THE WORLD BANK IBRD • IDA I WORLDBANKGROUP SATU KA.HKONEN Count ry Director. Indonesia and iimor Leste Letter No. CD-060 /WB/INEY/IIV2023 March 14, 2023 Mr. Swninto Director General of Budget Financing and Risk Management Ministry of Finance Gd. Frans Seda Jl. DR. Wahidin Raya No.I Jakarta Pusat Dear Mr. Suminto, Re: Republic of Indonesia: IBRD Loan No. 8884-ID (Investing in Nutrition Early Years Program) and Global Financing Facility Grant No. TF0A7565 (Investing in Nutrition and Early Years Project) -Amendments to the Loan Agreement and the Grant Agreement We refer to the loan agreement between the Republic of Indonesia ("Borrower") and the International Bank for Reconstruction and Development ("Bank") for the Investing in Nutrition Early Years Program ("Program"), dated August 1, 2018, as amended to date ("Loan Agreement"), and the grant agreement ("Grant Agreement") dated August 1, 2018, as amended to date, between the Borrower and the Bank, acting as an administrator of the Global Financing Facility, for the Investing in Nutrition and Early Years Project ("Project", together with the Program, the "Operation"). We also refer to the Borrower' s letter dated April 26, 2022, requesting a restructuring of the Operation. All capitalized terms used in this letter shall have the same meanings assigned to them in the Loan Agreement and the Grant Agreement unless the context requires otherwise. We are pleased to inform you that the Bank concurs with your request, and proposes to amend the Loan Agreement and the Grant Agreement by way of this letter ("Amendment Letter") all as set out below: I. Amendment to the Loan Agreement 1. The table under Section IV.A.2 of Schedule 2 to the Loan Agreement is deleted in its entirety and replaced by the table set forth in Attachment 1 to this letter; 2. The following definition is amended in the Appendix to the Loan Agreement as follows : "20. "Fiscal Year" or " FY" means the Borrower's fiscal year commencing on January 1 and ending on December 31 of the same year, except for FY22, for purposes of which means January 1, 2022 through June 30, 2023." 18 18 H Street NW • Washington, DC 20433 USA 2 of 14 L 8884 - TFOA 7565 II. Amendments to the Grant Agreement 1. Section 2.01 of the Grant Agreement is deleted in its entirety and replaced with the following: "The Recipient declares its commitment to the objective of the Project. To this end, the Recipient shall carry out: (a) Parts A. I and A.2 of the Project through the Ministry of State Secretariat; (b) Part A.3 of the Project through Bappenas; (c) Part B of the Project through the Ministry of Home Affairs; (d) Part C of the Project through the Ministry of Villages, Development of Disadvantaged Areas and Transmigration; and (e) Part D of the Project through BKKB , all in accordance with the provisions of Article II of the Standard Conditions." 2. The following paragraph is inserted as Part D to Schedule I, Project Description, to the Grant Agreement: "Part D: Strengthening Capacity for Household Convergence I. Strengthening the capacity of BKKB to improve convergence of nutrition interventions at the household level through: (a) developing, implementing and/or updating a national plan for the acceleration of stunting reduction; (b) coordinating acceleration of stunting prevention at the family level, in coordination with the So VP, MOHA, MOY and sub-national task forces; (c) providing technical assistance and capacity building ensure continuity of essential health and nutrition services at the district, village, and household levels; and (d) enhancing monitoring, evaluation, and data use to implement priority interventions. 2. Enhance analytics capacity of BKKB and strategic use of results monitoring by supporting regular reviews of coverage and utilization of service delivery at the central and subnational levels. " 3. Paragraph A, General Institutional Arrangements, in Section I of Schedule 2 is hereby revised in its entirety as follows : "A. General Institutional Arrangements The Recipient shall maintain, at all times during the implementation of the Project, the following entities, all with staff, functions and resources satisfactory to the World Bank: I. a Leadership Committee, chaired by the Vice President and co-chaired by the Coordinating Minister for Human Development and Culture, consisting of ministers/head of agencies, or their designates, from Bappenas, Ministry of Finance, Ministry of Health, Ministry of Education and Culture, Ministry of Social Affairs, Ministry of Villages, Development of Disadvantaged Areas and Transmigration, Ministry of Home Affairs, BPS, and BKKBN which shall be responsible for setting policies and annual targets, reviewing progress and performance, and resolving specific issues as required; and 2. a Steering Committee, chaired by the deputy for human development and equality of the Ministry of State Secretariat and co-chaired by the deputy of health of the Coordinating Ministry for Human Development and Culture and the deputy for human and societal development and cultural affairs of Bappenas, consisting of echelon- I 1818 H Street NW · Washington, DC 20433 USA 3 of 14 LN8884 - TFOA 7565 officials of Bappenas, Ministry of Finance, Ministry of Health, Ministry of Social Affairs, Ministry of Education and Culture, Ministry of Home Affairs, Ministry of Villages, Disadvantaged Areas and Transmigration, BPS, BPKP, and BKKB , which shall be responsible for providing guidance throughout Project implementation, carrying out semi-annual monitoring reviews and overseeing the Project and approving the Annual Work Plans and Budgets." 4. The following paragraph is inserted in the Appendix to the Grant Agreement, and the paragraphs in the Appendix are renumbered accordingly: "5. "BKKB " or "Badan Kependudukan dan Keluarga Berencana Nasional" means Recipient' s National Population and Family Planning Board, or any successor thereto ." Except as specifically amended by this letter, all other provisions of the Loan Agreement and the Grant Agreement shall remain in full force and effect. Please confirm the Borrower' s agreement to the amendments set out above by having an authorized representative of the Borrower countersign and date the two originals of this letter, and returning one fully countersigned original of this letter to the Bank. Upon receipt by the Bank of the countersigned copy of this letter, the amendments herein shall become effective as of the date of the countersignature of this Amendment Letter by the Borrower. Country Director, Indonesia and Timor-Leste CONFIRMED AND AGREED: RE PUBLIC OF INDONESIA By fl"'Oie- ,,_ ¾ Authorized Representative SUt'lilVTO ame: Di ~ElT~ ~EtJE~~\. {)f e,voG£1 Fil" ANCi"'C, Title: Jot-JC) fl.i~~ Ml",tJAC.ENHIT Date: 1818 H Street NW • Washington, DC 20433 USA 4 of 14 LN8884 - TFOA 7565 Copy to: 1. Mr. Suprayoga Hadi, Deputy for Human Development and Equality Secretariat of the Vice President 2. Mr. Subandi Sardjoko, Acting Deputy for Human, Community and Cultural Development, Ministry of National Development Planning/National Development Planning Agency/Bappenas 3. Mr. Scenaider C.H. Siahaan, Deputy Minister for Development Funding Affairs, Ministry of National Development Planning/National Development Planning Agency/Bappenas 4. Mr. Teguh Setyabudi, Director General of Regional Development, Ministry of Home Affairs 5. Mr. Sugito, Director General of Villages and Rural Development, Ministry of Villages, Disadvantaged Regions and Transmigration 6. Ms. Maria Endang Sumiwi, Director General of Community Health, Ministry of Health 7. Mr. Tavip Agus Rayanto, Principal Secretary, Badan Kependudukan dan Keluarga Berencana Nasional 8. Mr. Sukaryo Teguh Santoso, Deputy for Advocay, Mobilization and Information, Badan Kependudukan dan Keluarga Berencana asional 9. Mr. Syurkani Ishak Kasim, Director for Loans and Grants, Ministry of Finance 1818 H Street NW • Washington, DC 20433 USA 5 of 14 LN8884 - TFOA 7565 ATTACHMENT 1 Revised table (Section IV.A.2 of Schedule 2 to the Loan Agreement) Category Disbursement Linked Result Amount of the Formula (including (as applicable) Loan Disbursement Linked Allocated Indicator as ~xpressed in USD'. applicable) (1) DLI # 1: Public !DLR # 1.1: 5,000,000 NIA commitment of FY 18: Public commitment !Priority District secured from at least 60 Priority lLeaders to accelerate !Districts Leaders stunting prevention !DLR # 1.2: 5,000,000 IFY19: Public commitment secured from at least 96 Priority !Districts Leaders !DLR # 1.3 : 5,000,000 [FY20: Public commitment secured from at least 234 !Priority Districts Leaders !DLR # 1.4: 5,000,000 IFY2 l : Public commitment secured from at least 308 !Priority Districts Leaders !DLR # 1.5 : 10,000,000 FY22 : Public commitment secured from all 514 Priority !Districts Leaders (2) DLI #2: Tracking DLR#2. l: 4,000,000 NIA and performance Bappenas and MOF have evaluation of national developed the tagging and spending on priority racking system for priority tnutrition interventions nutrition interventions DLR#2.2: 6,000,000 Bappenas and MOF have issued: (a) by January 2019, a report of the Borrower' s 2019 budget summarizing budget lines tagged to the N atS trat Stunting; and (b) the performance report by August 2019 1818 H Street NW • Washington, DC 20433 USA 6 of 14 L 8884 - TFOA 7565 [DLR #2.3: 6,000,000 (a) MOF and Bappenas have ~ssued, by March 2020, a tperformance and expenditure treport of FY 19; (b) MOF and IBappenas have issued the semi- annual performance and expenditure report by August 2020; and (c) MOF has used said performance reports to inform the budget of the next FY DLR #2.4: 4,000,000 a) MOF and Bappenas have issued, by March 2021 , a performance and expenditure report of FY20; (b) MOF and Bappenas have issued the semi- annual performance and expenditure report by August 2021; and (c) MOF has used said performance reports to inform the budget of the next FY DLR #2.5 : 4,000,000 (a) MOF and Bappenas have issued, by March 31 , 2022 , a performance and expenditure report of FY2 l ; (b) MOF and Bappenas have issued the semi- annual performance and expenditure report by September 30, 2022 ; and (c) MOF has used said performance reports to inform the budget of the next FY (3) DLI #3: Timely DLR #3.l : 3,000,000 NIA publication of annual BPS has issued the guidelines national and District for the implementation of 2019 stunting rates SUSENAS (FYI 8) 1818 H Street NW • Washington, DC 20433 USA 7 of 14 L 8884 - TFOA 7565 28,800,000 ( a) FY 19: (i) the national stunting rate has been published n the government's website by ctober; and (ii) District stunting rates have been ublished by December 31 (b) FY20: (i) the national stunting rates have been ublished on the government's Full Achievement: ebsite; and (ii) District $ 9,000,000 m eac stunting rates have been y ublished on the government's ebsite artial Achievement for FY20, FY2 l and (c) FY21: (i) the national FY22 : (i) $1,800,000 stunting rates have been for the publication of ublished on the government ' s ational stunting ebsite by December 31 ; and ates on the (ii) District stunting rates have overnment' s een published on the ebsite; and (ii) overnment's website by $7,200,000 for the ecember 31 ublication of d) FY22: (i) the national stunting rates have been overnment' s ublished on the government ' s ebsite ebsite by February 28, 2023 ; nd (ii) District stunting rates ave been published on the overnment's website by Februa 28 , 2023 (4) DLI #4 LR #4.1: 2,000,000 IA riority Districts evised, and more nutrition- elivery of nutrition- sensitive, ECED professional sensitive professional evelopment materials and evelopment program andbooks issued by MOEC for ECED teachers FY18) 1818 H Street NW • Washington, DC 20433 USA 8 of 14 LN8884 - TFOA 7565 LR #4.2: 28,298 ,75 (a) FY19: (i) Up to 100 Priority istricts with at least 20 trainers ertified to deliver the more utrition-sensitive professional evelopment program to ECED eachers; and (ii) up to 100 riority Districts with teachers hat have completed the ECED rofessional development rogram evelopment rogram to ECED (b) FY20: (i) Up to 100 new eachers; and (ii) riority Districts with at least 20 $37,500 per FY for rainers certified to deliver the each new Priority rofessional development istrict with rogram to ECED teachers; and eachers that have (ii) up to 200 Priority Districts ompleted the ECED ith teachers that have rofessional ompleted the ECED rofessional development rogram r in case of partial (c) FY2 l : (i) Up to 100 new chievement riority Districts with at least 20 rainers certified to deliver the rofessional development chievement for rogram to ECED teachers; and Y20, FY21 , and (ii) up to 300 Priority Districts Y22 respectively: ith teachers that have (i) $12,500 for each ompleted the ECED ew Priority District rofessional development ith at least 10 rogram d) FY22 : (i) Up to 100 new rofessional Priority Districts with at least 20 evelopment rainers certified to deliver the rogram to ECED rofessional development eachers and $1 ,250 rogram to ECED teachers; and er additional (ii) up to 200 Priority Districts rainer, up to 20 ith teachers that have rainers; and (ii) ompleted the ECED $9,375 for each new rofessional development riority District with rogram focused on nutrition at least 10% Villages and stunting ith 1 teacher in each village, and scalable thereafter at S$ 937.50 for each er per oint of 18 I 8 H Street NW • Washington, DC 20433 USA 9 of 14 LN8884 - TFOA 7565 illages, or for each dditional ercentage point of illages with 1 eacher. (5) DLI #5: LR #5 .1: 10,000,000 (Achievement - sensitivity o Yl8: Up to 60% of aseline) x Unit eneficiaries in 100 Priority istricts have received BPNT ssistance nit Price: $500,000 for each Baseline: 40% of beneficiaries) ercentage (1 %) oint increase LR#5 .2: (a) 4,000,000 (a) NIA Yl 9: (a) Additional protein and/or fortified food item for hildren aged 6-24 months •ntroduced to BPNT assistance; and b) Up to 90% of beneficiaries (b) 12,000,000 (b) (Achievement - •n 160 Priority Districts have aseline) x Unit eceived BP T assistance (Baseline: 60% of nit Price: eneficiaries) $400,000 for each ercentage (1 %) oint increase LR #5.3 : Y20: (a) Additional protein (a) 4,000,000 (a) NIA nd/or fortified food item for hildren aged 6-24 months introduced to BPNT assistance; nd b) Up to 50% ofe-Warongs in (b) 17,000,000 (b) (Achievement - 60 Priority Districts had all aseline) x Unit ligible food items Baseline: 30% of e-Warongs) each ercentage (1%) oint increase LR #5.4: 18,000,000 (Achievement - Y21 Up to 80% of e-Warongs aseline) x Unit in 360 Priority Districts had all eligible food items by the losing Date nit Price: $600,000 for each (Baseline: 50% of e-Warongs) ercentage ( 1%) oint increase 1818 H Street NW • Washington, DC 20433 USA 10 of 14 LN8884 - TF0A 7565 LR#5.5 : Y22 : So VP, working together 6,269,228 IA ith Ministry of Social Affairs, ompletes a study of the cash ersus non-cash BPNT ssistance to inform future olicy (6) DLI #6: Priority LR #6.1: 35 ,282,022 (Achievement istricts Y 18: Up to 80 Priority aseline) x Unit implementation of istricts have issued regulations locally-adapted nlocal behavioral change interpersonal ommunication strategy and IPC nit Price for FY 18, ommunication FYI 9, FY20(a), (" IPC") acti vi ti es FY2l(a) and LR #6.2: Y22(a) : FY 19: Up to 128 Priority $50,000 for each new istricts have implemented IPC Priority District activities in at least 70% of riority Villages nit Price for FY20 (b), FY21(b), and LR #6.3: Y22(b) : Y20: (a) Up to 50 new Priority $40,000 for each new istricts have implemented IPC riority District activities in 70% of all Villages; and (b) up to 80 new Priority artial Achievement istricts have developed a for FY20(a), locally adapted behavioral Y2 l(a), and hange communication strategy Y22(a), (Strakom) espectively: $ 8,570 for each new riority District that LR #6.4: as implemented Y2 l : (a) Up to 75 new Priority IPC activities in at istricts have implemented IPC least 40% of all activities in 70% of all Villages; illages, and $ 714 and (b) up to I 00 new Priority for each subsequent istricts have developed a ercentage point ocally adapted behavioral increase up to 70% hange communication strategy (Strakom ) DLR #6.5: FY22 : (a) Up to 150 new Priority Districts have implemented IPC activities in 70% of all Villages; and (b) up o 132 new Priority Districts ave developed a locally adapted behavioral change ommunication strategy (Strakom) 1818 H Street NW • Washington, DC 20433 USA 11 of 14 L 8884 - TFOA 7565 (7) DLI #7: 4,000,000 IA redictability and Yl8 : (a) Bappenas has issued esults-orientation of uidelines on the District fiscal transfers that implementation of stunting support Convergence eduction program by September 018; and (b) Presidential egulation on the use of DAK to support priority nutrition interventions and District-level onvergence actions issued by ecember 2018 LR #7.2: [intentionally omitted 0 4,000,000 FY20: (a) MOF has issued uidelines on DAK proposal rocess for stunting onvergence program for FY2 l y May 2020; and (b) MOHA as published on its website by ecember 2020 the results of an ual performance assessment •strict im lementation of the ram 4,000,000 Y2 l: (a) MOF has issued uidelines on DAK proposal rocess for stunting onvergence program for FY22 y June 2021 ; and (b) MOHA as published on its website by December 2021 the results of an ual performance assessment i ri im m n i n of the ram 10,000,000 Y22: (a) MoF publishes DAK erformance report on results for supporting priority stunting interventions; and (b) MOHA as published on its website by ecember 2022 the results of an annual performance ssessment of District implementation of the stunting 1818 H Street NW • Washington, DC 20433 USA 12 of 14 L 8884 - TFOA 7565 (8) DLI #8: District LR #8: chievement x Unit erformance in argeting of priority (a) Up to 2.2% increase of the (a) 15,400,000 utrition interventions nnual nutrition targeting index nit Price: o 1,000-Day FY18 through FY20) $700,000 for every ouseholds 0.1% increase above he threshold level to e agreed between ) Up to 5% increase of the he Bank and the annual nutrition targeting index (b) 35,000,000 orrower based on (FY 21 and FY22) he annual nutrition argeting index of he relevant years, p to the maximum amount indicated in he third column. 9) DLI #9: Villages ave been empowered Yl8 : MOY has issued o identify 1,000-Day Households and evelopment workers and onverge intervention illage Convergence scorecards elivery and MOF has revised the I . Achievement x 33,750,00 nit Price (a) FYI 9: Up to 96 Priority istricts with at least 70% of nit price: illages consolidated the For FY 19: $100,000 illage-level data for each new Priority District achieving at (b) FY20: (i) Up to 160 Priority least 70% of Villages Districts with at least 70% of aving consolidate illages having consolidated the illage-level data. illage-level data; and (ii) Up to or FY20, FY21 , 51 Priority Districts continuing and FY22: ith at least 50% of Villages (i) $100,000 for each aving consolidated the Village- ew Priority District level data. achieving at least 70% of Villages c) FY2 l: (i) Up to 213 new aving consolidate riority Districts with at least illage-level data; 70% of Villages consolidated nd (ii) he Village-level data; and (ii) $50,000 for each p to 96 Priority Districts riority District ontinuing with at least 50% of ontinuing with at illages having consolidated the least 50% of Villages illage-level data aving consolidated he village-level 1818 H Street NW • Washington, DC 20433 USA 13 of 14 LN8884 - TFOA 7565 (d) FY22 : (i) Up to 72 new r Priority Districts with at least . Partial 70% of Villages having chievement for onsolidated the Village-level Y20, FY21 and ata by the Closing Date; and Y22 : (i) $70,000 ii) Up to 61 Priority Districts for each new Priority ontinuing with at least 50% of istrict achieving at illages having consolidated east 50% of Villages he Village-level data by the aving consolidated losing Date he Village-level data nd had the data onvergence on FY2 l and FY22: Up to 120 1,000-Day Priority Districts with at least Households 0% of Villages increased nit price: onvergence as per data $200,000 for each ompiled by the Closing Date ew Priority istrict chievement for Y2 l and FY22: i) $150,000 for ach new Priority istrict achieving at least 60% until < 80% of Villages aving increased onvergence ii) $ l 00,000 for ach new priority istrict achieving at least 40% until < 0% of Villages aving increased onvergence 1818 H Street NW • Washington, DC 20433 USA 14 of 14 L 8884 - TFOA 7565 0C>LR #l0.2: 42,000,000 IFY22: At least 35,000 Villages !Unit price: $1,200 nn 434 Priority Districts have for each Village !good performance in accelerating stunting reduction, as this term is defined in the fVerification Protocol, as per ldata compiled by the Closing OC>ate. rroTAL AMOUNT 400,000,000 1818 H Street NW • Washington, DC 20433 USA