India - Maharashtra Agricultural Credit Project : Credit 0293 - Maharashtra Agreement - Conformed

CONFORMED COPY CREDIT NUMBER 293 IN Maharashtra Agreement (Maharashtra Agricultural Credit Project) BETWEEN THE STATE OF MAHARASHTRA AND INTERNATIONAL DEVELOPMENT ASSOCIATION DATED MARCH 29, 1972 CONFORMED COPY CREDIT NUMBER 293 IN Maharashtra Agreement (Maharashtra Agricultural Credit Project) BETWEEN THE STATE OF MAHARASHTRA AND INTERNATIONAL DEVELOPMENT ASSOCIATION DATED MARCH 29, 1972 MAHARASHTRA AGREEMENT AGREEMENT, dated March 29, 1972, between THE STATE OF MAHARASHTRA (hereinafter called Maharashtra) and INTERNATIONAL DEVELOPMENT ASSOCIATION (hereinafter called the Association). WHEREAS (A) by a development credit agreement of even date herewith between India, acting by its President (hereinafter called the Borrower) and the Association (hereinafter referred to as the Development Credit Agreement), the Association has agreed to make available to the Borrower an amount in various currencies equivalent to thirty million dollars ($30,000,000), on the terms and conditions set forth in the Development Credit Agreement, but only on condition inter alia that Maharashtra agrees to undertake such obligations toward the Association as hereinafter set forth; (B) by an agreement of even date herewith between the Association, of the one part, and Agricultural Refinance Corporation and Maharashtra State * Cooperative Land Development Bank, Limited, of the other part, Agricultural Refinance Corporation and Maharashtra State Cooperative Land Development Bank, Limited, respectively, have agreed to undertake certain obligations in respect of the carrying out of the Project; and WHEREAS Maharashtra, 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 THEREFORE 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. 4 ARTICLE II Particular Covenants Section 2.01. Maharashtra shall cause that portion which is applicable to Maharashtra of the Project described in Schedule 2 to the Development Credit Agreement to be carried out with due diligence and efficiency and in conformity with sound administrative, financial and engineering practices, and shall provide, or cause to be provided, promptly as needed, the funds, facilities, services and other resources required for the purpose. Section 2.02. (a) Maharashtra shall by the Effective Date have established in its Department of Industries GSDA, with clearly defined responsibilities and authority and adequate staffing acceptable to the Association. (b) Maharashtra shall take such steps as may be necessary to enable GSDA to perform efficiently its responsibilities with respect to the Project. Section 2.03. In order to assist GSDA in the carrying out of geologic and hydrologic analyses and in the application of appraisal criteria, Maharashtra shall by the Effective Date, take such steps as shall be necessary on its part to enable GSDA to obtain for 2 years upon terms and conditions satisfactory to the Association, two internationally recruited qualified and experienced consultants. Section 2.04. (a) Maharashtra shall by the Effective Date implement a plan acceptable to the Association for the establishment by departmental reorganization within its Department of Agriculture of LDA, with clearly delineated powers and adequate staffing and with provision for the employment whenever necessary of the services of specialists in land development on a contract basis. (b) Maharashtra shall where necessary arrange for the participation of contractors in Maharashtra in the land development program to be carried out under the supervision of LDA. Section 2.05. (a) Maharashtra shall by the Effective Date establish rates for work done in respect of land development sufficient to cover all costs and shall appropriately modify its lending program to conform with the procedures and terms relating to this Project. (b) Maharashtra shall as far as practicable take due measures to recover outstanding charges (not covered by a mortgage to LDB) in respect of any part of the land development program completed before the commencement of Project lending. 5 Section 2.06. Maharashtra shall cause its State Electricity Board to act expeditiously in, and give priority to, the connection of electricity to wells included in the Project. Section 2.07. Maharashtra shall enable the Association's representatives to inspect the Project and any relevant records and documents; and shall furnish or cause to be furnished to the Association all such information as the Association shall reasonably request concerning the Project, the services and the operations and financial condition with respect to the Project of the agency or agencies responsible for the carrying out of the Project or any part thereof. Section 2.08. Maharashtra and the Association shall cooperate fully to assure that the purposes of the Credit will be accomplished. To that end, Maharashtra and the Association shall from time to time, at the request of either party, exchange views through their representatives with regard to the performance of their respective obligations under this Agreement, the Project, and other matters relating to the purpose of the Credit. Section 2.09. Maharashtra shall take all action which shall be necessary on its part to enable ARC and LDB to perform their obligations under (i) the Project Agreement, and (ii) the Subsidiary Loan Agreement in the case of ARC, and shall not take or permit any of its agencies to take any action which would prevent or interfere with the performance of any such obligations of ARC and LDB or of Participating Banks associated therewith. Section 2.10. Maharashtra and the Association shall promptly inform each other of any condition which interferes with, or threatens to interfere with, the accomplishment of the purposes of the Credit, or the performance by either of them of its obligations under this Agreement. Section 2.11. Maharashtra shall take all action which shall be necessary on its part to support the implementation of the operating policies and procedures set out in Schedule 1 to the Project Agreement. Section 2.12. Maharashtra shall take all action which shall be necessary on its part to complete the financial and managerial reorganization of the Primary Banks in accordance with Section 2.14 of the Project Agreement. Section 2.13. Maharashtra shall through its Cooperative Department take measures adequate to ensure (i) that the Primary Banks maintain an accounting system which conforms to good accounting practices, (ii) that the accounts of LDB and the Primary Banks are audited efficiently and in a timely manner by 6 independent auditors acceptable to the Association, and (iii) that the financial statements of the Primary Banks shall be available within 4 months after the close of the respective fiscal year. Section 2.14. (a) Maharashtra shall be responsible for the organization of the procurement of equipment required for the Project in accordance with Schedule 3 to the Development Credit Agreement. (b) Maharashtra shall ensure that all imported goods to be financed out of the proceeds of the Credit are insured against hazards incident to the acquisition, transportation and delivery thereof to the place of use or installation, or that adequate provision is made for the insurance thereof, and for such insurance any indemnity shall be payable in a currency freely usable to replace or repair such goods. (c) Except as the Association may otherwise agree, Maharashtra shall cause all goods and services financed out of the proceeds of the Credit under Category III of the allocation of the proceeds of the Credit set forth in Schedule I to the Development Credit Agreement to be used exclusively for the Project. ARTICLE III Effective Date; Termination; Cancellation and Suspension Section 3.01. This Agreement shall come into force and effect on the date upon which the Development Credit Agreement becomes effective. If the Development Credit Agreement shall terminate pursuant to Section 10.04 of the General Conditions, the Association shall promptly notify Maharashtra of this event and, upon the giving of such notice, this Agreement and all obligations of the parties hereunder shall forthwith terminate. Section 3.02. This Agreement shall terminate and all obligations of Maharashtra and the Association hereunder shall cease and determine on the date on which the Project Agreement terminates in accordance with its terms. Section 3.03. All the provisions of this Agreement shall continue in full force and effect notwithstanding any partial cancellation or suspension under the Development Credit Agreement. 7 ARTICLE IV Miscellaneous Provisions Section 4.01. 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 hereinafter specified or at such other address as such party shall have designated by notice to the party giving such notice or making such request. The addresses so specified are: For Maharashtra: The Chief Secretary to the Government of Maharashtra Sachivalaya, Bombay India Cable address: Restis Bombay For the Association: International Development Association 1818 H Street, N.W. Washington, D.C. 20433 United States of America Cable address: Iindevas Washington, D.C. Section 4.02. Any action required or permitted to be taken, and any documents required or permitted to be executed, under this Agreement on behalf of Maharashtra, may be taken or executed by the Secretary to the Government 8 of Maharashtra or such other person or persons as Maharashtra shall designate in writing. Section 4.03. Maharashtra shall furnish to the Association sufficient evidence of the authority and the authenticated specimen signature of the person or persons who will, on behalf of Maharashtra, take any action or execute any documents required or permitted to be taken or executed by Maharashtra pursuant to any of the provisions of this Agreement. Section 4.04. This Agreement may be executed in several counterparts, 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 and delivered in the District of Columbia, United States of America, as of the day and year first above written. THE STATE OF MAHARASHTRA By /s / L. K. Jha A u thorized Representative INTERNATIONAL DEVELOPMENT ASSOCIATION By /s / J. Burke Knapp Vice Presiden t