LOAN NUMBER 8301-IN Loan Agreement (National Highways Interconnectivity Improvement Project) between INDIA and INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT Dated 2 ,014 LOAN NUMBER 8301-IN LOAN AGREEMENT Agreement dated J.L , 2014, between INDIA ("Borrower") and INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT ("Bank"). The Borrower and the Bank hereby agree as follows: ARTICLE I - GENERAL CONDITIONS; DEFINITIONS 1.01. The General Conditions (as defined in the Appendix to this Agreement) constitute an integral part of this Agreement. 1.02. Unless the context requires otherwise, the capitalized terms used in this Agreement have the meanings ascribed to them in the General Conditions or in the Appendix to this Agreement. ARTICLE II - LOAN 2.01. The Bank agrees to lend to the Borrower, on the terms and conditions set forth or referred to in this Agreement, the amount of five hundred million United States Dollars (USD 500,000,000), as such amount may be converted from time to time through a Currency Conversion in accordance with the provisions of Section 2.07 of this Agreement ("Loan"), to assist in financing the project described in Schedule 1 to this Agreement ("Project"). 2.02. The Borrower may withdraw the proceeds of the Loan in accordance with Section IV of Schedule 2 to this Agreement. 2.03. The Front-end Fee payable by the Borrower shall be equal to one quarter of one percent (0.25%) of the Loan amount. 2.04. The interest payable by the Borrower for each Interest Period shall be at a rate equal to the Reference Rate for the Loan Currency plus the Variable Spread; provided, that upon a Conversion of all or any portion of the principal amount of the Loan, the interest payable by the Borrower during the Conversion Period on such amount shall be determined in accordance with the relevant provisions of Article IV of the General Conditions. Notwithstanding the foregoing, if any amount of the Withdrawn Loan Balance remains unpaid when due and such non-payment continues for a period of thirty days, then the interest payable by the Borrower shall instead be calculated as provided in Section 3.02 (e) of the General Conditions. 2.05. The Payment Dates are March 15 and September 15 in each year. 2.06. The principal amount of the Loan shall be repaid in accordance with the amortization schedule set forth in Schedule 3 to this Agreement. 2.07. (a) The Borrower may at any time request any of the following Conversions of the terms of the Loan in order to facilitate prudent debt management: (i) a change of the Loan Currency of all or any portion of the principal amount of the Loan, withdrawn or unwithdrawn, to an Approved Currency; (ii) a change of the interest rate basis applicable to: (A) all or any portion of the principal amount of the Loan withdrawn and outstanding from a Variable Rate to a Fixed Rate, or vice versa; or (B) all or any portion of the principal amount of the Loan withdrawn and outstanding from a Variable Rate based on a Reference Rate and the Variable Spread to a Variable Rate based on a Fixed Reference Rate and the Variable Spread, or vice versa; or (C) all of the principal amount of the Loan withdrawn and outstanding from a Variable Rate based on a Variable Spread to- a Variable Rate based on a Fixed Spread; and (iii) the setting of limits on the Variable Rate or the Reference Rate applicable to all or any portion of the principal amount of the Loan withdrawn and outstanding by the establishment of an Interest Rate Cap or Interest Rate Collar on the Variable Rate or the Reference Rate. (b) Any conversion requested pursuant to paragraph (a) of this Section that is accepted by the Bank shall be considered a "Conversion", as defined in the General Conditions, and shall be effected in accordance with the provisions of Article IV of the General Conditions and of the Conversion Guidelines. (c) Promptly following the Execution Date for an Interest Rate Cap or Interest Rate Collar for which the Borrower has requested that the premium be paid out of the proceeds of the Loan, the Bank shall, on behalf of the Borrower, withdraw from the Loan Account and pay to itself the amounts required to pay any premium payable in accordance with Section 4.05 (c) of the General Conditions up to the amount allocated from time to time for the purpose in the table in Section IV of Schedule 2 to this Agreement. ARTICLE III - PROJECT 3.01. The Borrower declares its commitment to the objectives of the Project. To this end, the Borrower shall carry out the Project through its Ministry of Road Transport and Highways ("MORTH") with the cooperation of the Project States, in accordance with the provisions of Article V of the General Conditions. 3.02. Without limitation upon the provisions of Section 3.01 of this Agreement, and except as the Borrower and the Bank shall otherwise agree, the Borrower shall ensure that the Project is carried out in accordance with the provisions of Schedule 2 to this Agreement. ARTICLE IV - EFFECTIVENESS; TERMINATION 4.01 The Effectiveness Deadline is the date ninety (90) days after the date of this Agreement. -2- ARTICLE V - REPRESENTATIVE; ADDRESSES 5.01. The Borrower's Representative is any of the following officials, acting severally: the Secretary, Additional Secretary, Joint Secretary, Director, Deputy Secretary or Under Secretary of the Department of Economic Affairs of the Borrower's Ministry of Finance. 5.02. The Borrower's Address is: Secretary Department of Economic Affairs Ministry of Finance Government of India North Block New Delhi 110001, India Facsimile: +91-11-23094075 5.03. The Bank's Address is: International Bank for Reconstruction and Development 1818 H Street, N.W. Washington, D.C. 20433 United States of America Cable address: Telex: Facsimile: INTBAFRAD 248423(MCI) or 1-202-477-6391 Washington, D.C. 64145(MCI) -3- AGREED at }\.4 ;i' India, as of the day and year first above written. INDIA By Authorized Representative Name: _ ________ Title: ..c1 INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT By Authorized Representati e Name: c1 , oA a Title: - 4 - .. SCHEDULE 1 Project Description The objective of the Project is to improve the national highway network connectivity to less developed areas and low-income States and enhance the institutional capacity of MORTH to better manage the highway network under the purview of MORTH. The Project consists of the following parts: Component A: Road Improvement and Maintenance 1. Widening and upgrading approximately 400 km of existing single-lane/intermediate lane national highways of the Non-NHDP Network in the Project States, to two-lane standards through item-rate contracts. 2. Widening and upgrading approximately 720 km of existing single-lane/intermediate lane national highways of the Non-NHDP Network in the Project States, to two-lane standards through EPC Contracts. 3. Maintaining the assets improved/created under sub-components A.1 and A.2 above for a period of at least five (5) years post construction. 4. Providing quality control services for the activities under sub-component A. 1, A.2 and A.3 above, including implementation of/compliance with the EMF, RPF and the respective EIAs, EMPs, SIAs, RAPs and TDPs. Component B: Institutional Development 1. Improving MORTH's internal processes and procedures through: (a) rolling out of enterprise resource planning software solutions; (b) developing standard manual(s) for the allocation roles and responsibilities between MORTH and the Project States' PWDs for the identification, preparation and implementation of Project activities; and (c) updating costs-databases, data-books and other reference materials for the roads sector. 2. Developing and implementing: (a) an IT-based road information system containing an inventory of road assets in the entire Non-NHDP Network; and (b) designing and piloting an asset management system covering the Non-NHDP Network in at least three (3) Project States. 3. Carrying out studies to review the existing policies and practices for the allocation of resources and financing of construction and maintenance work of the assets of the Non- NHDP network in order to suggest improvement and assess options available for the mobilization of additional resources. 4. Strengthening MORTH's governance and accountability through the implementation of the GAAP. -5- 5. Carrying out training programs for MORTH's and the PWDs' staff, as well as sector- related institutions/agencies on policy, technical, financial, procurement and contract management issues related to the road sector. Component C: Road Safety 1. Reviewing and updating: (a) the road safety standards and codes of practices maintained by the Indian Roads Congress, including improving standards and regulations for work- zone safety, and mainstreaming implementation of road safety standards into MORTH's contract management framework; and (b) the vehicle axle-load codes and institutional arrangements for monitoring and enforcement thereof. 2. Establishing road accident database management systems in each for the Project States. 3. Strengthening the institutional capacity of MORTH, in particular its road safety cell, in order to: (a) assess and improve the existing policy framework (statutory and regulatory) for road safety, and develop models for the enforcement thereof and the provision of related emergency care; (b) mainstream road safety monitoring and evaluation systems; (c) carry out social marketing and public awareness campaigns to promote road safety behavioral changes; and (d) support the establishment of lead road safety and traffic management agencies. 4. Carrying out road safety training programs for MORTH's and the PWDs' staff, as well as sector related institutions/agencies on safety road design, engineering countermeasures, road safety audits and construction zone safety standards/policies, including strengthening the institutional capacity to assess roads risk profiles pursuant to the iRAP, and developing 3-star iRAP safety designs for selected roads in the Non-NHDP Network. -6- SCHEDULE 2 Project Execution Section . Implementation Arrangements A. Institutional Arrangements 1. The Borrower shall maintain, throughout the period of implementation of the Project: (a) a project steering committee (the "PSC"): (i) headed by the Secretary of MORTH and with a composition/membership acceptable to the Bank; and (ii) vested with such powers, functions and competencies, acceptable to the Bank, as shall be required to exercise policy guidance for, and exercise the general oversight of, the implementation of Project activities, including the assessment of quarterly Progress Reports submitted by EAP Cell and the review of the semi-annual audits reports prepared by the TPAC; and (b) an externally aided projects cell ("EAP Cell") within the MORTH: (i) headed by a project director and assisted by competent staff with experience and qualifications, in numbers and under terms of reference acceptable to the Bank; and (ii) vested with such powers, financial resources, functions and competencies, acceptable to the Bank, as shall be required for it to carry out the day-to-day implementation of Project activities, including the inter-institutional coordination with the PWDs of Project States and other line agencies, the carrying out of procurement, financial management, monitoring and reporting activities, the screening of Project activities pursuant to the EMF and the RPF, as well as the preparation of required EIAs, EMPs, SlAs, RAPs and/or TDPs, as the case may be, and the monitoring and enforcement of contractors' implementation of/compliance with the respective Safeguard Documents. 2. The Borrower shall cause each of the Project States to maintain, throughout the period of implementation of the Project: (a) a state oversight committee: (i) with composition/membership acceptable to the Bank; and (ii) vested with such powers, functions and competencies, acceptable to the Bank as shall be required for providing policy guidance and strategic direction to the PCU of each such Project State, monitoring progress in the implementation of Project activities in the respective Project State (including compliance with statutory and regulatory requirements as well as the Safeguard Documents), and facilitating the solution of any emerging problems and/or obstacles for such implementation; and (b) a project coordination unit ("PCU") within the national highway wing of the respective Project States' PWDs: (i) headed by a nodal officer in the rank of Superintending Engineer and assisted by competent staff, all with experience and qualifications, in numbers and under terms of reference acceptable to the Bank; and (ii) vested with such powers, financial resources, functions and competences, -7- acceptable to the Bank, as shall be required for it to: (A) carry out the technical and fiduciary control of Project activities at the State level, as delegated by the EAP Cell (including contract management and preparation and submission of reporting requirements); and (B) ensure compliance with/implementation of the Safeguard Documents (including the screening of Project activities pursuant to the EMF and RPF and preparation of EIAs, EMP, SlAs, RAPs and TDPs), and timely implementation of any land acquisition and resettlement activities, as well as the payment of compensation therefor, 3. The Borrower shall select and engage: (a) by no later than three (3) months after the Effective Date, and thereafter maintain throughout the period of implementation of the Project, the services of a project management consulting firm ("PMC") with qualification and experience and under terms of reference acceptable to the Bank, in order to assist the EAP Cell with Project planning and implementation including, inter alia: (i) providing guidance and recommendation on technical and policy matters; (ii) preparing bidding documents and subsequent changes/variations thereof; (iii) evaluating technical and financial proposals; (iv) handling contractual matters and procurement disputes, and establishing an automated contract management system; (v) overseeing of payments to service providers and/or Project contractors under Components B and C of the Project, and monitoring those payments for civil works under Component A of the Project; (vi) providing training, guidance and recommendations to PCUs and PIUs to ensure compliance with the Safeguards Documents; and (vii) preparing the Project Reports and the IFRs; and (b) by no later than six (6) months after the Effective Date, and thereafter maintain throughout the period of implementation of the Project, the services of a third party audit consulting firm ("TPAC") with qualification and experience and under terms of reference acceptable to the Bank, in order to carry out semi- annual audits and report to the EAP Cell and the PSC on: (i) financial management performance, procurement decisions and contract administration; (ii) contract performance (i.e. quality of construction, compliance with technical specifications, design requirements and maintenance plans); and (iii) compliance with statutory/regulatory requirements and implementation of the Safeguard Documents, and the PFM Manual (other than the functions of the internal audit). B. Project Financial Management Manual 1. The Borrower shall implement, and/or cause the Project States to implement, the Project in accordance with the financial management arrangements set forth in the PFM Manual; provided however that in the event of conflict between the provisions of said manual, on the one hand, and those of this Agreement, on the other hand, the provisions of this Agreement shall prevail. -8- 2. The Borrower shall refrain, and/or cause the Project States to refrain, from amending, suspending, waiving and/or voiding any provisions of the PFM Manual, whether in whole or in part, without the prior written concurrence of the Bank. C. Road Improvement and Maintenance Activities 1. For purposes of implementing the road widening and upgrading activities set forth in Component A of the Project, the EAP Cell and the PCU of the respective Project State identified/shall identify Selected Roads in accordance with a road readiness criteria acceptable to the Bank, which criteria shall include, inter alia: (a) the completion of the notifications for any necessary land acquisition; (b) the securing of all environmental clearances (including any mandatory public hearings) and governmental permits for construction activities; (c) the completion of the environmental and social screening assessments of the proposed road construction activities, pursuant to the EMF and RPF, and the preparation, approval and disclosure of the respective EIA, EMP, RAP and TDP, as the case may be; (d) the payment, in full, of compensation and/or resettlement assistance to Displaced Persons as per the applicable RAP, in respect of the first milestone stretch of civil works; (e) the engagement of the respective Construction Supervision Consultant or Authority Engineer, as the case may be; and (f) the engagement of the respective RAP Implementation Support Agency. The Borrower shall submit each Selected Road to the Bank for written concurrence prior to the award of the civil works contracts for such Selected Road to the respective contractor(s). 2. For each Selected Road, prior to the earlier of any invitation to bid, and/or the selection of any contractor for activities on such road, the Borrower shall cause the respective Project State to establish, and thereafter maintain throughout the period of implementation of Project activities in such Selected Road, a road-specific Project implementation unit ("PIU"): (a) headed by an executive engineer, assisted by competent staff, all with experience and qualifications, in numbers and under terms of reference acceptable to the Bank; and (b) vested with such powers, financial resources, functions and competences, acceptable to the Bank, as shall be required for it to carry out all preparatory activities for site-specific Project activities (including securing the necessary encumbrance-free land and State-level clearances and permits), ensure coordination with inter-state agencies and governmental departments, oversee the implementation of/compliance with the Safeguard Documents, handle the MORTH's grievance complaints systems (for all grievances other than procurement-related ones), undertake contract management responsibilities, and guide/oversee performance of the Construction -9- Supervision Consultant or the Authority Engineer, and the RAP Implementation Support Agencies, as the case may be. 3. For each Selected Road, prior to the commencement of civil works, the Borrower shall select, engage and thereafter maintain throughout the period of implementation of such activities, the services of: (a) a supervision consulting firm (the "Construction Supervision Consultant"), for works other than those procured under EPC Contracts, with qualifications and experience and under terms of reference acceptable to the Bank, in order to assist the respective PIU with contract management, monitoring/supervision, and the certification of contractors' performance, including the compliance with/implementation of the Safeguard Documents; (b) an engineering consulting firm (the "Authority Engineer") for works procured under EPC Contracts, with qualifications and experience and under terms of reference acceptable to the Bank, including sufficient delegated authority to resolve and approve any contractual claims/clarifications, in order to assist the respective PIU with contract management, monitoring/supervision, and the certification of contractors' performance, including the compliance with/implementation of the Safeguard Documents; and (c) a non-governmental organization or social mobilization consulting firm (the "RAP Implementation Support Agency"), with qualifications and experience and under terms of reference acceptable to the Bank, in order to assist the respective PIU with the implementation of the works-specific RAP and, when applicable, the TDP; the handling and processing of any grievance complaints in accordance with MORTH's grievance systems in relation to the sub-project activities, the carrying out of community awareness trainings and public information campaigns, and the preparation and implementation of health and safety trainings, including HIV/AIDS awareness/prevention activities. D. Anti-Corruption The Borrower shall ensure that the Project is carried out in accordance with the provisions of the Anti-Corruption Guidelines and the GAAP. E. Safeguards The Borrower shall, and shall cause the Project States, to: (a) carry out the Project in accordance with the EMF and the RPF, and the EIAs, EMPs, SIAs, RAPs and TDPs prepared and/or to be prepared pursuant to paragraph 2 of this sub-section in accordance with the objectives, policies, procedures, time schedules, compensation arrangements and other provisions set forth in the EMF and RPF (together, the "Safeguard Documents"), in each case in a manner and in substance satisfactory to the Bank; and -10- (b) refrain from taking any action which would prevent or interfere with the implementation of the Safeguard Documents, including any amendment, suspension, waiver, and/or voidance of any provision of the Safeguard Documents, whether in whole or in part, without the prior written concurrence of the Bank. 2. With respect to each Selected Road, the Borrower shall refrain from awarding any contract to contractors or undertaking any activities which would result in Displaced Persons, until and unless: (a) the proposed activities have been screened by the EAP Cell, and/or the PCU of the respective Project State, in accordance with the guidelines, standards and procedures set forth in the EMF and RPF; (b) all of the respective EIA(s), EMP(s), SIA(s), RAP(s) and/or TDP(s) required for such Selected Road pursuant to the EMF and RPF has/have been prepared and submitted to the Bank for review and the Bank has notified the Borrower in writing of its no-objection thereto; and (c) the foregoing .Safeguard Documents have been publicly disclosed by the Borrower, and/or the respective Project State, in local language(s) at the relevant Project's sites, at least one hundred and twenty (120) days prior to the award of the contract for the related works. 3. The Borrower shall ensure, and/or cause the Project States to ensure, that, prior to commencing any civil works on a Selected Road, or section thereof, under the Project: (a) all necessary governmental permits and clearances for such civil works in the relevant road, or section, shall have been obtained from the competent governmental authority/ies and submitted to the Bank; (b) all pre-construction conditions imposed by the governmental authority/ies under such permit(s) or clearance(s) shall have been complied with/fulfilled; and (c) all resettlement measures set forth in the applicable RAP to the respective section of such Selected Road shall have been fully executed, including the full payment of compensation prior to displacement and/or the provision of relocation assistance to all Displaced Persons, as per the entitlements provided in the RPF and/or the applicable RAP. 4. The Borrower shall ensure, and/or cause the Project States to ensure, that each contract for civil works under the Project includes the obligation of the relevant contractor to comply with the relevant Safeguard Documents applicable to such civil works commissioned/awarded pursuant to said contract. 5. The Borrower shall, and/or shall cause the Project States to: (a) maintain monitoring and evaluation protocols and record keeping procedures acceptable to the Bank and adequate to enable the Borrower, the Project States and the Bank to supervise and assess, on an on-going basis, the implementation of/compliance with the Safeguards Documents, as well as the achievement of the objectives thereof; and -ll- (b) furnish to the Bank, throughout the period of Project implementation: (i) quarterly reports prepared by the EAP Cell, with the assistance of the PCUs, on the physical and financial progress of Project activities, the general compliance with the Safeguard Documents, the social and environmental impact of Project activities, and the results of the mitigation or benefit-enhancing measures applied thereto, during the period preceding the date of each such report; and (ii) quarterly reports prepared by the respective Construction Supervision Consultants or the Authority Engineers, as the case may be, and the RAP Implementation Support Agency, assessing the contractors' general compliance with the Safeguard Documents and the respective works contracts, monitor the efficacy of the social and environmental management measures, and the results of the mitigation or benefit- enhancing measures applied thereto, with particular emphasis on the implementation and results of resettlement activities, during the period preceding the date of each such report. 6. The Borrower shall ensure that the following Project expenditures are financed exclusively out of the Borrower's own resources, and, to this end, shall provide, as promptly as needed, the resources required therefor, namely: (a) all land acquisition required for the purpose of the Project; and (b) any compensation, resettlement and rehabilitation payment to Displaced Persons in accordance with the provision of the RAPs. 7. In the event of any conflict between the provisions of any of the EMF, the RPF, ElAs, SIAs, EMPs, RAPs and/or TDPs, on the one hand, and the provisions of this Agreement, on the other hand, the provisions of this Agreement shall prevail. Section II. Project Monitoring Reporting and Evaluation A. Project Reports The Borrower shall monitor and evaluate the progress of the Project and prepare Project Reports in accordance with the provisions of Section 5.08 of the General Conditions and on the basis of indicators agreed with the Bank. Each Project Report shall cover the period of one calendar quarter, and shall be furnished to the Bank not later than forty-five (45) days after the end of the period covered by such report. B. Financial Management, Financial Reports and Audits The Borrower shall maintain or cause to be maintained a financial management system in accordance with the provisions of Section 5.09 of the General Conditions. -12- 2. Without limitation on the provisions of Sub-section A of this Section, the Borrower shall prepare and furnish to the Bank not later than forty five (45) days after the end of each calendar quarter, interim unaudited financial reports for the Project covering the quarter, in form and substance satisfactory to the Bank. 3. The Borrower shall have the Financial Statements audited in accordance with the provisions of Section 5.09 (b) of the General Conditions. Each audit of the Financial Statements shall cover the period of one fiscal year of the Borrower, commencing with the fiscal year in which the first withdrawal was made. The audited Financial Statements for each such period shall be furnished to the Bank not later than nine (9) months after the end of such period. 4. The Borrower shall carry out regular internal audits in accordance with the PFM Manual, performed by qualified staff acceptable to the Bank, and shall furnish such audits to the Bank for their review, ninety (90) days after the completion/issuance of the audit report, including, if any, the recommendations made by the internal auditors. Section III. Procurement A. General 1. Goods, Works and Non-consulting Services. All goods, works and non-consulting services required for the Project and to be financed out of the proceeds of the Loan shall be procured in accordance with the requirements set forth or referred to in Section I of the Procurement Guidelines, and with the provisions of this Section. 2. Consultants' Services. All consultants' services required for the Project and to be financed out of the proceeds of the Loan shall be procured in accordance with the requirements set forth or referred to in Sections I and IV of the Consultant Guidelines and with the provisions of this Section. 3. Definitions. The capitalized terms used below in this Section to describe particular procurement methods or methods of review by the Bank of particular contracts refer to the corresponding method described in Sections II and III of the Procurement Guidelines, or Sections II, III, IV and V of the Consultant Guidelines, as the case may be. B. Particular Methods of Procurement of Goods, Works and Non-consulting Services I. International Competitive Bidding. Except as otherwise provided in paragraph 2 below, goods, works and non-consulting services shall be procured under contracts awarded on the basis of International Competitive Bidding. 2. Other Methods of Procurement of Goods, Works and Non-consulting Services. The following methods, other than International Competitive Bidding, may be used for procurement of goods, works and non-consulting services for those contracts specified in the Procurement Plan: (a) National Competitive Bidding, subject to the additional provisions set forth in the Procurement Plan; and (b) Shopping. -13- C. Particular Methods of Procurement of Consultants' Services 1. Quality- and Cost-based Selection. Except as otherwise provided in paragraph 2 below, consultants' services shall be procured under contracts awarded on the basis of Quality- and Cost-based Selection. 2. Other Methods of Procurement of Consultants' Services. The following methods, other than Quality- and Cost-based Selection, may be used for procurement of consultants' services for those contracts which are specified in the Procurement Plan: (a) Selection under a Fixed Budget; (b) Least Cost Selection; (c) Selection based on Consultants' Qualifications; and (d) Procedures set forth in paragraphs 5.2 and 5.3 of the Consultant Guidelines for the Selection of Individual Consultants. D. Review by the Bank of Procurement Decisions The Procurement Plan shall set forth those contracts which shall be subject to the Bank's Prior Review. All other contracts shall be subject to Post Review by the Bank. Section IV. Withdrawal of Loan Proceeds A. General I. The Borrower may withdraw the proceeds of the Loan in accordance with the provisions of Article II of the General Conditions, this Section, and such additional instructions as the Bank shall specify by notice to the Borrower (including the "World Bank Disbursement Guidelines for Projects" dated May 2006, as revised from time to time by the Bank and as made applicable to this Agreement pursuant to such instructions), to finance Eligible Expenditures as set forth in the table in paragraph 2 below. 2. The following table specifies the categories of Eligible Expenditures that may be financed out of the proceeds of the Loan ("Category"), the allocation of the amounts of the Loan to each Category, and the percentage of expenditures to be financed for Eligible Expenditures in each Category. -14- Category Amount of the Loan Percentage of Expenditures Allocated to be financed (expressed in USD) (inclusive of taxes) (1) Works under Sub- Components A.1, and A.2 of 442,100,000 50% the Project (2) Goods, non-consulting services, consultants' services, and Training under Sub- 56,650,000 80% Component A.4 and Components B and C of the Project. Amount payable pursuant to Section 2.03 of this (3) Front-end Fee 1,250,000 Agreement in accordance with Section 2.07 (b) of the General Conditions Amount due pursuant to (4) Interest Rate Cap or Interest Rate Collar premium 0 Section 2.07(c) of this Agreement TOTAL AMOUNT 500,000,000 B. Withdrawal Conditions; Withdrawal Period 1 . Notwithstanding the provisions of Sub-section A of this Section, no withdrawal shall be made for payments made prior to the date of this Agreement, except that withdrawals up to an aggregate amount not to exceed USD 10,000,000 equivalent may be made for payments made prior to this date but on or after June 15, 2013, for Eligible Expenditures under Categories (1) and (2). 2. The Closing Date is June 30, 2019. -15- SCHEDULE 3 Amortization Schedule 1. The following table sets forth the Principal Payment Dates of the Loan and the percentage of the total principal amount of the Loan payable on each Principal Payment Date ("Installment Share"). If the proceeds of the Loan have been fully withdrawn as of the first Principal Payment Date, the principal amount of the Loan repayable by the Borrower on each Principal Payment Date shall be determined by the Bank by multiplying: (a) Withdrawn Loan Balance as of the first Principal Payment Date; by (b) the Installment Share for each Principal Payment Date, such repayable amount to be adjusted, as necessary, to deduct any amounts referred to in paragraph 4 of this Scheduke, to which a Currency Conversion applies. Principal Payment Date Installment Share (Expressed as a Percentage) On each March 15 and September 15 Beginning March 15, 2019 3.85% through March 15, 2031 On September 15, 2031 3.75% 2. If the proceeds of the Loan have not been fully withdrawn as of the first Principal Payment Date, the principal amount of the Loan repayable by the Borrower on each Principal Payment Date shall be determined as follows: (a) To the extent that any proceeds of the Loan have been withdrawn as of the first Principal Payment Date, the Borrower shall repay the Withdrawn Loan Balance as of such date in accordance with paragraph I of this Schedule. (b) Any amount withdrawn after the first Principal Payment Date shall be repaid on each Principal Payment Date falling after the date of such withdrawal in amounts determined by the Bank by multiplying the amount of each such withdrawal by a fraction, the numerator of which is the original Installment Share specified in the table in paragraph I of this Schedule for said Principal Payment Date ("Original Installment Share") and the denominator of which is the sum of all remaining Original Installment Shares for Principal Payment Dates falling on or after such date, such amounts repayable to be adjusted, as necessary, to deduct any amounts referred to in paragraph 4 of this Schedule, to which a Currency Conversion applies. 3. (a) Amounts of the Loan withdrawn within two calendar months prior to any Principal Payment Date shall, for the purposes solely of calculating the principal amounts payable on any Principal Payment Date, be treated as withdrawn and outstanding on the second Principal Payment Date following the date of withdrawal and shall be repayable on each Principal Payment Date commencing with the second Principal Payment Date following the date of withdrawal. -16- (b) Notwithstanding the provisions of sub-paragraph (a) of this paragraph, if at any time the Bank adopts a due date billing system under which invoices are issued on or after the respective Principal Payment Date, the provisions of such sub- paragraph shall no longer apply to any withdrawals made after the adoption of such billing system. 4. Notwithstanding the provisions of paragraphs 1 and 2 of this Schedule, upon a Currency Conversion of all or any portion of the Withdrawn Loan Balance to an Approved Currency, the amount so converted in the Approved Currency that is repayable on any Principal Payment Date occurring during the Conversion Period, shall be determined by the Bank by multiplying such amount in its currency of denomination immediately prior to the Conversion by either: (i) the exchange rate that reflects the amounts of principal in the Approved Currency payable by the Bank under the Currency Hedge Transaction relating to the Conversion; or (ii) if the Bank so determines in accordance with the Conversion Guidelines, the exchange rate component of the Screen Rate. 5. If the Withdrawn Loan Balance is denominated in more than one Loan Currency, the provisions of this Schedule shall apply separately to the amount denominated in each Loan Currency, so as to produce a separate amortization schedule for each such amount. -17- APPENDIX Definitions 1. "Anti-Corruption Guidelines" means the "Guidelines on Preventing and Combating Fraud and Corruption in Projects Financed by IBRD Loans and IDA Credits and Grants", dated October 15, 2006 and revised in January 2011. 2. "Authority Engineer" means each of the consulting firms selected, or to be selected, by the Borrower pursuant to Section I.C.3.(b) of Schedule 2 to this Agreement; and the term "Authority Engineers" means all such consulting firms collectively considered. 3. "Category" means a category set forth in the table in Section IV of Schedule 2 to this Agreement. 4. "Component" means each of the sets of Project activities grouped together under each of the sections entitled "Road Improvement and Maintenance", "Institutional Development" and "Road Safety", in Schedule I to this Agreement. 5. "Construction Supervision Consultant" means each of the consulting firms selected, or to be selected, by the Borrower pursuant to Section I.C.3.(a) of Schedule 2 to this Agreement; and the term "Construction Supervision Consultants" means all such consulting firms collectively considered. 6. "Consultant Guidelines" means the "Guidelines: Selection and Employment of Consultants under IBRD Loans and IDA Credits and Grants by World Bank Borrowers" dated January 2011. 7. "Displaced Persons" means persons who, on account of the execution of the Project, have experienced or would experience direct economic and social impacts caused by: (a) the involuntary taking of land, resulting in: (i) relocation or loss of shelter; (ii) loss of assets or access to assets; or (iii) loss of income sources or means of livelihood, whether or not such persons must move to another location; or (b) the involuntary restriction of access to legally designated parks and protected areas, resulting in adverse impact on the livelihoods of such persons. 8. "EAP Cell" means the team/cell established by MORTH for the implementation of externally funded projects, and referred to in Section l.A.1(b) of Schedule 2 to this Agreement. 9. "Environmental Impact Assessments" and the acronym "ElAs" means, collectively, the Borrower's: (a) the environmental impact assessments for roads NHl IB, NH98, NH104, NH113, NH200 and NH217, and disclosed in the Bank's Infoshop on July 26, 2013, March 11, 2013, July 27, 2013, September 6, 2013, March 11, 2013 and March 11, 2013, respectively; and (b) the environmental impact assessments to be prepared pursuant to Section I.E.2 of Schedule 2 to this Agreement, in accordance with the provisions of the EMF, in order to assess the likely positive and negative environmental impact of Project -18- activities; as such assessments may be revised, updated or supplemented from time to time with the prior written concurrence of the Bank. 10. "Environmental Management Framework" and the acronym "EMF" mean the Borrower's framework, dated January 26, 2012, setting forth the guiding principles, acceptable standards and procedures for: (a) the screening of Project activities and the identification of any adverse or positive environmental impacts caused, or expected to be caused, on account of their implementation; and (b) the preparation of their prescribed Environmental Impact Assessements, and Environmental Management Plans; as such framework may be revised, updated or supplemented from time to time with the prior written concurrence of the Bank. 11. "Environmental Management Plans" and the acronym "EMPs" mean, collectively, the Borrower's plans: (a) prepared in respect of roads NHllB, NH98, NH1O4, NH113, NH200 and N-1217, and disclosed in the Bank's Infoshop on July 26, 2013, March 11, 2013, July 27, 2013, September 6, 2013, March 11, 2013 and March 11, 2013, respectively; and (b) to be prepared pursuant to Section I.E.2 of Schedule 2 to this Agreement, in accordance with the provisions of the EMF, in each case setting out mitigation, enhancement, monitoring and institutional measures, including capacity building through training, required to: (i) eliminate adverse environmental impacts of activities to be implemented under the Project; (ii) offset them, or reduce them to acceptable levels; (iii) enhance any positive impacts thereof; as such plans may be revised, updated or supplemented from time to time with the prior written concurrence of the Bank; and/or (iv) ensure compliance with Borrower's statutory environmental requirement. 12. "EPC Contracts" means the engineering,-procurement-construction composite contracts to be piloted by the Borrower for the widening and upgradation of selected roads under the Project, whereby the contractor takes comprehensive responsibility for the design, execution and maintenance of the respective asset, in each case on the basis of the model form of agreement agreed between the Borrower and the Bank. 13. "GAAP" means the Borrower's governance and accountability action plan dated June 12, 2013, for purposes of the Project, which sets out the key actions to be undertaken by the Borrower to strengthen governance, transparency and accountability under the Project; as such action plan may be revised, updated or supplemented, from time to time, with the prior written concurrence of the Bank. 14. "General Conditions" means the "International Bank for Reconstruction and Development General Conditions for Loans", dated March 12, 2012. 15. "HIV/AIDS" means the human immunodeficiency virus and the resulting acquired immune deficiency syndrome. 16. "IFRs" means, collectively, the interim unaudited financial reports (to be) prepared by the Borrower, through MORTH, pursuant to Section I1.B.2 of Schedule 2 to this Agreement. -19- 17. "Indian Roads Congress" means the Indian society of highways engineers established and registered in 1937, and operating under India's the Societies Registration Act of 1860. 18. "iRAP" means the International Road Assessment Program, a charity operating under the laws of the United Kingdom of Great Britain and Northern Ireland, and registered under the Company No. 05476000, and Charity No. 1140357. 19. "MORTH" means the Borrower's Ministry of Roads, Transport and Highways, or any successor thereto. 20. "Non-NHDP Network" means the Borrower's primary road network (i.e. national highways) other than the national highways comprised under the Borrower's National Highways Development Program. 21. "PCU" means the project coordination unit established in each of the Project States, and referred to in Section I.A.2(b) of Schedule 2 to this Agreement; and the term "PCUs" means all five (5) said coordination units, collectively considered. 22. "PFM Manual" means the manual dated September 17, 2013, for purposes of the Project, which provides detail guidance on segregation of financial management duties, internal control protocols, accounting and record keeping procedures, funds flow arrangements, withdrawal applications procedures, asset management, reporting and auditing arrangements applicable to the Project; as such manual may be revised, updated or supplemented, from time to time, with the prior written concurrence of the Bank. 23. "PIU" means the sub-project level implementation unit to be established in respect of each of the Project's selected roads pursuant Section I.C.2 of Schedule 2 to this Agreement; and the term "PIUs" means all such sub-project implementation units collectively considered. 24. "PMC" means the project management consulting firm to be selected by the Borrower pursuant to Section I.A.3.(a) of Schedule 2 to this Agreement. 25. "Procurement Guidelines" means the "Guidelines: Procurement of Goods, Works and Non-consulting Services under IBRD Loans and IDA Credits and Grants by World Bank Borrowers" dated January 2011. 26. "Procurement Plan" means the Borrower's procurement plan for the Project, dated September 21, 2013 and referred to in paragraph 1.18 of the Procurement Guidelines and paragraph 1.25 of the Consultant Guidelines, as the same shall be updated from time to time in accordance with the provisions of said paragraphs. 27. "Project" means the activities described in Schedule 1 to this Agreement, which are the same as the ones approved by the Borrower on April 18, 2013 under the title of 'National Highways Interconnectivity Improvement Projects' and/or any changes thereof as mutually agreed between the Borrower and the Bank. -20- 28. "Project States" means the Borrower's States of Bihar, Orissa, Rajasthan, Karnataka and West Bengal, and/or any other states of the Borrower as mutually agreed between the Borrower and the Bank. 29. "PSC" means the project steering committee established by the Borrower on February 20, 2013, and referred to in Section I.A.1(a) of Schedule 2 to this Agreement. 30. "PWDs" means collectively the Public Works Department of the Project States. 31. "RAP Implementation Support Agency" means each of the specialized social mobilization non-government organizations or consulting firms to be selected by the Borrower pursuant to Section I.C.3(c) of Schedule 2 to this Agreement. 32. "Resettlement Action Plans" and the acronym "RAPs" mean, collectively, the Borrower's resettlement and relocation plans: (a) prepared in respect of roads NH11B, NH98, NHIO4, NH 113, NH200 and NH217, and disclosed in the Bank's Infoshop on July 10, 2013, March 27, 2013, March 27, 2013, July 22, 2013, March 27, 2013 and March 28, 2013, respectively; and (b) to be prepared pursuant to Section I.E.2 of Schedule 2 to this Agreement, in accordance with the provisions of the RPF, in each case identifying Displaced Persons on account of implementation of Project activities in the respective Selected Road or section thereof, and setting forth the terms and conditions for providing them with resettlement assistance and/or compensation, as well the procedures to be applied in the identification, assessment and mitigation of potential Project related social impacts, including the protocols for consultation, the processing of complaints and grievance redressal, monitoring and reporting requirements, and the Displaced Persons' entitlement schedules; as such plans may be revised, updated or supplemented, from time to time, with the prior written concurrence of the Bank. 33. "Resettlement Policy Framework" and the acronym "RPF" mean the Borrower's framework, dated March 11, 2013, setting for the guiding principles, acceptable standards and procedures for: (a) the screening of Project activities and the identification of any Displaced Persons and or Tribal Groups, on account of their implementation; and (b) the preparation of their prescribed Resettlement Action Plans and Tribal Development Plans, as applicable; as such framework may be revised, updated or supplemented from time to time with the prior written concurrence of the Bank. 34. "Safeguard Documents" means, collectively, the EMF, the RPF, the EIAs, the EMPs, the SIA, the RAPs and the TDPs. 35. "Selected Road" means the stretches of the roads NHl IB, NH30A, NH60A, NH98, NHIO4, NHIO6, NH1l3, NH200, NH201, NH217, and NH234, as well as any other roads that the Borrower and the Bank may agree from time to time, provided that all these roads meet the criteria set out in paragraph I of Section I.C of Schedule 2 to this Agreement. 36. "States" means any of the political subdivisions of the Borrower, acknowledged in the Borrower's States Reorganization Act of 1956; and/or subsequent complementary legislation and treaties. -21- 37. "Social Impact Assessments" and the acronym "SIAs" mean, collectively, the Borrower's: (a) the social impact assessments prepared for roads NHI IB, NH98, NHIO4, NIH 1l3, NH200 and NH217, and disclosed in the Bank's Infoshop on July 10, 2013, March 27, 2013, March 27, 2013, July 22, 2013, March 27, 2013'and March 28, 2013, respectively; and (b) the social screening to be prepared pursuant to Section I.E.2 of Schedule 2 to this Agreement, in accordance with the provisions of the RPF, in order to assess the likely social impact of Project activities; as such assessments may be revised, updated or supplemented from time to time with the prior written concurrence of the Bank. 38. "Sub-Component" means each activity or set of activities within a Component, individualized through a numbered paragraph in Schedule I to this Agreement. 39. "TPAC" means audit consulting firm(s) to be selected by the Borrower pursuant to Section I.A.3(b) of Schedule 2 to this Agreement. 40. "Training" means the reasonable cost of trainings, seminars, workshops, conferences and study tours, conducted in the territory of the Borrower and/or overseas, including: (a) the fees of training institutions and courses; (b) domestic and international travel costs, lodging costs, and subsistence/per diem allowances both for trainers and trainees; (c) the rental of training facilities; and (d) preparation, purchase or reproduction of training materials. 41. "Tribal Development Plans" and the acronym "TDPs" mean, collectively, the Borrower's plan collectively, the Borrower's development plans: (a) prepared for roads NHI I B, NIH 13, NH200 and NH217 as part of the RAPs, and disclosed at the Bank's Infoshop on July 12, 2013, July 22, 2013, March 11, 2013, and March 11, 2013 respectively; and (b) to be prepared pursuant to Section I.E.2 of Schedule 2 to this Agreement, in accordance with the provisions of the RPF, setting out, in each case: (i) the measures designed to ensure meaningful consultation with, and informed participation of, Tribal Groups and their communities in a Project State in the design and implementation of the Project activities in respect of a selected road, as well as; (ii) the envisioned Project benefits for said Tribal Groups and communities which shall be/are culturally appropriate and socially inclusive. 42. "Tribal Groups" means any distinct, vulnerable, social and cultural group within the territory of the Borrower, that: (i) self-identifies as such and claims, and is recognized by others as, having a distinguishable cultural identity; (ii) has collective attachment to geographically distinct habitats or ancestral territories in the Project area, and to the natural resources in these habitat and territories; (iii) has customary cultural, economic, social and political institutions that are separate from those of the dominant society and culture; and (iv) has an indigenous language, often different from the official language of the Borrower. -22-