Conformed Copy - C1885 - Northern Irrigation Project - Amendment 3

Page 1 July 27, 1992 Minister Wang Bing-qian Minister of Finance Ministry of Finacne Sanlihe Beijing 100820 People's Republic of China Re: Credit 1885-CHA (Northern Irrigation Project) Adjustment of Disbursement Percentage and Reallocation Dear Minister Wang: We refer to Schedule 1 to the Development Credit Agreenent between People's Republic of Chlna (the Borrower) and the International Development Association (the Association) for the Northern Irrigation Project (the Project), dated August ll, 1988 (the Development Credit Agreement). We also refer to the request from Mr. Luo Qing, Director, World Bank Department, Ministry of Finance, of June 3, 1992, requesting an increase in the disbursement percentage for civil works under Part A of the Project and a reallocation of proceeds of the Credit provided for in the Development Credit Agreement. The Association is pleased to concur with the Borrower's request except for Category (3)(a). Consequently, the Association hereby agrees to amend the "% of Expenditures to be Financed" column of the table set forth in paragraph 1 of Schedule 1 to the Development Credit Agreement to read "60%" for Category (l)(a)(i) and "40%" for Category (l)(a)(iii). The Association also hereby reallocates: (a) SDR990,000 from Category (1)(a)(i) to Category (1)(a)(ii); (b) SDR210,000 from Category (1)(a)(i) to Category (1)(a)(iii); and (c) SDR 5,610,000 from Category (2)(a) to Category (1)(a)(iii). A copy of Schedule l incorporating these changes is attached for your reference. Credit 1885 CHA Schedule 1 to the Development Credit Agreement Category Amount of the Credit % of Allocated (Expressed Expenditures in SDR Equivalent) to be Financed (1) Works (a) Civil works under Part A of the Project for: (i) trunk drain and Honghebu pumping 5,150,000 60% station (ii) mobilization advance 1,350,000 100% for (a)(i) above (iii)other than (i) and (ii) above (excluding the cost of materials under (2) (a) below 1,700,000 100% Page 2 (b) Civil works under Part B of the Project for: drains, canals, structures 13,610,000 60% building, on-farm facili- ties, fish ponds and land development (excluding the cost of steel under (2) (b) below, cement and timber) (2) Machinery, equipment and ) 100% of foreign materials: ) expenditures ) 100% of local (a) under Part A of the Project 22,060,000 ) expenditures ) (ex-factory cost) ) and (b) under Part B of the Project 11,460,000 ) 75% of local ) expenditures ) for other items ) procured locally (3) Consultants' services, overseas 100% training and study tours (a) under Part A of the Project 710,000 (b) under Part B of the Project 1,060,000 Total 72,700,000 Please confirm the agreement on behalf of the Borrower to the amendment stated above by signing and dating the form of confirmation on the enclosed copy of this letter and returning it to us for our files. A copy of this letter is being sent to the Governors of the Nei Mongol and Ningxia Hui Autonomous Regions, in view of their interest in this matter. CONFIRMED MINISTRY OF FINANCE By /s/ Authorized Representative Date: 15/8/1992