India - Chambal Command Area Development Project : Credit 0562 - Project Agreement - Conformed

CONFORMED COPY CREDIT NUMBER 562 IN Project Agreement (Chambal Command Area Development Project - Madhya Pradesh) BETWEEN INTERNATIONAL DEVELOPMENT ASSOCIATION AND THE STATE OF MADHYA PRADESH DATED JUNE 20, 1975 PROJECT AGREEMENT AGREEMENT, dated June 20, 1975, between INTERNATIONAL DEVELOPMENT ASSOCIATION (hereinafter called the Association) and THE STATE OF MADHYA PRADESH, acting by its Governor (hereinafter called Madhya Pradesh). 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 twenty-four million dollars ($24,000,000), on the terms and conditions set forth in the Development Credit Agreement, but only on condition that Madhya Pradesh agrees to undertake such obligations toward the Association as are hereinafter set forth; and WHEREAS Madhya Pradesh, in consideration of the Association's entering in .to 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. ARTICLE H Execution of the Project Section 2.01. (a) Madhya Pradesh shall carry out or cause to be carried out Parts A through E, F(2) and G of the Project described in Schedule 2 to the Development Credit Agreement with due diligence and efficiency and in conformity with appropriate administrative, financial, agricultural 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. 4 (b) Without any limitation or restriction upon the provisions of paragraph (a) of this Section, Madhya Pradesh shall furnish to the Association, not later than February 1 in each year, a detailed Project implementation schedule for the next fiscal year, acceptable to the Association. Section 2.02. Except as the Association shall otherwise agree, the goods, works and services (other than consultants' services) for the Project to be financed out of the proceeds of the Credit, shall be procured in accordance with the provisions of the Schedule to this Agreement. Section 2.03. (a) Madhya Pradesh undertakes to insure, or make adequate provision for the insurance of, the imported goods to be financed out of the proceeds of the Credit made available to it by the Borrower against hazards incident to the acquisition, transportation and delivery thereof to the place of use or installation, and for such insurance any indemnity shall be payable in a currency freely usable by Madhya Pradesh to replace or repair such goods. (b) Except as the Association may otherwise agree, Madhya Pradesh shall cause all goods and services financed out of the proceeds of the Credit made available to it by the Borrower to be used exclusively for the Project. Section 2.04. (a) Madhya Pradesh shall furnish to the Association promptly upon their preparation, all essential plans, specifications, reports, contract documents and construction and procurement schedules for the Project, and any material modifications thereof or additions thereto, in such detail as the Association shall reasonably request. (b) Madhya Pradesh: (i) shall maintain records adequate to record the progress of the Project (including the cost thereof) and to identify the goods and services financed out of the proceeds of the Credit made available to it by the Borrower, and to disclose the use thereof in the Project; (ii) shall enable the Association's representatives to visit the facilities and construction sites included in the Project, and to examine the goods financed out of such proceeds and any relevant records and documents; and (iii) shall furnish to the Association all such information as the Association shall reasonably request concerning the Project, the expenditure of the proceeds of the Credit so made available to it and the goods and services financed out of such proceeds. Section 2.05. Madhya Pradesh shall, not later than December 3 1, 1978, prepare and introduce a water allocation plan for the Project Area which shall ensure that eventually all land in the said area receives an equitable share of the available water. 5 Section 2.06. (a) Madhya Pradesh shall, at the request of the Association, exchange views with the Association with regard to the progress of the Project, the performance of its obligations tinder this Agreement and other matters relating to the purposes of the Credit. (b) Madhya Pradesh shall promptly inform the Association of any condition which interferes or threatens to interfere with, the progress of the Project, the accomplishment of the purposes of the Credit, or the performance by Madhya Pradesh of its obligations under this Agreement. ARTICLE III Other Covenants Section 3.01. Madhya Pradesh shall- in its CAA maintain records adequate to reflect in accordance with consistently maintained appropriate accounting practices the operations and financial condition of CAA. Section 3.02. Madhya Pradesh shall: (i) have the accounts and financial statements (balance sheets, statements of income and expenses and related statements) of CAA for each fiscal year audited, in accordance with sound auditing principles consistently applied, by the Accountant General of Madhya Pradesh; (ii) furnish to the Association as soon as available, but in any case not later than six months after the end of each such year, (A) certified copies of the said financial statements for such year as so audited and (B) the report of such audit by said Accountant General, of such scope and in such detail as the Association shall have reasonably requested; and (iii) furnish to the Association such other information concerning the accounts and financial statements of CAA and the audit thereof as the Association shall from time to time reasonably request. Section 3.03. Madhya Pradesh shall cause all works and facilities included in the Project or necessary to the proper and efficient operation therof to be operated, maintained and repaired in accordance with sound engineering practices and shall provide, or cause to be provided, the funds, facilities services and other resources required for the purpose. Section 3.04. Madhya Pradesh shall, not later than June 30, 1977, or such other date as the Association shall agree, review and adjust the charges levied on farmers in the Project Area to ensure recovery from said farmers: (i) of all operation and maintenance costs of the irrigation and drainage facilities included in the Project; and (ii) of all capital costs of the said facilities in not more than thirty years. 6 ARTICLE IV Effective Date; Termination; Cancellation and Suspension Section 4.01. This Agreement shall come into force and effect on the date upon which the Development Credit Agreement becomes effective. Section 4.02. (a) This Agreement and all obligations of the Association and of Madhya Pradesh 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 thirty years after the date of this Agreement. (b) If the Development Credit Agreement terminates in accordance with its terms before the date specified in paragraph (a)(ii) of this Section, the Association shall promptly notify Madhya Pradesh of this event. Section 4.03. All the provisions of this Agreement shall continue in full force and effect notwithstanding any partial cancellation or suspension under the Development Credit Agreement. ARTICLE V Miscellaneous Provisions Section 5.01. 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 the Association: International Development Association 1818 H Street, N.W. Washington, D.C. 20433 United States of America Cable address: INDEVAS Washington, D.C. 7 For Madhya Pradesh: Agricultural Production Commissioner Government of Madhya Pradesh Bhopal, India Cable address: AGRISECY Bhopal Section 5.02. Any action required or permitted to be taken, and any documents required or permitted to be executed, under this Agreement on behalf of Madhya Pradesh may be taken or executed by the Secretary to the Government of Madhya Pradesh or such other person or persons as Madhya Pradesh shall designate in writing. Section 5.03. Madhya Pradesh 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 Madhya Pradesh, take any action or execute any documents required or permitted to be taken or executed by Madhya Pradesh pursuant to any of the provisions of this Agreement. Section 5.04. 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 in the District of Columbia, United States of America, as of the day and year first above written. INTERNATIONAL DEVELOPMENT ASSOCIATION By /s / M. L. Weiner Regional Vice President South Asia THE STATE OF MADHYA PRADESH By /s / G. V. Ramakrishna Authorized Representative 8 SCHEDULE Procurement A. General Procedures 1. Except as provided in Part A.2 hereof, contracts for vehicles and equipment shall be let under procedures consistent with those set forth in the "Guidelines for Procurement under World Bank Loans and IDA Credits" published by the Bank in April 1972, as revised in October 1972 (hereinafter called the Guidelines), on the basis of international competitive bidding. 2. Contracts for equipment and vehicles estimated to cost less than the equivalent of $100,000 shall be let on the basis of the standard procedures of Madhya Pradesh. 3. Identical or similar goods shall be grouped together, whenever practicable, for the purpose of procurement. 4. Civil works shall be carried out either under contracts let under the standard procedures of Madhya Pradesh or through force account. 5. Contracts for fertilizer shall be let under the following procedures: (a) the Borrower shall invite not less than three price quotations from suppliers in member countries of the Bank and Switzerland; (b) the contract shall be awarded to the bidder whose bid is the lowest evaluated bid; and (c) the Borrower shall furnish to the Association, together with any application for withdrawal of funds from the Credit Account in respect of any such contract: (i) the details of the bids sought; (ii) the names of the firms invited to submit bids; (iii) the summary of the bids submitted and, in the event the lowest bid is not accepted, the analysis thereof and the reasons for choosing the successful bidder; (iv) two confomed copies of the contract; and (v) a statement from the Borrower that fertilizer in the quantity and of the types financed out of the proceeds of the Credit has been made available to farmers in the Project Area as set forth in Part F of the Project. 9 B. Evaluation and Comparison of Bids for Goods; Preference for Domestic Manufacturers 1. For the purpose of evaluation and comparison of bids for the supply of goods: (i) bidders shall be required to state in their bid the c.i.f. (port of entry) price for imported goods, or the ex-factory price for domestically-manufactured goods; (ii) customs duties and other import taxes on imported goods, and sales and similar taxes on domestically-supplied goods, shall be excluded; and (iii) the cost to Madhya Pradesh of inland freight and other expenditures incidental to the delivery of goods to the place of their use or installation shall be included. 2. Goods manufactured in India may be granted a margin of preference in accordance with, and subject to, the following provisions: (a) All bidding documents for the procurement of goods shall clearly indicate any preference which will be granted, the information required to establish the eligibility of a bid for such preference and the following methods and stages that will be followed in the evaluation and comparison of bids. (b) After evaluation, responsive bids will be classified in one of the following three groups: (1) Group A: bids offering goods manufactured in India if the bidder shall have e-,tablished to the satisfaction of Madhya Pradesh and the Association that the manufacturing cost of such goods includes a value added in India equal to at least 20% of the ex-factory bid price of such goods. (2) Group B: all other bids offering goods manufactured in India. (3) Group C: bids offering any other goods. (c) All evaluated bids in each group shall be first compared among themselves, excluding any customs duties and other import taxes on goods to be imported and any sales or similar taxes on goods to be supplied domestically, to determine the lowest evaluated bid of each group. Such lowest evaluated bids shall then be compared with each other, and if, as a result of this comparison, a bid from group A or group B is the lowest, it shall be selected for the award. (d) If, as a result of the comparison under paragraph (c) above, the lowest bid is a bid from group C, all group C bids shall be further compared with the lowest evaluated bid from group A after adding to the c.i.f. bid price of the imported goods offered in each group C bid, for the purpose of this further 10 comparison only, an amount equal to (i) the amount of customs duties and other import taxes which a non-exempt importer would have to pay for the importation of the goods offered in such group C bid, or (ii) 15% of the c.i.f. bid price of such goods if said customs duties and taxes exceed 15% of such price. If the group A bid in such further comparison is the lowest, it shall be selected for the award; if not, the bid from group C which as a result of the comparison under paragraph (c) is the lowest evaluated bid shall be selected. C. Review of Procurement Decisions by Association 1. Review of invitation to bid and of proposed awards and final contracts. With respect to all contracts for equipment and vehicles estimated to cost the equivalent of $100,000 or more: (a) Before bids are invited, Madhya Pradesh shall furnish to the Association, for its comments, the text of the invitations to bid and the specifications and other bidding documents, together with a description of the advertising procedures to be followed for the bidding, and shall make such modifications in the said documents or procedures as the Association shall reasonably request. Any further modification to the bidding documents shall require the Association's concurrence before it is issued to the prospective bidders. (b) After bids have been received and evaluated, Madhya Pradesh shall, before a final decision on the award is made, inform the Association of the name of the bidder to which it intends to award the contract and the reasons for the intended award and shall furnish to the Association, in sufficient time for its review, a detailed report on the evaluation and comparison of the bids received, together with the recommendation for award and such other information as the Association shall reasonably request. The Association shall, if it determines that the intended award would be inconsistent with the Guidelines or this Schedule, promptly inform Madhya Pradesh and state the reasons for such determination. (c) The terms and conditions of the contract shall not, without the Association's concurrence, materially differ from those on which bids were asked or prequalification invited. (d) Two conformed copies of the contract shall be furnished to the Association promptly after its execution and prior to the submission to the Association of the first application for withdrawal of funds from the Credit Account in respect of such contract. 11 2. With respect to each contract to be financed out of the proceeds of the Credit and not governed by the preceding paragraph, Madhya Pradesh shall furnish to the Association, promptly after its execution and prior to the submission to the Association of the first application for withdrawal of funds from the Credit Account in respect of such contract, two conformed copies of such contract, together with the analysis of bids, recommendations for award and such other information as the Association shall reasonably request. The Association shall, if it determines that the award of the contract was not consistent with the Guidelines or this Schedule, promptly inform Madhya Pradesh and state the reasons for such determination.