Sri Lanka - Kurunegala Rural Development : Credit 0891 - Credit Agreement - Conformed

CREDIT NUMBER 891 CE Development Credit Agreement (Kurunegala Rural Development Project) between DEMOCRATIC SOCIALIST REPUBLIC OF SRI LANKA and INTERNATIONAL DEVELOPMENT ASSOCIATION Dated , 1979 CREDIT NUMBER 891 CE DEVELOPMENT CREDIT AGREEMENT AGREEMENT, dated , 1979, between DEMOCRATIC SOCIALI REPUBLIC OF SRI LANKA (hereinafter called the Borrower) and INTERNATIONAL DEVELOPMENT ASSOCIATION (hereinafter called the Association). ARTICLE I General Conditions; Definitions Section 1.01. The parties to this Agreement accept all the provisions of the General Conditions Applicable to Devel- opment Credit Agreements of the Association, dated March 15, 1974, 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 Agreement, unless the context otherwise requires, the several terms defined in the General Conditions have the respective meanings therein set forth and the following additional terms have the following meanings: (a) "Bank of Ceylon" means the Bank of Ceylon, a banking corporation established under the laws of the Borrower, or any successor thereof; (b) "Peoples' Bank" means the Peoples' Bank, a banking corporation established under the laws of the Borrower, or any successor thereof; (c) "District of Kurunegala" means the geographical area comprising the existing administrative District of Kurunegala in the Borrower's territory; (d) "Rs" means Rupees, the currency of the Borrower; and (e) "subsidiary agreements" means the subsidiary agreements entered into by the Borrower with, respectively, (i) the Bank of Ceylon and (ii) the Peoples' Bank, pursuant to Section 3.07 of this Agreement. -2- ARTICLE II The Credit Section 2.01. The Association agrees to lend to the Borrower, on the terms and conditions in the Development Credit Agreement set forth or referred to, an amount in various currencies equiv- alent to twenty million dollars ($20,000,000). 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 The amount of the Credit may be withdrawn from the Credit Account in accordance with the provisions of Schedule 1 to this Agreement, as such Schedule may be amended from time to time by agreement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 tae Credit. Section 2.03. Except as the Association shall otherwise agree, procurement of the goods and civil works to be financed out of the proceeds of the Credit, shall be governed by the provisions of Schedule 3 to this Agreement. Section 2.04. The Closing Date shall be June 30, 1984 or such later date as the Association shall establish. The Association shall promptly notify the Borrower of such later date. Section 2.05. 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 2.06. Service charges shall be payable semiannually on March l and September 1 in each year. Section 2.07. The Borrower shall repay the principal amount of the Credit in semiannual installments payable on each March 1 and September 1 commencing September 1, 1989, and ending March 1, 2029, each installment to and including the installment payable on March 1, 1999, 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. Section 2.08. The currency of the United States of America is hereby specified for the purposes of Section 4.02 of the General Conditions. ARTICLE III Execution of the Project Section 3.01. The Borrower shall carry out the Project with due diligence and efficiency and in conformity with appro- priate financial and administrative practices, and shall provide, promptly as needed, the funds, facilities, services and other resources required for the purpose. Section 3.02. In order to assist the Borrower in carrying out the Project, the Borrower shall: (a) establish and maintain a Project Coordination Committee and a Project Steering Committee, the memberships and terms of reference of which shall be satisfactory to the Borrower and the Association; (b) appoint and maintain a Project Director having qualifi- cations and experience and with functions and responsibilities all satisfactory to the Borrower and the Association; and (c) employ consultants having qualifications and experience and upon terms and conditions of employment all satisfactory to the Borrower and the Association. Section 3.03. (a) The Borrower undertakes to insure, or make adequate provision for the insurance of, the imported goods to be financed out of the proceeds of the Credit 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 )i the Borrower to replace or repair such goods. (b) Except as the Association shall otherwise agree, the Borrower shall cause all goods and services financed out of the proceeds of the Credit to be used exclusively for the Project. Section 3.04. (a) The Borrower shall furnish to the Associa- tion, promptly upon their preparation, the plans, specifications, reports, contract documents and work and procurement schedules for the Project, and any material modifications thereof or additions thereto, in such detail as the Association shall reasonably request. -4- (b) The Borrower: (i) shall maintain records and procedures adequate to record and monitor the progress of the Project (including its cost and the benefits to be derived from it), to identify the goods and services financed out of the proceeds of the Credit, and to disclose their use in the Project; (ii) shall enable the Association's accredited representatives to visit the facilities and construction sites included in the Project and to examine the goods financed out of the proceeds of the Credit and any relevant records and documents; and (iii) shall furnish to the Association at regular intervals all such information as the Association shall reasonably request concerning the Project, its cost and, where appropriate, the benefits to be derived from it, the expenditure of the proceeds of the Credit and the goods and services financed out of such proceeds. (c) Promptly after completion of the Project, but in any event not later than six months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Association, the Borrower shall prepare and furnish to the Association a report, of such scope and in such detail as the Association shall reasonably request, on the execution and initial operation of the Project, its cost and the benefits derived and to be derived from it, the performance by the Borrower and the Association of their respective obligations under the Development Credit Agreement and the accomplishment of the purposes of the Credit. Section 3.05. The Borrower shall take or cause to be taken all such action as shall be necessary to acquire as and when needed all such land and rights in respect of land as shall be required for carrying out the Project and shall furnish to the Association, promptly after such acquisition, evidence satis- factory to the Association that such land and rights in respect of land are available for purposes related to the Project. Section 3.06. The Borrower shall ensure that the selection of village irrigation schemes for rehabilitation under Part A of the Project will be in accordance with criteria satisfactory to the Association. Section 3.07. The Borrower shall ensure that the agri- cultural credit under Part E of the Project shall be provided in accordance with rules and procedures satisfactory to the Associ- ation. To this end, the Borrower shall enter into subsidiary agreements satisfactory to the Association with, respectively, (i) the Bank of Ceylon and (ii) the Peoples' Bank. -5- Section 3.08. The Borrower shall: (a) ensure that institutional arrangements made for the operation and maintenance of village irrigation schemes and field channels in major tank schemes under the Project are satisfactory to the Association; (b) cause civil works, including irrigation works, buildings and roads constructed and/or rehabilitated under the Project, to be maintained in accordance with sound administrative and engi- neering practices, and shall ensure that adequate staff are provided for this purpose; and (c) ensure that sufficient funds -are provided to its various implementing departments and agencies to meet all oper- ational, maintenance and other recurrent expenditures under the Project. Section 3.09. The Borrower shall ensure that the organiza- tional structures and arrangements and work programs for agricul- tural extension in the District of Kurunegala are satisfactory to the Association. Section 3.10. The Borrower shall cause: (a) a quarterly progress report on the Project to be prepared and furnished, not later than one month after the end of the quarter under review, to the Association for comment; (b) an annual (January 1 to December 31) progress report on the Project to be prepared and furnished, not later than March 31 of the following year following the year under review, to the Association for comment; (c) an annual (January 1 to December 31) detailed work program on the Project to be prepared and furnished, not later than October 31 of the year prior to the year in which the work is to be carried out to the Association for comment; and (d) a detailed project evaluation plan to be prepared and furnished, not later than December 31, 1979, to the Associ- ation for comment. Section 3.11. The Borrower shall (a) recover a portion of the costs of the Project, mutually agreed with the Association, such -6- recovery to be based upon the objectives of (i) fair distribution of the said portion of the costs amongst the Project beneficiaries and (ii) the ability to pay of the said Project beneficiaries; and (b) review with the Association, from time to time, the progress of the recovery in order to ensure that the said objectives are consistently achieved. ARTICLE IV Other Covenants Section 4.01. (a) The Borrower shall cause each of its various departments and agencies responsible for carrying out the Project, to maintain separate records adequate to reflect in accordance with consistently maintained appropriate accounting practices the operations and financial condition of the part or parts of the Project for which the department or agency is responsible. (b) The Borrower shall: (i) cause each of its various departments and agencies to have the department's or agency's accounts and financial statements (balance sheets, statements of income and expenses, disbursement documents and related state- ments) for the part or parts of the Project for which the depart- ment or agency is responsible, for each fiscal year audited, in accordance with appropriate auditing principles consistently applied, by independent auditors acceptable to the Association; (ii) cause the Project Director to consolidate the said accounts and financial statements of the said various departments and agencies; (iii) 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 accounts and financial statements of its various departments and agencies for such year as so audited; (B) the report or reports of such audit by said auditors, of such scope and in such detail as the Association shall have reasonably requested; and (C) the consolidated accounts and financial statements prepared- by the Project Director under paragraph (b) (ii) above; and (iv) furnish to the Association such other information concerning the said accounts and financial statements of its various departments or agencies and the audit thereof as the Association shall from time to time rea3onably request. Section 4.02. The Borrower shall cause its various depart- ments and agencies responsible for carrying out the Project, to take out and maintain with responsible insurers, or to make other provision satisfactory to the Association for, insurance against such risks and in such amounts as shall- be consistent with appropriate practice. ARTICLE V Remedies of the Association Section 5.01. For the purposes of* Section 6.02 of the General Conditions, the following additional event is specified pursuant to paragraph (h) thereof, namely, that the Bank ofk Ceylon or the Peoples' Bank shall have failed to perform any covenant or obligation under their respective subsidiary agree- ments with the Borrower. Section 5.02. For the purposes of Section 7.01 of the General Conditions, the following additional event is specified pursuant to paragraph (d) thereof, viz, the event specified in Section 5.01 uf this Agreement shall occur and shall continue for a period of 60 days after notice thereof shall have been given by the Association to the Borrower. ARTICLE VI Effective Date; Termination Section 6.01. The following events are specified as addi- tional conditions to the effectiveness of the Development Credit Agreement within the meaning of Section 12.01 (b) of the General Conditions: (a) the Borrower has, pursuant to Section 3.07, entered into a subsidiary agreement satisfactory to the Association, with the Bank of Ceylon; and (b) the Borrower has, pursuant to Section 3.07, entered into a subsidiary agreement satisfactory to the Association, with the Peoples' Bank. Section 6.02. The following are specified as additional matters, 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: (a) the subsidiary agreement entered into between the Borrower and the Peoples' Bank pursuant to Section 3.07, has been duly executed and is legally binding on the Borrower and the Peoples' Bank; and (b) the subsidiary agreement entered into between the Borrower and the Bank of Ceylon pursuant to Section 3.07, has been duly executed and is legally binding on the Borrower and the Bank of Ceylon. Section 6.03. The date 024,/9'' , is hereby speci- fied for the purposes of Sec on 2.04 of the General Conditions. Section 6.04. The obligations of the Borrower under Section 5.02 of this Agreement shall cease and determine on the date on which the Development Credit Agreement shall terminate or on a date twenty years after the date of this Agreement, whichever shall be the earlier. ARTICLE VII Representatives of the Borrower; Addresses Section 7.01. The Secretary, Ministry of Finance and Plan- ning of the Borrower is designated as representative of the Borrower for the purposes of Section 11.03 of the General Con- ditions. Section 7.02. The following addresses are specified for the purposes of Section 11.01 of the General Conditions: For the Borrower: Ministry of Finance and Planning Colombo, Democratic Socialist Republic of Sri Lanka Cable address: Telex: SECMINFIN 1232 Colombo FORAID -9- 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. DEMOCRATIC SOCIALIST REPUBLIC OF SRI LANKA By Authorized Representative INTERNATIONAL DEVELOPMENT ASSOCIATION By r Regional Vice President South Asia - 10 - 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 Dollar Equivalent) to be Financed (1) Civil works and 5,300,000 80% construction materials (2) Field works and 1,400,000 80% of finan- related materials cial assistance under Part B of by the Borrower the Project in excess of amount specified in paragraph 4 (b) below (3) Equipment, 3,500,000 100% of foreign vehicles and expenditures; or spares .100% of local expenditures ex-factory; or 80% of local expenditures (4) Loans for crop 2,400,000 40% of loan production under amounts disbursed Part E of the by Peoples' Bank Project and Bank of Ceylon in excess of amount speci- fied in paragraph 4 (c) below - 11 - Amount of the Credit Allocated % of (Expressed in 'Expenditures Category Dollar Equivalent) to be Financed (5) Loans for equip- 2,100,000 80% of loan ment and vehicles amounts under Part E of disbursed by the Project Peoples' Bank and Bank of Ceylon (6) Technical assis- 700,000 100% tance and consul- tshits (7) Unallocated 4,600,000 TOTAL 20,000,000 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; provided, however, that if the currency of the Borrower is also that of another country from the territory of which goods or services are supplied, expenditures in such currency for such goods or services shall be deemed to be "foreign expenditures"; and (b) the term "local expenditures" means expenditures in the currency of the Borrower and for goods or services supplied from the territory of the Borri-?r. 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 anyssuch 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 - 12 - Borrower, increase or decrease the disbursement 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 (a) 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 $500,000 may be made on account of payments made for expen- ditures before that date but after January 1, 1979; (b) in respect of expenditures under Category (2) unless and until such expenditures for the calendar year shall exceed Rsl,000,000 and then only to cover such excess; and (c) in respect of expen- ditures under Category (4) unless and until such expenditures for the calendar year shall exceed Rs7,000,000 and then only to cover such excess. 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 expendi- tures, 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. 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 expenditures 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 Borrower, cancel such amount of the Credit as, in the Associ- ation's reasonable opinion, represents the amount of such expendi- tures which would otherwise have been eligible for financing out of the proceeds of the Credit. - 13 - SCHEDULE 2 Description of the Project The Project is intended to assist the Borrower in developing the District of Kurunegala in an integrated manner for purposes of raising productivity, employment, incomes and living standards of the rural population, and to evolve a replicable model of rural development for other districts in the Borrower's territory. The Project consists of the following Parts: Part A: Construction and/or rehabilitation of about 9 existing major tank irrigation schemes and about 500 village irrigation schemes, including the construction and/or provision of about 22 mobile pumping facilities, and improvement of water management for these schemes. Part B: Rehabilitation and/or improvement of coconut lands through, amongst others, intensive programs of replanting, underplanting and intercropping, construction of contour drains, removal of excess palms, and establishment of nurseries and/or demonstration plots for coconut, cocoa, coffee and pepper. Part C: Strengthening of agricultural extension services through the Training and Visit system. Part D: Provision and/or improvement of agricultural input supplies and services and their coordination, including construction and equipping of a seed processing center for paddy and other field crops and provision of farm implements to farmers. Part E: Provision and/or strengthening of existing schemes for short-term production credit for field crops, medium-term produc- tion credit for coconut rehabilitation, medium-term credit for - 14 - purchase of farm machinery and equipment by farmers and medium- term credit for purchase of vehicles by multi-purpose cooperative societies. Part F: Strengthening of animal disease control and veterinary services. Part G: Exploration of groundwater resources. Part H: Construction and/or rehabilitation of about 130 miles of gravel roads. Part I: Construction of about 400 dug wells. Part J: Electrification of about 16 rural areas. Part K: Provision and/or improvement of health care facilities. Part L: Construction of buildings and workshops, and provision of related equipment and other facilities for education (including vocational and technical). Part M: (i) Construction of buildings and quarters, and provision of vehicles, office equipment*and other facilities for purposes of Project coordination and management; (ii) preparation of a District of Kurunegala statistical handbook; (iii) preparation of plans, preliminary works and feasibility studies, including training of staff, for similar projects in about 4 other districts in the Borrower's territory; (iv) surveys and studies to assess - 15 - the impact of the Project; and (v) preparation of other devel- opment schemes for the District of Kurunegala. * * * The Project is expected to be completed by December 31, 1983. 1 1 -16- SCHEDULE 3 Procurement A. International Competitive Bidding 1. Except as provided in Part C hereof, goods shall be procured under contracts awarded 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 March 1977 (hereinafter called the Guidelines), on the basis of interna- tional competitive bidding as described in Part A of the Guide- lines. 2. For goods to be procured on the basis of international competitive bidding, in addition to the requirements of paragraph 1.2 of the Guidelines, the Borrower shall prepare and forward to the Association as soon as possible, and in any event not later than 60 days prior to the date of availability to the public of the first tender or prequalification documents relating thereto, as the case may be, a general procurement notice, in such form and detail and containing such information as the Association shall reasonably request; the Association will arrange for the publica- tion of such notice in order to provide timely notification to prospective bidders of the opportunity to bid for the goods and works in question. The Borrower shall provide the necessary information to update such notice annually so long as any goods or works remain to be procured on the basis of international compe- titive bidding. 3. For the purpose of evaluation and comparison of bids for the supply of goods to be procured on the basis of international competitive bidding, (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 the Borrower of inland freight and other expenditures incidental to the delivery of goods to the place of their use or installation shall be included. B. Preference for Domestic Manufacturers In the procurement of goods in accordance with the procedures described in Part A of this Schedule, goods manufactured in - 17 - the Democratic Socialist Republic of Sri Lanka may be granted a margin of preference in accordance with, and subject to, the following provisions: 1. 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. 2. After evaluation, responsive bids will be classified in one of the following three groups: (1) Group A: bids offering goods manufactured in the Democratic Socialist Republic of Sri Lanka if the bidder shall have established to the satisfaction of the Borrower and the Association that the manufacturing cost of such goods includes a value added in the Democratic Socialist Republic of Sri Lanka equal to at least 20% of the ex-factory bid price of such goods. (2) Group B: all other bids offering goods manufactured in the Democratic Socialist Republic of Sri Lanka. (3) Group C: bids offering any other goods. 3. 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. 4. If, as a result of the comparison under paragraph 3 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 evaluated 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 evaluated bid price of such 11w, -18- 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 3 is the lowest evaluated bid shall be selected. C. Other Procurement Procedures 1. Civil works may be carried out by force account or by contracts awarded through local competitive bidding procedures satisfactory to the Association. 2. Field works may be carried out by force account. 3. Farm inputs, equipment and vehicles under Part E of the Project may be procured on the basis of prudent shopping in accordance with procedures satisfactory to the Association. 4. Subject to the limit of sub-paragrah (iv) below, (i) equip- ment for a seed processing center under Part B of the Project may be procured in accordance with the Borrower's procedures for such procurement satisfactory to the Association; (ii) medical and educational equipment under Parts K and L of the Project may be procured in accordance with the Borrower's competitive bidding procedures satisfactory to the Association; (iii) (a) vehicles, equipment and spares which are urgently needed, or which cannot be suitably bulked for procurement under Part A of this Schedule and which cost less than $10,000 each contract, or which are to be purchased by the staff of the Borrower's implementing departments and agencies under the Project, and (b) agricultural input supplies which are to be purchased by farmers under Part D of the Project, may be procured through prudent shopping in accordance with procedures satisfactory to the Association; and (iv) provided all such purchases under subparagraphs (i), (ii) and (iii) above, shall not in the aggregate exceed $1,200,000. D. Review of Procurement Decisions by the Association 1. Review of invitations to bid and of proposed awards and final contracts: With respect to all contracts for goods estimated to cost the equivalent of $100,000 or more: (a) Before bids are invited, the Borrower shall furnish to the Association, for its comments, the text of the invitations -19- 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, the Borrower 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 shall furnish to the Associ- ation, in sufficient time for its review, a detailed report on the evaluation and comparison of the bids received, 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 the Borrower 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. 2. With respect to each contract not governed by the preceding paragraph, the Borrower 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 the respective 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 the Borrower and state the reasons for such determination. 3. Before agreeing to any material modification or waiver of the terms and conditions of a contract, or granting an exten- sion of the stipulated time for performance of such contract, or issuing any change order under such contract (except in cases of I -20 - extreme urgency) which would increase the cost of the contract by more than 15% of the original price, the Borrower shall inform the Association of the proposed modification, waiver, extension or change order and the reasons therefor. The Association, if it determines that the proposal would be inconsistent with the provisions of this Agreement, shall promptly inform the Borrower and state the reasons for its determination. 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 d a datof, 1979. j FOR SECRETARY'