India - Orissa Agricultural Development Project : Credit 0682 - Credit Agreement - Conformed

CONFORMED COPY CREDIT NUMBER 682 IN DEVELOPMENT CREDIT AGREEMENT (Orissa Agricultural Development Project) between INDIA and INTERNATIONAL DEVELOPMENT ASSOCIATION Dated April 1, 1977 DEVELOPMENT CREDIT AGREEMENT AGREEMENT, dated April 1, 1977, between INDIA, acting by its President (hereinafter called the Borrower) and INTERNATIONAL DEVELOPMENT ASSOCIATION (hereinafter called the Association). WHEREAS (A) the Borrower has requested the Association to assist in the financing of the Project described in Schedule 2 to this Agreement by extending the Credit as hereinafter provided; (B) by an agreement of even date herewith between the State of Orissa and the Association, the State of Orissa has agreed to undertake certain obligations in respect of the carrying out of the Project; and WHEREAS the Association has agreed, on the basis inter alia of the foregoing, to extend the Credit to the Borrower upon the terms and conditions hereinafter set forth and in the Orissa Proj- ect Agreement of even date herewith between the State of Orissa and the Association; NOW THEREFORE the parties hereto hereby agree as follows: - 2 - ARTICLE I General Conditions; Definitions Section 1.01. The parties to this Agreement accept all the provisions of the General Conditions Applicable to Development Credit Agreements of the Association, dated March 15, 1974, with the same force and effect as if they were fully set forth herein (said General Conditions Applicable to Development Credit Agree- ments of the Association being hereinafter called the General Conditions). Section 1.02. Wherever used in this Agreement, unless the context otherwise requires, the several terms defined in the General Conditions and in the Preamble to this Agreement have the respective meanings therein set forth and the following additional terms have the following meanings: (a) "Orissa" means the State of Orissa, a State of India, or any successor thereof; (b) "Orissa Project Agreement" means the agreement between the State of Orissa and the Association of even date herewith, as the same may be amended from time to time, and such term in- cludes all schedules to the Project Agreement and all agreements supplemental to the Orissa Project Agreement; and -3- (c) "OUAT" means Orissa University of Agriculture and Tech- nology, Bhubaneswar, and includes any successor thereof. ARTICLE II The Credit Section 2.01. The Association agrees to lend to the Borrower, on the terms and conditions in the Development Credit Agreement set forth or referred to, an amount in various currencies equival- ent to twenty million dollars ($20,000,000). Section 2.02. The amount of the Credit may be withdrawn from the Credit Account in accordance with the provisions of Schedule 1 to this Agreement, as such Schedule may be amended from time to time by agreement between the Borrower and the Association, for expenditures made (or, if the Association shall so agree, to be made) in respect of the reasonable cost of goods and services required for the Project and to be financed out of the proceeds of the Credit. Section 2.03. Except as the Association shall otherwise agree, contracts for the purchase of goods or for civil works to be fi- nanced out of the proceeds of the Credit, shall be procured in accordance with the provisions set forth or referred to in Sec- tion 2.03 of the Orissa Project Agreement. Section 2.04. The Closing Date shall be December 31, 1983 or such later date as the Association shall establish. The Associa- tion shall promptly notify the Borrower of such later date. (c) "OUAT" means Orissa University of Agriculture and Tech- nology, Bhubaneswar, and includes any successor thereof. ARTICLE II The Credit Section 2.01. The Association agrees to lend to the Borrower, on the terms and conditions in the Development Credit Agreement set forth or referred to, an amount in various currencies equival- ent to twenty million dollars ($20,000,000). Section 2.02. The amount of the Credit may be withdrawn from the Credit Account in accordance with the provisions of Schedule 1 to this Agreement, as such Schedule may be amended from time to time by agreement between the Borrower and the Association, for expenditures made (or, if the Association shall so agree, to be made) in respect of the reasonable cost of goods and services required for the Project and to be financed out of the proceeds of the Credit. Section 2.03. Except as the Association shall otherwise agree, contracts for the purchase of goods or for civil works to be fi- nanced out of the proceeds of the Credit, shall be procured in accordance with the provisions set forth or referred to in Sec- tion 2.03 of the Orissa Project Agreement. Section 2.04. The Closing Date shall be December 31, 1983 or such later date as the Association shall establish. The Associa- tion shall promptly notify the Borrower of such later date. Section 2.05. The Borrower shall pay to the Association a service charge at the rate of three-fourths of one per cent (3/4 of 1%) per annum on the principal amount of the Credit withdrawn and outstanding from time to time. Section 2.06. Service charges shall be payable semi-annually on March 1 and September 1 in each year. Section 2.07. The Borrower shall repay the principal amount of the Credit in semi-annual installments payable on each March 1 and September 1 commencing September 1, 1987, and ending March 1, 2027, each installment to and including the installment payable on March 1, 1997 to be one-half of one per cent (1/2 of 1%) of such principal amount, and each installment thereafter to be one and one-half per cent (1-1/2%) of such principal amount. Section 2.08. The currency of The United Kingdom of Great Britain and Northern Ireland is hereby specified for the pur- poses of Section 4.02 of the General Conditions. - 6 - ARTICLE III Execution of the Project Section 3.01. (a) Without any limitation or restriction upon any of its other obligations under the Development Credit Agree- ment, the Borrower shall enable Orissa to perform in accordance with the provisions of the Orissa Project Agreement all the obligations therein set forth, shall take and cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable Orissa to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) The Borrower shall make the proceeds of the Credit available to Orissa in accordance with the Borrower's standard arrangements for developmental assistance to the States of India. ARTICLE IV Remedies of the Association Section 4.01. For the purposes of Section 6.02 of the General Conditions the following additional event is specified pursuant to paragraph (h) thereof, namely, that Orissa shall have failed to perform any of its obligations under the Orissa Project Agreement. Section 4.02 For the purposes of Section 7.01 of the General Conditions, the following additional event is specified pursuant to paragraph (d) thereof, namely, that the event specified in Section 4.01 of this Agreement shall occur and shall continue for a period of 60 days after notice thereof shall have been given by the Association to the Borrower and Orissa. -8- ARTICLE V Effective Date; Termination Section 5.01. The following events are specified as additional conditions to the effectiveness of the Development Credit Agreement within the meaning of Section 12.01 (b) of the General Conditions: (a) the execution of the Orissa Project Agreement on behalf of Orissa has been duly authorized or ratified by all necessary governmental action; and (b) the Policy Planning and Coordination Unit referred to in Section 2.02 (a) of the Orissa Project Agreement has been es- tablished. Section 5.02. The following is specified as an additional matter, within the meaning of Section 12.02 (b) of the General Conditions, to be included in the opinion or opinions to be fur- nished to the Association, namely, that the Orissa Project Agreement has been duly authorized or ratified by Orissa, and is legally binding upon Orissa in accordance with its terms. Section 5.03. The date July 1, 1977, is hereby specified for the purposes of Section 12.04 of the General Conditions. - 9- ARTICLE VI Representative of the Borrower; Addresses Section 6.01. Any Secretary, Additional Secretary, Joint Secretary, Director or Deputy Secretary of the Department of Economic Affairs in the Ministry of Finance of the Borrower is designated as representative of the Borrower for the purposes of Section 11.03 of the General Conditions. Section 6.02. The following addresses are specified for the purposes of Section 11.01 of the General Conditions: For the Borrover: The Secretary to the Government of India Ministry of Finance Department of Economic Affairs New Delhi, India Cable address: ECOFAIRS New Delhi For the Association: International Development Association 1818 H Street, N.W. Washington, D.C. 20433 United States of America Cable address: INDEVAS Washington, D.C. - 10 - IN WITNESS WHEREOF, the parties hereto, acting through their representatives thereunto duly authorized, have caused this Agree- ment to be signed in their respective names in the District of Columbia, United States of America, as of the day and year first above written. INDIA By /s/ Kewal Singh Authorized Representative INTERNATIONAL DEVELOPMENT ASSOCIATION By /s/ Ernest Stern Regional Vice President South Asia - 11 - SCHEDULE 1 Withdrawal of the Proceeds of the Credit 1. The table below sets forth the Categories of items to be financed out of the proceeds of the Credit, the allocation of the amount of the Credit to each Category and the percentage of expenditures for items so to be financed in each Category: Credit Allocated % of (Expressed in Expenditures Category Dollar Equivalent) to be Financed (1) Equipment and 4,500,000 100% of foreign Vehicles expenditures or 80% of local ex- penditures (2) Civil works 9,400,000 80% (3) Training, tech- 100,000 100% nical assistance and fellowships (4) Salaries of in- 4,000,000 25% cremental staff (5) Unallocated 2,000,000 TOTAL 20,000,000 - 12 - 2. For the purposes of this Schedule: (a) the term "foreign expenditures" means expenditures in the currency of any country other than the Borrower and for goods or services supplied from the territory of any country other than the Borrower; and (b) the term "local expenditures" means expenditures in the currency of the Borrower and for goods or services supplied from the territory of the Borrower. 3. The disbursement percentages have been calculated in compli- ance with the policy of the Association that no proceeds of the Credit shall be disbursed on account of payments for taxes levied by, or in the territory of, the Borrower on goods or services, or on the importation, manufacture, procurement or supply thereof; to that end, if the amount of any such taxes levied on or in re- spect of any item to be financed out of the proceeds of the Credit decreases or increases, the Association may, by notice to the Borrower, increase or decrease the disbursement percentage then applicable to such item as required to be consistent with the aforementioned policy of the Association. 4. Notwithstanding the provisions of paragranh 1 above, no with- drawals shall be made in respect of payments made for expenditures prior to the date of this Agreement. 5. Notwithstanding the allocation of an amount of the Credit or the disbursement percentages set forth in the table in paragraph 1 above, if the Association has reasonably estimated that the amount - 13 - of the Credit then allocated to any Category will be insufficient to finance the agreed percentage of all expenditures in that Cate- gory, the Association may, by notice to the Borrower: (i) reallo- cate to such Category, to the extent required to meet the estimated shortfall, proceeds of the Credit which are then allocated to an- other Category and which in the opinion of the Association are not needed to meet other expenditures; and (ii) if such reallocation cannot fully meet the estimated shortfall, reduce the disbursement percentage then applicable to such expenditures in order that fur- ther withdrawals under such Category may continue until all expen- ditures thereunder shall have been made. 6. If the Association shall have reasonably determined that the procurement of any item in any Category is inconsistent with the procedures set forth or referred to in this Agreement, no expendi- tures for such item shall be financed out of the proceeds of the Credit and the Association may, without in any way restricting or limiting any other right, power or remedy of the Association under the Development Credit Agreement, by notice to the Borrower, can- cel such amount of the Credit as, in the Association's reasonable opinion, represents the amount of such expenditures which would otherwise have been eligible for financing out of the proceeds of the Credit. - 14 - SCHEDULE 2 Description of the Project The Project is to increase agricultural production in Orissa over a period of five years and consists of the following: Part A: The strengthening of agricultural extension services. Part B: The strengthening of applied and adaptive agricultural research and support for farm management data collec- tion and evaluation by OUAT. Part C: The training of agricultural and cooperative extension workers. Part D: The improvement of land surveys and land record sys- tems. Part E: The implementation of a program of support for the design, testing, demonstration and distribution of improved animal drawn farm implements. Part F: The undertaking of ground water surveys and monitoring, research, design, installation and field testing of alternative types of shallow tubewells and pumping techniques. - 13 - of the Credit then allocated to any Category will be insufficient to finance the agreed percentage of all expenditures in that Cate- gory, the Association may, by notice to the Borrower: (i) reallo- cate to such Category, to the extent required to meet the estimated shortfall, proceeds of the Credit which are then allocated to an- other Category and which in the opinion of the Association are not needed to meet other expenditures; and (ii) if such reallocation cannot fully meet the estimated shortfall, reduce the disbursement percentage then applicable to such expenditures in order that fur- ther withdrawals under such Category may continue until all expen- ditures thereunder shall have been made. 6. If the Association shall have reasonably determined that the procurement of any item in any Category is inconsistent with the procedures set forth or referred to in this Agreement, no expendi- tures for such item shall be financed out of the proceeds of the Credit and the Association may, without in any way restricting or limiting any other right, power or remedy of the Association under the Development Credit Agreement, by notice to the Borrower, can- cel such amount of the Credit as, in the Association's reasonable opinion, represents the amount of such expenditures which would otherwise have been eligible for financing out of the proceeds of the Credit. - 14 - SCHEDULE 2 Description of the Project The Project is to increase agricultural production in Orissa over a period of five years and consists of the following: Part A: The strengthening of agricultural extension services. Part B: The strengthening of applied and adaptive agricultural research and support for farm management data collec- tion and evaluation by OUAT. Part C: The training of agricultural and cooperative extension workers. Part D: The improvement of land surveys and land record sys- tems. Part E: The implementation of a program of support for the design, testing, demonstration and distribution of improved animal drawn farm implements. Part F: The undertaking of ground water surveys and monitoring, research, design, installation and field testing of alternative types of shallow tubewells and pumping techniques. - 15 - Part G: The strengthening of agricultural statistics and data processing by the Orissa Bureau of Economics and Statistics. The Project is expected to be completed by June 30, 1983.