/34791/154444.pdf 30 AfDB. 2020. Reaching the Most Vulnerable: Scaling Up Service Delivery in Urban Water Supply and Sanitation IDEV

Project Cluster Evaluation. Abidjan. https://idev.afdb.org/sites/default/files/documents/files/Urban%20WSS%20Cluster%20Evaluation%20Report%20-

Eng.pdf

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C. Evaluation Scope and Methodology

1. Scope of the Evaluation 30. The evaluation will cover ADB’s support for urban and rural water operations during 2011–2020, which amounted to $23.2 billion in financial commitments.31 The subsectors under rural include irrigation and drainage, flood protection, water supply, sanitation, water based natural resources, policy and institutional capacity development, and hydropower. The subsectors under urban include water supply; sewerage; sanitation; flood protection; and policy, institutional, and capacity development. The scope of the evaluation will include support to national and basin level interventions and knowledge generation activities. Loans, grants, and TA for both sovereign and nonsovereign projects approved during 2011–2020 will be considered for this evaluation.32 In addition, projects approved prior to 2011 but are closed and evaluated during the evaluation period will also be included in the object of this evaluation. The list of projects is given in the Supplementary Attachments 2 and 3.

2. Theory of Change 31. To guide the evaluation, a theory of change is proposed which identifies cause-effect links that describe how ADB supported water interventions, guided by the 2001 Water Policy, WOP (2011–2020), UOP (2012–2020), Operational Plan for Agriculture and Natural Resources (2015–2020), and Operational Plan for Sustainable Food Security (2010–2014), are expected to achieve the intended outcomes of ADB’s water policy and ultimately contribute to the desired larger impact: increased water security in all its dimensions, livable cities, and equitable economic growth and reduced poverty (Figure 2). Both ADB context, including its organizational set up and staff skill set, as well as the external context, including macro, financial, and regional cooperation environment, DMCs’ commitment policy goals and leadership, have an influence on various parts of the results chain. 32. A range of inputs including sovereign and nonsovereign financing instruments; TA operations, along with cofinancing and partnerships; and policy dialogues help deliver the planned outputs, which in turn help achieve the desired outcomes leading to the stated policy outcomes and contribute to the broader development impacts. 33. ADB inputs help deliver outputs such as knowledge products and sector assessments; policy support, capacity building, and sector reform; promotion of integrated approaches to water management through national water apex body; increased ADB investments in sanitation and wastewater management, and river clean-ups; water use efficiency mainstreamed into project designs; accelerated policy and institutional reforms to support improved water use efficiency; IWRM, river basin development, and irrigation projects address climate change mitigation, climate change adaptation, and flood and drought mitigation; ADB’s partnership with private sector broadened and deepened; and water crisis awareness raised in the political and public spheres.

31 An earlier evaluation by IED assessed the performance of the 2001 Water Policy for relevance and responsiveness

by examining the extent to which the underlying objectives or approaches of the policy were integrated in the water sector operations during 2001–2009. It also assessed the performance and results from the operations during 2001–2009. IED. 2010. Special Evaluation Study: Water Policy and Related Operations. Manila: ADB.

32 Since the report will be delivered in the fourth quarter of 2022, the evaluation will try to cover the portfolio in 2021 to the extent feasible.

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Figure 2: Theory of Change: Linking Inputs, Outputs, Outcomes, and Impact

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34. These outputs will help achieve planned outcomes of the WOP: accelerated policy and institutional reforms in DMCs, accelerated and expanded implementation of IWRM, and increased efficiency and productivity in the delivery of irrigation, water supply services. The outputs will also help achieve the Water Policy outcomes such as improved level and quality of services delivered, conservation of water fostered and system efficiencies increased, and water governance and institutional and financial capacity improved.

35. Some of the causal links are as follows. Policy dialogues, water sector assessments, institutional capacity development and awareness raising, such as through country partnership strategy development, TA, and policy-based lending, will help DMCs adopt effective national water policies, water laws, and sector coordination arrangements. Increased adoption of IWRM principles and mainstreaming water use efficiency in project designs will help achieve sustainable management of water resources and increase the efficiency and productivity in the delivery of irrigation, water supply, and other services, which will contribute to the desired impact of improved water security.

36. Increased investments in physical infrastructure complemented with institutional capacity development for procurement and financial management and support for policy and regulatory reforms, factoring in the needs of the poor, will help achieve improved services in terms of levels, quality, inclusivity, affordability, and reliability, thus, contributing to improved water security. Implementation of appropriate legal mandates and regulatory changes and tariff design can help extend service access to all including women and children, the poor and the vulnerable, contributing to inclusive cities which would also be in line with the operational priorities of Strategy 2030. Improved and reliable water supply, irrigation and other services have favorable impact on women’s agency, labor force participation, and time poverty. 37. Partnerships and leveraging of cofinancing will result in improved financing mechanisms for sustained and accelerated provision of water and sanitation infrastructure and service expansion.

38. Knowledge products help strengthen project and program preparation by incorporating good practices and innovative approaches and improved integration of sustainability dimensions, gender, and social inclusion in project design. 39. Addressing climate change adaptation, flood, and drought mitigation in investment and TA projects will help address water stress due to climate change and protect and conserve water. This would help increase the livability of cities by mitigating the risk of floods and other water-related disasters and help reduce ground and surface water pollution and enhance agricultural water productivity through more efficient use of available water resources. 40. In addition to assessing the strategic guidance and water sector support provided by ADB, the evaluation scope includes assessment of ADB’s organizational setup and staffing and its strengths and weaknesses. As indicated in the theory of change, water sector program inputs, outputs, and outcomes are influenced by the external context. However, detailed assessment of the external drivers of the results of the program as well as the contributions to wider development impacts are outside the scope of this evaluation.

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3. Evaluation Questions 41. The evaluation will address the overarching question: To what extent have ADB’s Water Policy and the subsequent program succeeded in delivering their intended outcomes and meeting DMC needs and requirements?

42. The overarching question is underpinned by the following supporting questions (detailed evaluation questions and the data and methods used to address these are presented in Attachment 3):

(i) To what extent was (and is) ADB’s 2001 Water Policy relevant in meeting current

and likely future DMCs’ needs and addressing their water challenges, evolving water context, and Strategy 2030?

(ii) To what extent has ADB’s water program during 2011–2020 been relevant, effective, efficient, and sustainable in achieving the program outcomes (accelerated policy and institutional reforms, expanded implementation of integrated water resource management, improved access to quality services, increased efficiency and productivity in the delivery of services, better understanding of transboundary water issues, increased awareness of water issues and experience sharing, and improved institutional capacity and governance in Asia and the Pacific) all contributing to the seven outcomes of Water Policy?

(iii) How well is ADB organized to deliver long term and sustainable solutions to water sector challenges? To what extent are ADB’s organizational capacity and staff skills adequate for this purpose?

4. Evaluation Structure

43. To answer these questions, the evaluation will undertake the following analyses and assessments. 44. Policy relevance. Following the earlier evaluation of Water Policy by IED, this evaluation will examine the continued relevance of the Policy for the evaluation period considered. It will examine the Policy’s comparability with water policies and strategies of other MDBs and international financial institutions, and how well it complements or supports policy directions of institutions operating in the region. The evaluation will focus on the alignment of the Policy with the current and evolving policy context of the DMCs and the issues faced by the Asia and Pacific region; ADB’s Strategy 2020 and other sector policies and operational plans; and ADB’s other directional documents (such as on safeguards, gender, and environment). It will check the consistency of country partnership strategy (CPS) objectives with the Water Policy and the extent to which reports, and recommendations of the President (RRPs) cite the Water Policy. It will also check the extent to which the Water Policy influenced the design of projects during the evaluation period. 45. The evaluation will also focus on understanding if the Water Policy would continue to be aligned with future DMCs’ needs and if it responds well to ADB Strategy 2030. It will analyze the extent to which the Water Policy responds to the evolving water sector context, including the availability of low-cost technologies, new business models, the SDGs, the Paris Agreement on climate change and the Sendai Framework in 2015.

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46. Water program assessment. This will involve evaluation of the water program during 2011–2020, i.e., implementation of ADB supported sovereign, nonsovereign, TA, advisory, knowledge dissemination, partnerships with other institutions, administering of trust funds, and other types of interventions under regional, multi-country, and country programs. This will cover the following criteria.

(i) Relevance. Examine if ADB water portfolio is aligned with the existing and evolving water context of DMCs, and consistent with the Water Policy and WOP objectives. Although the approved water program during 2011–2020 was not guided by Strategy 2030 (except for the last 2 years), the evaluation will, through illustrated examples, provide insights on the consistency of the existing water program with Strategy 2030. This would help understand the readiness of ADB’s water operations in implementing Strategy 2030. Literature on the seven operational priorities, along with this portfolio analysis, will be useful in identifying possible changes in emphasis that may be required in the coming years.

(ii) Effectiveness. Assess the extent to which the water program during 2011–2020 achieved the outputs and outcomes mentioned in the results framework of the WOP and the extent to which the ADB water portfolio has supported the achievement of the intended outcomes of the 2001 Water Policy. Examine the effectiveness of different financing modalities (e.g., project vs. sector interventions) in achieving program objectives. Assess the extent to which support for investments in advanced technology and/or innovative tools and systems enhanced service coverage and better managed water resources; and how ADB’s long term systemic support for institutional strengthening developed the capacity for reforms and governance.

(iii) Efficiency. Assessment based largely on estimated economic internal rates of return ex-ante and/or at completion, as well as examining process efficiency in terms of time and cost overruns from available project level information.

(iv) Sustainability. Assess to what extent the program outcomes will be sustained over time including the results of policy reform and institutional actions implemented. Examine how different lending modalities like sector development programs which support institutional reforms have affected sustainability of water projects. The analysis will consolidate evaluative evidence from evaluation documents at project, program, and sector levels, including user charges and other revenue sources, financial internal rates of return, where relevant.

47. Organization for delivery. The evaluation will examine the appropriateness of organizational structure at ADB, and the extent to which ADB staff, protocols, and reporting structures are geared toward performing efficiently and effectively to meet government and client expectations and the objectives of water operational plan and the Water Policy. The evaluation will examine the adequacy of ADB’s sectoral structure to deliver water projects, including cross sectoral interventions and private sector participation. More specifically the report will examine in detail:

(i) Quality at entry, whether risks to outputs and outcomes are identified and an appropriate design and monitoring framework is defined at project appraisal and used during project implementation. Show case some projects that performed well and not so well in this regard.

(ii) Staff skills and reliance on external consultants to deliver the project portfolio, as well as to engage in a meaningful policy dialogue (outside CPS boundaries) with the clients.

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(iii) Internal collaboration among sectoral divisions, regional departments, as well as thematic, knowledge and private sector operations department.

(iv) Collaboration and partnerships with global and/or regional centers of excellence in the water sector and use of innovative approaches.

(v) Knowledge and innovation, and the role of ADB (and ADB Institute) as a knowledge center, and the role it plays in supporting research, innovation, technology transfer, knowledge events, and demonstrative projects in the water sector.

5. Data and Evaluation Methods

48. To answer the evaluation questions, a mixed methods approach will be adopted drawing on a range of evidence. The methods will include literature review, portfolio analysis, country case studies, interviews with key stakeholders, and staff surveys. 49. Literature review. This will help understand the development context (economic, social, political, and institutional) and technological and policy alternatives that have a bearing on ADB’s water sector operations during the evaluation period and the likely influence they have on operations in the future. The literature review will cover, among other things, governments’ water related policy and strategies, academic articles, knowledge products, and evaluation reports (e.g., completion reports, validation reports, and previous sector wide evaluations of water operations), including from other multilateral and bilateral development agencies, to provide insights on how water operations can address challenges such as climate change and gender equality, with the help of emerging innovations and systems. The review will also cover ADB documents that spell out directions and strategies at the country, regional, and subregional levels, as well as project documents (e.g., RRPs, back-to-office reports, and mid-term review reports) relating to sovereign operations (investment, policy-based lending, grants, and TA) and nonsovereign operations (private sector lending, equity investments, and guarantees). 50. Portfolio analysis. The portfolio analysis will help understand the nature of ADB’s support for water sector in its DMCs—the extent to which different subsectors are supported, the spread of support across different regions and different countries, the financing modalities used, and so on. Portfolio performance in terms of relevance, effectiveness, efficiency, and sustainability of projects is compiled by reviewing the evidence from project performance evaluation reports, PCR validation reports, and PCRs. In addition, realization of outputs, outcomes, and impact indicators as indicated in the design and monitoring framework in PCRs will be mapped on to the theory of change of the evaluation to assess the development pathways. Ongoing projects in advanced stages of implementation will be assessed by reviewing mission back-to-office reports, mid-term review reports, and interviewing project officers and staff from implementing and executing agencies. 51. Country case studies. Considering the evolution of ADB’s support to water sector in the past, and the outlook for the future, this review will include specific case studies of selected DMCs to answer the key evaluation questions and provide detailed analysis of specific issues and lessons learned in each case. Case study countries are selected so that all ADB regions are represented, a broad cross section of water subprojects is covered, and there are opportunities for learning from innovations and best practices. The proposed case countries are Uzbekistan (Central and West Asia); the PRC (East Asia); one of the three countries (Kiribati, Solomon Islands, or Tonga) in the Pacific region; India (South Asia); and Cambodia (Southeast Asia).

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52. Uzbekistan is a water scarce country with likelihood of facing increasing water stress in the future due to increasing demand and supply being affected by climate change. ADB has been supporting its water sector for many years including projects relating to sustainable management of irrigation and urban water supply and sanitation and may provide useful lessons in providing support for climate change adaptation, irrigation systems management, and reform of public water utilities. The PRC has high volume of private sector and IWRM interventions and has incorporated in its projects nature-based solutions such as the sponge cities for addressing flood risks, with potential opportunity for identifying lessons and best practices for application in other DMCs. ADB has a diverse water portfolio in India and can offer many useful lessons. ADB’s support for strengthening of urban local government institutions in India and developing their capacity for reforms and urban governance as well as support for the implementation of innovative approaches such as integrated urban development, and city-wide inclusive sanitation can provide lessons for other DMCs. ADB also supports adoption of IWRM by some states in the context of overall river basin and help them develop policy, planning, and legal framework for IWRM, which can potentially provide best practices that can be followed by other states in India or other DMCs. 53. Cambodia is the ninth largest borrower for water operations during the evaluation period and has a diverse mix of rural and urban water projects. It is a Group A country eligible for concessional assistance only. Cambodia has abundant water resources but faces extreme seasonal fluctuation between dry and wet seasons and lacks storage capacity and lessons can be obtained on addressing these challenges. One of the three countries (Kiribati, Solomon Islands, or Tonga) will be chosen as the case country in the Pacific to illustrate how ADB addresses the unique urban water supply and sanitation needs of small island nations, which are highly water stressed and vulnerable to climate change and lessons relating to donor coordination and reform of state-owned utilities, among others. 54. The list of case countries is tentative and could change based on new findings as the study progresses. Country case studies will be complemented by recent sector or country assessments carried out by IED within the last 4 years, including CAPE reports for Bangladesh (2021), Indonesia (2019), Azerbaijan (2019), Sri Lanka (2016), and Papua New Guinea (2015). 55. Other evaluation evidence. To address thematic and corporate issues related directly or indirectly with the water sector, this study will build on IED’s evaluation evidence of applicable thematic and corporate issues, such as gender equality and social inclusion, environment and climate change, governance, knowledge, One ADB, safeguards, and partnerships. 56. Interviews with key stakeholders. The evaluation team will meet with key ADB staff at headquarters and the resident missions to gauge strategic and operational perspectives on ADB’s water sector interventions and IWRM; on resources and skills adequacy; interdepartmental coordination; one ADB approach, and on alignment of operations with water policy and operational plans. Key stakeholders in government agencies, client public sector entities, and private sector participants will be interviewed to gauge their perspectives on rural and urban operations and integrated water resource management, on thematic areas such as gender, on ADB strategies and interventions, as well as on ADB’s efficiency and institutional responsiveness. Additionally, stakeholders from think-tanks; academia; and civil society organizations will be interviewed; as well as other MDBs and international organizations (e.g., WBG, IADB, AfDB, and IFAD); bilateral donors; to gather information on issues of coordination and collaboration. 57. Staff surveys. ADB staff at headquarter and resident missions working on the design, appraisal, and implementation of sovereign and nonsovereign water projects and those providing TA to water operations will be surveyed anonymously to gauge, among others, the following:

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(i) skills adequacy: skills existing in-house in the Rural Development and Food Security (Agriculture) Thematic Group, Energy, Urban and Water Sector Groups, in regional departments, PSOD, OPPP, EREA, as well as the extent of reliance on external consultants in policy dialogue with clients and delivery of projects; (ii) perspective on skills required going forward; (iii) interdepartmental coordination and One ADB approach; and (iv) strategy and operations alignment. 6. Limitations 58. The evaluation may be affected by the availability and/or quality of documentations needed to be reviewed for assessing portfolio performance. This would be mitigated by supplementing available project data with key informant interviews and survey questionnaires. Due to the health security issues of COVID-19, the evaluation missions would be conducted virtually without field visits. To make up for this the evaluation will rely on in-country consultants for collecting the necessary data and evidence for the evaluation. D. Implementation Arrangements and Resource Requirements 59. The evaluation is expected to be completed for final circulation to the Board of Directors for the Development Effectiveness Committee meeting in October 2022. The proposed timeline is shown in Table 5.

Table 5: Proposed Evaluation Timeline Activity Tentative Schedule Approval of evaluation approach paper II October 2021 Case study country missions III November 2021–IV March 2022 Storyline meeting II May 2022 One-Stop review meeting (draft report) II June 2022 Interdepartmental circulation IV June 2022 Editing II–IV August 2022 Heads of departments meeting II September 2022 Technical meeting on recommendations II September 2022 IED Director General approval IV September 2022 Board circulation I October 2022 DEC meeting IV October 2022

DEC = Development Effectiveness Committee, IED = Independent Evaluation Department. Source: Asian Development Bank (Independent Evaluation Department).

60. The evaluation will be conducted by a team of IED staff comprising (i) Srinivasan Palle Venkata, team leader, with the overall responsibility for the evaluation implementation and delivery; (ii) Shimako Takahashi, evaluation specialist; (iii) Payton Deeks, evaluation Specialist; (iv) Jerome Jovellanos and Caren Joy Mongcopa, national officers; and (v) Bryan Lazaro, evaluation assistant. A team of consultants will be engaged: international consultants supporting the IED team, including a lead consultant (water resources specialist with experience in evaluation and expertise in MDB policy and strategy); a rural water resources (irrigation, drainage, rural water supply, and sanitation) expert; an urban water (water supply, sanitation, wastewater treatment) technical, policy, and regulatory expert; two national consultants at ADB headquarters to support research, data gathering, and documentation review, as well as an in-country national consultant in each country of field visit to support country missions. The draft final report will be reviewed by external experts Ramachandra Jammi, senior evaluation officer of the Sustainable Development

19


Unit, World Bank Group, and another influential authority in water. Internal commenters will be Garrett Kilroy, senior evaluation specialist and Toshiyuki Yokota, principal evaluation specialist. 61. IED will disseminate the evaluation findings within ADB and externally following the discussion of the final report at the Development Effectiveness Committee. It will organize knowledge sharing and learning activities, including publication of lessons learned, and presentations in seminars and conferences within (e.g., in consultation with the sector and thematic groups) and outside ADB (e.g., the Asian Evaluation Week). Attachments:

1. Water Policies and Strategies of different Multilateral Development Banks 2. ADB’s Water Sector Portfolio Analysis, 2011–2020 3. Evaluation Framework

Supplementary Attachments (available on request):

1. List of ADB’s Sovereign and Nonsovereign Water Projects (Loans, Grants, and TA, 2011–2020

2. List of Projects with PVRs/PCRs/PPERs/XVRs 3. List of Projects in Advanced Stages of Implementation

20 Attachment 1

WATER POLICES AND STRATEGIES OF DIFFERENT MULTILATERAL DEVELOPMENT BANKS

1. The African Development Bank’s (AfDB’s) 2021 policy on water1 seeks to improve Africa’s water security and transform its water assets to foster sustainable, green, and inclusive socioeconomic growth and development. It has four guiding principles: (i) attainment of water security at household, national, and regional levels is fundamental for inclusive growth; (ii) equitable social welfare and economic growth require an integrated water resources management (IWRM) approach; (iii) promoting sustainable and equitable access to water services helps to achieve the Sustainable Development Goals (SDGs); and (iv) transboundary water resources management and development should be recognized as a key driver for regional economic integration. The draft policy was built on the earlier AfDB’s 2000 policy on integrated water resources management (IWRM) whose central objective was to promote efficient, equitable, and sustainable development through IWRM, and which was based on two principles: water should be treated as an economic, social, and environmental good; and water resources management policies should be analyzed within a comprehensive framework.2 2. The Asian Infrastructure Investment Bank (AIIB) 2020 water sector strategy aims to support its members’ efforts to ensure the availability and sustainable management of water and sanitation for all, in line with the SDGs. AIIB’s investments will be client driven and its role will be unique and catalytic, improving the efficiency of the water sector through the application of innovative technologies.3

3. According to its water lending policy, the European Investment Bank’s (EIB’s) intervention priorities will be based on maximizing value added.4 To address water scarcity and droughts, flood management, and adaptation to climate change, the policy will focus on river basin approach linking water resources management and water service provision; supporting consolidation of fragmented institutional structures; mitigating detrimental impacts of climate change on water resource availability and quality; increasing water efficiency in allocation of water resources and water services; development of new water supply, as necessary; providing wastewater collection, treatment, and disposal services; and supporting research and development of appropriate technologies and the use of research outputs in project preparation and implementation.

4. The Inter-American Development Bank’s (IADB’s) water and sanitation sector framework’s goal is to support the countries in achieving universal access to sustainable, high-quality water and sanitation services.5 It prioritizes the following principles that will govern IADB’s actions: (i) achieve universal access to services, improving opportunities for the low-income and most vulnerable population; (ii) promote comprehensive solutions, complementing infrastructure provision with institutional strengthening; (iii) promote multisector interventions; and (iv) reinforce the concept of water security in the water and sanitation sector, to have resources of adequate quality and quantity for all uses and reduce the risk of disasters, taking into consideration climate change effects.

5. The stated goal of the Islamic Development Bank’s (IsDB’s) water sector policy is sustainable and resilient water and sanitation systems for all.6 The policy is supported by five

1 AfDB. 2021. Policy on Water. African Development Bank. https://www.afdb.org/en/documents/policy-water 2 AfDB. 2000. Policy for Integrated Water Resources Management. African Development Bank. 3 AIIB. 2020. Water Sector Strategy. Asian Infrastructure Investment Bank. 4 EIB. 2008. Water Sector Lending Policy. European Investment Bank. 5 IADB. 2017. Water and Sanitation Sector Framework. Inter-American Development Bank. 6 IsDB. 2020. Water Sector Policy: Sustainable and Resilient Water and Sanitation Systems for All. Jeddah.

Attachment 1 21


pillars: (i) universal and affordable access to water and sanitation, (ii) water use efficiency, (iii) capacity development and solutions transfer, (iv) effective water resources management, and (v) resilient water systems. The guiding principles for achieving the objectives are strategic blending of finance to mobilize more funds; optimizing cross sector synergy in water investments; selectivity in prioritizing interventions based on their ability to innovate, create significant impacts, and scalability and replicability; and mainstreaming science, technology, and innovation to accelerate access to water supply and sanitation.

6. The World Bank’s 1993 Policy Paper reflected the broad global consensus that water resources management should be based on three fundamental principles (known as “the Dublin Principles”).7 The ecological principle, which argued for river basin as the unit of analysis, paying greater attention to the environment, managing land and water together; the institutional principle which argued that water resources management is best done when all stakeholders, the state, the private sector, and the civil society, including women, participate; and the instrument principle, which argued for greater use of incentives and economic principles to improve the allocation of scarce water resources and enhance the quality.

7. The World Bank’s 2004 water resources sector strategy focused on how to improve the development and management of water resources, while providing the principles that link resource management to the specific water-using sectors.8 The seven main messages of this strategy are i) water resources management and development are central to sustainable growth and poverty reduction, (ii) most developing countries need to be active in both management and development of water resources infrastructure, (iii) the main management challenge is not a vision of integrated water resources management but a “pragmatic but principled” approach, (iv) the World Bank needs to assist countries in developing and maintaining appropriate stocks of well-performing hydraulic infrastructure and in mobilizing public and private financing, while meeting environmental and social standards, (v) the World Bank will reengage with high-reward–high-risk hydraulic infrastructure, using a more effective business model, (vi) the World Bank is perceived by many to have a major comparative advantage in the water sectors, and there is, accordingly, a strong demand for Bank services and a strong demand that the Bank engage, (vii) The World Bank’s water assistance must be tailored to country circumstances and be consistent with the overarching Country Assistance Strategies and Poverty Reduction Strategy Papers. 8. The World Bank’s water global practice launched in 2019 a new Strategic Action Plan,9 which recognized the need to manage water in a holistic manner throughout the hydrological cycle, and centers on three interrelated pillars: (i) sustain water resources (supporting equitable and efficient sharing of water across sectors and administrative boundaries, introducing new water storage, improving water reuse and recycling, and desalination and other technologies); (ii) deliver services (supporting reform of water and sanitation utilities and irrigation reform and addressing the global sanitation gap and last mile service delivery); and (iii) build resilience (adapting to climate change and weather extremes and addressing conflict and migration). The Water Global Practice has identified five priority themes on water to help achieve the SDGs: (i) resilience (to address water scarcity and variability), (ii) sustainability (to ensure lasting results), (iii) inclusion (to provide access to water and sanitation to everyone and prevent them from getting affected by water-related diseases and disasters), (iv) institutions (investments in infrastructure needs to be complemented by investment in institutions to achieve greater sustainability and inclusion), and (v) financing (to meet the rising financing needs of infrastructure needed for universal access and more sustainable water management).

7 World Bank. 1993. Water Resources Management: World Bank Policy Paper. Washington, DC. 8 World Bank. 2004. Water Resources Sector Strategy: Strategic Directions for World Bank Engagement. Washington, DC. 9 World Bank. 2019. Working Together for a Water Secure World. Washington. DC.

22 Attachment 2

ADB’S WATER SECTOR PORTFOLIO ANALYSIS, 2011–2020 1. For 2011–2020, ADB extended a total loan/grant funding of $30.89 billion for water operations in the water and other urban infrastructure services (WUS) and agriculture, natural resources, and rural development (ANR) sectors, averaging $3.1 billion per year (Table A2.1).42 The support includes 336 loans/grants, comprising both sovereign and nonsovereign operations. There were 180 loans/grants from the WUS sector and 156 from the ANR sector. Thirty-five of the ANR sector projects had financed urban water components, which are included in the total financing amount for urban water components.

Table A2.1: Water Sector Portfolio

Classification Number of

Loans/Grants ADB Commitment

($ million) All projects with water subsectors (including hydropower) 336 30,898.92 Financing for urban water components (water supply, sewerage, sanitation, and flood protection, and urban policy and institutional and capacity development) 180 12,935.23 Financing for rural water components (irrigation and drainage, rural water supply services, rural sanitation, rural flood protection, water based natural resources management, rural water policy, and hydropower) 156 10,261.76 Total financing for rural plus urban water components 336 23,196.99

ADB = Asian Development Bank. Source: Asian Development Bank (Independent Evaluation Department).

2. There was an average of 31 approvals per year. The greatest number of approvals was achieved in 2018, 42 approvals with a total of $4.2 billion in ADB financing (Figure A2.1).

42 This evaluation covers water sector projects that relate to urban water classified under the WUS subsectors: (i) urban

water supply; (ii) urban sanitation; (iii) urban sewerage; (iv) urban flood protection; (v) urban policy, institutional and capacity development; and those relating to rural water classified under the ANR subsectors: (vi) water-based natural resources management; (vii) irrigation and drainage; (viii) rural flood protection; (ix) rural water supply services; (x) rural sanitation; (xi) rural water policy, institutional, and capacity development; and (xii) hydropower. Of the 336 loans/grants, 180 are from the WUS sector and 156 are from the ANR sector. Thirty-five of the 156 ANR sector projects had financed some urban water components. The financing amount for these urban water components is included in the financing volume for urban water components. The difference between $30,898.92 million and $23,196.99 million ($7,701.93 million) financed non-water components.

36 28 44 40 32 26 24 42 33 31

2,976

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Figure A2.1: Number of Loans/Grants and Commitments, 2011–2020

Attachment 2 23


3. Commitments by regional departments. The regional spread of water operations shows that financial commitment was the largest in South Asia, amounting to $8.59 billion comprising 94 loans and grants, or 37% of total commitments (Figure A2.2). This was followed by Central and West Asia (19%) with 60 loans and grants, Southeast Asia (18%) with 78 loans and grants and East Asia (17%) 54 loans/grants. Financing for private sector operations amounted to $1.56 billion for 23 loans/grants.

4. Number of operations and commitments by developing member country (DMC). India was the largest borrower for water components with a commitment of $5.03 supporting 40 operations, followed by the People’s Republic of China (PRC) with 59 operations and a commitment of $4.99 billion during 2011–2020 (Figures A2.3 and A2.4). Pakistan, Viet Nam, and Bangladesh are among the other big borrowers.

AFG = Afghanistan, ARM = Armenia, AZE = Azerbaijan, BAN = Bangladesh, BHU = Bhutan, CAM = Cambodia, DMC = developing member country, FIJ = Fiji, FSM = Federated States of Micronesia, GEO = Georgia, IND = India, INO = Indonesia, KGZ = Kyrgyz Republic, KIR = Kiribati, LAO = Lao People’s Democratic Republic, MON = Mongolia, MYA = Myanmar, NEP = Nepal, PAK = Pakistan, PAL = Palau, PHI = the Philippines, PNG = Papua New Guinea, PRC = the People’s Republic of China, REG = regional, RMI = Republic of Marshall Islands, SAM = Samoa, SOL = Solomon Islands, SRI = Sri Lanka, TAJ = Tajikistan, TIM = Timor-Leste, TON = Tonga, TUV = Tuvalu, UZB = Uzbekistan, VAN = Vanuatu, VIE = Viet Nam. Source: Asian Development Bank.

59

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Figure A2.3: Number of Operat ions by Developing M ember Country, 2011-2020

Figure A2.2: Commitments by Regional Departments, 2011–2020 ($ billion)

CWRD = Central and West Asia Department, EARD = East Asia Department, PARD = Pacific Department, PSOD = Private Sector Operations Department, SARD = South Asia Department, SERD = Southeast Asia Department. Source: Asian Development Bank.

8.59

4.45

4.27

4

1.56

0.32

S A R D C W R D S E R D E A R D P S O D P A R D

24 Attachment 2

AFG = Afghanistan, ARM = Armenia, AZE = Azerbaijan, BAN = Bangladesh, BHU = Bhutan, CAM = Cambodia, DMC = developing member country, FIJ = Fiji, FSM = Federated States of Micronesia, GEO = Georgia, IND = India, INO = Indonesia, KGZ = Kyrgyz Republic, KIR = Kiribati, LAO = Lao People’s Democratic Republic, MON = Mongolia, MYA = Myanmar, NEP = Nepal, PAK = Pakistan, PAL = Palau, PHI = the Philippines, PNG = Papua New Guinea, PRC = the People’s Republic of China, REG = regional, RMI = Republic of Marshall Islands, SAM = Samoa, SOL = Solomon Islands, SRI = Sri Lanka, TAJ = Tajikistan, TIM = Timor-Leste, TON = Tonga, TUV = Tuvalu, UZB = Uzbekistan, VAN = Vanuatu, VIE = Viet Nam. Source: Asian Development Bank.

5. Of the total ADB commitment of $30.89 billion for water-related projects, $23.2 billion was used to finance water components (rural plus urban) amounting to 75%. The remaining 25% financed non-water components such as transport, housing, and slum development. 6. Commitment by subsectors. Excluding the financing devoted to non-water components, the net financing committed for water components during 2011–2020 is $23.2 billion. Fifty-six percent of this net commitment was for urban water components and the remaining was for rural. A large share of the financing for urban components went to urban water supply projects (49%). In the case of rural water, irrigation and drainage received the largest share (40%). 7. Urban water. Total commitment in 2011–2020 for urban water subsectors was $12.93 billion, accounting for about 56% of total (rural plus urban) (Table A2.2). A large part of the support is for the urban water supply subsector with $6.37 billion or 49% of total urban water. This was followed by urban sewerage accounting for $2.99 billion (23%), urban flood protection accounting for $1.60 billion (12%) and urban sanitation accounting for $1.05 billion (8%).

8. Rural water. Commitments for rural water subsectors totaled $10.27 billion, 44% share of the total (rural plus urban). Irrigation and drainage had the largest share (40%) of assistance to rural water subsectors, with total commitment of $4.11 billion. This was followed by water-based natural resources with $2.26 billion (22%), hydropower with $2 billion (20%), and rural flood protection with $0.94 billion (9%) (Table A2.2).

5,0

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Figure A2.4: F inancing Commitments by Developing M ember Country, 2011-2020

($ M i l l ion)

Attachment 2 25


Table A2.2. ADB Financing for Water by Subsectors, 2011–2020

Subsector Financing Volume

($ million) % Share within Rural

or Urban Water % Share of Total

(Rural plus Urban) Urban Water Supply 6,368.49 49.23% 27.45% Urban Sewerage 2,997.91 23.18% 12.92% Urban Sanitation 1,050.68 8.12% 4.53% Urban Flood Protection 1,604.86 12.41% 6.92% Urban Policy, Institutional and Capacity Development

913.29 7.06% 3.94%

Total Urban Water 12,935.23 100.00% 55.76% Irrigation and Drainage 4,110.61 40.06% 17.72% Rural Flood Protection 941.07 9.17% 4.06% Rural Water Supply Services

529.29 5.16% 2.28%

Rural Sanitation 132.89 1.29% 0.57% WBNR 2,262.43 22.05% 9.75% Rural Water Policy, Institutional Capacity Development

276.15 2.69% 1.19%

Hydropower 2,009.31 19.58% 8.66% Total Rural Water 10,261.76 100.00% 44.24% Total (Rural plus Urban) 23,196.99 100.00%

ADB = Asian Development Bank, WBNR = water-based natural resources. Source: ADB.

9. Technical assistance (TA). There were 351 TA projects approved for water operations from 2011–2020 with assistance totaling $401.31 million. The greatest number of TA approvals was in 2017, with 61 TA projects approved with financing commitment of $62.83 million (Figure A2.5). TA commitment was the largest in 2018, $71.16 million, supporting 41 TA projects.

10. TA by implementing units. Aside from the regional departments, ADB departments which had TA projects as part of this evaluation portfolio were the Sustainable Development and Climate Change Department (SDCC) and Private Sector Operations Department (PSOD). Southeast Asia accounted for the greatest number of TA approvals during the period with 84, as well as the largest share of TA funding, with $131.23 million or 33% of total TA (Figures A2.6 and A2.7).

29 17 44 42 17 44 61 41 31 25

35.50

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20

30

40

50

60

70

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

$ m

illio

n

Nu

mb

er

of

Ap

pro

vals

Figure A2.5: Technical Assistance Approvals, 2011–2021

26 Attachment 2

CWRD = Central and West Asia Department, DOC = Department of Communications, EARD = East Asia Department, PARD = Pacific Department, PSOD = Private Sector Operations Department, SARD = South Asia Department, SDCC = Sustainable Development and Climate Change Department, SERD = Southeast Asia Department. Source: Asian Development Bank.

CWRD = Central and West Asia Department, DOC = Department of Communication, EARD = East Asia Department, PARD = Pacific Department, PSOD = Private Sector Operations Department, SARD = South Asia Department, SDCC = Sustainable Development and Climate Change, SERD = Southeast Asia Department, TA = technical assistance. Source: Asian Development Bank.

11. TA by type. Out of 351 TA projects, capacity and development TA (CDTA) projects were the preferred modality (157), followed by project preparatory TA (PPTA, 148); policy and advisory TA (PATA, 35); and research and development TA (RDTA, 11) in 2011–2020 (Figure A2.8). Bulk of financing assistance was provided for PPTA ($182.75 million), followed by CDTA ($177.67 million), PATA ($34.70 million), and RDTA ($6.20 million) (Figure A2.9). It should be noted that the Strategy, Policy and Partnerships Department (SPD) introduced a new classification of TA in 2016, i.e., transaction TA (TRTA) and knowledge support TA (KSTA). The old PPTA now falls under TRTA, while CDTA, PATA, and RDTA are classified under KSTA.

68

1

67

19

2

72

38

84

C W R D D O C E A R D P A R D P S O D S A R D S D C C S E R D

Figure A2.6: Technical Assistance Approvals by Implement ing Department ,

2011–2020

62

.82

0.1

8

39

.62

24

.13

0.5

7

82

.71

60

.06

13

1.2

3

C W R D D O C E A R D P A R D P S O D S A R D S D C C S E R D

Figure A2.7: Technical Assistance Amounts by Implement ing Department ,

2011–2020 ($ m i l l ion)

Attachment 2 27


CDTA = capacity development technical assistance, PATA = policy and advisory technical assistance, PPTA = project preparatory technical assistance, RDTA = research and development technical assistance. Source: Asian Development Bank.

CDTA = capacity development technical assistance, PATA = policy and advisory technical assistance, PPTA = project preparatory technical assistance, RDTA = research and development technical assistance. Source: Asian Development Bank.

12. TA by subsectors. Urban water TA projects totaled 174, with $238.17 million in funding and distributed over five subsectors (Table A2.3). There were 177 rural water TA projects, with $163.15 million in funding and distributed over nine subsectors.

Table A2.3: Urban and Rural Water Technical Assistance by Subsector

Subsector TA Count TA Amount ($ million) Urban Water Urban policy, institutional, and capacity development 88 102.13 Urban water supply 35 68.48 Urban flood protection 26 41.09 Urban sanitation 14 17.43 Urban sewerage 11 9.04 Subtotal (Urban Water) 174 238.17 Rural Water Water-based natural resources management 81 70.87 Irrigation 50 56.03 Large hydropower generation 14 10.93 Rural flood protection 11 7.75 Rural water policy, institutional, and capacity development 7 4.90 Renewable energy—small hydropower 6 6.25 Rural water supply services 4 3.93 Agricultural drainage 2 1.40 Rural sanitation 2 1.10 Subtotal (Rural Water) 177 163.15 Total TA 351 401.31

TA = technical assistance. Source: Asian Development Bank.

157

35

148

11

C D T A P A T A P P T A R D T A

Figure A2.8: Approvals by Technical Assistance Type,

2011–2020

177.6

7

34.7

0

182.7

5

6.2

0

C D T A P A T A P P T A R D T A

Figure A2.9: Technical Assistance F inancing by

Type, 2011–2020 ($ m i l l ion)

28 Attachment 3

EVALUATION FRAMEWORK

This evaluation framework describes the data and methods used to answer the detailed evaluation questions that help answer the overarching question: To what extent have ADB’s Water Policy and the subsequent program succeeded in delivering their intended outcomes and meeting DMC needs and requirements?

Contextual

Review

Strategy Review

Portfolio Review

Country Case Studies,

Surveys, Interviews, and

Review of Organizational

Setup

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I. To what extent was (and is) ADB’s 2001 Water

Policy relevant in meeting current and likely

future DMCs’ needs and addressing their

water challenges, evolving water context, and

Strategy 2030?

� � � � � � � � � �

(i) To what extent has it been relevant to the overall

economic, social, environmental contexts and

institutional capacity of DMCs?

� � � � � �

(ii) To what extent has it been relevant to the trends

observed in DMCs’ such as rapid urbanization,

structural transformations, climate variability and

increasing disaster risks?

� � � � �

(iii) To what extent has the ADB Water Policy

enabled CPSs and water related interventions

align with country-specific water priorities?

� �

Attachment 3 29


Contextual

Review

Strategy Review

Portfolio Review




Setup

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(iv) To what extent is ADB’s Water Policy

complementary and supportive to the directional

documents related to water of other MDBs and

international financial institutions operating in the

region?

� � �

(v) How influential is the water policy as a

foundational document, where water is treated as

both a resource and a service, in informing

operations?

� � � � �

(vi) To what extent does the policy cover both

service delivery issues such as water user

charges and reforms relating to national water

resources management including river basin

management, conservation of water, and

ecological systems?

� � �

(vii) To what extent does the policy make a distinction

between urban and rural water policies

considering their differing contexts?

� � � �

(viii) How well do ADB’s policy and directional

documents provide guidance to nonsovereign

operations and public–private partnerships?

� � � � �

30 Attachment 3

Contextual

Review

Strategy Review

Portfolio Review




Setup

Question/Topic

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ba

l an

d r

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ion

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on

text

revie

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(ix) To what extent will the ADB Water Policy

continue to be relevant to likely future DMCs’

priorities and goals and overall strategic direction

and in avoiding water conflicts?

� � �

(x) To what extent will the ADB Water Policy remain

consistent with Strategy 2030 and its operational

priorities? How does the policy relate to other

related ADB policies?

�

II. To what extent has ADB’s water program

during 2011–2020 been relevant, effective,

efficient, and sustainable in achieving the

program outcomes (accelerated policy and

institutional reforms, expanded

implementation of integrated water resource

management, improved access to quality

services, increased efficiency and

productivity in the delivery of services, better

understanding of transboundary water

issues, increased awareness of water issues

and experience sharing, and improved

institutional capacity and governance in Asia

� � � � � � � � �

Attachment 3 31


Contextual

Review

Strategy Review

Portfolio Review




Setup

Question/Topic

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ba

l an

d r

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ion

al c

on

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and the Pacific) all contributing to the seven

outcomes of Water Policy?

(i) To what extent the completed and validated

projects were relevant, effective, efficient, and

sustainable in achieving the water policy and

program outcomes?

� � � � �

(ii) What is the outlook for other completed projects

(without completion reports) and ongoing

(mature) projects regarding their relevance,

effectiveness, efficiency, and sustainability?

� � � � �

Relevance

(i) How well was ADB’s water program during

2011–2020 designed to meet the needs of DMCs

given their water context align with the objectives

of water and other operational plans?

� � � � �

(ii) To what extent did the project DMF indicators

focus on service quality and water quality, apart

from focusing on service coverage of households

and per capita consumption of water?

� � � �

(iii) How appropriate is the mix of modalities—e.g.,

project lending, policy-based lending, results- � � � �

32 Attachment 3

Contextual

Review

Strategy Review

Portfolio Review




Setup

Question/Topic

Glo

ba

l an

d r

eg

ion

al c

on

text

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w

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t in

terv

iew

s (

sta

ff f

rom

AD

B,

EA

s a

nd

IA

s, a

nd

de

velo

pm

ent

pa

rtn

ers

)

Re

vie

w o

f o

rga

niz

atio

nal st

ruct

ure

an

d s

taffin

g fo

r de

live

ry o

f w

ate

r

pro

jects

based lending, MFF—used by ADB in supporting

reforms?

(iv) To what extent have the operations been

designed to account for unique country specific

characteristics including their institutional

capacities?

� � � � �

(v) To what extent was ADB able to promote and

upscale innovative solutions and integrate the

emerging technological trends (digitization, big-

data, IoT, etc.) in the water sector lending

portfolio?

� � � � �

(vi) To what extent were gender issues incorporated

in water operations and the impacts on the poor

and women monitored.

� � � � �

(vii) What is the extent of development partner

coordination in robust policy dialogues with

DMCs?

� � �

(viii) How well are the technical assistance (TA)

projects designed to support and supplement

lending operations to maximize outcomes?

� � � �

Attachment 3 33


Contextual

Review

Strategy Review

Portfolio Review




Setup

Question/Topic

Glo

ba

l an

d r

eg

ion

al c

on

text

revie

w

Pri

va

te s

ecto

r con

text

revie

w

Syn

thesis

of p

ast

eva

lua

tion

evid

en

ce in

clu

din

g f

rom

oth

er

MD

Bs

Re

vie

w o

f A

DB

's 2

00

1 W

ate

r P

olic

y;

wa

ter,

and

oth

er

op

era

tiona

l pla

ns

an

d S

trate

gy 2

03

0.

CP

Ss a

nd

DM

C

go

ve

rnm

en

t w

ate

r se

cto

r d

ocum

en

ts

Re

vie

w o

f w

ate

r p

olic

y a

nd

str

ate

gic

do

cu

me

nts

fro

m o

the

r M

DB

s

An

aly

sis

of p

roje

ct d

ata

base

to

ch

ara

cte

rize t

he w

ate

r p

ort

folio

Re

vie

w o

f P

PE

Rs,

PV

Rs,

an

d P

CR

s

of

co

mple

ted

pro

ject

s o

r B

TO

Rs a

nd

MT

Rs f

or

ong

oin

g p

roje

cts

Re

vie

w o

f R

RP

s a

nd

th

e d

esig

n o

f

ne

w p

roje

cts

Re

vie

w o

f te

ch

nic

al assi

sta

nce

Co

un

try

case

ass

ess

me

nts

Sta

ff s

urv

ey

Ke

y in

form

an

t in

terv

iew

s (

sta

ff f

rom

AD

B,

EA

s a

nd

IA

s, a

nd

de

velo

pm

ent

pa

rtn

ers

)

Re

vie

w o

f o

rga

niz

atio

nal st

ruct

ure

an

d s

taffin

g fo

r de

live

ry o

f w

ate

r

pro

jects

(ix) To what extent was public participation

encouraged in water tariff reform and in water

conservation through behavior change?

� � � � �

(x) To what extent were partnerships used in

achieving the water program and policy goals? � � � � �

Effectiveness

(i) To what extent was ADB’s water program

effective in achieving the outputs and outcomes

listed in the TOC?

� � � �

(ii) To what extent has ADB water program influenced DMCs’ to undertake reform programs that include priority thrusts from the Water Operational Plan?

� � � � �

(iii) To what extent did the ADB water program lead

to increased productivity and efficiency in service

delivery (improve irrigation productivity, and

reduce non-revenue water)?

� � �

(iv) To what extent has the program led DMCs to

expand the implementation of IWRM principles in

their river basins?

� � �

34 Attachment 3

Contextual

Review

Strategy Review

Portfolio Review




Setup

Question/Topic

Glo

ba

l an

d r

eg

ion

al c

on

text

revie

w

Pri

va

te s

ecto

r con

text

revie

w

Syn

thesis

of p

ast

eva

lua

tion

evid

en

ce in

clu

din

g f

rom

oth

er

MD

Bs

Re

vie

w o

f A

DB

's 2

00

1 W

ate

r P

olic

y;

wa

ter,

and

oth

er

op

era

tiona

l pla

ns

an

d S

trate

gy 2

03

0.

CP

Ss a

nd

DM

C

go

ve

rnm

en

t w

ate

r se

cto

r d

ocum

en

ts

Re

vie

w o

f w

ate

r p

olic

y a

nd

str

ate

gic

do

cu

me

nts

fro

m o

the

r M

DB

s

An

aly

sis

of p

roje

ct d

ata

base

to

ch

ara

cte

rize t

he w

ate

r p

ort

folio

Re

vie

w o

f P

PE

Rs,

PV

Rs,

an

d P

CR

s

of

co

mple

ted

pro

ject

s o

r B

TO

Rs a

nd

MT

Rs f

or

ong

oin

g p

roje

cts

Re

vie

w o

f R

RP

s a

nd

th

e d

esig

n o

f

ne

w p

roje

cts

Re

vie

w o

f te

ch

nic

al assi

sta

nce

Co

un

try

case

ass

ess

me

nts

Sta

ff s

urv

ey

Ke

y in

form

an

t in

terv

iew

s (

sta

ff f

rom

AD

B,

EA

s a

nd

IA

s, a

nd

de

velo

pm

ent

pa

rtn

ers

)

Re

vie

w o

f o

rga

niz

atio

nal st

ruct

ure

an

d s

taffin

g fo

r de

live

ry o

f w

ate

r

pro

jects

(v) To what extent has ADB’s annual water lending

achieved the target levels of investment (2–2.5

billion annually) and target share of investments

in sanitation, wastewater management, and river

clean-up projects (25% of total)?

� �

(vi) To what extent was equity and inclusion and

efficiency in water use mainstreamed into the

design of ADB projects (DMFs of irrigation and

water supply projects included increased

efficiency and/or productivity as project

outcomes)?

� � � � �

(vii) To what extent did IWRM, river basin

development, irrigation and urban water projects

address climate change adaptation, flood and

drought mitigation, and water-food-energy

security nexus?

� � � � �

(viii) To what extent has ADB taken a basin-wide

approach to flood risk management, rather than

addressing a location-specific flood risk?

� � � � �

(ix) To what extent did ADB support nonstructural

measures and nature-based solutions to manage

flood and drought risks?

� � � � �

Attachment 3 35


Contextual

Review

Strategy Review

Portfolio Review




Setup

Question/Topic

Glo

ba

l an

d r

eg

ion

al c

on

text

revie

w

Pri

va

te s

ecto

r con

text

revie

w

Syn

thesis

of p

ast

eva

lua

tion

evid

en

ce in

clu

din

g f

rom

oth

er

MD

Bs

Re

vie

w o

f A

DB

's 2

00

1 W

ate

r P

olic

y;

wa

ter,

and

oth

er

op

era

tiona

l pla

ns

an

d S

trate

gy 2

03

0.

CP

Ss a

nd

DM

C

go

ve

rnm

en

t w

ate

r se

cto

r d

ocum

en

ts

Re

vie

w o

f w

ate

r p

olic

y a

nd

str

ate

gic

do

cu

me

nts

fro

m o

the

r M

DB

s

An

aly

sis

of p

roje

ct d

ata

base

to

ch

ara

cte

rize t

he w

ate

r p

ort

folio

Re

vie

w o

f P

PE

Rs,

PV

Rs,

an

d P

CR

s

of

co

mple

ted

pro

ject

s o

r B

TO

Rs a

nd

MT

Rs f

or

ong

oin

g p

roje

cts

Re

vie

w o

f R

RP

s a

nd

th

e d

esig

n o

f

ne

w p

roje

cts

Re

vie

w o

f te

ch

nic

al assi

sta

nce

Co

un

try

case

ass

ess

me

nts

Sta

ff s

urv

ey

Ke

y in

form

an

t in

terv

iew

s (

sta

ff f

rom

AD

B,

EA

s a

nd

IA

s, a

nd

de

velo

pm

ent

pa

rtn

ers

)

Re

vie

w o

f o

rga

niz

atio

nal st

ruct

ure

an

d s

taffin

g fo

r de

live

ry o

f w

ate

r

pro

jects

(x) To what extent has ADB supported public water

utilities adopt corporate governance principles

and practices?

� � � � �

(xi) To what extent did ADB support help expand

private sector participation and PPPs in water

sector to meet ADB financing targets ($500

million per year between 2012–2020 excluding

hydropower projects)?

�

(xii) To what extent did investment projects and TAs

support institutionalization of continued

professional development in DMCs?

� � �

(xiii) To what extent was awareness on water crisis

and water-food-energy security nexus raised in

political and public spheres (through ADB

support, e.g., country water assessments)?

� � �

(xiv) To what extend did ADB provide institutional

capacity building, support for policy and

regulatory reforms?

� �

(xv) To what extent did ADB integrate gender, social

inclusion, climate change adaptation and

mitigation, and disaster risk management

considerations into project designs?

� �

36 Attachment 3

Contextual

Review

Strategy Review

Portfolio Review




Setup

Question/Topic

Glo

ba

l an

d r

eg

ion

al c

on

text

revie

w

Pri

va

te s

ecto

r con

text

revie

w

Syn

thesis

of p

ast

eva

lua

tion

evid

en

ce in

clu

din

g f

rom

oth

er

MD

Bs

Re

vie

w o

f A

DB

's 2

00

1 W

ate

r P

olic

y;

wa

ter,

and

oth

er

op

era

tiona

l pla

ns

an

d S

trate

gy 2

03

0.

CP

Ss a

nd

DM

C

go

ve

rnm

en

t w

ate

r se

cto

r d

ocum

en

ts

Re

vie

w o

f w

ate

r p

olic

y a

nd

str

ate

gic

do

cu

me

nts

fro

m o

the

r M

DB

s

An

aly

sis

of p

roje

ct d

ata

base

to

ch

ara

cte

rize t

he w

ate

r p

ort

folio

Re

vie

w o

f P

PE

Rs,

PV

Rs,

an

d P

CR

s

of

co

mple

ted

pro

ject

s o

r B

TO

Rs a

nd

MT

Rs f

or

ong

oin

g p

roje

cts

Re

vie

w o

f R

RP

s a

nd

th

e d

esig

n o

f

ne

w p

roje

cts

Re

vie

w o

f te

ch

nic

al assi

sta

nce

Co

un

try

case

ass

ess

me

nts

Sta

ff s

urv

ey

Ke

y in

form

an

t in

terv

iew

s (

sta

ff f

rom

AD

B,

EA

s a

nd

IA

s, a

nd

de

velo

pm

ent

pa

rtn

ers

)

Re

vie

w o

f o

rga

niz

atio

nal st

ruct

ure

an

d s

taffin

g fo

r de

live

ry o

f w

ate

r

pro

jects

(xvi) How did the regional TA projects contribute to

the implementation of Water Policy and in

particular addressing transboundary issues?

� � �

(xvii) How effective were the different financing

modalities (e.g., project vs. sector interventions,

PBLs and MFF) in achieving program objectives.

� � � �

Efficiency

(i) To what extent has the ADB water program

supported the adoption of innovative

technologies and systems to improve

administrative and technical efficiencies in the

operation of water supply and sanitation

systems? How has ADB supported the use of

high technology in the water sector, for improving

efficiency in data collection and analysis?

� � � � �

(ii) What are some good models of privatization

and/or corporatization, given that poorly

performing public water utilities contribute to

accumulation of public debt?

� � �

(iii) To what extent were delays and cost overruns

due to internal factors such as low project � � �

Attachment 3 37


Contextual

Review

Strategy Review

Portfolio Review




Setup

Question/Topic

Glo

ba

l an

d r

eg

ion

al c

on

text

revie

w

Pri

va

te s

ecto

r con

text

revie

w

Syn

thesis

of p

ast

eva

lua

tion

evid

en

ce in

clu

din

g f

rom

oth

er

MD

Bs

Re

vie

w o

f A

DB

's 2

00

1 W

ate

r P

olic

y;

wa

ter,

and

oth

er

op

era

tiona

l pla

ns

an

d S

trate

gy 2

03

0.

CP

Ss a

nd

DM

C

go

ve

rnm

en

t w

ate

r se

cto

r d

ocum

en

ts

Re

vie

w o

f w

ate

r p

olic

y a

nd

str

ate

gic

do

cu

me

nts

fro

m o

the

r M

DB

s

An

aly

sis

of p

roje

ct d

ata

base

to

ch

ara

cte

rize t

he w

ate

r p

ort

folio

Re

vie

w o

f P

PE

Rs,

PV

Rs,

an

d P

CR

s

of

co

mple

ted

pro

ject

s o

r B

TO

Rs a

nd

MT

Rs f

or

ong

oin

g p

roje

cts

Re

vie

w o

f R

RP

s a

nd

th

e d

esig

n o

f

ne

w p

roje

cts

Re

vie

w o

f te

ch

nic

al assi

sta

nce

Co

un

try

case

ass

ess

me

nts

Sta

ff s

urv

ey

Ke

y in

form

an

t in

terv

iew

s (

sta

ff f

rom

AD

B,

EA

s a

nd

IA

s, a

nd

de

velo

pm

ent

pa

rtn

ers

)

Re

vie

w o

f o

rga

niz

atio

nal st

ruct

ure

an

d s

taffin

g fo

r de

live

ry o

f w

ate

r

pro

jects

readiness or due to external factors such as

economic crisis or disasters?

(iv) What steps were taken to mitigate the risk of

delays and cost overruns? How adequate is the

amount of TA in preparing projects at appraisal?

� � �

Sustainability

(i) To what extent has the ADB’s water program

effectively improved the financial viability of

utilities through appropriate pricing of water for

recovery of costs of operations and maintenance

and through ensuring adequate subsidies from

the provincial or central governments? To what

extent has ADB supported the commercialization

of water operations?

� � � �

(ii) To what extent did the program improve

institutional capacities of implementing agencies, including human resources and policies,

budgets, organizational business processes to

manage procurement for building quality

infrastructure and operate and maintain newly

built infrastructure? To what extent did the ADB

� � � � �

38 Attachment 3

Contextual

Review

Strategy Review

Portfolio Review




Setup

Question/Topic

Glo

ba

l an

d r

eg

ion

al c

on

text

revie

w

Pri

va

te s

ecto

r con

text

revie

w

Syn

thesis

of p

ast

eva

lua

tion

evid

en

ce in

clu

din

g f

rom

oth

er

MD

Bs

Re

vie

w o

f A

DB

's 2

00

1 W

ate

r P

olic

y;

wa

ter,

and

oth

er

op

era

tiona

l pla

ns

an

d S

trate

gy 2

03

0.

CP

Ss a

nd

DM

C

go

ve

rnm

en

t w

ate

r se

cto

r d

ocum

en

ts

Re

vie

w o

f w

ate

r p

olic

y a

nd

str

ate

gic

do

cu

me

nts

fro

m o

the

r M

DB

s

An

aly

sis

of p

roje

ct d

ata

base

to

ch

ara

cte

rize t

he w

ate

r p

ort

folio

Re

vie

w o

f P

PE

Rs,

PV

Rs,

an

d P

CR

s

of

co

mple

ted

pro

ject

s o

r B

TO

Rs a

nd

MT

Rs f

or

ong

oin

g p

roje

cts

Re

vie

w o

f R

RP

s a

nd

th

e d

esig

n o

f

ne

w p

roje

cts

Re

vie

w o

f te

ch

nic

al assi

sta

nce

Co

un

try

case

ass

ess

me

nts

Sta

ff s

urv

ey

Ke

y in

form

an

t in

terv

iew

s (

sta

ff f

rom

AD

B,

EA

s a

nd

IA

s, a

nd

de

velo

pm

ent

pa

rtn

ers

)

Re

vie

w o

f o

rga

niz

atio

nal st

ruct

ure

an

d s

taffin

g fo

r de

live

ry o

f w

ate

r

pro

jects

water programs support asset management of

the created infrastructure?

(iii) To what extent has ADB promoted judicious

pricing of water supply and sanitation services,

and institutionalize payment for water and

sewerage keeping in view both supply and

demand side stakeholders?

� � � � �

(iv) How far have water operations been able to keep

the water pricing affordable for the poor in the

region?

� � � � � � �

(v) To what extent did the ADB water program

support the creation of enabling environments in

DMCs for greater private sector participation in

the water sector?

� � �

(vi) How well has ADB addressed resource

conservation by managing the national water

resources cycle? by promoting the Reduce,

Reuse, Recycle principle for Sustainable

environment, ecosystem services, and natural

resources management?

� � � �

Attachment 3 39


Contextual

Review

Strategy Review

Portfolio Review




Setup

Question/Topic

Glo

ba

l an

d r

eg

ion

al c

on

text

revie

w

Pri

va

te s

ecto

r con

text

revie

w

Syn

thesis

of p

ast

eva

lua

tion

evid

en

ce in

clu

din

g f

rom

oth

er

MD

Bs

Re

vie

w o

f A

DB

's 2

00

1 W

ate

r P

olic

y;

wa

ter,

and

oth

er

op

era

tiona

l pla

ns

an

d S

trate

gy 2

03

0.

CP

Ss a

nd

DM

C

go

ve

rnm

en

t w

ate

r se

cto

r d

ocum

en

ts

Re

vie

w o

f w

ate

r p

olic

y a

nd

str

ate

gic

do

cu

me

nts

fro

m o

the

r M

DB

s

An

aly

sis

of p

roje

ct d

ata

base

to

ch

ara

cte

rize t

he w

ate

r p

ort

folio

Re

vie

w o

f P

PE

Rs,

PV

Rs,

an

d P

CR

s

of

co

mple

ted

pro

ject

s o

r B

TO

Rs a

nd

MT

Rs f

or

ong

oin

g p

roje

cts

Re

vie

w o

f R

RP

s a

nd

th

e d

esig

n o

f

ne

w p

roje

cts

Re

vie

w o

f te

ch

nic

al assi

sta

nce

Co

un

try

case

ass

ess

me

nts

Sta

ff s

urv

ey

Ke

y in

form

an

t in

terv

iew

s (

sta

ff f

rom

AD

B,

EA

s a

nd

IA

s, a

nd

de

velo

pm

ent

pa

rtn

ers

)

Re

vie

w o

f o

rga

niz

atio

nal st

ruct

ure

an

d s

taffin

g fo

r de

live

ry o

f w

ate

r

pro

jects

(vii) How much long-term green financing (with

minimal or no environmental degradation) has

been achieved through ADB financing?

� � �

(viii) To what extent has risk to environment been

monitored in ADB operations?

� � �

III. How well is ADB organized to deliver long

term and sustainable solutions to water

sector challenges? To what extent are ADB’s

organizational capacity and staff skills

adequate for this purpose?

� � � � � � �

(i) To what extent have sector divisions, regional

departments, private sector department,

knowledge departments, and other ADB units

collaborated to engage in policy dialogue and

deliver the water program? How has the One

ADB approach been applied in the delivery of the

program? What is the extent of collaboration

between the different sector divisions (e.g.,

environment, natural resources and agriculture

and urban development and water divisions) in

ADB and between different executing and

� � � �

40 Attachment 3

Contextual

Review

Strategy Review

Portfolio Review




Setup

Question/Topic

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implementing agencies in different ministries to

achieve integrated water management?

(ii) How well were energy-water projects internally

coordinated and how good are the operational

structures for coordination?

� � � �

(iii) To what extent were staff skills complemented by

external consultants and knowledge partnerships

(with global and regional centers of excellence)

to design and deliver the water program?

� � � �

(iv) What was the role of ADB and ADB Institute in

supporting research, innovation, technology

transfer, knowledge events, and demonstrative

projects?

� � � �

(v) How is ADB positioned in tapping and catalyzing

cofinancing through Water Financing Partnership

facility and other global funds for achieving the

water program and policy goals?

� � � �

(vi) How satisfactory was the quality at entry of

projects? How appropriate were the risks

assessments and how adequate were the design

and monitoring frameworks?

� � �

Attachment 3 41


Contextual

Review

Strategy Review

Portfolio Review




Setup

Question/Topic

Glo

ba

l an

d r

eg

ion

al c

on

text

revie

w

Pri

va

te s

ecto

r con

text

revie

w

Syn

thesis

of p

ast

eva

lua

tion

evid

en

ce in

clu

din

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f A

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(vii) How does the EIRR for water projects at

completion compare with that at appraisal? � �

(viii) How effective are ADB’s business processes and

the incentives, tools, and guidance available to

the staff for conceptualizing and executing cross-

cutting and complex water projects?

� � � �

(ix) How effective and efficient are the safeguard

processes in water sector operations? Are they

adapting to the rapidly changing context?

� � �

ADB= Asian Development Bank, BTOR = back-to-office report, CPS = country partnership strategy, DMC = developing member country, DMF = design and monitoring framework, EA = executing agency, EIRR = economic internal rate of return, IA = implementing agency, IoT = internet of things, IWRM = integrated water resources management, MDB = multilateral development bank, MFF = multitrance financing facility, MTR = mid-term review report, PBL = policy-based loan, PCR = project completion report, PPER = project performance evaluation report, PPP = public-private partnership, PVR = PCR validation report, TA = technical assistance. Source: ADB (Independent Evaluation Department).