India - Haryana Irrigation II Project : Credit 1319 - Credit Agreement - Conformed

10 =llC Ag L1 OFF~IIL ICREDIT NUMBER 1319 IN DOCUMENTS Development Credit Agreement (Haryana Irrigation II Project) between INDIA and INTERNATIONAL DEVELOPMENT ASSOCIATION Dated , 1983 CREDIT NUMBER 1319 IN DEVELOPMENT CREDIT AGREEMENT AGREEMENT, dated , 1983, between INDIA, acting by its President, (he einafter called the Borrower) and INTERNATIONAL DEVELOPMENT ASSOCIATION (hereinafter called the Association). WHEREAS (A) the Borrower has requested the Association to assist in the financing of the Project described in Schedule 2 to this Agreement by extending the Credit as hereinafter provided; and (B) by an agreement of even date herewith between the Association and the State of Haryana, the State of Haryana has agreed to undertake certain obligations in respect of the carrying out of the Project; WHEREAS the Association has agreed, on the basis inter alia of the foregoing, to extend the Credit to the Borrower upon the terms and conditions hereinafter set forth and in the Project Agreement of even date herewith between the Association and the State of Haryana; NOW THEREFORE the parties hereto hereby agree as follows: ARTICLE I General Conditions; Definitions Section 1.01. The parties to this Agreement accept all the provisions of the General Conditions Applicable to Development Credit Agreements of the Association, dated June 30, 1980, with the same force and effect as if they were fully set forth herein (said General Conditions Applicable to Development Credit Agreements of the Association being hereinafter called the General Conditions). Section 1.02. Wherever used in this Agreemer , unless the context otherwise requires, the several terms d fined in the General Conditions have the respective meanings the ein set forth and the following additional terms have the following meanings: (a) "HARYANA" means the State of Haryana, acting by its Governor, a State of India; -2- (b) "HSMITC" means the Haryana State Minor Irrigation (Tubewells) Corporation Ltd., a public sector corporation wholly-owned by Haryana established and organized under the laws of the Borrower; (c) "Project Area" means the area of about 2.3 M ha cover- ing the Bhakra and Western Yamuna Canal Systems and of about 102,000 ha of the Jui and Sewani Pump-lift Systems, in Haryana; (d) "Project Agreement" means the agreement between the Association and Haryana of even date herewith, as the same may be amended from time to time, and such term includes the schedule to the Project Agreement and all agreements supplemental to the Project Agreement; (e) "Shareholders Maintenance Committee" means each of the associations to be established on each watercourse by the farmer beneficiaries of such watercourse pursuant to the provisions of Section 2.05 of the Project Agreement; (f) "Sprinkler Irrigation Association" means each of the associations to be established by the farmer beneficiaries of the respective sprinkler irrigation system pursuant to tha provisions of Section 2.08 of the Project Agreement; and (g) "Chak" means the cultivable command area irrigated by a watercourse. ARTICLE II The Credit Section 2.01. The Association agrees to lend to the Borrower, on the terms and conditions set forth or referred to in this Agreement, an amount in various currencies equivalent to one hundred thirty-nine million Special Drawing Rights (SDR 139,000,000). Section 2.02. The amount of the Credit may be withdrawn from the Credit Account in accordance with the provisions of Schedule 1 to this Agreement, as such Schedule may be amended from time to time by agreement between the Borrower and the Association, for expenditures made (or, if the Association shall so agree, to be made) in respect of the reasonable cost of goods and services required for the Project and to be financed out of the proceeds of the Credit. -3- Section 2.03. Except as the Association shall otherwise agree, procurement of the goods and civil works required for the Project and to be financed out of the proceeds of the Credit shall be governed by the provisions of the Schedule to the Project Agreement. Section 2.04. The Closing Date shall be March 31, 1988 or such later date as the Association shall establish. The Association shall promptly notify the Borrower of such later date. Section 2.05. (a) The Borrower shall pay to the Association a commitment charge at the rate of one-half of one per cent (1/2 of 1%) per annum on the principal amount of the Credit not with- drawn from time to time. The commitment charge shall accrue from a date sixty days after the date of the Development Credit Agree- ment to the respective dates on which amounts shall be withdrawn by the Borrower from the Credit Account or shall be cancelled. (b) The commitment charge shall be paid: (i) at such places as the Association shall reasonably request; (ii) without restrictions of any kind imposed by, or in the territory of, the Borrower; aad (iii) in the currency specified in this Agreement for the purposes of Section 4.02 of the General Conditions or in such other eligible currency or currencies as may from time to time be designated or selected pursuant to the provisions of that Section. Section 2.06. The Borrower shall pay to the Association a service charge at the rate of three-fourths of one per cent (3/4 of 1%) per annum on the principal amount of the Credit withdrawn and outstanding from time to time. Section 2.07. Commitment charges and service charges shall be payable semiannually on January 1 and July 1 in each year. Section 2.08. Thg Borrower shall repay the principal amount of the Credit in semiannual installments payable on each January I and July 1 commencing July 1, 1993, and ending January 1, 2033, each installment to and including the installment payable on January 1, 2003, to be one-half of one per cent (1/2 of 1%) of such principal amount, and each installment thereafter to be one and one-half per cent (1-1/2%) of such principal amount. -4- Section 2.09. The currency of the United States of America hereby specified for the purposes of Section 4.02 of the General Conditions. ARTICLE III Execution of the Project Section 3.01. Without any limitation or restriction upon any of its other obligations under the Development Credit Agreement, the Borrower shall cause Haryana to perform in accordance with the provisions of the Project Agreement, all the obligations therein set forth, shall take and cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable Haryana to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. Section 3.02. The Borrower shall make the proceeds of the Credit available to Haryana in accordance with the Borrower's standard arrangements for development assistance to the States of India. ARTICLE IV Remedies of the Association Section 4.01. For the pu,rposes of Section 6.02 of the General Conditions the following additional events are specified pursuant to paragraph (h) thereof: (a) Haryana shall have failed to perform any of its obliga- tions under the Project Agreement; and (b) as a result of events which have occurred after the date of the Development Credit Agreement, an extraordinary situa- tion shall have arisen which shall make it improbable that Haryana will be able to perform its obligations under the Project Agreement. Section 4.02. For the purposes of Section 7.01 of the General Conditions, the following additional events are specified pursuant to paragraph (d) thereof, namely, that, any event speci- fied in paragraph (a) of Section 4.01 of this Agreement shall occur and shall continue for a period of 60 days after notice -5- thereof shall have been given by the Association to the Borrower and Haryana. ARTICLE V Effective Date; Termination Section 5.01. The following is specified as an additional matter, within the meaning of Section 12.02 (b) of the General Conditions, to be included in the opinion or opinions to be furnished to the Association, namely, that the Project Agreement has been duly authorized or ratified by Haryana, and is legally binding upon Haryana in accordance with its terms. Section 5.02. The date, -&a"{t c-' > 1983, is hereby specified for the purposes of Stion 12.04 of the General Conditions. ARTICLE VI Representative of the Borrower; Addresses Section 6.01. Any Secretary, Additional Secretary, Joint Secretary, Director, Deputy Secretary and Under Secretary of the Department of Economic Affairs in the Ministry of Finance of the Borrower is designated as representative of the Borrower for the purposes of Section 11.03 of the General Conditions. Section 6.02. The following addresses are specified for the purpose of Section 11.01 of the General Conditions: For the Borrower: The Secretary to the Government of India Ministry of Finance Department of Economic Affairs New Delhi India Cable address: Telex: ECOFAIRS 953-313546 New Delhi -6- 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) 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. INDIA By Authorized Representative INTERNATIONAL DEVELOPMENT ASSOCIATION By Regional Vice President South Asia -7- SCHEDULE 1 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 (Expressed in Expenditures Category SDR Equivalent) to be Financed (1) Civil works: (a) for Part A 59,000,000 70% of the Project (b) for Parts B 46,700,000 70% and C of the Project (c) for other 17,300,000 70% Parts of the Project (2) Equipment, goods, 7,600,000 100% of foreign materials and expenditures, vehicles 100% of local expenditures ex-factory, and 70% of other local expendi- tures (3) Research and 4,000,000 100% Development, Training, Tech- nical Services and Monitoring and Evaluation Studies (4) Unallocated 4,400,000 TOTAL 139,000,000 -8- 2. For the purposes of this Schedule: (a) the term "foreign expenditures" means expenditures in the currency of any country other than the Borrower and for goods or services supplied from the territory of any country other than 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. 3. The disbursement percentages have been calculated in com- pliance with the policy of the Association that no proceeds of the Credit shall be disbursed on account of payments for taxes levied by, or in the territory of, the Borrower on goods or services, or on the importation, manufacture, procurement or supply thereof; to that end, if the amount of any such taxes levied on or in respect of any item to be financed out of the proceeds of the Credit decreases or increases, the Association may, by notice to the Borrower, increase or decrease the dis- bursement percentage then applicable to such item as required to be consistent with the aforementioned policy of the Association. 4. Notwithstanding the provisions of paragraph 1 above, no withdrawals shall be made in respect of payments made for expenditures prior to the date of this Agreement, except that withdrawals, in an aggregate amount not exceeding the equivalent of SDR 3,000,000, may be made in respect of Categories (1) and (2) on account of payments made for such expenditures before that date but after February 1, 1983. 5. Notwithstanding the allocation of an amount of the Credit or the disbursement percentages set forth in the table in para- graph 1 above, if the Association has reasonably estimated that the amount of the Credit then allocated to any Category will be insufficient to finance the agreed percentage of all expenditures in that Category, the Association may, by notice to the Borrower: (i) reallocate to such Category, to the extent required to meet the estimated shortfall, proceeds of the Credit which are then allocated to another Category and which in the opinion of the Association are not needed to meet other expenditures; and (ii) if such reallocation cannot fully meet the estimated shortfall, reduce the disbursement percentage then applicable to such expenditures in order that further withdrawals under such Category may continue until all expenditures thereunder shall have been made. 9 6. If the Association shall have reasonably determined that the procurement of any item in any Category is inconsistent with the procedures set forth or referred to in this Agreement, no expend- itures for such item shall be financed out of the proceeds of the Credit and the Association may, without in any way restricting or limiting any other right, power or remedy of the Association under the Development Credit Agreement, by notice to the Bor- rower, cancel such amount of the Credit as, in the Association's reasonable opinion, represents the amount of such expenditures which would otherwise have been eligible for financing out of the proceeds of the Credit. - 10 - SCHEDULE 2 Description of the Project Part A: Modernization of the Bhakra and Western Yamuna Canal Systems (i) Lining of about 23 million square meters (about 250 million square feet) of existing canals (equivalent to about 2,900 km of branch, distributory and minor canals) in the Bhakra and Western Yamuna Canal Systems, including when needed, construction of new parallel lined channels. (ii) Improvement and modernization of the Bhakra and Western Yamuna Canal Systems, including the replacement of canal regu- lators, installation and operation of water measuring devices, remodelling of falls and watercourse outlets, and construction of ancillary facilities. (iii) Improvement and modernization of the communication system in the Bhakra and Western Yamuna Canal Systems, including the installation and operation of the necessary base station two-way radio sets. Part B: Modernization of Watercourses Lining and installation of minor irrigation structures for about 6 million lineal meters (about 20 million lineal feet) of existing watercourses (equivalent to about 1,700 watercourses) in the Bhakra and Western Yamuna Canal Systems, and construction of about 1 million lineal meters (about 3 million lineal feet) and installation of minor irrigation structures for new watercourses (equivalent to about 200 watercourses) in the Jui and Sewani Pump-lift Systems. Part C: Augmentation Tubewells Construction and electrification of about 325 deep tubewells together with necessary link channels to augment surface water supply in the Bhakra and Western Yamuna Canal Systems. Part D: Sprinkler Irrigation Installation, operation and maintenance of about 100 sprinkler irrigation sets in the Bhiwani, Sirsa and Hissar Districts of Haryana. - 11 - Part E: Village Water Supply Construction of about 120 water supply schemes to serve about 360 villages in the Project Area. Part F: Village Access Roads Construction of about 196 km of village access roads to serve about 111 villages in the Project Area. Part G: Training Manpower training for in-service and new recruit staff of Haryana's Irrigation Department. Part H: Research and development of irrigation infrastructure, including pilot projects, experiments, studies and provision of technical assistance. The Project is expected to be completed by March 31, 1987. INTERNATIONAL DEVELOPMENT ASSOCIATION CERTIFICATE I hereby certify that the foregoing is a true copy of the original in the archives of the Interna- tional Development Association. In witness whereof I have signed this Certifi- cate and affixed the Seal of the Association thereunto the J day of __ , 198 %. FOR SECRETARY