India - National Seed Project : Loan 1273 - Andhra Pradesh Project Agreement - Conformed

LOAN NUMBER 42 73 IN ANDHRA PRADESH PROJECT AGREEMENT (National Seed Project) between INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT and THE STATE OF ANDHRA PRADESH Dated , 1976 ANDHRA PRADESH PROJECT AGREEMENT AGREEMENT, dated 12<< cau}/ , 1976, between INTER- NATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (hereinafter called the Bank) and THE STATE OF ANDHRA PRADESH (hereinafter called Andhra Pradesh). WHEREAS by the Loan Agreement of even date herewith between India, acting by its President (hereinafter called the Borrower) and the Bank, the Bank has agreed to make available to the Borrower an amount in various currencies equivalent to twenty-five million dollars ($25,000,000), on the terms and conditions set forth in the Loan Agreement, but only on condition that Andhra Pradesh agrees to undertake such obligations toward the Bank as are hereinafter set forth; and WHEREAS Andhra Pradesh, in consideration of the Bank's entering into the Loan Agreement with the Borrower, has agreed to undertake the obligations hereinafter set forth; NOW THEREFORE the parties hereto hereby agree as follows: -2- ARTICLE I Definitions Section 1.01. Wherever used in this Agreement, unless the context shall otherwise require, the several terms defined in the Loan Agreement and in the General Conditions (as so defined) have the respective meanings therein set forth. -3- ABTICLE II Execution of the Project Section 2.01. Andhra Pradesh shall carry out or cause to be carried out in the State of Andhra Pradesh the Project described in Schedule 2 to the Loan Agreement with due diligence and effi- ciency and in conformity with appropriate administrative, fi- nancial, agricultural and engineering practices, and shall pro- vide, or cause to be provided, promptly as needed, the funds, facilities, services and other resources required for the purpose. Section 2.02. Andhra Pradesh shall cause its SSC to enter into an agreement with NSC satisfactory to the Bank. The said agreement shall, inter alia, set out the respective responsibili- ties of NSC and the SSC in the carrying out of the Project. Section 2.C3. Andhra Pradesh shall with respect to supplies of foundation seed, access to seed quality control services and such other matters as may be agreed between the Borrower and the Bank extend the same treatment to all persons involved in the seed industry. Section 2.04. Except as the Bank may otherwise agree, Andhra Pradesh shall support the establishment of an interdisciplinary cooperative program among relevant departments of Andhra Pradesh Agricultural University to undertake applied seed technology re- search. Section 2.05. Andhra Pradesh shall not make, or permit to be made, any change in the articles of association or other instrument governing its SSC without prior consultation with the Borrower and the Bank. Section 2.06. (a) Andhra Pradesh shall cause its SSC to manage its affairs, maintain its financial position, plan its future expan- sion and carry on its operations in accordance with sound business, financial and personnel practices under the supervision of experi- enced and competent staff in adequate number. (b) Andhra Pradesh shall by the Effective Date purchase for cash equity shares of its SSC in an amount of not less than five hundred thousand rupees (Rs500,OOO). Section 2.07. Andhra Pradesh shall review crop credit limits and adjust them as necessary for seed production. Section 2.08. Andhra Pradesh shall permit its SSC to appoint such dealers in seed as the SSC may in the interest of efficiency consider necessary. Section 2.09. Andhra Pradesh shall, for the purpose of enforc- ing minimum seed quality control standards under the applicable laws, cause to be inspected annually not less than one-half of all dealers handling certified or truthfully labelled seeds in Andhra Pradesh. Section 2.10. Andhra Pradesh shall transfer to Andhra Pradesh Agricultural University land which satisfies the Bank as suitable for seed production. -5- Section 2.11. Except as the Bank may otherwise agree, the goods and services for the Project to be financed out of the pro- ceeds of the Loan, shall be procured in accordance with the provi- sions of Schedule 4 to the Loan Agreement. Section 2.12. (a) Andhra Pradesh undertakes to insure, or make adequate provision for the insurance of, any imported roods to be financed out of the proceeds 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 instal- lation, and for such insurance any indemnity shall be payable in a currency freely usable by Andhra Pradesh to replace or repair such goods. (b) Except as the Bank may otherwise agree, Andhra Pradesh shall cause all goods and services financed out of the proceeds of the Loan made available to it by the Borrower to be used ex- clusively for the Project. Section 2.13. (a) Except as the Bank may otherwise agree, Andhra Pradesh shall furnish to the Bank promptly upon their preparation, the plans, specifications, reports, contract documents and work and procurement schedules for the Project, and any mate- rial modifications thereof or additions thereto, in such detail as the Bank shall reasonably request. (b) Andhra Pradesh shall: (i) maintain or cause to be main- tained records adequate to record the progress of the Project (in- cluding the cost thereof) and to identify the goods and services financed out of the proceeds of the Loan made available to it by the Borrower, and to disclose the use thereof in the Project; (ii) -6. enable 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 Bank all such information as the Bank shall reasonably request concerning the Project, the ex- penditure of the proceeds of the Loan so made available to it and the goods and services financed out of such proceeds. Section 2.14. (a) Andhra Pradesh shall, at the request of the Bank, exchange views with the Bank with regard to the progress of the Project in Andhra Pradesh, the performance of its obligations under this Agreement and other matters relating to the purpose of the Loan. (b) Andhra Pradesh shall promptly inform the Bank of any condition which interferes, or threatens to interfere, with the progress of the Project in Andhra Pradesh, the accomplishment of the purposes of the Loan, or the performance by Andhra Pradesh of its obligations under this Agreement. -7- ARTICLE III Other Covenants Section 3.01. Andhra Pradesh shall maintain, and cause its SSC, SSCA and Andhra Pradesh Agricultural University to maintain, records adequate to reflect in accordance with consistently maintained appropriate accounting practices their respective operations and fi- nancial conditions. Section 3.02. Andhra Pradesh shall: (i) have its own accounts and financial statements for the Project (balance sheets, if any, statements of income and expenses and related statements) and those of SSC, SSCA and Andhra Pradesh Agricultural University, for each fiscal year audited, in accordance with sound auditing principles consistently applied, by independent auditors acceptable to the Bank; (ii) cause its SSC, SSCA and Andhra Pradesh Agricultural University to furnish, to the Bank as soon as available, but in any case not later than six months after the end of each such year, (A) certified copies of their respective 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 Bank shall have reasonably requested; and (iii) furnish and cause its SSC, SSCA and Andhra Pradesh Agricultural University to furnish, to the Bank such other information concerning the accounts and financial state- ments of Andhra Pradesh, its SSC, SSCA or Andhra Pradesh Agricultural University (as the case may be) and the audits thereof as the Bank shall from time to time reasonably request. -8- Section 3.03. Andhra Pradesh shall at all times cause the facilities, plant, equipment and machinery required for the Project to be operated, maintained, renewed and repaired in accordance with appropriate engineering and management practices. 0 -9- 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 Loan Agreement becomes effective. Section 4.02. (a) This Agreement and all obligations of the Bank and of Andhra Pradesh thereunder shall terminate on the earlier of the following two dates: (i) the date on which the Loan Agreement shall terminate in accordance with its terms; or (ii) a date twenty years after the date of this Agreeement. (b) If the Loan Agreement terminates in accordance with its terms before the date specified in paragraph (a) (ii) of this Section, the Bank shall promptly notify Andhra Pradesh of this event. Section 4.03. All the provisions of this Agreement shall con- tinue in full force and effect notwithstanding any partial cancel- lation or suspension under the Loan Agreement. - 10 - 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 herein- after 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 Bank: International Bank for Reconstruction and Development 1818 H Street, N.W. Washington, D.C. 20433 United States of America Cable address: INTBAFRAD Washington, D.C. For Andhra Pradesh: Secretary to the Government of Andhra Pradesh Agricultural Department Hyderabad India Cable address: AGRIANDHRA Hyderabad, India - 11 - 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 Andhra Pradesh may be taken or executed by the Secretary to the Government of Andhra Pradesh or such other person or persons as Andhra Pradesh shall designate in writing. Section 5.03. Andhra Pradesh shall furnish to the Bank suffi- cient evidence of the authority and the authenticated specimen signature of the person or persons who will, on behalf of Andhra Pradesh, take any action or execute any documents required or permitted to be taken or executed by Andhra 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 collec- tively but one instrument. - 12 - IN WITNESS WHEREOF, the parties hereto, acting through their representatives thereunto duly authorized, have caused this Agree- ment 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 BANK FOR RECONSTRUCTION AND IEVELOPMENT Aegional Vice President South Asia THE STATE OF ANDHRA PRADESH By Reprsenttiv Authorized Representative 0j INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT CERTIFICATE I hereby certify that the foregoing is a true copy of the original in the archives of the Interna- tional Bank for Reconstruction and Develop- ment. In witness whereof I have signed this Certifi- cate and affixed the Seal of the Bank thereunto this JD day of ! , 1974 FOR SECRETARY