Conformed Copy - C1849 - National Agricultural Research Project - Amendment 3

Page 1 January 24, 1991 His Excellency, The Minister of Finance Nairobi, Kenya Re: Cr. 1849-KE / National Agricultural Research Project (NARP) Amendments 1. We refer to your letter of January 2, 1991, in which you requested certain amendments in the Development Credit Agreement of May 13, 1988, between the Republic of Kenya and the International Development Association (IDA) for reallocation of the amounts of the Credit allocated to different categories and to provide for incremental support activities under the Project. We also refer to the telex send by Miss. W.W. Ikua of January 11, 1991 providing additional clarifications. We are pleased to inform you that the Association accepts your request in principle although minor modifications were made to take account of the Bank's disbursement guidelines. Schedule 1 and 2 to the Development Credit Agreement shall therefore be amended as indicated in the attachment. 2. The amendments shall be considered effective as of July 1, 1990, except for the Adaptive Research Grants which would become effective after IDA review and approval of guidelines for the operation and use of these grants to be submitted by the Kenya Agricultural Research Institute before April 1, 1991. 3. All provisions of the Development Credit Agreement as amended herein shall remain in full force and effect. 4. Please confirm your agreement to the amendments by countersigning and returning to us the enclosed copy of this letter. Sincerely yours, Callisto Madavo Director Eastern Africa Department CONFIRMED REPUBLIC OF KENYA By Authorized Representative Date: 7/2/91 SCHEDULE I 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 amounts of the Credit to each Category and the percentage of expenditures for items so to be financed in each Category: Amount of the Credit Allocated % of Page 2 (Expressed in Expenditures Category SDR Equivalent) to be Financed 1. For Part A of the Project: (a) Civil Works 1,500,000 80% (b) Vehicles, 450,000 100% of foreign plant and expenditures and equipment 70% of local expenditures (c) Non-salary 1,220,000 (i) 90% up to an operating aggregate amount of SDR 630,000; thereafter (ii) 50% up to an aggregate amount of SDR 1,040,000; and thereafter (iii)25% up to an aggregate amount of SDR 1,220,000 (d) Training, Seminars 200,000 100% and Workshops, including technical Assistance 2. For Part B of the Project: (a) Civil Works 5,860,000 80% (b) Vehicles, 2,240,000 100% of foreign plant and expenditures and equipment 70% of local expenditures (c) Non-salary 1,680,000 (i) 90% up to an operating aggregate amount of SDR 880,000; thereafter (ii) 70% up to an aggregate amount of SDR 1,430,000; and thereafter (iii)50% up to an aggregate amount of SDR 1,680,000 (d) Adaptive Research 500,000 100% Grants (e) Training, Workshops 300,000 100% and seminars, including technical assistance 3. Refunding of Project 86,000 Amount pursuant preparation Advance to Section 2.02 4. Unallocated 1,464,000 TOTAL 15,500,000 Page 3 For the purposes of this Schedule: (a) the term "foreign expenditures" means expenditures in the currency of any country other than that of the Borrower for goods or services supplied from the territory of any country other than that of the Borrower; and (b) the term "local expenditures" means expenditures in the currency of the Borrower or for goods or services supplied from the territory of the Borrower. Notwithstanding the provisions of paragraph 1 above, no withdrawals shall be made: (C) in respect of payments made for expenditures prior to the date of the Agreement; and (d) in respect of payments for expenditures under Category (2) of the table above, until the Association has approved the research programs under Part 8 of the Project. SCHEDULE 2 Description of the Project The objectives of the Project are to: (i) focus agricultural research in Kenya on priority programs; (ii) develop technologies that contribute to increased productivity; (iii) intensify producer participation in research program formulation; (iv) strengthen linkages between research and other agricultural services; and (v) improve cooperation with other agricultural research institutions. The Project consists of the following parts: PART A: Kenya Agricultural Research Institute - Headquarters 1. Restructuring of KARI to enable It to undertake research planning, management, budgeting, supervision, reporting and training. 2. Establishment of identified elements of KARI's management information and reporting systems through the provision of technical assistance, vehicles, equipment and the construction of a headquarters building. 3. Development of KARI's management and research capacity through the provision of post-graduate degree training, short-term courses, workshops, seminars and technical assistance. PART B: Research Program Development 1. Rationalization of the network of RRCs in Kenya on the basis of their specific mandates. 2. Support for the execution of adaptive research programs covering all of Kenya's agro-climatic zones and the rehabilitation of all RRCS, through the provision of civil works, equipment, vehicles training and technical assistance. 3. Rehabilitation of the NRCs and assistance to implement critical nationally coordinated commodity and factor research programs for applied research, through the provision of civil works, equipment, vehicles, training and technical assistance. 4. The Project is expected to be completed by June 30, 1992. Page 4