Road Asset Management

In many countries, roads and highways provide the dominant mode of land transportation. They form the backbone of the economy, often carrying more than 80 percent of passengers and over 50 percent of freight in a country, and providing essential links to vast rural road networks. 

Roads are among the most important public assets in many countries. Improvements to roads bring immediate and sometimes dramatic benefits to communities through better access to hospitals, schools, and markets; greater comfort, speed, and safety; and lower vehicle operating costs.

For these benefits to be sustained, however, road improvements must be followed by well-planned programs of road maintenance. Without regular maintenance, roads can rapidly fall into disrepair, preventing communities from reaping the longer term benefits of road improvement such as increased agricultural production and an increase in school enrollment.

Although the need for maintenance is widely recognized, it is still not adequately implemented. Many countries spend just 20–50 percent of what they should be spending on maintenance of their road network. There are many reasons why this is so.

World Bank Support

The World Bank is cognizant of countries’ needs to address road networks in a holistic manner with new constructions being balanced with regular maintenance.  The challenge lies in assuring a source of funds for both purposes, and in spending those funds efficiently.

In India, the Bank is supporting a number of state roads projects. These projects are ongoing in Karnataka, Tamil Nadu, UP, Kerala, Mizoram, and Gujarat, and are under preparation for Orissa, Assam, Punjab, and Himachal Pradesh. These projects aim to support state budgets for roads, including both new construction and maintenance.

While funds for new construction are sometimes easier to obtain and implement, those for maintenance are more difficult as they need to be sustained on a regular basis. Some states have adopted or considered adopting a “road fund” type of arrangement for supporting maintenance. Under such arrangements, maintenance funds are assured from a mandated tax on gasoline and diesel and are deposited into an assured and independently operated Fund. The Fund may be overseen by a Board which may include both the public and the private sector.  

On the implementation side, the states are exploring more options such as contracting out the maintenance works rather than using in-house labor teams, and using performance-based maintenance contracts.  The National Highways Authority of India (NHAI) has taken four major loans from the World Bank (and a number from the Asian Development Bank) to support its new construction program. While focusing on new construction, the NHAI is aware of the need for ongoing asset management in terms of maintenance and is tolling these roads to assure a regular source of funds for maintenance.

In Sri Lanka, the Road Development Authority is negotiating for a credit from the World Bank to support its road network. This project, along with funding from the Asian Development Bank and the Government of Japan, provides support for overall asset management with a large focus on sustained maintenance of the network.

In Nepal, the Rural Access Improvement and Decentralization Project approved by the World Bank Board in June 2005 (IDA $32 million equivalent), complements the ongoing Road Maintenance and Development Project. These rural access projects take an overall asset management approach. They by providing support to the rehabilitation and upgrade of existing dry-season rural roads to all-season standards, the upgrade of existing rural trails and tracks to dry-season standards in remote hill districts,. They also support the maintenance of rural roads, covering routine and recurrent maintenance, the construction of short-span trail bridges, and the development of small, community infrastructure, including markets. In addition, the resettlement and rehabilitation of project affected people is supported and a rural transport services scheme is being piloted. The ongoing Road Maintenance and Development Project is supporting the introduction and operation of the Nepal Roads Board and Road Fund.

In Bhutan, the World Bank has been supporting a Rural Access Project to help improve the access of rural communities to social and economic centers. The project also aims to build the capacity of the Department of Roads to implement environmentally friendly construction methods and introduce community-based maintenance contracts. Discussions are underway for the Bank to provide further support in these areas.

In Afghanistan, the Bank, along with other donors has over the last 3 years focused on the emergency rehabilitation of key road links, including part of the country's ring road and access roads to its northern neighbors. Focus has also been given to building the capacity of the Ministry of Public Works for project management and implementation.  With major road links almost complete, the emphasis is shifting towards setting up appropriate organizations and financing arrangements for the operations and maintenance of these roads.  Discussions with the government and other major development partners are ongoing.  In addition, under the National Emergency Employment Program, partly funded by the Bank, the Bank has been supporting a nation-wide program for rehabilitation, reconstruction and maintenance of essential rural roads using appropriate labor-based approaches to create short-term employment for the rural poor.  This Program also supports the capacity building of the Ministry of Rural Development and local authorities in the operation and management of rural roads.

In Pakistan, the World Bank is supporting the development of the country’s highway network through the ongoing Highways Rehabilitation Project.   Discussions are underway for a possible follow –up project.  Again, the project supports a full asset management approach including rehabilitation and resurfacing of roads complemented by support for funding sources such as the Road Maintenance Account and the Annual Maintenance Plan. Revenue for road asset management is obtained from tolls. The Annual Maintenance Plan is based on a detailed survey of the condition of roads, and a strategic assessment that aims to deliver a stable network over the medium term, by focusing resources on preventative maintenance strategies. HDM-4 software is used to develop the Annual Maintenance Plan to select the best maintenance options to make optimal use of available resources.  A Road Asset Management Study is also underway.