LOAN NUMBER 8027-ID

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Loan Agreement I
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(Water Resources and Irrigation Sector Management Program (phase II) 1
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between

REPUBLIC OF INDONESIA il

and

INTERNATIONAL BANK FOR RECONSTRUCTION

AND DEVELOPMENT

Dated October 6, 2011

 LOAN NUMBER 8027-10

LOAN AGREEMENT

AGREEMENT dated Oc.~"bt'(' 6,2011, betweenREPUBLIC OF INDONESIA

("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 detlned 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 one hundred fifty million
Dollars ($150,000,000), 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 desclibed 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. The Borrower shaH pay the Front-end Fee
not later than sixty (69) days after the Effective Date.

2.04. The interest payable by the Borrower for each Interest Period shall.be at a1rate
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 Bon'ower 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amount of the Withdrawn Loan Balance remains unpaid when due and such non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 (30) 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 May 15 and November 15 in each year.
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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 theL.cian Currency of all or ~my portion of the principal
amount. of the Loan, withdrawn or un~withdrawn, to an Approved
Currency; (ii) a change of the interest rate basis applicabl~ to 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 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 tbe Variable 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.

(b) Any conversion requested pursuant to paragr~ph (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 N of the General Conditions and of the Conversion
Guide1ines.

ARTICLE I l l - PROJECT

3.01. The Borrower declares its commitment to the objective of the Project. To this
end, the Borrower shall carry out the Project through the Ministries of Public
Works, Home Affairs, and Agriculture, with on-granting to Participating
Provinces and Kabupaten, 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 Bon'ower shall
ensure that the Project is carried out in accordance with the provisiops of
Schedule 2 to this Agreement.

ARTICLE IV - REMEDIES OF THE BANK

4.0]. The Additional Event of Suspension consists of the follOWing, namely, that an
extraordinary situation has arisen that makes it unlikely that the Program will be
implemented.
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ARTICLE V - EFFECTIVENESS

.5.01. The Effectiveness Deadline is the date ninety (90) days after the date of this
Agreement.

ARTICLE VI - REPRESENTATIVE; ADDRESSES

6.01. The Borrower's Representative is its minister at the time responsible for finance.

6.02. The Borrower's Address is:

Directorate of Funds
Directorate General of Debt Management
MiniStry of Finance ..
Jalan Lapangan Banteng Timor No. 2-4
Jakarta 10710
Indonesia

Cable: Telex: Facsimile:

. FINMINISTRY 45799 DJMLN~IA 62-21-381-2859
Jakarta 44319 DEPKEU-IA

903. 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(MCl)
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AGREED at Jakarta, Indonesia, as of the day and year first above

wdtten.

REPUBLlC OF INDONESIA

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By
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Ra~mat Waluyanto
Authorized Representative

INTERNATIONAL BANK FOR

RECONSTRUCTION AND DEVELOPMENT

.l3Y

Authorized Representative

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SCHEDULEl

Project Description

The objective of the Project is to assist the Borrower to improve its capacity for
basin water resource and irrigation management and increase irrigated agriculture
productivity in the Project area.

The Project constitutes the second phase of the Program, and consists of the
following parts:

i. Basin Water Resource Management Improvement

. (a) Improvement of operational effectiveness of basin management

institutions and implementation of pilot community-based catchment
management programs at:

(i) central level in selected national and provincial river basins; and

(li) Province level in selected provincial river basins in Participating

Provinces.

(b) Improvement of physical system performance of river basins at:

(i) central level in selected national river basins; and

(ii). Province level in selected provincial river basins in Participating

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Provinces.

2. Participatory Irrigation Managemerit Improvement

(a) Improvement of participatory irrigation management institutions in:

(i) Participating Provinces; and (ii) Participating Kabupaten,. including
establishment and enhancement of local participatory irrigation
management regulatory frameworks and capacity bqilding of local
institutions such as government irrigation and agriculture agencies,
Irrigation Commissions, and Water Users Associations Federations.

(b) Light and moderate rehabilitation and repair of: (i) Participating
Province; and (ii) Participating Kabupaten irrigation system
infrastructure.

(c) Provision of support .to irrig~ted agriculture, and carrying out of climate
changeadaptat~on measures, including support to fanners in relation to:

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(i) adoption of new techn'ology and development of agribusiness

management skills in: (A) Participating Provinces; and
(B) Participating Kabupaten; and

(ii) establishment of pUblic-plivate' partnerships for farming and

marketing through . the .implementation of Community
Subprojects in: (A) Participating Provinces; and (B) Participating
Kabupaten. '

(d) Provision of technical assistance in relation to implementation of

Parts
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2 (a), (b), and (c) of the Project.
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3. Jatiluhurlrrigation Management Improvement

(a) Improvement of Jatiluhur irrigation system management institutions,

including:

(i) establishment and strengthening of participatory irrigation

management institutions at various levels;

(ii) development of effective inter-agency management

arrangements ;

(iii) development of a funding mechanism for management of the'

latiluhur irrigation system. .

(b) Rehabilitation and improvement of irrigation and drainage infrastructure

in the latiluhur irrigation system, including: '

(i) removal of bottlenecks in East and North Tarum Canals; and

(ii) rehabilitation of secondary irrigation systems. ,

(c) Preparation for overall rehabilitation and modernization of the latiluhur

irrigation system, including provision of technical assistance in relation
to:

(i) implementation of Part 3 (b) of the Project; and

(ij) preparation of management, institutional, and technical design

documents and tender documents for future modernization of
East and North Trullm Canals and future rehabilitation of
additional secondary irrigation systems.

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4. Project Management and Implementation Support

Provision of advisory support to entities involved in Project implementation in

relation to Project management, implementation, including administrative and
financial management, disbursement, and procurement, and monitoring and
evaluation, at: (a) central; (b) Participating Province; and (c) Participating
Kabupaten levels.
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SCHEDULE 2

ProjeCt Execution

Section I. Implementation Arrangements

A. Institutional Arrangements

1. The Borrower shall be responsible for Project management, implementation,

including administrative and' financial management, disbursement, and
procurement, and monitoring and evaluation' in accordance with the following
arrangements.

National Steering Corrunittee on Water Resources

2. The Borrower shall be responsible for the provision of policy and strategic
orientation to the Project through the National Steering Committee on Water
Resources.

3. To this end, the Borrower shall maintain, throughout Project implementation, the
National Steering Corrunittee on' Water' Resources, with an adequate
composition, institutional framework, functions, and resources satisfactory to the
Bank as shall be required for purposes of Project implementation.

Ministries of Public Works, Home Affairs, and Agriculture

National Project Management UnIt

4. The Borrower shall be responsible for: (i) overall Project management; and
(ii) the implementation, including administrative and fmancial man~gement,
disbursement, and procurement, and monitoring and evaluation, of Part 4 of the
Project through the NPMU.

National Project Implementation Units

5. The Borrower shall be responsible for the national-level implementation,

including administrative and financial management, disbursement, and
procurement, and monitoring and evaluation of Part 1 of the Project through the
Directorate of Water Resow'ces Management NPIU, Part 2 of the Project through
the Directorate of Irrigation and Swamps NPIU, the Directorate of Spatial
Planning and Environment NPIU, and the Directorate of Irrigation Water
Management NPIU, and Part 3 of the Project through the Jatilullul' PIU.

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Provincial Project Management Unit

6. The Borrower shall be responsible for the Province-level management of

Parts 1 (a) (ii) and (b) (ii) and 2 of the Project through the PPMU.

Provincial Project Implementation Units

7. The Borrower shall be responsible for the Province-level implementation,

including administrative and financial management, disbursement, and
procurement,. and monitoring and evaluation of Parts 1 (a) (ii) and (b) (ij) and 2
of the Project through the PPIUs.

Kabupaten Project"Management Unit

8. The Borrower shall be responsible for the Kabupaten-Ievel management of Part 2

of the Project through the KPMU.

Kabupaten Project Implementation Units

9. The Borrower shall be responsible" for the Kabupaten-Ievel implementation,

including administrative and financial management, disbursement, and
procurement, and monitoring and evaluation of Part 2 of the Project through the
KPIUs.

General

10. To this end, the Borrower shall maintain, throughout Project implementation, all
of the entities referred to in paragraphs 4-9 of this Part A, with an adequate
institutional framework, functions, and resources, including competent personnel
in. adequate numbers, satisfactory to the Bank as shall be required for purposes of
Project implementation. "

B. Anti-Corruption

1. The.Borrower shall ensure that the Project is carried out in accordance with the
provisions of the Anti-Corroption Guidelines and the Better Governance Action
Plan.

2. The Borrower shall not assign, amend, abrogate, or waive, or permit to be

assigned, amended, abrogated, or waived, the Better Governance Action Plan, or
any provision thereof.

3. In the event of a conflict between the provisions of the Better Governance Action
Plan and those of this Agreement, the hitter shall govern.
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c. Project Management Manual

1. The Borrower shall:

(a) ensure that the Project is carried out in accordance with the provisions of
the Project Management Manual; and

(b) except as the BOlTower and the Bank shall otherwise agree in writing, not
assign, amend, abrogate, or waive, or permit to be assigned, amended,
abrogated, or waived, the aforementioned, or any provision theJ;'eof.

2. In the event of a conflict between the provisions of the Project Management

Manual and those of this Agreement, the latter shall govern.

D. Participating Provinces and Kabupaten

For the purposes of carrying out Parts I (a) (ii) and (b) (ii), 2, and 4 (b) and (c) of
the Project, the Borrower shall:

(a) issue, no later than three (3) months after the Effective Date, a circular,
in fonn and substance satisfactory to the Bank, setting forth the
procedures to be applied by the Participating Province or Kabupaten for
the flow of funds for said Parts of the Project, the role of the various
parties, and the sanctions to be applied in the event of the use of such
funds for expenditures other than those required for the carrying out of
the Project;

(b) prior to the implementation of said Parts of the Project, enter into, and
thereafter maintain in effect throughout Project implementation, an on
granting agreement with the Participating Province or Kabupaten on
terms and conditions agreed with the Bank, specified in the Project
Management Manual, and including the obligation of the Participating
Province or Kabupaten to: (i) provide, promptly as needed, its
contribQtion in respect of expenditures for said Parts of the Project in
accordance with the Project Management Manual; and (ii)monitor and
evaluate the progress of the Project on the basis of the performance
indicators referred to in Section II.A.I (a) of this Schedule;

(c) employ the national government's flow of funds mechanism for the
transfer to Participating Provinces or Kabupaten of Loan proceeds
withdrawn from the Loan Account in respect of expenditures for said
Parts of the Project, which proceeds shall be transferred from the national
government budget to the budget of the respective Participating Province
or Kabupaten; and

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(d) ensure that each Participating Province or Kabupaten makes the

necessary allocation in its budget for purposes of the contribution
referred to in paragraph (b) (i) of this Part D.

E. Community Subprojects

1. . General

The Borrower shall review and approve Community Subproject proposals, and
thereafter monItor and evaluate Community Subprojects, through Extension
Commissions or Extension Working Groups in accordance with the provisions of
this PaIt E and the Proj~t Management Manual.

2. Eligibility
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The Borrower shall make Community Subproject Grants to Community
Subproject Grant Beneficiaries in accordance With eligibility criteria and
procedures agreed with the Bank and specified in the Project Management
Manual, which shall include the following:

(a) the proposed ComI);lUnity Subproject Orant Beneficiary is a duly

constituted Water Users Associations Federation locatect in a
Participating Province or Kabupaten irrigation system greater than 200
hectares;

(b) the Community Subproject satisfies the requirements of Part 2 (c) (ii) of
the Project, as described in further detail in the Project Management
Manual; ..

(c) the Community Subproject complies with the Safeguards Instruments;

(d) the Community Subproject is consistent with the relevant technical,

economic, financial, managerial, environmental, and social standards;

(e) the Comrriunity Subproject proposal indicates the Community Subproject

objectives, beneficiaries, expected benefits, activities, management,
including financial management, arrangements, operation and
maintenance costs, a cost estimate, and the contribution of the
Community Subproject Grant Beneficiary to the costs of the Community
. Subproject;

(f) the Community Subproject has been verified by the respective

Kabupaten Agriculture Service as being technically viable, having a
Benefit-Cost Ratio greater than 1.5, complying with the Safeguards
Instruments, and having sound management arrangements; and
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(g) the amount ofCommunity Subproject Grants in a single Kabupaten over

the life of the Project does not exceed $150,000 equivalent.
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.J. Terms and Conditions

(a) The Borrower shall make each Community Subproject Grant under a
Community' Subproject Grant Agreement with the Community
Subproject Grant Beneficiary on terms and conditions agreed with the
Bank and specified. in the Project Management ManUal, which shall
include the following: .

(i) a description of the Community Subproject, its budget, and the

applicable performance indicators;

(ii) the right of the Borrower to suspend or terminate the right of the
Community Subproject Grant Beneficiary to use the proceeds of
the Community Subproject Grant, or obtain a refund of all or any
part of the amount of the Community Subproject Grant then
withdrawn, upon failure by the Community Subproject Grant
Beneficiary to perform any of its obligations .under the
Community Subproject Grant Agreement;

(iii) the obligation of the Community Subproject Grant Beneficiary

to:

(A) carry out the Community Subproject with due diligence

and efficiency and in accordance with: (1) sound
technical, economic, financial, managerial,
environmental, and sociai standards and practices
satisfactory to the Bank, including the provisions of the
Anti-Corruption Guidelines applicable to recipients of
loan proceeds other than the Borrower, and the
provisions of the Better Governance Action Plan; and
(2) the provisions of the Project Management Manual
and the Safeguards Instruments, and without any right or
authority, except as the Bank shall otherwise agree in
writing, to assign, amend, abrogate, or waive, or permit
to be assigned, amended, abrogated, or wai ved, any of
the aforementioned, or any provision of anyone thereof;

(B) provide, promptly as needed, the resources required for

the Community Subproject; .
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(C) procure the goods, non-consulting services, works, and

consultants' services to be financed out of the
Community Subproject Grant in accordance with
procedures ensuring efficiency and economy and the
provisions of this Agreement and to ensure that they are
used exclusively in the carrying out of the Community
Subproject~

(D) maintain policies and procedures adequate to enable it to

monitor and evaluate in accordance with indicators
acceptable to the Bank, the progress of the Community
Subproject and the achievement of its objectives;

(E) (1) maintain a financial management system and prepare

financial statements in accordance with consistently
applied accounting standards acceptabJe to the Bank,
both in a manner adequate to reflect the operations,
resources, and expenditures related to the Community
Subproject; and (2) at the Bank's or the Borrower's
request, have such financial statements audited by
independent auditors acceptable to the Bank, in
accordance with consistently applied auditing standards
acceptable to the Bank, and promptly furnish the
statements as so audited to the Borrower and the Bank;

(F) enable the Borrower and the Bank to inspect the

. Cominunity Subproject, its -operation, and any relevant
records and documents; and

(G) prepare and furnish to the Borrower and the Bank all
such information as the Borrower: or the Bank shall
reasonably request relating to the fqregoing ..

(b) The Borrower shall exercise its rights under the Community Subproject Grant
Agreement in such manner as to protect its interests and the interests of the Bank
and to accomplish the purposes of the Community Subproject Grant, and, except
as the Bank shall otherwise agree i.n writing, the Borrower shall not as'sign,
amend, abrogate, or waive, or permit to be assigned, amended, abrogated, or
waived, the aforementioned, or any provision thereof.
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F. Annual Work Plans and Budgets

The Borrower shall:

(a) furnish to the Bank for approval as soon as available, but in any case not
later than September 30 of each year, the annual work plan and budget
fot the Project for each SUbsequent year of Project implementation, of
stich scope and detail as the Bank shall have reasonably requested,
except for the annual work plan cand budget for the Project for the first
year of Project implementation,whichshall be fwnishedno later than
one (1) month after the Effective Date; and

(b) thereafter ensure that the Projectis carried out in accordance with such
plans and budgets as agreed with the Bank.

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G. Safeguards
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i 1. The Borrower shall ensure that the Project is carried out in accordance with the
provisions of. the Safeguards instruments, and, except as the Bank shall otherwise
agree in writing, the Borrower shall not assign, amend, abrogate, or waive, or
permit to be assigned, amended, abrogated, or waived, any of the
aforementioned, or any provision of anyone thereof.

2. Wherever required pursuant to the terms of the Environmental. and Social

Safeguards Framework, the Borrower shall, for the purposes of the second and
subsequent years of Project implementation, and prior to the commencement
thereof, proceed to have an Additional Environmental Management Plan: '

(a) prepared in form and substance satisfactory to the Bank;

(b) except as otherwise agreed with the Bank in writing, submitted to the
Bank for review and approval; and

(c) thereafter, adopted andlocaUy disclosed.

3. Wherever required pursuant to the terms of the Land Acquisition and

Resettlement Policy Framework and I or the Indigenous People's Policy
Framework, the Borrower shall, for the purposes of a Subproject, and prior to
implementation thereof, proceed to have a Land Acquisition and Resettlement
Action Plan and I or an Indigenous People's Plan, respectively:

(a) prepared in form and substance satisfactory to the Bank;

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(b) except as otherwi$e agreed with the Bank in writing, submitted to the
Bank for review and approval; and

(c) . thereafter, adopted and locally disclosed.

4. The Borrower shall ensure that each contract for a Subproject includes the
obIlgation of the relevant contractor to implement the Safeguards Instruments.

5. Without limitation to the proviSions of Section II.AJ (a) of this Schedule 2, the
Borrower shall take all measures necessary on its part to regularly collect,
compile, and submit to the Bank, as part of the Project Reports, information on
the status of compliance with the Safeguarcls Instruments, giving details of:

(a) measures taken in furtherance of the Safeguards Instruments;

(b) conditions, if any, which interfere or threaten to interfere with the

smooth implementation of the Safeguards Instruments; and

(c) remedial measures taken or required to be taken to address such

conditions.

6. The Borrower shall be responsible for the implementation and monitoring and
evaluation of the Safeguards Instruments and the preparation of any Additional
Environmental Management Plans, Land Acquisition and Resettlement Action
Plans, and Indigenous People's Plans through the National Project Management
Unit.

7. In the event of 'a conflict between the provisions of any of the Safeguards
Instruments and those of this Agreement, the latter shall govern.

Dam Safety

8. The Borrower shall take all measures necessary on its part to regularly collect,
compile, and submit to the Bank, as part of the Project Reports, infonruition on
the status of implementation of the safety measures agreed in relation to the
latiluhur dam under the Dam Operational Improvement and Safety Project,
giving details of: .

(a) actions taken in.furtherance of such measures;

(b) conditions, if any, which interfere or threaten to interfere with the

smooth implementation of such meaSUres; and

(c) remedial measures taken or required to be taken to address such

conditions.
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9. the Borrower shall: (a) cany out, throughout Project implementation, periodic
safety inspections of the Jatiluhur dam in accordance with the relevant guidelines
of the Pam Safety Commission and the Borrower's Regulation No. 3712010 of
February 18,2010; and (b) liaise with the central project management unit
established under the Dam Operational Improvement and Safety Project to obtain
. updated versi.ons of the special studies, designs of remedial works, and operation
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and maintenance andemergency preparedness plans relating to said dam.
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10. Following the passage of the Closing Date set out in the Loan Agreement for the
Dam Operational Improvement arid Safety Project, or if .said Agreement
I terminates prior to the termination of this Agreement, and notwithstanding such
passage or termination, tbe' Borrower shall continue to perform, in. a manner
I satisfactory to the Bank, all .of its obligations relating to the Jatiluhur dam under
I said Agreement, including implementation of the safety measures referred to in
paragraph 8 of this Part G and updating of the special studies, designs of
,remedial workS, and operation and. inaintenance and emergency preparedness
plans referred to in paragraph 9 (b) of this Pait G.. .

SectionU. Project Monitoring. Reporting and Evaluation

. A. Project Reports , .'

1. . (a) The Borrower shall monitor and evaluate the progress of the Project and
prepare Project Reports in accordance with the provisions of Secti.on
5:08 .of the General Conditi.ons and on the basis .of the indicators set forth
below in sub-paragraph (b) of this paragraph. Each Project Report shall
cover the period of one (1) calendar semester, and shall be furnished to
the Bank not later than forty-five (45) days after the end of the peri.od
. covered by such report.

(b) The performance indicators referred to above in sub-paragraph (a)

consist of the following:

No. Indicator Targets

Yearl Year 2 Year 3 Year 4 YearS

Project Objective
1. Number of national 0 ] 6 9 12
and Province basin
; agencies fully
I; functional in
.accordance with the

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,
criteria set out in
..
. ; the Project
Management
Manual
2.. Number of 5 10 20 45 45 i
Irrigation
Conunissions fully
functional in
accordance with the
criteria set out in
the Project
Management
Manual
3. Increase in iirigated 20,000 120,000 280,000 340,000 390,000
areas (hectares)
with over fifteen
percent (15%)
irtcreasein
agricultural
production (tons)
i
Part 1 of the
Project
4.: Number of basin 1 3 6 9 12
water allocation
plans operational
1
5. i Number of river 0 .3 6 9 12
infrastructure
operation and
: maintenance plans
formulated and
implemented
.'
6' Percentage of river 11 50 78 100 100
infrastructure
established under
the Project
; functional
,
Part 2 of the
'. L
Project
7;:; Number of Water 1,275 1,375 1,445 2,000 2,030
User Associations
,
Federations duly
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!; I constituted
8. Command area 50,000 121,000 207,6000 301,500 360,000
wi th improved
irrigation
infrastructure and
I services (hectares)
I
Part 3 of the
Project
9. Establishment of Decree issued Directorate N/A Detailed Mechanis
effective General of institutional functional, '
institutional Water arrangements staffing aI
mechanism for Resources- established funding f<
system Bulk Water operation c
management Supply maintenanc
Corporation place
No. 2
Province-
Kabupaten
role-sharing
agreement
signed
10. Command area 37 000 9,400 16,100 22,800 30,000
with improved
irrigation I
infrastructure and
services (hectares)
Part 4 of the
Project
1l. Establishment of Functional . Functional Functional Functional Function
web-based Project
management
information system
. in Project
i management and
implementation
units
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. B. Semi-Annual Reviews

. The Borrower-shall review jointly with the Bank, no later than one (1) month after the
submission of each Project Report to the Bank, such report, and thereafter take all
measures requiredto ensure the efficient completion of the Project and the achievement
of the objective thereof, based on the conclusions and recommendations of such report
and the Bank's views on the matter.

C. Midterm Review

The Borrower shall:

(a) carry out jointly with the Bank, no later than thirty (30) months after the
Effective Date, a midterm review to assess the status of Project
implementation, as measured against the performance indicators referred
to in Section II.A.1 (a) of this Schedule. Such review shall include an
assessment of the following: (i) overall progress in Project
implementation; (ii) results of monitoring and evaluatio~ activities;'
(iii) progress on implementation of annual work plans and budgets;
(iv) progress on procurement and disbursement; (v) implementation
arrangements; and (vi) the need to make any adjustments to the Project
and reallocate funds to improve performance;

(b) prepare and furnish to the Bank, at least three (3) months before such
review, a report, in scope and detail satisfactory to the Bank, needed to
.undertake the review,. integrating the results of the monitoring and
evaluation activities performed pursuant to paragraph (a) of this Section
on .the progress achieved in the carrying out of the Project during the
period preceding the date of the said report and setting out the measures
recommended to ensure the efficient carrying out of 'the Project and the
achievement of the objective thereof during the period following such
date; and

(c) review, jointly with the Bank, the report referred to in paragraph (b) of
this Section and thereafter take all measures required to ensure the
efficient completion of the Project and the achievement of the objective
thereof, based on the conclusions and recommen9ations of said report
and the Bank's views on the matter.

D. . Financial Management, Financial Reports and Audits

1. 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 .

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2. Without limitation on the provisions of Part 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 unau'Clited financial reports for the Project
covering the quarter, in fOlm and substance satisfactory to the Bank.

3. The Borrower shall have its 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 (1) fiscal year of the Borrower.
The audited Financial Statements for each. such period shall be furnished to the
Brink not.later than six. (6) months after the end of such period.

Section III. Procurement

A. General
. ' .
1. Goods, Non;.Consulting Services,and Works. All goods, non-consulting
services, and works required. for the Project and to be fmanced 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 ofthis 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 "Yith 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 the Procurement
Guidelines, or Consultant Guidelines, as the case may be.

B. . Part.icular Methods of Procurement of Goods, Non-Consulting Services, and

Works

1. International Competitive Bidding. Except as otherwise provided in paragraph

2 below, goods, non-consulting services, and works shall be procured under
.contracts awarded on the basis of International Competitive Bidding.

2. Other Methods of Procurement of Goods, Non-Consulting Services, and

Works. The following table specifies the methods of procurement, other than
International Competitive Bidding, which may be used for goods, non-consulting
services, and works. The Procurement Plan shall specify the ci,rcumstances
under which such methods may be used.

1/

 - 21

Procurement Method

(a) National C()mpetitive Bidding, subject to the modifications to the procedures

set out in the Annex to this Schedule

(b) Direct Contracting

(c) Force Account

(d) Community Participation in Procurement

c. Particular Methods of Procurement of Consultants' Services

1. Quality- and Cost-based Selection. Except as otherwise provided in

paragraph 2 belowT consultants' services shall be procured under contracts .
awarded on the b~sis of Quality- and Cost-based Selection.

2. Other Methods of Procurement of Consultants' Services. Tlie following table

specifies the methods of procurement, other than Quality- and Cost-based
Selection, which may be used for consultants' services. The Procurement Plan
shall specify the circumstances under which such methods may be used.

Procurement Method
!

(a) Quality-Based Selection

(b) Selection Based on the Consultants' Qualifications

(c) Least Cost Selection

(d) Single-Source Selection

(e) Selection oflndividual Consultants

D. Re'View by the Bank o~ 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.
 - 22

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
fmanced for Eligible Expenditures in each Category.

Percentage of
Amount of the Loan Expenditures to be
Allocated fmanced
Category (expressed in USD) (exclusive of Taxes)

(1) Goods, non-consulting $85,710,000 75%

services, works, consultants'
services (including for audits),
Training, and Operating Costs
for Parts 1 (a) (i) and (b) (i),
2 (d), 3, and 4 (a) of the Project

(2) Goods, non-consulting . $20,810,000 . 100%

services, works, consultants'
services (including for audits),
Training, and Operating Costs
for Parts 1 (a) (ii) and (b) (ii),
2 (a) (i), (b) (i), and (c) (i) (A),
and 4 (b) of the Project financed
under the Loan

(3) Goods, non-consulting . $36,880,000 100%

services, works, consultants'
services (including for audits),
Training, and Operating Costs
for Parts 2 (a) (ii), (b) (ii), and
(c) (i) (B), and 4 (c) of the
Proiect financed under the Loan
 - 23
I
';

(4) Community' Subproject $6,600,000 100% of the amounts

Grants for Part 2 (c) (ii) of the disbursed
Project

TOTAL AMOUNT $150,000,000

B. Withdrawal Conditions; Withdrawal Period

L Notwithstanding the provisions of Part A of this Section, no withdrawal shall be

made:

(a) from ,the Loan Account until the Bank has received payment in full of the
Front-end Fee; or

(b) for payments made prior to the date of this Agreement, exc,ept that
. withdrawals up to an aggregate amount not .to exceed $1,750,000
equivalent may be made for payments made prior to this date but on or
after May 1, 2010, for Eligible Expenditures under Categories (1), (2),
and (3).

2. The Closing Date is November 30, 2016.

,
'.
 - 24

ANNEX TO SCHEDULE 2

National Competitive Bidding: Modifications to Procedures

The procedures applicable to the procurement of goods,' works, and non

consulting services under contracts awarded, on the basis of National Competitive
Bidding shall be those of the Pelelangan Umum (Public Tendering) and Pemilihan
Langsung / Pelelangan Sederhana (Simplified Tendering) methods as set forth in the
Borrower's Presidential Regulation No. 54/201 0, with the modifications set out below in
or4er to ensure economy, efficiency, transparency, and broad consistency with the
provisions of Section I of the Procurement Guidelines, pursuant to paragraph 3.3 of said
Guidelines. The Pemilihan Langsung / Pelelangan Sederhana method shall apply to
, such procurement up to the financial thresholds specified in said Regulation. , In the event
of a conflict between the Borrower's procedures and these modifications, the latter'shall
govern.

1. Procuring entities shall use the appropriate standard. bidding documents

acceptable to the Borrower and the Bank. The provisions of Section 1.14
(Fraud and Corruption) of the Procurement Guidelines shall apply, and
each bidding document and contract financed out of the proceed$ of the
Loan shall include provisions on matters pertaining to fraud' and
corruption as defmed in paragraph 1.14 (a) of s.aid Guidelines and the
contract provisions set out in paragraph 1.14 (e) of said Guidelines.

2. Foreign bidders shall not be precluded from bidding. If a registration

process is required, a foreign finn determined to be the lowest evaluated
bidder shall be given reasonable time for registration: Foreign bidders
shall not be required to form a joint venture or sub-contract part of the
supply of goods, non-consulting services, and works as a condition for
submitting bids or the award of the 'contract. . Bidding docUments shall be
made available, by mail or in person, to all international bidders who are
willing to pay the required fee. '

3. No preference of any kind shall be given to any bidders.

4. Under the Pelelangan Umum method, bidders shall be allowed at least

twenty-one (21) days from the date of the invitation to bid or the date of
availability of bidding documents, whichever is later, to prepare and
submit bids; this period shall be ten (10) days under the Pemilihan
Langsung / Pelelangan Sederhan,a method.

5. Bids invited under the Pelelangan Umum method shall be submitted in

one (1) envelope and evaluated using post-qualifi~ation.

,\1
,
!
'
 - 25

6. No bidder shall be rejected merely on the basis of a comparison with the

owner's estimate and. budget ceiling without the Bank's prior written
c,::oncurrence.

7. Bid security, at the bidder's option, shall be in the form of a letter of

credit or guarantee from a reputable bank or other reputable financial
institution and sl].all without exception follow the form provided for this
purpose in the bidding documents.

8. All bids shall not be rejected and new bids solicited without the Bank's
prior written concurrence.

9. Govemment-owned enterprises in Indonesia shall be eligible to

participate in bidding only if they can establish that they are legally and
financially autonomous, operate under commercial law, and are not
dependent agencies of the Borrower or sub-borrower.
 - 26

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 Principai
PaYIllent Date ("Installment Share").. If the proceeds of the Loan have been fully
withdrawn as of the flfst Principal Payment Date, the pnn.cipal amount of the
Loan repa)'ab\e b)' the Borrower on each Principal Pa),ment Date shall be
determined by the Bank by multiplying: (a) Withdrawn Loan Balance as of the
flfst Principal Payment Date; by (b) the Installment Share for each Principal
Payment Date, such repayable amount to be adjusted, as necessary, to deduct any
a:tn(:mnts referred to in paragraph 4 of this Schedule, to which a Currency .
Conversion applies. . .

I
Instalbnent Share.
Principal Payment Date (E:tg)ressed as a Percentage)
May 15,2020 2.17
November 15, 2020 2.22
May 15,2021 2.28
November 15,2021 2.34
May 15,2022 2.40
November 15,2022 2.46
May 15,2023 2.52
November 15,2023 2.58
May 15,2024 2.64
November 15,2024 2.71
May 15,2025 2.78
November 15,2025 2.85
May 15,2026 2.92
November 15,2026 2.99
May 15,2027 3.07
November 15, 2027 3.14
May 15,2028 3.22
November 15, 2028 3.30
May 15,2029 3.38
November 15,2029 3.47
May 15,2030 3.56
November 15, 2030 3.65
May 15,2031 3.74 i
November 15, 2031 3.83
May 15,2032 3.93
November 15,2032 4.02
May 15,2033 4.12
 II
II
Ij
- 27 I
!
:~
I'{

November 15, 2033 4.23 ~

May 15,2034 4.33
November 15, 2034 4.44
May 15,2035 4.71

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 1
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 1 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 (2) calendar months prior to
any Principal Payment Date shall, for th~ 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.

(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.
", i
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
 - 28

currency of denomination immediately prior to the Conversion by either: (i) the

exchange rate that reflects the amounts of principal in the Approved Cucrency
payable by the Bank under the Cucrency 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 (1) Loan
CUrrency, the provisions of this Schedule shall apply separately to the amount
dertominated in each Loan Cucrency, so as to produce a separate amortization
schedule for each such amount.

1;
,

'II

 - 29

APPENDIX

Definitions

1. "Additional EnvironmenW Management Plan" means the Borrower's plan, to be

agreed with the Bank, setting out mitigation, enhancement, monitOling, and
institutional measures, including capacity building through training, to eliminate
any ad:verse environmental impacts of Project activities to be implemented in the
second and subsequent years of Project implementation, offset them, or reduce
them to acceptable levels, or enhance positive impacts, to be prepared in
accordance with the provisions of the Environmental and Social Safeguards
Framework (as hereinafter defmed), as the same maybe modified from time to
time with the prior written agreement of the Bank, and such term includes any
annexes or schedules to such plan; and "Additional Environmental Management
Plans" means more than one (1) such plan. .

2. "Anti-Corruption Guidelines" means the "Guidelines on Preventing and

Combating Fraud and Corruption in Projects Fmanced by IBRD Loans and IDA
Credits and Grants", dated October 15,2006 and revised in January 2011.

3. "Benefit-Cost Ratio" means the ratio of the benefit derived by a Community

Subproject Grant Beneficiary (as hereinafter defmed) from a Community
Subproject (as hereinafter defmed), calculated in accordance with the provisions
of the Project Management Manual (as hereinafter defined), relative to the cost of
the Community Subproject (as hereinafter defined).

4. "Better Governance Action Plan" means the Borrower's plan, dated

February 2011 and agreed with the ;Bank and part of the Project Management
Manual (as hereinafter defined), setting out measures to reinforce Project
governance, enhance the transparency of Project activities, increase public
accountability, and reduce opportunities for collusion, corruption, or fraud under
.the Project, as the same may be modified from time to time with the prior written
agreement of the Bank, and such term includes any annexes or schedules to such
~~ . .

5. "Bulk Water Supply Corporation No.2" means the Borrower's wholly-owned

enterprise responsible for the operation of the Jatiluhur dam, or any successor
thereto. ::

6. "Community Subproject" means a specific activity carried out under

Part 2 (c)(ii) of the Project, financed or proposed to be financed through a
Community Subproject Grant (as hereinafter defmed) in accordance with the
. eligibility criteria referred to in Section I.E:2 (b) of Schedule 2 to this Agreement
and specified in further detail in the Project Management Manual (as hereinafter
defmed).
i
,,;. .
 - 30

7. "Community Subproject Grant" means a cash award made or proposed to be

made to a Community Subproject Grant Beneficiary (as hereinafter defined) out
of the proceeds of the Loan to finance a Community Subproject purSuant to a
Community Subproject Grant Agreement (as hereinafter-defined).

8. "Community Subproject Grant Agreement" means an agreement, referred to in

Section I.E.3 of Schedule 2 to this Agreement, between the 'Borrower,
represented by the respective Kabupaten Agriculture Service KPIU (as
hereinafter defined), and a Community Subproject Grant Beneficiary ,(as
hereinafter defined), setting forth the terms' and conditions governing a ,,
i
Community Subproject Grant. "

9. "Community Subproject Grant Beneficiary" means an entity to whom or for

whose benefit a Community Subproject Grant is made orproposed to be made.

10. "Consultant Guidelines" means the "Guidelines: Selection and Employment of

Consultants by World Bank Borrowers" 'published by the Bank in May 2004 and
revised in October 2006 and May 2010.

11. "Dam Operational Improvement and Safety Project" means the project described

in Schedule Ito the Loan Agreement dated March -27, 2009 between the

Borrower and the Bank for a Dam Operational Improvement and Safety Project,

as the same may be amended from time to time in accordance with its

terms (Loan No. 7669-ID).

12. "Dam Safety Commission" means the Borrower's entity, under the Ministty of

Public Works (as hereinafter defined), responsible for the management oversight

of dam safety assurance and certification of da.nis in Indonesia, or any successor

thereto. -

13. "Directorate General of Agriculture Infrastructure" means the directorate of the

Ministry of Agriculture (as hereinafter defined) responsible for agriculture
infrastructure management, or a successor thereto.

,14. "Directorate General of Regional Development" means the directorate of the

Ministry of Home Affairs (as hereinafter defined) responsible for regional
development management, or a successor thereto.

15. "Directorate General of Water Resources" means the directorate of the Ministry

of Public Works (as hereinafter defined) responsible for water resource

management, or a successor thereto.

 - 31

16. "Directorate of Irrigation and Swamps" means the directorate of the Directorate
General of Water Resources responsible for irrigation and swamp management,
or any successor thereto.

17. "Directorate of Irrigation and Swamps National Project Implementation Unit" or

"Directorate of Irrigation .and Swamps NPIU" means the Borrower's entity,
. under the Directorateof Irrigation and Swamps, whose responsibilities are set out
in Section I,A.5 of Schedule 2 to this Agreement, or any successor thereto.

18. "Directorate of Spatial Planning and Environment" means .the directorate of the
. Directorate General of Regional Development responsible for spatial planning
and environmental management, or any successor thereto.

i9. "Directorate of Spatial Planning and Environment National Project

Implementation Unit" or "Directorate of Spatial Planning and Environment
l\t'PIU" means the Borrower's entity, under the Directorate of Spatial Planning
and Environment, whose responsibilities are set out in Section lA.5 of
Schedule 2 to this Agreement, or any successor thereto.

20. "Directorate of Irrigation Water Management" means the directorate of the

Directorate General of Agriculture Infrastructure, responsible for irrigation water
management, or any successor thereto.

21. "Directorate of Irrigation Water Management National Project Implementation

Unit" or. "Directorate of Irrigation Water Management NPIU" means the
Borrower's entity, under the Directorate of Water Management, whose
responsibilities are set out in Section lA.5 of Sch~ule 2 to this Agreement, or
arty successor thereto ..

22. "Directorate of Water Resources Management" means the department of the

Ministry of Public Works. (as hereinafter defmed), responsible for water resource
management, or any successor thereto.

23. "Directorate of Water Resources Management National Project Implementation

Unit" or "Directorate of Water Resources Management NPIU" means the
Borrower's entity, under the Directorate of Water Resources Management,
whose responsibiiities are set out in Section lA.5 of Schedule 2 to this
Agreement, or any successor thereto.

24. "East and North Tarum Canals" means the East and North Tarum Canals in
latiluhur (as hereinafter defined). .

25. "Environmental Man~gement Plan" means the Borrower's plan, dated

December 2, 2010 and agreed with the Bank, setting out mitigation,
enhancement, monitoring, and institutional measures, including capacity building

i
.'
 - 32

II through training, to eliminate any adverse environmental impacts of Project

! activities to be implemented'in the fIrst year of Project implementation; offset
I: them, or reduce them to acceptable levels, or enhance positive impacts, prepared
i . in accordance with the provisions of 'the Environmental and Social Safeguards
I
I
!
Framework (as hereinafter defmed), as the same may be modifIed from time to
time with the prior written agreement of the Barik, and such term includes any
~.
I; annexes or schedules to such plan.
I
26. "Environmental and Social Safeguards Framework" means the Borrower's
f' framework, dated December 2, 2010, agreed with the Bank and setting out

I',
mitigation, .enhancement, monitoring, and ,institutional measures, including
",
capacity building through training, to eliminate any a9verse environmental and
"

i social impacts of Project activities, offset them, or reduce them to acceptable

levels, or enhance positive impacts, and guidelines' for the' preparation of .
Additional Environmental Management Plans, as the same may be modifIed from
time to time with the prior written agreement of the Bank, and such term includes
any schedules or annexes to such framework.

27. "Extension Commissions" means, collectively, the Borrower's entities, under the
Kabupaten Agriculture Service (as hereinafter defmed), whose responsibilities
are set out in Section lE.1 of Schedule 2 to this Agreement, or any successors
thereto.

28. "Extension Working Groups" means, collectively, the Borrower's entities, under
the Kabupaten' Agriculture Service (as hereinafter defined), whose
responsibilities are set out in Section I.E.1 of Schedule 2 to this Agreement, or
any succ,essors thereto.

29. "General Conditions" means the "International Bank for Reconstruction and
Development General Conditions for Loans", dated July 31, 2010.

30. "Indigenous Peoples" means social groups, disadvantaged in the' development

process and with a social and cultuml identity distinct from those which
constitute the predominant ethnic group in the Borrower's territory.

31. "Indigenous Peoples' Plan" means the Borrower's plan, to be agreed with the
Bank and setting out armngeIilents to address any adverse effects on Indigenous
Peoples and ensure cultumlly appropriate social and economic benefIts for
Indigenous Peoples, prepared in accordance with the provisions of the
Indigenous Peoples Policy Framework (as hereinafter defmed), as the same may
be modifIed from time to time with the prior written agreement of the Bank, and
such term includes any annexes or schedules to such plan; and "Indigenous
Peoples Plans" means more than one (1) such plan.

1/

 - 33

32. "Indigenous Peoples' Policy Framework" means the Borrower's framework,

dated December 2, 2010, agreed with the Bank and setting out the mitigation,
enhancement, monitoring, and institutional measures, including capacity building
through training, to ensure meaningful consultation with, and the informed
participation of, Indigenous Peoples within the Project area who are affected by

the Project, and guidelines and procedures for the preparation of Indigenous

Peoples Plans (as hereinafter defined), as the same may be modified from time to

time with the prior written agreement of the Bank, and such term includes any

annexes or schedules to such framework .

33. . "Integrated Pest Management Plan" means the Borrower's plan, dated
December 2,2010, agreed with the Bank and setting out measures to develop and
implement integrated pest management and safe handling of pesticides in. the
course of Project implementation, as the same may be modified from time to time
with the prior written agreement of the Bank, and such term includes any annexes

34.
or schedules to such plan.

"Irrigation. Commissions" means, collectively, the multi-stakeholder entities

responsible for the provision of advisory services in relation to ,the participatory
I
ittigation management of Province (as hereinafter defined) and Kabupaten (as
hereinafter defined) irrigation schemes, or any successors thereto.

35. "Jatiluhur" means the Jatiluhur irrigation system in the Province (as hereinafter
defined) of WestJava in the Borrower's territory.

36. "latiluhur Project Implementation Unit" or "Jatiluhur PIU" means the

Borrower's entity, under the Directorate of Irrigation and Swamps NPIU, whose
responsibiliqes are set out in Section lA.5 of Schedule 2 to this Agreement, or a
successor thereto.

37. "Kabupaten" means a district, an administrative division of the Borrower, within

. a Province (as hereinafter defined).
: 1

38. "Kabupaten Agriculture Service" means the Borrower's entity, under the
Kabupaten, responsible for the management of agriculture in the respective
Kabupaten. or any successor thereto.

39. "Kabupaten Agriculture Service Kabupaten Project Implementation Unit" or

. "Kabupaten Agriculture Service KPIU" means the Borrower's Kabupaten-level

entity, .under the Kabupaten Agriculture Service, whose responsibilities are set

out in Section I.A.9 of Schedule 2 to this Agreement, or any successor thereto.

40. "Kabupaten Development Planning Agency" means .the Borrower's entity, under
the Kabupaten, responsible for development planning in the respective
Kabupaten. or any successor thereto. .
f'
L
I

~; -34
1<
r
. -' . ' .

41. ,"Katiupaten Deyelopment, Planning Agency KabupatenProject Implementation

Unit", or "Kabupaten Development' Planning Agency KPIU'" means the
, Borrower's Kabupaten.,.level entity, under the Kabupaten Deveiopmen t Planning
Agency, whose responsibilities are set out in Section 1.A.9 of Schedule 2to this
Agr~eme,nt, or any slicC~SSOJ;" thereto.

42. "KabupatenPr6ject Impleme~tation Units" or "KPIUs"means,collectively, the

Kabupaten Agriculture Service KPIU,the Kabupateh De'veiopmtmt Planning'
Agency KPIU, and the KabupatenWater Resources Service Kabupaten Pr9ject
Implementation Unit (as hereinafter defined), or any successors thereto.

43. "KabupatenProject Management Unit" or'!KPMU" means the Borrower's

entity, under-the' Kabupaten Development ,Planning Agency, whose
respOnsibilitlesare set out in Section tA.8 of Schedule 2 to this Agreement, or a
successor there~o.,

44. "Kabiipaten Water Resources Service" means the Borrower's entity, under the
Kabupaten, ' ,responSIble for' water resource 'management in the respective
Kabupaten, or any successor thereto. ' '

45. "Kabupaten Water Resources Service Kabupaten Project Implementation Unit"

or "Kabupaten Water Resources Service KPIU" means the Borrower's
Kabupaten-level entity, under the Kabupaten Water Resources Service, whose
responsibilities are set out in Section I.A.9 of Schedule 2 to this Agreement, or
any successor thereto.

46. "Land Acquisition and Resettlement Action Plan" means the Borrower's plan, to
be agreed with the Bank, setting out the arrangements pertaining to land
acquisition and the compensation, resettlement, and rehabilitation of Project
Affected Persons' (as hereinafter defined)i prepared in accordance with the
provisions of the Land Acquisition and Resettlement Policy Framework, as the
same may, be modified from time to time with the' prior written agreement of the
Bank, and such term includes any annexes or schedules to such plan; and "Land
Acquisition and Resettlement Action Plans" means more than one (1) such plan.

47. "Land Acquisitio~ and Resettlement Policy Framework" means the Borrower's
,framework, dated December 2,2010, agreed with the, Bank and setting out
mitigation, enhancement; monitoring, and institutional measures, including
capacity buildingtbrough training, .to carry out acquisition of land and related
assets under the Project, compensation, resettlement, and rehabilitation of Project
Affected Persons, and guidelines and procedures for the preparation of Land
Acquisition and Resettlement Action Plans, as the same may be modified from
timeto time with the prior written agreement of the Bank, and such term includes
any annexes or schedules to such framework.

lJ

 35

48. "Ministry of Agriculture" means the Borrower's ministry responsible for the
management of agriculture, or any successor thereto.

49. "Ministry of Home Affairs" means the Borrower's ministry responsible for the
management of home affairs, or any successor thereto.

50. "Ministry of Finance" means the Borrower's ministry responsible for the
management of finance, or any successor thereto.

51. "Ministry of Public Works" means the Borrower's ministry responsible for the
management of public works, or any successor thereto.

52. "National Development Planning Agency" means Badan Perencanaan

Pembangzman Nasioncil (Bappenas), the Borrower's ministry-level entity
responsible for development planning, or any successor thereto.

53. "National Project Implementation Units" or "NPIUs" means, collectively, the

Directorate of Irrigation and Swamps NPIU, the Directorate of Spatial Planning
and Environment NPIU, the Directorate of Irrigation Water Management NPIU,
the Directorate of Water Resources Management NPIU, and the latiluhur PIU, or
any successors thereto.

54. "National Project Management Unit" or "NPMU" means the Borrower's entity,
under the Directorate General of Water Resources, whose responsibilities are set
out in Section I.A.4 of Schedule 2 to this Agreement, or any successor thereto._

55. '''National Steering Committee on Water Resources" means the Borrower's

entity, under the National Development Planning Agency, responsible for the
operational and programmatic coordination of national- and local-level
government activities affectirig water resources infrastructure, or any successor
thereto.

56. "Operating Costs" means the reasonable costs of incremental expenditures under
the Project, based on the annual work plans and budgets referred to in Section IF
of Schedule 2. to this Agreement as approved by the Bank, and incurred by the
Borrower for purposes of Project management, implementation, and monitoring
and evaluation, on account of utilities and supplies, bank charges,
communications, vehicle operation, maintenance, and insurance, office space
rental, building and equipment maintenance, public awareness-related publicity
and media expenses, domestic travel and subsistence, and salaries of contractual
arid temporary staff, but excluding salaries, bonuses,' and fees of members of the
Borrower's civil service.

57. "Participating Kabupaten" means a Kabupaten that has met the eligibility criteria
for carrying out, or having carried out within its geographical territory, as the

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Ii case may be, ari activity under Part 2 (a) (ii) or (b) Oi), or 4 (c) of the Project
pursuant to the provisions of the Project Management Manual,
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I
i Sg. "Participating Province" means a Province (as hereinafter defined) that has met
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! the eligibility criteria for carrying Ollt, or having can-ied Ollt within .its
L
, geographical territory, as the case may be, an activity under Part 1 (a) (ij) Of
i' (b) Oi), 2 (a) (i), (b) (i) or (c) (i), or 4 (b) of the Project pursuant to the provisions
II
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of the Project Management ManuaL
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, 59. "Procurement Guidelines" means the "Guidelines: Procurement under IBRD
Loans and IDA Credits" published by the Bank .in May 2004 and revised in
October 2006 and May 20W. .

60. "Procorement Plan" means the BOITower's procurement plan for the Prqject,
il dated March 1, 2011 and refen-ed to in paragraph L 16 of the Procurement
\iLi Guidelines and paragraph 1.24 of the Consultant Guidelines, as the same shall be
!i upd~ted from time to time in accordance with the provisions of said P!1ragraphs.
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II 61. "Program" means the program designed to strengthen the Bon-ower's water
I resources and irrigation sector and rehabilitate . and improve the sector
I infrastructure, and set forth or referred to in the letter dated May 8, 20m from the
Bon'ower to the Bank.

62. "Project Affected Person" means a person who, on account of implementation of

the Project, has experienced or would experience direct economic and social
impacts caused by: (i) the involuntary taking of land, resulting in: (A) relocation
or loss of shelter; (B) loss of assets or access to assets; or (C) loss of income
sources or means of livelihood, whether or not such person must move to another
location; or (ii) the involuntary restriction of access to legally designated parks
and protected areas, resulting in adverse impacts on the livelihood of such
person; and "Project Affected Persons" means, collectively, all such persons.

63. "Project Management Manual" means the Bon-ower's manual, dated

February 2011 and agreed with the Bank, setting out implementation,
organizational, administrative, monitoring and evaluation, financial management,
disbursement, and procurement arrangements for purposes of Project
implementation, and including the Better Governance Action Plan, as the same
may be modified from time to time with the prior written agreement of the Bank,
and such term includes any annexes or schedules to such manual. .

64. "Province" means a province, an administrative division of the Borrower

6:;. "Provincial Agriculture Service" means the Borrower's entity, urider. the
Province, respons}ble for the management of agriculture in the respective
Province, or any successor thereto.

!I

 - 37

66. "Provincial Agriculture Service Provincial Project Implementation Unit" or

"Provincial Agriculture Service PPIU" means th~ Borrower's Province-level
entity. under the Provincial Agriculture Service. whose responsibilities are set out
in Section LA.7 of Schedule 2 to this Agreement, or any successor thereto.

67. "Provincial Development Planning Agency" means the Borrower's entity. under
the Province. responsible for development planning in the respective Province. or
any successor thereto.

68. "Provincial Development Planning Agency Provincial Project Implementation

Unit" or "Provincial Development Planning Agency PPIU" means the
Borrower's Province-level entity, under the Provincial Development Planning
Agency, whose responsibilities are set out in Section 1.A.7 of Schedule 2 to this
Agreement. or any successor thereto.

69. "Provincial Project Implementation Units or "PPIUs" means. collectively, the

Provincial Agriculture Service PPIU. the Provincial Development Planning
Agency PPIU, and the 'Provincial Water Resources Service Provincial Project
Implementation Unit (as hereinafter defined), or any successors thereto.

70. "Provincial Project Management Unit" or "PPMU" means the Borrower's entity,
under the Provincial Development Planning Agency, whose responsibilities are
setout in Section I.A.6 of Schedule 2 to this Agreement. or any. successor
thereto.

71. "Provincial Water Resources Service" means the Borrower'S entity, under the
Province, responsible for water resource management in the respective Province,
or any succe~sor thereto.

72. "Provincial Water Resources Service Provincial Project Implementation Unit" or

"Provincial Water Resources Service PPIU" means the Borrower's Province
level entity, under the Provincial Water Resources Service, whose
responsibilities are set out in Section I.A.7 of Schedule 2 to this Agreement, or
any successor thereto.

. 73. "Safeguards Instruments" means, collectively, the Environmental and Social

S"eguards Framework, the Environmental Management Plan, any Additional
Environmental Management Plans, the Indigenous Peoples Policy Framework,
any Indigenous Peopl~s .Plans, the Land Acquisition and Resettlement Policy
Framework, any Land Acquisition and Resettlement Action Plans, the Integrated
. 'Pest Management Plan, and such term includes any annexes or schedules to such
instruments.

74.' "SUbproject" means one (1) or more contract packages under the Project,
grouped together for procurement purposes.
 38

75. "Training" means the costoftraining financed under the Project, based on the
annual work plans and Qudgets referred to in Section LFof Schedule 2 to this
Agreement as approved by the Ba,nk, and attributable to seminars, workshops,
artd study tours, a]oilg with the cost of domestic andintemational travel and
subsistence for training participants; services of trainers, rental of training
facilities, preparation and reproductiOn of training materials, and other activities
directly related to course preparation and implementation.
I',
"
r. 76. "Water Users Association'~ means an autonomous association of iIrigators and
other water'users in' a.spedfic inigation' scheme, established pursuant .to
"0 "
,registration with a notary public, owning accounts, empowered to raise and retain
revenue, and having a democratically elected leadership, or any successor
, thereto; and "Water Users ASSoCiations" means more than one (1) such
association.
, ,

77. "Water Users Associations Federation~' means an autonomous federation of

Water Users Associations,~stablished pursuant to registration with a notary
public, owning accounts, empowered to raise and retain revenue, and having a
democratically ,elected 'leadership, or any succeSsor thereto; and "Water Users
Associations Federations" means more than one (1) such federation.