The Wor.4 Bank New Delhi f2 INTERNATIONAL BANK FOR RECONSTRUGTION AND DEVELOPMENT 70 Lodi Estate CableAddress: INTBAFRAD INTERNATIONAL DEVELOPMENT ASSOCIATION New Delhi - 110 003 Mailing Address: P.0 Box 416 India Facsimile : 24619393 / February 22, 2013 Mr. Nilaya Mitash - AL Joint Secretary I TS Department of Economic Aflirs Ministry of Finance, North Blodc New Delhi 10001 India Mr. B. K. Patnaik Chief Secretary Government of Odisha Odisha 12 ZJ 3 India Dear Mr. Mitash and Mr. Patnaik: IN: Orissa State Roads Project (Loan No.7577-IN) Amendments to the Loan Agreement, the Project Agreement and the Supplemental Letter (Performance Monitovingz Indicators) We refer to the Loan Agreement between India (the "Borrower") and the International Bank for Reconstruction and Development (the "Bank") dated January 27, 2009 (the "Loan Agreement") and the Project Agreement of the same date between the Bank and the State of Orissa (the "Project Agreement") for the above-referred Project (the "Project"). We also refer to: (i) our letter dated November 15, 2011 to the Chief Secretary of the Government of Orissa indicating the Bank's withdrawal of support to all Public Private Partnership (PPP) activities under the Project; (ii) the Letter from the Government of Odisha Home Department dated November 19, 2011 regarding the alteration of the name of the State of Orissa"; (iii) the Government of Odisha's letter EAP 52/126896/W dated July 10, 2012 and (iv) DEA letters dated August 7, 2012 and September 24, 2012. As per the meeting held in Department of Economic Affairs (DEA) on January 15, 2013, we hereby propose to amend the Loan Agreement, the Project Agreement, and the Supplemental Letter on performance monitoring indicators as follows: I. Loan Agreement 1. "Orissa", wherever it appears in the Agreement, is replaced with "Odisha". 2. The text under Part A of Schedule 1 is revised to read as follows: "Widening, strengthening and selective realignment of about 310 km of existing roads in the State of Odisha to the double-lane standard, to be completed in two phases: (i) Phase I Roads, comprising about 204 km of total roads included in the Project; and (ii) Phase II Roads, comprising 106 km included in the Project; and implementation of ancillary social, health, resettlement and environmental measures." Mr. Nilaya Mitash - 2 - February 22, 2013 -Mr. B.K. Patnaik 3. The heading of the Part B in Schedule I is revised to read as "Sector Policy and Institutional Development and Implementation Support". 4. Part B. 1 in Schedule 1 is deleted in its entirety and is purposely left blank. 5. Part B.2 (c) in Schedule 1 is amended to read as follows: "strengthening the OWD capacity in core business functions, including road safety, road assets management". 6. The table in Section IV A.2 of Schedule 2 is amended to read as follows: Amount of the Loan Allocated Percentage of (Expressed in Expenditures Category Dollars) to be Financed (1) Civil works, goods, 194,827,631 80% consultants' services, Training, R&R Assistance, and Incremental Operating Costs (2) Refund of the Project 547,369 Amount payable pursuant to Preparation Advance Section 2.07(a) of the General Conditions (3) Front End Fee 625,000 Amount payable pursuant to Section 2.03 of this Agreement in accordance with Section 2.07 (c) of the General Conditions (4) Premia for Interest Rate Cap -0- Amount payable pursuant to and Interest Rate Collar Section 2.07 (c) of this Agreement in accordance with Section 4.05 (c) of the General Conditions Cancelled as of January 15, 2013 5 Original Amount of the Loan 7. Section IV.B.2 of Schedule 2 is amended to read as follows: "2. The Closing Date is June 30, 2016". 8. Paragraph 3 in the Appendix is amended to read as follows: "Consultant Guidelines" means the "Selection and Employment of Consultants under IBRD Loans and IDA Credits & Grants by World Bank Borrowers", January, 2011". 9. Paragraph 18 in the Appendix for the definition of "PPP Cell" is hereby deleted and is purposely left blank. Mr. Nilaya Mitash - 2 - February 22, 2013 *Mr. B.K. Patnaik 10. Paragraph 19 is amended to read as follows: "Procurement Guidelines" means the "Procurement of Goods, Works, and Non-Consulting Services under IBRD Loans, and IDA Credits & Grants by World Bank Borrowers", January 2011". 11. In Paragraph 20 "paragraph 1.16" is replaced with "paragraph 1.18", "paragraph 1.24" is replaced with "paragraph 1.25". II. Project Agreement 1. "Orissa", wherever it appears in the Agreement, is replaced with "Odisha". 2. Section I.C of the Schedule is hereby amended to read as follows: "maintain the PMU, EMC and SMC and ensure that the PMU, EMC and SMC, and the OWD field offices have officials, staff and resources required under the Project". 3. In Section I.F of the Schedule "2010" is replaced with "2013". 4. In Section I.G of the Schedule "2010" is replaced with "2013". 5. Section I.H of the Schedule is amended to read as follows: "carry out, with respect to the Project roads: (a) three user satisfaction and land use surveys, and produce reports for each survey, with the first (baseline) survey to be carried out and the report to be produced no later than March 31, 2013, the second survey to be carried out and the report to be produced no later than March 31, 2015, and the third survey to be carried out and the report to be produced no later than March 31, 2016; (b) one value engineering and quality review to be carried out and the report to be produced no later than June 30, 2015". 6. In Section I.J of the Schedule "2010" is replaced with "2013". 7. In Section I.K of the Schedule "2011" is replaced with "2014". 8. In Section I.L of the Schedule "2012" is replaced with "2015". 9. In Section I.M of the Schedule "2013" is replaced with "2016". 10. In Section II A.2 of the Schedule "December 31, 2010" is replaced with "June 30, 2015". Supplemental Letter (Performance Monitoring Indicators) The attachment to the Supplemental Letter (Performance Monitoring Indicators) dated the same date as the Loan Agreement, is hereby amended and is replaced with the Annex 1 to this Amendment Letter. Except as specifically amended in this letter, all other terms and conditions of the Loan Agreement and the Project Agreement shall remain in full force and effect. Mr. Nilaya Mitash - 2 - February 22, 2013 -+Mr. B.K. Patnaik Please confirm your agreement to the foregoing on behalf of the Borrower and of the State of Odisha by countersigning and dating the corresponding form of confirmation set forth below, and returning one fully countersigned original of this letter to us. The above amendments to the Loan Agreement, the Project Agreement, and the Supplemental Letter on performance monitoring indicators shall become effective upon receipt by the Bank of a duly countersigned original of this letter by the authorized representative of the Borrower and of the State of Odisha respectively. Notwithstanding the foregoing, for purposes of paragraphs 1.3, 1.4, 1.5 and 11.2 of this Letter, this Letter shall, upon countersignature, be deemed effective as of November 15, 2011. Sincerely, INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT Onno Ruhl Country Director, India South Asia Region CONFIRMED: INDIA By: Authorized Representative Name: ) Title: Date: CONFIRMED: STATE O F DISHA By: __U x_W ____I Authorizeo-Representative B. K. PATNAIK Name: Chief Secrotaryl Title: Date: Annex 1 Performance Monitoring Indicators Results Framework PDO Project Outcome Indicators Use of Project Outcome Information 1. Remove transport 1.1 Reduction in vehicle operating costs on project corridors To assess the performance of bottlenecks in priority transport 1.2 Increase in vehicle speed on project the project and to redirect it, if corridors for greater 1.3 Improvement in Road User Satisfaction Index necessary, to achieve the PDO investment and economic and 1.4 Improvement in Network Congestion Indices social development activities. 1.5 RTI compliance Ratio of PMU Intermediate Outcomes Intermediate Outcome Indicators Use of Intermediate Outcome Monitoring 1 Three Project Corridors 1.1 310 km of state highways widened and upgraded efficiently To assess the performance of the improved in socially and project and to redirect it, if envionmetaly sutainble 1.2 Environmental management plans, including biodiversity' ncsay o civ h D environmentally sustainable mngmnmesrsfecilympmntdnecessary, to achieve the PDO way management measures effectively implemented way 1.3 Percentage of project displaced households and/or business enabled to reestablish their shelter and/or business 2 OWD Core Business 2.1 Road Asset Management, Road Safety and Environment and Units/Cells Fully Functional Social Management functions operational and execute annual business programs, and IT/ICT/MIS functions and assets operational 3 Conducive road sector policy 3.1 Improved policy and legislative framework in place put in place to govern the 3.2 Sustainable road maintenance financing options studied and management, financing and safety of the road network 3.3 Road Safety Action Plan established and being implemented 5 Arrangements for Results Monitoring Actual Target Values Data Collection and Reporting Value Outcome Indicators Baseline 2013 2014 2015 June Frequency and Reports Data Collection Responsibility (2006) 2016 Instruments 1.1 vehicle operating costs in project EOP, High Priority RAMS OWD/PMU corridors reduced Cars - 4.29 5 4.6 Network Condition Reports Trucks - 16 14 10.22 17 15 Buses - 8.70 1.2 vehicle speed in project corridors EOP High Priority RAMS OWD/PMU increased Cars - 45 47 54 Network Traffic Reports Trucks - 35 46 53 Buses - 40 47 53 1.3 Road User Satisfaction Index Being User satisfaction surveys - Survey OWD/PMU Improved Collected Baseline and EOP 1.4 Improvement in Network Congestion - EOP Surveys, Secondary Data OWD/PMU Indices (%) Collection (i) Congestion free CRN (ii) Congested CRN (iii) Over Congested CRN 1.5 RTI Compliance Ratio of PMU - 100% 100% 100% 100% Secondary Data Collection OWD/PMU Maintained at 100% Results Indicators for Each Component Component I (Road I Corridor Improve ent Component) 1.1 310 km of state highways widened and 0 Km 0 Km 100 200 km 310 Km Monthly reports, quarterly In-house reporting, OWD/PMU/CSC upgraded efficiently Km FMRs certification of quantities by CSC 1.2 EMP, including biodiversity - - 310 km EOP report In-house reporting OWD/PMU management measures effectively implemented 1.3 Percentage of project displaced 40% Above EOP Independent impact Independent Consultant households and/or business enabled to 95% assessment reestablish their shelter and/or businesses Actual Target Values Data Collection and Reporting Value6 6 Intermediate Outcome Indicators Baseline 2013 2014 2015 June 2016 Frequency and Data Responsibity Reports Collection Instruments Component 2 (Sector Policy and Institutional Development and Implementation Support) 3.1 Road Asset Management, Road Safety Nil RAMS Road Safety Cell IT/ICT/MIS 100% Semi-annual progress In-house OWD/PMU and Environment and Social Management Operational operational rollout report reporting functions operational and IT/ICT/MIS functions and assets operational ES IT/ICT/MIS 50% rollout operational 3.2 Milestones in GAAP and ISAP met Nil 20% 40% 60% 100% Study report and final In-house OWD/PMU report reporting 4.1 Improved Road Policy and Legislative Nil Study Policy and Legal GOO-approved Policy Study report and final In-house OWD/PMU Framework put in place completed Framework approved by and Legal Framework report reporting GOO enhancements in place. 4.2 Sustainable road maintenance Nil Study GOO decisions taken on GOO-endorsed changes Annual report In-house OWD/PMU financing options studied and suitably Completed new Road Maintenance to Road Maintenance reporting implemented Financing option(s). Financing implemented 4.3 Road Safety Action Plan put in place Nil Study GOO decisions taken on New Road Safety Study report and final In-house OWD/PMU completed new state-level Road Policy, Action Plan and report reporting Safety Action Plan and supporting institutional its implementation arrangements established and under Implementation. 7