India - Haryana Irrigation Project : Credit 0843 - ARDC Agreement - Conformed

CONFORMED COPY CREDIT NUMBER 843 IN ARDC Agreement (Haryana Irrigation Project) between INTERNATIONAL DEVELOPMENT ASSOCIATION and AGRICULTURAL REFINANCE AND DEVELOPMENT CORPORATION Dated August 16, 1978 CREDIT NUMBER 843 IN ARDC AGREEMENT AGREEMENT, dated August 16, 1978, between INTERNATIONAL DEVELOPMENT ASSOCIATION (hereinafter called the Association) and AGRICULTURAL REFINANCE AND DEVELOPMENT CORPORATION (hereinafter called ARDC). WHEREAS by the Development Credit Agreement of even date herewith between India, acting by its President (hereinafter called the Borrower) and the Association, the Association has agreed to make available to the Borrower an amount in various currencies equivalent to one hundred eleven million dollars ($111,000,000), on the terms and conditions set forth in the Development Credit Agreement, but only on condition that ARDC agree to undertake such obligations toward the Association as are hereinafter set forth; and WHEREAS by financial arrangements to be entered into between the Borrower and ARDC, part of the proceeds of the credit provided for under the Development Credit Agreement will be made available to ARDC on the terms and conditions therein set forth; and WHEREAS ARDC, in consideration of the Association's entering into the Development Credit Agreement with the Borrower, has agreed to undertake the obligations hereinafter set forth; NOW THEREFO E the parties hereto hereby agree as follows: ARTICLE I Definitions Section 1.01. Wherever used in this Agreement, unless the context shall otherwise require, the several terms defined in the Development Credit Agreement and in the General Conditions (as so defined) have the respective meanings therein set forth. ARTICLE II Execution of the Project Section 2.01. ARDC shall take all steps as shall be necessary on its part to assist the Borrower and Haryana in the carrying out -2- of Parts B, C, D and E of the Project described in Schedule 2 to the Development Credit Agreement and shall do so in accor- dance with a banking plan satisfactory to the Association. ARDC shall act with due diligence and efficiency and in conformity with appropriate administrative, financial and engineering practices. Section 2.02. Except as the Association shall otherwise agree, procurement of the goods and civil works to be [inanced out of the proceeds of the Credit, shall be governed by the provisions of the Schedule to the Project Agreement. Section 2.03. Except as the Association may otherwise agree, ARDC shall cause all goods and services financed out of the proceeds of the Credit relent to it by the Borrower to be used exclusively for the Project. Section 2.04. (a) ARDC: (i) shall maintain records and procedures adequate to record and monitor the progress of Parts B, C, D and E of the Project (including its cost and the bene- fits to be derived from it), to identify the goods and services financed out of the proceeds of the Credit relent to it by the Borrower, and to disclose their use in the Project; and (ii) shall furnish to the Association at regular intervals all such information as the Association shall reasonably request concern- ing Parts B, C, D and E of the Project, its cost and, where appropriate, the benefits to be derived from it, the expenditures of such proceeds and the goods and services financed out of such proceeds. (b) Promptly after completion of Parts B, C, D and E of the Project, but in any event not later than six months after the Closing Date or such later date as may be agreed for this purpose between ARDC and the Association, ARDC shall prepare and furnish to the Association a report, of such scope and in such detail as the Association shall reasonably request, on the execution and initial operation of Parts B, C, D and E of the Project, its cost and the benefits derived and to be derived from it, the performance by ARDC and the Association of their respective obligations under this Agreement and the accomplishment of the purposes of the Credit. Section 2.05. (a) ARDC shall enter into financial arrange- ments with the Borrower on terms and conditions which shall have been approved by the Association. -3- (b) ARDC shall duly perform all its obligations under the financial arrangements referred to in paragraph (a) above. Except as the Association shall otherwise agree, ARDC shall not take or concur in any action which would have the effect of amending, abrogating, assigning or waiving the financial arrangements or any provision thereof. Section 2.06. (a) ARDC shall at the request of the Associa- tion, exchange views with the Association with regard to the progress of Parts B, C, D and E of the Project, the performance of its obligations under this Agreement and under the financial arrangements, and other matters relating to the purposes of the Credit. (b) ARDC shall promptly inform the Association of any condition which interferes or threatens to interfere with the progress of Parts B, C, D and E of the Project, the accomplish- ment of the purposes of the Credit, or the performance by ARDC of its obligations under this Agreement and under the financial arrangements. ARTICLE III Management and Operations of ARDC Section 3.01. ARDC shall at all times carry on its opera- tions, manage its affairs, plan its future development and main- tain its financial position in accordance with sound financial and administrative practices, and under the supervision of experienced and competent management. ARTICLE IV Financial Covenants Section 4.01. ARDC shall maintain records adequate to reflect in accordance with consistently maintained appropriate accounting practices its operations and financial condition. Section 4.02. ARDC shall: (i) have its accounts and financial statements (balance sheets, statements of income and expenses and related statements) for each fiscal year audited, in accordance with appropriate auditing principles consistently applied, by independent auditors acceptable to the Association; (ii) furnish to the Association as soon as available, but in any case not later -4- than four months after the end of each such year, (A) certified copies of its financial statements for such year as so audited and (B) the report of such audit by said auditors, of such scope and in such detail as the Association shall have reasonably requested; and (iii) furnish to the Association such other inforinattoa concerning the accounts and financial statements of ARDC and the audit thereof as the Association shall from time to time reason- ably request. Section 4.03. ARDC shall cause the Lending Banks to (i) main- tain separate accounts for loans made in respect of Parts B, C, D and E of the Project, and (ii) send to the Association through ARDC their audited accounts (together with an analysis of overdue and bad debts and a statement certified by ARDC of their Project lending) not later than four months after the end of their each fiscal year. ARTICLE V Effective Date; Termination; Cancellation and Suspension Section 5.01. This Agreement shall come into force and effect on the date upon which the Development Credit Agreement becomes effective. Section 5.02. (a) This Agreement and all obligations of the AFsociation and of ARDC thereunder shall terminate on the earlier of the following two dates: (i) the date on which the Development Credit Agreement shall terminate in accordance with its terms; or (ii) a date twenty years after the date of this Agree- ment. (b) If the Development Credit Agreement terminates in accor- dance with its terms before the date specified in paragraph (a) (ii) of this Section, the Association shall promptly notify ARDC of this event. Section 5.03. All the provisions of this Agreement shall con- tinue in full force and effect notwithstanding any cancellation or suspension under the General Conditions. -5- ARTICLE VI Miscellaneous Provisions Section 6.01. Any notice or request required or permitted to be given or made under this Agreement and any agreement between the parties contemplated by this Agreement shall be in writing. Such notice or request shall be deemed to have been duly given or made when it shall be delivered by hand or by mail, telegram, cable, telex or radiogram to the party to which it is required or permitted to be given or made at such party's address herein- after specified or at such other address as such party shall have designated by notice to the party giving such notice or Taktag such request. The addresses so specified are: 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. For ARDC: Managing Director Agricultural Refinance and Development Corporation Shri Niketan (F. Block) Dr. Annie Besant Rd., Worli, Bombay, India Cable address: AGREFINANS Bombay - 18 Section 6.02. Any action required or permitted to be taken, and any document required or permitted to be executed, under this Agreement on behalf of ARDC may be taken or executed by its Managing Director or such other person or persons as ARDC shall -6- designate in writing, and ARDC shall furnish to the Association sufficient evidence of the authority and the authenticated speci- men signature of each such person. Section 6.03. This Agreement may be executed in several coun- terparts, each of which shall be an original, and all collectively but one instrument. IN WITNESS WHEREOF, the parties hereto, acting through their representatives thereunto duly authorized, have caused this Agreement 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. INTERNATIONAL DEVELOPMENT ASSOCIATION By /s/ W. David Hopper Regional Vice President South Asia AGRICULTURAL REFINANCE AND DEVELOPMENT CORPORATION By Is/ N. A. Palkhivala Authorized Representative