India - Gujarat Fisheries Project : Credit 0695 - Project Agreement - Conformed

CONFORMED COPY CREDIT NUMBER 695-IN LOAN NUMBER 1394 T-IN GUJARAT PROJECT AGREEMENT (Gujarat Fisheries Project) between INTERNATIONAL DEVELOPMENT ASSOCIATION and INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT and THE STATE OF GUJARAT Dated April 22, 1977 GUJARAT PROJECT AGREEMENT AGREEMENT, dated April 22, 1977, between INTERNATIONAL DEVELOPMENT ASSOCIATION (hereinafter called the Association), INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (hereinafter called the Bank) and THE STATE OF GUJARAT, acting by its Governor (hereinafter called Gujarat). 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 four million dollars ($4,000,000), on the terms and conditions set forth in the Development Credit Agreement, but only on condition that Gujarat agrees to undertake such obligations toward the Association as hereinafter set forth; WHEREAS by the Loan Agreement of even date herewith between the Borrower and the Bank, the Bank has agreed to make available to the Borrower an amount in various currencies equivalent to fourteen million dollars ($14,000,000), on the terms and conditions set forth in the Loan Agreement, but only on condition that Gujarat agrees to undertake such obligations towards the Bank as hereinafter set forth; and -2- WHEREAS in consideration of the Association's entering into the Development Credit Agreement with the Borrower and the Bank's entering into the Loan Agreement with the Borrower, Gujarat has agreed to undertake the obligations hereinafter set forth; NOW THEREFORE the parties hereto hereby agree as follows: -3- 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, the Loan Agreement and the General Conditions (as so defined) have the respective meanings therein set forth. 4- ARTICLE II Execution of the Project Section 2.01. (a) Gujarat shall and shall cause GPD, GFCCA, and FTD to carry out Parts A, B, C (2) and C (3) of the Project described in Schedule 2 to the Development Credit Agreement with due diligence and efficiency and in conformity with appropriate 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. (b) Gujarat shall assist ARDC to carry out the credit program described in Part D of the Project. Section 2.02. (a) In order to obtain the technical assistance described in Part C (3) of the Project, Gujarat shall employ consultants, whose qualifications, experience and terms and conditions of employment shall be mutually agreed between Gujarat, the Association and the Bank, in the fields of harbor engineering, underwater rock excavation and fisheries resource and terminal operation. -5- Section 2.03. Except as the Association and the Bank shall otherwise agree, contracts for the purchase of goods or for civil works to be financed out of the proceeds of the Credit and of the Loan, shall be procured in accordance with the provisions of the Schedule to this Agreement. Section 2.04. (a) Gujarat undertakes to insure, or make adequate provision for the insurance of, the imported goods to be financed out of the proceeds of the Credit and of the Loan 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 Gujarat to replace or repair such goods. (b) Except as the Association and the Bank may otherwise agree, Gujarat shall cause all goods and services financed out of the proceeds of the Credit and of the Loan made available to it by the Borrower to be used exclusively for the Project. Section 2.05. (a) Gujarat shall collect and furnish to the Association and the Bank, promptly upon the preparation by GPD, GFCCA and FTD, the 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 or the Bank shall reasonably request. -6- (b) Gujarat shall cause GPD, GFCCA, and FTD to: (i) 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 and of the Loan made available to it by the Borrower, and to disclose the use thereof in the Project; (ii) without limitation upon the provisions of paragraph (c) of this Section, enable the Association's and the Bank'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) furnish to the Association and the Bank all such information as the Association or the Bank shall reasonably request concerning the Project, the expenditure of the proceeds of the Credit and of the Loan so made available to it and the goods and services financed out of such proceeds. (c) Gujarat shall enable the Association's and the Bank's representatives to examine all plant, installations, sites, works, buildings, property and equipment of GFCCA and FTD and any relevant records and documents. Section 2.06. (a) Gujarat shall cause GPD, GFCCA and FTD to exchange views with the Association and the Bank whenever requested by the Association or the Bank with regard to the progress of the Project, the execution of their respective Parts of the Project and other matters relating to the purposes of the Credit and of the Loan. - 7 - (b) Gujarat shall promptly inform the Association and the Bank of any condition which interferes or threatens to interfere with, the progress of the Project, the accomplishment of the purposes of the Credit and of the Loan, or the execution of the Parts of the Project by GPD, GFCCA and FTD. Section 2.07. (a) Gujarat shall cause the design and capacity of the freezing and ice plant at Mangrol and Veraval and of the proposed second block ice plant for Veraval to be prepared and be reviewed by ARDC by June 30, 1981 or such later date as may be agreed by the Association and the Bank. (b) Gujarat shall consolidate the production, fishermen's households and credit recipients surveys under Part C (2) of the Prodject. Terms of reference for these surveys shall be furnished to the Association and the Bank for approval by September 30, 1977 or such later date as may be agreed by the Association and the Bank. Section 2.08. (a) By September 30, 1977 or such later date as may be agreed by the Association and the Bank, Gujarat shall, in consultation with ARDC, furnish a proposal for establishing a Boat Risk Fund which shall be operated by GFCCA for the purpose of providing insurance to vessel owners. (b) Gujarat shall assist in the establishment and management of FPCS. -8- (c) Gujarat shall ensure that the project monitoring and evaluation system in DACFF is adequately staffed to prepare reports on the progress of Project implementation. (d) Gujarat shall establish PSC in DACFF under the chairmanship of the Secretary of DACFF. The Commissioner of Fisheries shall act as Secretary of PSC and project coordinator. Section 2.09. By October 31, 1977 or such later date as may be agreed by the Association and the Bank, Gujarat shall strengthen the Statistical Cell of its Department of Fisheries by appointing a senior statistician whose qualifications, experience and terms and conditions of employment shall be mutually agreed between Gujarat, the Association and the Bank. Section 2.10. Gujarat shall make available to FTD adequate land and such constructions at Mangrol and Veraval harbor areas as are necessary to carry out its functions described under Section 2.12 hereof. Section 2.11. Gujarat shall reorganize and strengthen GFCCA in accordance with the proposal prepared by Gujarat in consultation with ARDC and approved by the Association and the Bank. Gujarat shall cause GFCCA to retain qualified accountants to maintain a sound financial system for GFCCA and to appoint additional engineers and a marketing manager for this purpose. - 9 - Section 2.12. (a) By December 31, 1977 or such later date as may be agreed by the Association and the Bank, Gujarat shall establish FTD which shall develop and administer the fishing terminal areas at Mangrol and Veraval, operate the auction halls and issue leases of buildings and sites to enterpreneurs for Project related work. (b) By December 31, 1977 or such later date as may be agreed by the Association and the Bank, Gujarat shall furnish to the Association and the Bank the feasibility study on the deduction of part of the proceeds of fish sales for the repayment of loans obtained by fishermen from the Participating Bank and of the hire purchase price of mechanized trawlers. Section 2.13. By September 30, 1977 or such later date as may be agreed by the Association and the Bank, Gujarat shall cause GPD to appoint qualified technical staff for the carrying out of Part A of the Project. - 10 - ARTICLE III Financial Covenants Section 3.01. Gujarat shall and shall cause GPD, GFCCA and FTD to maintain separate accounts for the Project and records adequate to reflect in accordance with consistently maintained appropriate accounting practices its operations and financial condition. Section 3.02. (a) Gujarat shall and shall cause GFCCA and FTD to: (i) have an annual audit satisfactory to the Association and the Bank made of their accounts and financial statements (balance sheet of GFCCA and proforma balance sheet of FTD, statement of income and expenses and related statements) for each fiscal year, in accordance with sound auditing principles consistently applied, by independent and qualified auditors; (ii) furnish to the Association and the Bank as soon as available, but in any case not later than four months after the end of each such year, (A) certified copies of their 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 or the Bank shall have reasonably requested; and (iii) furnish to the Association and the Bank such other information concerning their accounts and financial statements and the audit thereof as the Association or the Bank shall from time to time reasonably request. - 11 - (b) Gujarat shall cause GPD to: (i) have an annual audit satisfactory to the Association and the Bank made of its accounts under Section 3.01 above for each fiscal year, in accordance with sound auditing principles consistently applied, by independent and qualified auditors; (ii) furnish to the Association and the Bank as soon as available, but in any case not later than four months after the end of each such year, (A) certified copies of its accounts 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 or the Bank shall have reasonably requested; and (iii) furnish to the Association and the Bank such other information concerning its accounts and the audit thereof as the Association or the Bank shall from time to time reasonably request. Section 3.03. Gujarat shall cause FTD to charge amounts sufficient to enable FTD to cover all operating expenditures and charges including taxes (if any), interest payment on borrowings and depreciation. - 12 - 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 and the Loan Agreement become effective. Section 4.02. (a) This Agreement and all obligations of the Association, of the Bank and of Gujarat thereunder shall terminate on the earlier of the following two dates: (i) the date on which the Development Credit Agreement and the Loan Agreement shall terminate in accordance with their terms; or (ii) a date twenty years after the date of this Agreement. (b) If either the Development Credit Agreement or the Loan Agreement terminates in accordance with their terms before the date specified in paragraph (a) (ii) of this Section, the Association or the Bank shall promptly notify Gujarat of this event. Section 4.03. All the provisions of this Agreement shall continue in full force and effect notwithstanding any cancellation or suspension under the Development Credit Agreement or the Loan Agreement. - 13 - 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 here- inafter 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: Telex: INDEVAS 440098 (ITT) Washington, D.C. 248423 (RCA) or 64145 (WUI) For the Bank: International Bank for Reconstruction and Development 1818 H Street, N.W. Washington, D.C. 20433 United States of America - 14 - Cable address: Telex: INTBAFRAD 440098 (ITT) Washington, D.C. 248423 (RCA) or 64145 (WUI) For Gujarat: Secretary to the Government of Gujarat Agriculture, Forests and Co-operation Department Sachivalaya, Gandhinagar, Gujarat, India. Cable address: AGRISEC GANDHINAGAR, INDIA Section 5.02. (a) So long as the Development Credit Agreement shall not have terminated prior to the termination of the Loan Agreement and so long as the Bank has not given notice to the contrary to Gujarat: (i) the obligations of Gujarat to consult with and to furnish information, documents, plans, reports, records and statements to the Bank shall be satisfied to the extent performance in respect of such obligations is rendered to the Association; and (ii) the obligations of the Bank to consult with and to furnish information to Gujarat shall be satisfied to the extent such obligations are fulfilled by the Association. - 15 - (b) Unless and until the Bank gives notice to the contrary to Gujarat, all actions taken (including the giving of approvals or the granting of waivers) by the Association pursuant to this Agreement shall be deemed to be taken in the name and on behalf of both the Association and the Bank. Section 5.03. Any action required or permitted to be taken, and any documents required or permitted to be executed, under this Agreement on behalf of Gujarat may be taken or executed by the Secretary to the Government of Gujarat or such other person or persons as Gujarat shall designate in writing. Section 5.04. Gujarat shall furnish to the Association and the Bank sufficient evidence of the authority and the authenticated specimen signature of the person or persons who will, on behalf of Gujarat, take any action or execute any documents required or permitted to be taken or executed by Gujarat pursuant to any of the provisions of this Agreement. Section 5.05. This Agreement may be executed in several counterparts, each of which shall be an original, and all collectively but one instrument. - 16 - 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/ Ernest Stern Regional Vice President South Asia INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT By /s/ Ernest Stern Regional Vice President South Asia STATE OF GUJARAT By /s/ J.S. Baijal Authorized Representative - 17 - SCHEDULE Procurement A. International Competitive Bidding 1. Civil works under Part A (1) of the Project for Veraval harbor comprising of breakwaters, quays, excavation and cofferdam; contracts for the purchase of dredging equipment, outboard motors, refrigeration equipment and net manufacturing machines costing $100,000 or more shall be procured in accordance with procedures consistent with those set forth in the "Guidelines for Procurement under World Bank Loans and IDA Credits" published by the Bank in August 1975 (hereinafter called the Guidelines) including the pertinent provisions of the General Introduction thereto, on the basis of international competitive bidding as described in Part A of the Guidelines. 2. The entire civil works under 1. above shall be procured under one work contract and bidders shall be prequalified as described in paragraph 1.3 of Part A of the Guidelines. B. Other Procurement Procedures 1. Wooden trawler hulls and their engines and canoes shall be contracted by competitive bidding on the basis of local advertising or other local procurement procedures satisfactory to the Association and the Bank. 2. All other civil works under Part A of the Project shall be contracted by competitive bidding on the basis of local - 18 - advertising or other local procurement procedures satisfactory to the Association and the Bank. 3. Fishing gears procured by ultimate borrowers under the credit program provided for under Part D of the Project shall be in accordance with the ultimate borrowers' preference. C. 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 except those to be procured in accordance with local procedures: (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 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 - 19 - 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 manufactued in India if the bidder shall have established to the satisfaction of Gujarat, the Association and the Bank 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 - 20 - 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 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 compari-,n is the lowest, it shall be selected for the award; if not, the bid from Gr'6up C which as a result of the comparison under paragraph (c) is the lowest evaluated bid shall be selected. D. Evaluation and Comparison of Bids for Civil Works; Preference for Domestic Contractors With respect to any contract for civil works included under Category (2) of the table set forth in Schedule 1 to the Development Credit Agreement and to be procured in accordance with the procedures described in Part A.1 of this Schedule, Gujarat may grant a margin of preference of 7-1/2% to domestic contractors, in accordance with, and subject to, the following provisions: (a) Contractors shall be required to prequalify as provided in Part A of this Schedule and application for prequalification - 21 - applying also for such preference shall be asked to provide, as part of data for qualification, such information, including details of ownership, as shall be required to determine whether, according to the classification established by Gujarat and GPD and accepted by the Association and the Bank, a particular firm or group of firms qualified for a domestic preference. The bidding documents shall clearly indicate the preference and the method that will be followed in the evaluation and comparison of bids to give effect to such preference. (b) After bids have been received and reviewed by Gujarat, responsive bids will be classified into the following groups: (i) bids offered by domestic contractors eligible for preference; and (ii) bids offered by other contractors. For the purpose of evaluation and comparison of bids an amount equal to 7-1/2% of the bid amount shall be added to bids received under group (ii) above. E. Review of Procurement Decisions by the Association and the Bank 1. Review of prequalification. Gujarat shall, before prequalification is invited, inform the Association and the Bank in detail of the procedure to be followed, and shall introduce such modifications in said procedures as the Association or the - 22 - Bank shall reasonably request. The list of prequalified bidders, together with a statement of their qualifications and, where applicable, of their eligibility for domestic preference under Part D above and of the reasons for the exclusion of any applicant for prequalification and for such eligibility shall be furnished by Gujarat to the Association and the Bank for their comments before the applicants are notified of Gujarat's decision, and Gujarat shall make such additions to, deletions from, or modifications in, the said list as the Association or the Bank shall reasonably request. 2. Review of invitations to bid and of proposed awards and final contracts: With respect to all contracts for civil works, equipment and materials for marine works and shore facilities under Parts A and B of the Project estimated to cost the equivalent of $200,000 or more: (a) Before bids are invited, Gujarat shall cause to be furnished to the Association and the Bank, for their 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 or the Bank shall reasonably request. Any further modification to - 23 - the bidding documents shall require the Association's and the Bank's concurrence before it is issued to the prospective bidders. (b) After bids have been received and evaluated, Gujarat shall, before a final decision on the award is made, inform the Association and the Bank of the name of the bidder to which it intends to award the contract and shall furnish to the Association and the Bank, in sufficient time for their review, a detailed report on the evaluation and comparison of the bids received, and such other information as the Association or the Bank shall reasonably request. The Association and the Bank shall, if they determine that the intended award would be inconsistent with the Guidelines or this Schedule, promptly inform Gujarat and state the reasons for such determination. (c) The terms and conditions of the contract shall not, without the Association's and the Bank'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 and the Bank promptly after its execution and prior to the submission to the Association and the Bank of the first application for withdrawal of funds from the Credit Account or the Loan Account, as the case may be, in respect of such contract. - 24- 3. With respect to each contract to be financed out of the proceeds of the Credit and of the Loan and not governed by the preceding paragraph, Gujarat shall cause to be furnished to the Association and the Bank, promptly after its execution and prior to the submission to the Association and the Bank of the first application for withdrawal of funds from the Credit Account or the Loan Account, as the case may be, in respect of such contract, two conformed copies of such contract, together with Lhe analysis of the respective bids, recommendations for award and such other information as the Association or the Bank shall reasonably request. The Association and the Bank shall, if they determine that the award of the contract was not consistent with the Guidelines or this Schedule, promptly inform Gujarat and state the reasons for such determination.