India - Second Ncdc Project : Credit 1146 - Credit Agreement - Conformed

OFFICIAL CREDIT NUMBER 1146 IN DOCUMTS Development Credit Agreement (Second NCDC Project) between INDIA and INTERNATIONAL DEVELOPMENT ASSOCIATION Dated 7 l ( , 1981 CREDIT NUMBER 1146 IN DEVELOPMENT CREDIT AGREEMENT AGREEMENT, dated J7 cf , 1981, between INDIA, acting by its President (hereinafter 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; (B) the Project will be carried out by National Cooperative Development Corporation (hereinafter called NCDC) with the Bor- rower's assistance and, as part of such assistance, the Borrower will make available to NCDC the proceeds of the Credit as herein- after provided; and 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 NCDC; 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 Agree- ments 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 and in the Preamble to this Agreement have the respective meanings therein set forth and the following additional terms have the following meanings: (a) "Project Agreement" means the agreement between the Association and NCDC of even date herewith, as the same may be - 2 - amended from time to time, and such term includes all schedules to the Project Agreement and all agreements supplemental to the Project Agreement; (b) "Financial Agreement" means the agreement to be entered into between the Borrower and NCDC pursuant to Section 3.01 (b) of this Agreement, as the same may be amended from time to time; (c) "Andhra Pradesh, Bihar, Haryana, Himachal Pradesh, Madhya Pradesh, Maharashtra, Punjab, Uttar Pradesh and West Bengal" mean respectively the following States of India: the State of Andhra Pradesh, the State of Bihar, the State of Haryana, the State of Himachal Pradesh, the State of Madhya Pradesh, the State of Maharashtra, the State of Punjab, the State of Uttar Pradesh and the State of West Bengal, or any successor thereof; (d) "SCMFs" means the Andhra Pradesh State Cooperative Marketing Federation, the Bihar State Cooperative Marketing Union, the Haryana State Cooperative Supply and Marketing Federation, the Himachal State Cooperative Marketing Federation, the Madhya Pradesh State Cooperative Marketing Federation, the Maharashtra State Cooperative Marketing Federation, Punjab Cooperative Supply and Marketing Federation, the Uttar Pradesh Cooperative Marketing Federation and the West Bengal State Cooperative Marketing Federation; (e) "Cooperative" means a primary cooperative society, SCMFs and, if applicable, a regional cooperative marketing society established according to the relevant laws of Andhra Pradesh, Bihar, Haryana, Himachal Pradesh, Madhya Pradesh, Maharashtra, Punjab, Uttar Pradesh and West Bengal; (f) "Participating Cooperative" means a Cooperative in receipt of a Sub-loan which is financed or refinanced by a NCDC-loan; (g) "SCB" means a state cooperative bank and "SLDB" means a state cooperative land development bank, respectively established according to the relevant laws of Andhra Pradesh, Bihar, Haryana, Himachal Pradesh, Madhya Pradesh, Maharashtra, Punjab, Uttar Pradesh or West Bengal; (h) "Participating Bank" means any SCB or SLDB which is allowed, in accordance with Section 2.08 of the Project Agreement, to make Sub-loans; - 3 - (i) "NCDC-loan" means a loan made or proposed to be made by NCDC to a Participating Bank for the purpose of refinancing Sub-loans made by the Participating Bank to Cooperatives for Sub-projects, out of the equivalent of the proceeds of the Credit relent to NCDC by the Borrower pursuant to Section 3.01 of this Agreement; (j) "Sub-loan" means a sub-loan made or proposed to be made by a Participating Bank out of the proceeds of the Credit to a Cooperative for a Sub-project; it being understood that the sub-loans in Bihar are made or proposed to be made by NCDC to Bihar State Cooperative Marketing Union; (k) "Sub-project" means a specific project to be carried out by a Cooperative utilizing the proceeds of a Sub-loan; and (1) "Recovery Rate" means the ratio (expressed in terms of a percentage) between (A) the aggregate amount of principal and interest on loans paid during any fiscal year pursuant to obliga- tions that fell due during or before such year, and (B) the aggregate amount of principal and interest on loans that became due and payable during or before such year. 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 equiva- lent to one hundred one million eight hundred thousand Special Drawing Rights (SDR 101,800,000). 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 Associa- tion, 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. Section 2.03. Except as the Association shall otherwise agree, procurement of the goods, civil works and services to be financed out of the proceeds of the Credit, shall be governed by the provisions set forth or referred to in Section 2.03 of the Project Agreement. Section 2.04. The Closing Date shall be June 30, 1987 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 CredJ: withdrawn and outstanding from time to time. Section 2.06. Service charges shall be payable semiannually on February 1 and August 1 in e9ch year. Section 2.07. The Borrower shall repay the principal amount of the Credit in semiannual installments payable on each February 1 and August 1 commencing August 1, 1991, and ending February 1, 2031, each installment to and including the installment payable on February 1, 2001, 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. (a) Without any limitation or restriction upon any of its other obligations under the Development Credit Agreement, the Borrower shall cause NCDC to perform in accordance with the provisions of the Project Agreement and the Financial 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 NCDC to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (b) The Borrower shall relend the proceeds of the Credit to NCDC under a financial agreement to be entered into between the -5- Borrower and NCDC with terms and conditions which are satisfactory to the Association. (c) The Borrower shall exercise its rights under the Financial Agreement in such manner as to protect the interests of the Borrower and the Association and to accomplish the purposes of the Credit, and except as the Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive the Financial Agreement or any provision thereof. ARTICLE IV Remedies of the Association Section 4.01. For the purposes of Section 6.02 of the General Conditions the following additional events are specified pursuant to paragraph (h) thereof: (a) The National Cooperative Development Corporation Act, No. 26 of 1962, as amended to the date of this Agreement, shall have been further amended, suspended, abrogated, repealed or waived so as, in the judgment of the Association, to materially affect the carrying out of the Project or the operations or financial condition of NCDC; (b) NCDC shall have failed to perform any covenant, agree- ment or obligation of NCDC under the Project Agreement or under the Financial Agreement; (c) an extraordinary situation shall have arisen which shall make it improbable that NCDC will be able to perform its obligations under the Project Agreement or under the Financial Agreement; (d) the Borrower or any other authority having jurisdiction shall have taken any action for the dissolution or disestablish- ment of NCDC or for the suspension of its operations; and (e) NCDC shall have become unable to pay any of its debts as they mature or any action or proceeding shall have been taken by NCDC or by others whereby any of the property of NCDC shall or may be distributed among its creditors. 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: -6- (a) any event specified in paragraph (b) of Section 4.01 of 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 and NCDC; and (b) any event specified in paragraphs (a), (c), (d) and (e) of Section 4.01 of this Agreement shall occur. ARTICLE V Effective Date; Termination Section 5.01. 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 execution and delivery of the Project Agreement on behalf of NCDC have been duly authorized or ratified by all necessary corporate action; and (b) the execution and delivery of the Financial Agreement on behalf of the Borrower and NCDC, respectively, have been duly authorized or ratified by all necessary corporate action. Section 5.02. 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) that the Project Agreement has been duly authorized or ratified by NCDC, and is legally binding upon NCDC in accor- dance with its terms; and (b) that the Financial Agreement has been duly authorized or ratified by the Borrower and NCDC and is legally binding upon the Borrower and NCDC in accordance with its terms. Section 5.03. The date &2e 0/ /71 is hereby specified for the purposes of Section 12.04 of the General Condi- tions. Section 5.04. The obligations of the Borrower under Section 4.02 of this Agreement shall cease and determine on the date on which the Development Credit Agreement shall terminate or on a -7- date 20 years after the date of this Agreement, whichever shall be the earlier. ARTICLE VI Representative of the Borrower; Addresses Section 6.01. Any Secretary, Additional Secretary, Joint Secretary, Director, Deputy Secretary or 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 110001 India Cable address: Telex: ECOFAIRS 953-313546 New Delhi 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) -8- 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 v 4 Regional Vice President South Asia -9- 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) NCDC loans 99,400,000 85% (2) Equipment and 830,000 100% of foreign vehicles expenditures and 80% of local expen- ditures (3) Technical 670,000 100% assistance and training (4) Research and 900,000 100% development TOTAL 101,800,000 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; 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 Borrower. - 10 - 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 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 in respect of payments made for expen- ditures prior to the date of this Agreement, except that with- drawals, in an aggregate amount not exceeding the equivalent of $4,000,000 may be made under Categories (1), (2) and (3) on account of payments made for such expenditures before that date but after October 1, 1980. 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 restric- ting or limiting any other right, power or remedy of the Associa- tion under the Development Credit Agreement, by notice to the Borrower, cancel such amount of the Credit as, in the Associa- tion'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. - 11 - SCHEDULE 2 Description of the Project The Project is designed to: (i) develop storage, marketing and office facilities through financing the construction of about 127 cold stores and about 7,900 godowns by Participating Cooperatives in Andhra Pradesh, Bihar, Haryana, Himachal Pradesh, Madhya Pradesh, Maharashtra, Punjab, Uttar Pradesh and West Bengal, thereby helping in meeting the service requirements preceding and following the harvest; (ii) promote the development and expansion of the cooperative institutions within these States; (iii) expand the capability for cooperative Sub-project prepara- tion and appraisal; (iv) foster research in the marketing of and the development of storage of perishables; (v) undertake manpower planning and training programs; and (vi) strengthen NCDC as a development finance institution for cooperatives. The Project is expected to be completed by September 30, 1986. 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 day of 1981L. FOR SECRETARY