India - Third National Agricultural Extension Project : Credit 1754 - Project Agreement - Conformed

IDOCU MENTS CREDIT NUMBER 1754 IN Project Agreement (Third National Agricultural Extension Project) between INTERNATIONAL DEVELOPMENT ASSOCIATION and STATE OF ASSAM and STATE OF HIMACHAL PRADESH and STATE OF UTTAR PRADESH Dated ()tV 1987 CREDIT NUMBER 1754 IN PROJECT AGREEMENT AGREEMENT, dated , , 1987, between INTERNATIONAL DEVELOPMENT XSSOCIATION (the Association) and STATE OF ASSAM and STATE OF HIMACHAL PRADESH and STATE OF UTTAR PRADESH, acting by their respective Governors (the Project States). WHEREAS (A) by the Development Credit Agreement of even date herewith between India, acting by its President (the Borrower) and the Association, the Association has agreed to make available to the Borrower an amount in various currencies equivalent to seventy one million seven hundred thousand Special Drawing Rights (SDR 71,700,000), on the terms and conditions set forth in the Development Credit Agreement, but only on condition that the Project States agree to undertake such obligations toward the Association as are set forth in this Agreement; (B) in accordance with the Borrower's standard arrangements for development assistance to the States of India, part of the proceeds of tie Credit provided for under the Development Credit Agreement will be made available to the Project States; and WHEREAS the Project States, in consideration of the Association's entering into the Development Credit Agreement with the Borrower, has agreed to undertake the obligations set forth in this Agreement; NOW THEREFORE the parties hereto hereby agree as follows: ARTICLE I Definitions Section 1.01. Unless the context otherwise requires, the several terms defined in the Development Credit Agreement, the Preamble to this Agreement and in the General Conditions (as so defined) have the respective meanings therein set forth. ARTICLE II Execution of the Project Section 2.01. (a) The Project States declare their commit- ment to the objectives of the Project as set forth in Schedule 2 -2 - to the Development Credit Agreement, and, to this end, shall carry out Part B of the Project with due diligence and efficiency and in conformity with appropriate administrative, financial, engineering and agricultural practices, and shall provide, or cause to be provided, promptly as needed, the funds, facilities, services and other resources required for the Project. (b) Without limitation upon the provisions of paragraph (a) of this Section, the Project States shall carry out Part B of the Project in accordance with the Implementation Program set forth in Schedule 2 to this Agreement, as such Schedule may be amended from time to time by agreement between the Association and the Project States. Section 2.02. Except as the Association shall otherwise agree, procurement of the goods and works required for the Project and to be financed out of the proceeds of the Credit shall be governed by the provisions of Schedule 1 to this Agreement. Section 2.03. the Project States shall carry out the obligations set forth in Sections 9.03, 9.04, 9.05, 9.06, 9.07 and 9.08 of the General Conditions (relating to insurance, use of goods and services, plans and schedules, records and reports, maintenance and land acquisition, respectively) in respect of the Project Agreement and Part B of the Project. Section 2.04. (a) the Project States shall, at the request of the Association, exchange views with the Association with regard to the progress of the Project, the performance of their obligations under this Agreement, and other matters relating to the purposes of the Credit. (b) The Project States shall promptly inform the Associa- tion of any condition which interferes or threatens to interfere with the progress of the Project, the accomplishment of the pur- poses of the Credit, or the performance by the Project States of their obligations under this Agreement. ARTICLE III Financial Covenants Section 3.01. (a) Each of the States shall cause its departments and other agencies and authorities responsible for -3- the carrying out of its part of Part B of the Project or any part thereof to: (i) maintain separate records and accounts adequate to reflect, in accordance with sound accounting practices and procedures consistently applied, their resources, expenditures and operations related to Part B of the Project; and (ii) furnish to the Association copies of their accounts and financial statements related to Part B of the Project for each fiscal year, certified as to their accuracy and authenticity by an independent auditor acceptable to the Association, as soon as available but in any case not later than nine months after the end of each such year. (b) Each of the States shall cause its departments and agencies and other authorities responsible for the carrying out of Part B of the Project or any part thereof to: (i) have their accounts and financial statements related to Part B of the Project for each fiscal year audited, in accordance with appropriate auditing principles consistently applied, by independent auditors acceptable to the Association; (ii) furnish to the Association immediately following its finalization, the report of such audit by said auditors, of such scope and in such detail as the Association shall have reasonably requested; and (iii) furnish to the Association such othsr information concerning said accounts and records, financial statements and the audit thereof as the Association shall from time to time reasonably request. (c) For all expenditures with respect to which withdrawals are requested from the Credit Account on the basis of statements of expenditures, each of the States shall: (i) maintain or cause to be maintained, in accordance with paragraph (a) of this Section, separate records and accounts reflecting such expenditures; (ii) retain, until one year after the Closing Date, all records, (contracts, orders, invoices, bills, receipts and other documents) evidencing such expenditures; (iii) enable the Association's representatives to examine such records; and (iv) ensure that such separate accounts are included in the annual audit referred to in paragraphs (a) and (b) of this Section and that the report thereof contains, in respect of such separate accounts, a separate opinion by the said auditors as to whether the proceeds of the Credit withdrawn in respect of such expenditures have been used for the purpose for which they are provided. 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 becomes effective. Section 4.02. (a) This Agreement and all obligations of the Association and of the Project States thereunder shall terminate on the earlier of the following two dates: (i) the date on which the Development Credit Agreement shall terminate in accordance with its terms; or (ii) the date 20 years after the date of this Agree- ment. (b) If the Development Credit Agreement terminates in accordance with its terms before the date specified in paragraph (a) (ii) of this Section, the Association shall promptly notify the Project States of this event. Section 4.03. All the provisions of this Agreement shall continue in full force and effect notwithstanding any cancella- tion or suspension under the General Conditions. 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 - 5 - permitted to be given or made at such party's address hereinafter 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: INDEVAS Washington, D.C. For State of Assam: Agriculture Production Commissioner Government of Assam P.O. Assam Sachivalaya Guwahati-781006 Assam, India Cable address: AGRIASSAM GUWAHATI, ASSAM For State of Himachal Pradesh: Secretary, Department of Agriculture Government of Himachal Pradesh Simla, India Cable address: AGRISEC Simla For State of Uttar Pradesh: Secretary, Department of Agriculture Government of Uttar Pradesh Lucknow, India Cable address: AGRISEC Lucknow - 6 - Section 5.02. Any action required or permitted to be taken, and any document required or permitted to be executed, under this Agreement on behalf of each of the Project States, may be taken or executed by a Secretary to the Government in each Project State or such other person or persons as each Project State shall designate in writing, and each Project State shall furnish to the Association sufficient evidence of the authority and the authen- ticated specimen signature of each such person. Section 5.03. This Agreement may be executed in several counterparts, each of which shall be an original, and all col- lectively but one instrument. IN WITNESS WHEREOF, the parties hereto, acting through their duly authorized representatives, 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 4 A15/r?Cut L Regional Vice President Asia STATE OF ASSAM By / Authorized Representative STATE OF HIMACHAL PRADESH By Authorized Representative STATE OF UTTAR PRADESH By Authorized Representative -7- SCHEDULE 1 Procurement of Goods and Works A. General Procedures Except as provided in Parts B and D hereof, contracts for civil works, vehicles, equipment and furniture shall be let on the basis of competitive bidding, advertised locally, in accord- ance with procedures satisfactory to the Association. B. Other Procurement Procedures Contracts for equipment and furniture estimated to cost the equivalent of $50,000 or less may be procured by prudent shopping through normal trade channels. C. Review of Procurement Decisions by the Association 1. Review of invitations to bid and of proposed awards and final contracts: (a) With respect to all contracts estimated to cost the equivalent of $100,000 or more, the procedures set forth in para- graphs 2 and 4 of Appendix 1 to the "Guidelines for Procurement under IBRD Loans and IDA Credits" published by the Bank in August 1984 (the Guidelines) shall apply. (b) With respect to each contract not governed by the pre- ceding paragraph, the procedures set forth in paragraphs 3 and 4 of Appendix 1 to the Guidelines shall apply. (c) The provisions of the preceding subparagraphs (a) and (b) shall not apply to contracts on account of which the Associa- tion has authorized withdrawals from the Credit Account on the basis of statements of expenditures. Such contracts shall be re- tained until one year after the Closing Date. 2. The figure of 15% is hereby specified for purposes of para- graph 4 of Appendix 1 to the Guidelines. D. Procurement Without Contracting Civil works estimated to cost the equivalent of $25,000 each or less, may be carried out through force account. -8- SCHEDULE 2 Implementation Program 1. The Project States shall: (a) establish procedures, satis- factory to the Association, for carrying out effective monitoring and evaluation of their respective parts of the Project and carry out such monitoring and evaluation in accordance with said procedures; and (b) prepare and furnish to the Association, through DOE, annual summaries of the results of such monitoring and evaluation. 2. The Project States shall ensure that: (a) all extension positions assigned to the administrative control of DOA for the purposes of the Project shall be used exclusively for agricul- tural extension and retained under such administrative control and; (b) staff assigned to carry out extension work under the Project shall not be adversely affected, in respect of their entitlements to emoluments, benefits and promotional prospects, by reason alone of such assignment. 3. In order to ensure the mobility of staff engaged in exten- sion work under the Project, the Project States shall undertake to make available: (a) to all eligible staff in need of credit for the purchase of motorcycles, mopeds or bicycles, such credit on terms and conditions designed to provide incentives for the purchase of such motorcycles, mopeds or bicycles; and (b) such financial incentive, including appropriate travel allowances, in order to encourage optimum use of the motorcycles, mopeds and bicycles to be purchased under paragraph (a) above. 4. The Project States undertake to fill incremental staff posi- tions with staff having qualifications and experience satisfac- tory to the Association and in accordance with a schedule agreed with the Association. 5. Each of the Project States shall: (a) no later than June 30, 1990, prepare and furnish to the Association for its comments, a mid-term review of the Project execution, such review to determine inter alia the needs for adjustment of Project targets, fund reallocation, or cancellation, prQgress in the transfer of zonal research responsibilities from DOA to SAUs, and the adequacy of existing staff; and (b) make necessary adjustment taking into account the Association's comments. -9- 6. Beginning July 15, 1987 and each year thereafter, the Project States shall furnish their annual Project budget to the Association for its review. 7. In order to coordinate the implementation of their respec- tive parts of the Project, Uttar Pradesh and Himachal Pradesh shall by June 30, 1987, establish coordination committees with functions and memberships satisfactory to the Association. 8. In a manner satisfactory to the State and the Association, Himachal Pradesh shall by March 31, 1987: (a) conclude a Memorandum of Understanding with Himachel Pradesh Horticultural University (Solan); and (b) revise the Memorandum of Understanding with Himachal Pradesh Agricultural University (Palampur). INTERNATIONAL DEVELOPMENT ASSOCIATION CERTIFICATE I hereby certify that the foregoing is a true copy of the original in the archives of the International Development Association. FOR SECRETARY