OFFICIAL
DOCUMENTS
CREDIT NUMBER 6142- NP
Financing Agreement
(Enhanced Vocational Education and Training Project II)
between
NEPAL
and
INTERNATIONAL DEVELOPMENT ASSOCIATION
- C,Y)WW    2-1,  e-cL


FINANCING AGREEMENT
AGREEMENT dated as of the Signature Date, entered into between NEPAL
("Recipient")  and   INTERNATIONAL        DEVELOPMENT       ASSOCIATION
("Association"). The Recipient and the Association hereby agree as follows:
ARTICLE I - GENERAL CONDITIONS; DEFINITIONS
1.01.  The General Conditions (as defined in the Appendix to this Agreement) apply to
and form 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 - FINANCING
2.01.   The Association agrees to extend to the Recipient, a credit, deemed by the
Association to be on concessional terms, as set forth or referred to in this
Agreement in an amount equivalent to forty-two million seven hundred thousand
Special Drawing Rights (SDR 42,700,000) (variously, "Credit" and "Financing"),
to assist in financing the project described in Schedule 1 to this Agreement
("Project").
2.02.  The Recipient may withdraw the proceeds of the Financing in accordance with
Section III of Schedule 2 to this Agreement.
2.03.  The Maximum Commitment Charge Rate is one-half of one percent (1/2 of 1%)
per annum on the Unwithdrawn Financing Balance.
2.04.  The Service Charge is three-fourths of one percent (3/4 of 1%) per annum on the
Withdrawn Credit Balance.
2.05.  The Payment Dates are March 15, and September 15, in each year.
2.06.  The principal amount of the Credit shall be repaid in accordance with the
repayment schedule set forth in Schedule 4 to this Agreement.
2.07.  The Payment Currency is Dollars.


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ARTICLE III - PROJECT
3.01.  The Recipient declares its commitment to the objective of the Project. To this end,
the Recipient shall carry the Project through MOE, in accordance with the
provisions of Article IV of the General Conditions and Schedule 2 to this
Agreement.
ARTICLE IV - EFFECTIVENESS; TERMINATION
4.01.  The Effectiveness Deadline is the date ninety (90) days after the date of this
Agreement.
4.02.  For purposes of Section 10.05 (b) of the General Conditions, the date on which the
obligations of the Recipient under this Agreement (other than those providing for
payment obligations) shall terminate is twenty (20) years after the date of this
Agreement.
ARTICLE V - REPRESENTATIVE; ADDRESSES
5.01.  The Recipient's Representative is the Secretary, Ministry of Finance.
5.02.  For the purposes of Section 11.01 of the General Conditions,
(a) the Recipient's address is:
Ministry of Finance
Government of Nepal
Singha Durbar
Kathmandu
Nepal; and
(b) the Recipient's Address is:
Facsimile:
(977-1) 4211-164
5.03.  For the purposes of Section 11.01 of the General Conditions,
(a) the Association's Address is:
International Development Association
1818 H Street, N.W.
Washington, D.C. 20433
United States of America; and


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(b) The Association's Address is:
Facsimile:
1-202-477-6391
AGREED as of the Signature Date.
NEPAL
By
Authorized Representative
Name: -Sejye,, 0Y-e,,AA  4  W,,
Title: FPk    e-,1t S tC CY-94Y
Date:      y     2-i 1,2_1c)11
INTERNATIONAL DEVELOPMENT ASSOCIATION
By                     617
Authorized Representative
Name:     <V) e0p
Title: C- U)  n          f C j c V
Date:  3  V%A(A"    )-k -\ -I 


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SCHEDULE 1
Project Description
The objectives of the Project are to improve equitable access to market relevant
training programs and to strengthen the technical and vocational education and training
sector service delivery in Nepal.
The Project consists of the following parts:
Component 1: Support to Results-based Financing
Results Area 1 - Strengthening Service Delivery in Technical Education
1.1.1 Provide, and manage, performance-based quality improvement grants ("Quality
Improvement Grants") based on institutional development plans ("IDP") to selected public
and private TSLC and/or Diploma program offering institutions that had gone through a
quality assurance assessment.
1.1.2. Improve management, instructor and assessor quality through, inter-alia,
providing: (i) the leadership and management training of heads for public and private TSLC
and/or Diploma program offering institutions; and (ii) occupational and instructional
training for instructors, and (iii) refresher and new training for skill test assessors.
1.1.3. Modernize technical education by supporting the CTEVT in the revision of the
existing, and the development of new, curricula for TSLC and/or Diploma programs in
order to improve their quality, relevance, and practical content.
Results Area 2 - Widening Access to TVET Programs
1.2.1. Provide, and manage Pro-Poor Scholarships for: (i) poor but meritorious students
to enable them to attend TSLC and/or Diploma program; and (ii) poor students with low
academic attainment who are eligible for attending TSLC programs.
1.2.2. Widen the access of disadvantaged and rural youth, women and migrants and other
vulnerable groups to CTEVT short-term vocational training programs.
1.2.3. (i) Test and certify through NSTB, youth's and migrants' on-the-job pre-acquired
skill levels; and (ii) upgrade skill test centers in rural areas and/or districts with high
concentration of international migrants.
Results Area 3 - Pilots in Enabling Youth Transition to Work
1.3.1. Implement apprenticeship programs by piloting and evaluating training programs
that combine work-place-based learning with institution-based learning.


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1.3.2. Provide job placement assistance services through: (i) piloting and evaluating the
effectiveness of search and matching assistance for youth to increase their chances of
employment; and (ii) establishing partnerships with private sector organizations and
providing career development activities within training institutions.
Component 2: Project Management, Monitoring and Evaluation
2.1.1  Strengthen the institutional capacity of the PS for the management, monitoring and
evaluation of the Project.
2.1.2  Implement initiatives aimed at reducing/eliminating sector-level institutional gaps,
such as: (i) preparing a TVET framework; and (ii) operationalizing and expanding the
scope of the TMIS in CTEVT.


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SCHEDULE 2
Project Execution
Section I.    Implementation Arran2ements
A.     Institutional Arrangements
1. The Recipient shall maintain the Project Secretariat ("PS"), headed by a Project
Director and staffed with professionals, all of whom shall have qualifications,
experience, and terms of reference satisfactory to the Association, which PS shall
be entrusted with the day-to-day implementation of the Project, including, inter-
alia, the planning, budgeting, coordination, procurement, financial management,
auditing, and monitoring and evaluation of Project activities.
2.     The Recipient shall maintain the Project Implementation Committee ("PIC"),
chaired by the Secretary, MOE, consisting of, inter-alia, officers of the MOE,
CTEVT, NPC and of other ministries and departments of the Recipient,
responsible for guiding and overseeing Project implementation based on selected
assignments set forth in detail in the PIM, including: (i) the review of Project
annual work plans and budgets prepared by the PS; (ii) the coordination among the
ministries and government agencies receiving support from the Project; and
(iii) the monitoring of Project implementation progress and outcomes.
B.     Implementation Documents
1 .    The Recipient shall, not later than sixty (60) days after the Effectiveness Date,
adopt a Project Implementation Manual (PIM) issued by the PS and endorsed by
the PIC, in form and substance satisfactory to the Association, consisting of
different modules setting forth rules, methods, guidelines, standard documents and
procedures for the carrying out of the Project, including, inter-alia:
(i)    the detailed description of Project implementation arrangements,
including: (A) all Project activities, their sequencing and the prospective
timetable and benchmarks in relation thereto; and (B) the institutional
arrangements in respect thereof, including the allocation of duties between
Recipient's agencies and other participating entities, and the terms and
conditions for their participation and all related procedures;
(ii)   the Project administrative, accounting, auditing, reporting, financial,
disbursement and procurement procedures, as agreed with the
Association;


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(iii)  the screening procedures, selection and eligibility criteria for Quality
Improvement Grant Beneficiaries and students receiving Pro-Poor
Scholarships for TVET programs, under Component 1 of the Project, as
well as the terms and conditions applicable to said Quality Improvement
Grants and Pro-Poor Scholarships;
(iv)   the protocols and procedures for the preparation of annual work plans and
grievance redress mechanisms, as well as the details on the verification
protocol; and
(v)    the performance indicators for the Project.
2.     The Recipient shall carry out the Project, and shall cause the Beneficiaries to
implement their respective activities/IDPs under the Project, in accordance with
the PIM. In the event that any provision of the PIM shall conflict with any
provision under this Agreement, the terms of this Agreement shall prevail.
3.     No provisions from the PIM  shall be modified without the prior agreement
between the Recipient and the Association.
C.     Safeguards
1 .    The Recipient shall:
(a)    ensure, and cause the Beneficiaries to ensure, that the Project (including
any activities carried out under the Quality Improvement Grants) is
implemented in accordance with: (i) the ESMF (including the VCDF);
(ii) the EMP(s), and/or the VCDP(s) to be prepared, as the case may be, in
accordance with the objectives, policies, procedures, time schedules and
other provisions set forth in the ESMF (the ESMF, VCDF, EMP(s), and
VCDP(s), collectively referred to as the "Safeguards Instruments"); and
(b)    refrain, and cause the Beneficiaries to refrain, from taking any action
which would prevent or interfere with the implementation of the
Safeguards Instruments, including any amendment, suspension, waiver,
and/or voidance of any provision of the Safeguards Instruments, whether
in whole or in part, without the prior written consent of the Association.
2.     The Recipient shall refrain from carrying out any activities under the Project,
and/or awarding a Quality Improvement Grant, until and unless:


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(a)    the proposed activities, or the respective IDP have/has been screened by
the PS in accordance with the guidelines, standards and procedures set
forth in ESMF;
(b)    the respective EMP(s) and/or VCDP(s), when required, for such activities
or IDP pursuant to the ESMF have/has been prepared in accordance with
the ESMF/VCDF; and
(c)    the foregoing EMP(s), and/or VCDP(s) have/has been publicly disclosed
by the Recipient and/or the respective Beneficiary/ies, in Nepali language,
at the relevant Project's sites.
3.     The Recipient shall ensure, and cause the Beneficiaries to ensure, that, prior to
commencing any activities under the Project (including any activities carried out
under the Quality Improvement Grants): (a) all necessary governmental permits
and clearances for such activities shall have been obtained from the competent
governmental authority/ies; and (b) all pre-conditions imposed by the
governmental authority/ies under such permit(s) or clearance(s) shall have been
complied with/fulfilled.
4.     The Recipient shall ensure, and cause the Beneficiaries to ensure, that no activity
under the Project (including any activities carried out under the Quality
Improvement Grants) shall require the involuntary acquisition of land or give rise
to Displaced Persons.
5.     The Recipient shall ensure, and cause the Beneficiaries to ensure, that: (a) any land
required for the Project (including any activities carried out under the Quality
Improvement Grants) shall be procured on a willing-buyer/willing-seller basis or
obtained as a voluntary donation/bequest, or any other voluntary means duly
documented; and (b) any expenditures associated with such acquisition be financed
exclusively out of the Recipient's or the Beneficiaries' own resources, as the case
may be.
6.     The Recipient shall ensure, and cause the Beneficiaries to ensure, that, each
contract for civil works under the Project (including any contract for civil works
under the Quality Improvement Grants) includes the obligation of the relevant
contractor to comply with the ESMF and the relevant Safeguards Instruments
applicable to the said civil works commissioned/awarded pursuant to said contract.
7.     The Recipient shall establish, by no later than six (6) months after the Effective
Date, and thereafter maintain and operate throughout the period of Project
implementation, a multi-tier grievance redress mechanism, in a manner and
substance satisfactory to the Association, for the handling of any stakeholder
complaints arising out of the implementation of Project activities, including the
Quality Improvement Grants.


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8.     In the event of any conflict between the provisions of any of the Safeguards
Instruments, on the one side, and the provisions of this Agreement, on the other,
the provisions of this Agreement shall prevail.
D.     Quality Improvement Grants
1 .    For purposes of carrying out the activities under Results Area 1.1 of the Project,
the Recipient shall:
(a)    publicly invite public and private sector TSLC and/or Diploma program
offering institutions to submit their respective Expression of Interest (EOI)
to benefit from Quality Improvement Grants;
(b)    Evaluate the submitted EOls and produce a short-list of the public and
private sector TSLC and/or Diploma program offering institutions;
(c)    Invite the shortlisted public and private sector TSLC and/or Diploma
program offering institutions, to submit their respective IDPs detailing the
activities proposed for financing through Quality Improvement Grants, in
accordance with the procedures and requirements set forth in the PIM; and
(d)    Screen the IDPs submitted pursuant to sub-paragraph (a) above, in
accordance with the protocols and eligibility criteria set forth in the PIM
and the provisions of Section I.C.2 above.
2.     Upon the screening and selection of the winning IDPs, the Recipient, through the
PS shall enter into a written agreement (the "Quality Improvement Grant
Agreement" or "MOUs") with each selected institution (the "Beneficiary") for the
provision of a Quality Improvement Grant, under terms and conditions set forth in
the PIM, which agreement shall provide, inter alia, that:
(a)    the Beneficiary commit to the objective of the Project; and undertake to
conduct its operations and affairs in accordance with sound technical,
procurement, financial, managerial, social and environmental and labor
standards, consistent with the requirements set forth in the PIM and the
Safeguards Instruments;
(b)    the Quality Improvement Grant: (i) be used to finance the expenditures
eligible under the PIM and set forth in the IDP; and (ii) have a closing date
(end of disbursement period) not to exceed the date set forth in Section
111.5 of this Schedule;
(c)    the Beneficiary implement the approved IDP, in compliance with: (i) the
Procurement Regulations, (ii) the Anti-Corruption Guidelines; and (iii) if
so determined by the Recipient during the screening of the IDPs pursuant


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Section I.C.2 of this Schedule, the ESMF and any appropriate Safeguards
Instruments that such Beneficiary shall have prepared prior to the award
of the Quality Improvement Grant.
(d)    the Beneficiary: (i) establish and/or maintain policies and procedures that
would allow the Recipient and/or the Association to carry out supervision
and monitor the implementation of the IDP; (ii) prepare and furnish to the
Recipient and/or the Association, all such information that the Recipient,
and/or the Association, shall reasonably request in relation to the IDP; and
(iii) accept random and/or unannounced physical or documentary
inspections by the Recipient and/or the Association in consultation with
the Recipient for the monitoring of, and in relation to, the carrying out of
the IDP;
(e)    the Beneficiary: (i) maintain records and accounts adequate to reflect, in
accordance with sound accounting practices, the operations, resources and
expenditures incurred in the implementation of the IDP; and (ii) have such
records and accounts audited in accordance with the Recipient's
acceptable principles and practices;
(f)    the Recipient have the right to suspend or terminate the right of a
Beneficiary to withdraw and use the proceeds of the Quality Improvement
Grant:
(i)    upon any failure of the Beneficiary to perform its obligations
under the Quality Improvement Grant Agreement; or
(ii)   upon the Association declaring the Beneficiary, or any of its
members benefiting from the Quality Improvement Grant,
ineligible under the Anti-Corruption Guidelines; and
(g)    the Beneficiary acknowledge and consent to the Recipient's right of
restitution of any amounts disbursed to the Beneficiary under the Quality
Improvement Grant with respect to which fraud and corruption has
occurred, or with which an ineligible expenditure has been paid.
Section II.  Project Monitoring, Reporting and Evaluation
Project Reports & DLI/DLR Verification Protocols
1.    The Recipient shall furnish to the Association each Project Report not later than
forty-five (45) days after the end of each calendar quarter, covering the calendar
quarter.


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2.     Without limiting the generality of the provisions of paragraph I above, the
Recipient shall:
(a)    undertake a verification process to certify the fulfilment of the
Disbursement Linked Results set out in the Schedule 3 to this Agreement
in accordance with terms of reference agreed with the Association and the
provisions of the Project Implementation Manual and
(b)    furnish to the Association the corresponding Verification Reports, in form
and substance acceptable to the Association, prior to submission of any
withdrawal application under Category (1) of the table in Section III. 1 of
Schedule 2 to this Agreement.
Section III.  Withdrawal of the Proceeds of the Financing
1 .    Without limitation upon the provisions of Article II of the General Conditions, and
in accordance with the Disbursement and Financial Information Letter, the
Recipient may withdraw the proceeds of the Financing to Credit to finance Eligible
Expenditures in the amount allocated and, if applicable, up to the percentage set
forth against each category of the following table:
Category         Amount of the        Percentage of
Financing Allocated   Expenditures to be
(expressed in SDR)       Financed
(inclusive of Taxes)
(1) Eligible
Expenditures
Program           38,400,000.00            100%
under
Component I
of the Project
(2) Goods, works,     4,300,000.00            100%
non-
consulting
services,
consulting
services,
Operating
Costs and
Training for


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Component 2
of the Project
TOTAL                42,700,000.00
AMOUNT
2.     Notwithstanding the provisions of paragraph I above, no withdrawal shall be
made:
(a)    for payments made prior to the date of this Agreement, except that
withdrawals up to an aggregate amount not to exceed five percent (5%) of
the total amount of the Credit, may be made for payments made prior to
this date but on or after July 16, 2017, for Eligible Expenditures under the
Project.
(b)    for EEP expenditures under Category (1), unless and until the Recipient
has:
(i)    furnished evidence satisfactory to the Association in accordance
with the DLI verification protocol, included in the PIM, that the
Recipient has achieved the respective DLI Targets set forth in
Schedule 3 to this Agreement against which withdrawal is
requested; and
(ii)   complied with the additional instructions referred to in paragraph
I above, including furnished to the Association the applicable
interim unaudited financial reports documenting the incurrence of
Eligible Expenditures which withdrawal is requested.
3.     Without limitations to the provisions of paragraph 2(b) above, the maximum
amount available for withdrawal by the Recipient at any point in time shall be the
equivalent of the aggregate of the Allocated Amounts for the DLRs achieved/met
and satisfactorily documents (verified) pursuant to paragraph 2.(b)(i) above, at the
time of submission for such withdrawal; provided, however, that any such
withdrawal shall not exceed the amount of Eligible Expenditures under the EEP
incurred but not yet reimbursed/paid out of the proceeds of the Credit at the date
of submission of such withdrawal application.
4.     Notwithstanding the provision of paragraphs 2(b) and 3 above, in the event that
the Association is not satisfied that any or various DLR(s) set forth in Schedule 3
to this Agreement has/have been achieved by the end of the DLR period provided
for such DLR in such Schedule, then the Association may, at any time, by notice
to the Recipient, decide, in its sole discretion, to:


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(a)    authorize the withdrawal of such lesser amount of the respective Allocated
Amount(s) allocated to said DLR(s) which, in the opinion of the
Association, corresponds to the extent of the achievement of said DLR;
(b)    withhold all or a portion of the Allocated Amount(s) allocated to said
DLR(s) until such DLR(s) has/have satisfactorily met;
(c)    reallocate all or a portion of the Allocated Amount(s) corresponding to
such unmet DLR(s) to any other DLR(s) and or disbursement categories;
and/or
(d)    cancel all or a portion of the Allocated Amount(s) corresponding to said
DLR(s).
5.     The Closing Date is July 15, 2022.


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Schedule 3
Disbursement Linked Indicators
DISBURSEMENT-LINKED RESULTS (DLRS)
DLI/RESULTs AREA    TARGET VALUES FOR  TARGET VALUES FOR  TARGET VALUES FOR   TARGET VALUES     TARGET VALUES   END OF PROJECT
YEAR 1             YEAR 2             YEAR 3           FOR YEAR 4       FOR YEAR 5
(JULY 15,2018)     (JULY 15,2019)     (JULY 15,2020)    (JULY 15,2021)   (JULY 15,2022)
DLR 1.3            DLR 1.4            DLR 1.5          DLR 1.6           100 supported
DLR 1.1.           PS has disbursed   PS has disbursed   PS has disbursed  PS has disbursed  TSLC/Diploma
PIC has endorsed the performance-based  performance-based  performance-based performance-based program
Quality Assurance  quality improvement quality improvement quality        quality          institutions
(QA) Manual for    grants to 100      grants to 100      improvement      improvement       receive grant
TSLC and/or        supported TSLC     supported TSLC     grants to 100    grants to 100    funds based on
Diploma program    and/or Diploma     and/or Diploma     supported TSLC   supported TSLC    quality targets
offering institutions  program offering  program offering  and/or Diploma  and/or Diploma   achieved
DLI 1:              prepared by PS    institutions in Year 2  institutions in Year 3 program offering  program offering
on account of quality on account of quality institutions in Year institutions in Year
Strengthened quality  DLR 1.2          targets achieved   targets achieved    4 on account of  5 on account of
and relevance of     PS has signed MOUs                                       quality targets  quality targets
techncal education   with 100 TSLC                                            achieved         achieved
and/or Diploma
program offering
institutions for
receiving
performance-based
quality improvement
grants


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DISBURSEMENT-LINKED RESULTS (DLRS)
DLI/RESULTs AREA     TARGET VALUES FOR  TARGET VALUES FOR  TARGET VALUES FOR   TARGET VALUES     TARGET VALUES   END OF PROJECT
YEAR 1             YEAR 2             YEAR 3           FOR YEAR 4        FOR YEAR 5
(JULY 15,2018)     (JULY 15, 2019)    (JULY 15,2020)    (JULY 15,2021)    (JULY 15,2022)
DLR 1.1            DLR 1.3            DLR 1.4             DLR 1.5          DLR 1.6           Total: 8,000,000
355,555 upon       888,878 for 50     888,878 for 50      888,878 for 50   888,877 for 50
achievement of the  institutions, and  institutions, and  institutions, and  institutions, and
target             thereafter, 17,778 per thereafter, 17,778 per thereafter, 17,778  thereafter, 17,778
additional institution  additional institution  per additional  per additional
institution       institution
Allocated Amounts and
Financing Formula per  DLR 1.2
DLR (in SDR)           159,884
for the first 30
institutions and,
thereafter, 5,335
per additional
institution
DLR 2.1.           DLR 2.3.           DLR 2.6.            DLR 2.9.         DLR 2.12.
40 heads of TSLC   100 heads of TSLC   100 heads of TSLC  100 heads of TSLC 60 heads of TSLC  400 heads of
and/or Diploma     and/or Diploma     and/or Diploma      and/or Diploma   and/or Diploma    TSLC/Diploma
program offering   program offering   program offering    program offering  program offering  institutions
DLI 2: Improved service  institutions have  institutions have  institutions have  institutions have  institutions have  complete
delivery and modernizing  completed the   completed the       completed the      completed the    completed the     leadership and
curricula in technical  leadership and    leadership and      leadership and     leadership and   leadership and    management
education              management training management training management training management     management        training in QA;
program            program over and   program over and   training program  training program
above those in Year  above those in Years over and above  over and above
1;                 I and 2);          those in Years 1  those in Years 1
through 3);       through 4);


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DISBURSEMENT-LINKED RESULTS (DLRS)
DLIIRESULTs AREA     TARGET VALUES FOR   TARGET VALUES FOR   TARGET VALUES FOR   TARGET VALUES     TARGET VALUES    END OF PROJECT
YEAR 1              YEAR 2             YEAR 3           FOR YEAR 4         FOR YEAR 5
(JULY 15,2018)     (JULY 15,2019)       (JULY 15,2020)    (JULY 15,2021)    (JULY 15,2022)
DLR 2.2.            DLR 2.4.           DLR 2.7.            DLR 2.10.         DLR 2.13.
100 TVET           440 TVET            440 TVET            340 TVET          340 TVET          1660 TVET
instructors and/or  instructors and/or  instructors and/or  instructors and/or  instructors and/or  instructors/
assessors have      assessors have     assessors have      assessors have    assessors have    assessors with
completed training  completed training  completed training  completed training  completed training  enhanced
programs for        programs for       program for         programs for      programs for      professional
enhanced            enhanced           enhanced            enhanced          enhanced          competencies
professional        professional       professional        professional      professional
competencies        competencies over  competencies over   competencies over  competencies over
and above those in  and above those in  and above those in  and above those in
Year I              Years I and 2      Years 1 through 3  Years I through 4
DLR 2.5.            DLR 2.8.           DLR 2.11.         DLR 2.14.
CTEVT has           CTEVT has          CTEVT has         CTEVT has         40
revised/developed the revised/developed the revised/developed  revised/developed  TSLC/Diploma
curricula for 10    curricula for 10   the curricula for 10 the curricula for 10 curricula
TSLC/Diploma,       TSLC/Diploma,      TSLC/Diploma,     TSLC/Diploma,     revised/develope
apprenticeship and/or apprenticeship and/or apprenticeship  apprenticeship  d with industry
short-term training  short-term training  and/or short-term  and/or short-term  participation to
courses, with       courses over and   training courses  training courses  reflect employer
industry participation above those in Year  over and above  over and above  requirements
to reflect employer  2, with industry  those in Years 2  those in Years 2
requirements        participation to   and 3, with       through 4, with
reflect employer   industry          industry
requirements        participation to  participation to
reflect employer  reflect employer
requirements      requirements


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DISBURSEMENT-LINKED RESULTS (DLRs)
DL/RESULTs AREA     TARGET VALUES FOR   TARGET VALUES FOR   TARGET VALUES FOR    TARGET VALUES     TARGET VALUES    END OF PROJECT
YEAR 1              YEAR 2              YEAR 3           FOR YEAR 4        FOR YEAR 5
(JULY 15,2018)      (JULY 15,2019)      (JULY 15,2020)     (JULY 15,2021)    (JULY 15,2022)
DLR 2.1             DLR 2.3             DLR 2.6             DLR 2.9           DLR 2.12
88,803              142,070             142,070 for 40 heads 71,035           35,520
million for 20 heads  for 40 heads of   of institutions, and  for 40 heads of  million for 20
of institutions, and  institutions, and  thereafter, 3,552 per  institutions, and  heads of
thereafter, 4440 per  thereafter, 3,552 per  additional head of  thereafter, 1,775  institutions, and
additional head of  additional head of  institution         per additional head thereafter, 1,775
institution         institution                             of institution    per additional head
of institution
DLR 2.2             DLR 2.4             DLR 2.7             DLR 2.10          DLR 2.13
106,555             213,120             213,120 for 240    99,500             99,500 for 180
for 60 instructors  for 240 instructors  instructors and/or  for 180 instructors  instructors and/ or
Allocated Amounts and   and/ or assessors, and and/ or assessors, and assessors, and  and/ or assessors,  assessors, and
Financing Formula per   thereafter, 1,776 per  thereafter, 710 per  thereafter, 710 per  and thereafter, 710  thereafter, 710 per  5,333,333
DLR (in SDR)            additional instructor  additional instructor  additional instructor  per additional  additional
and/or assessor     and/or assessor     and/or assessor    instructor and/or  instructor and/or
assessor          assessor
DLR 2.5             DLR 2.8             DLR 2.11          DLR 2.14
356,000             356,000             356,000           356,000
for 5 curricula     for 5 curricula     for 5 curricula   for 5 curricula
revised/developed,  revised/developed,  revised/developed, revised/developed
and thereafter,     and thereafter,     and, thereafter,  and, thereafter,
71,163 per additional 71,163 per additional 71,163 per    71,163 per
curricula           curricula           additional curricula additional curricula
revised/developed   revised/developed   revised/developed  revised/developed


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DISBURSEMENT-LINKED RESULTS (DLRS)
DLI/RESULTs AREA    TARGET VALUES FOR  TARGET VALUES FOR  TARGET VALUES FOR  TARGET VALUES    TARGET VALUES   END OF PROJECT
YEAR 1             YEAR 2            YEAR 3          FOR YEAR 4       FOR YEAR 5
(JULY 15,2018)    (JULY 15,2019)     (JULY 15,2020)    (JULY 15, 2021)   JULY 15, 2022
DLR 3.1.           DLR 3.2.          DLR 3.3.           DLR 3.4.
500 TSLC/Diploma   2,000 TSLC/Diploma 2,000 TSLC/Diploma 2,000                            6,500
students have been  students have been  students have been  TSLC/Diploma                  scholarships for
selected for/awarded  selected for/awarded  selected for/awarded  students have been      TSLC/Diploma
Pro-Poor           Pro-Poor          Pro-Poor Scholarship selected                        students selected
DLI 3: Pro-poor        Scholarships using a  Scholarships using a  using a PMT method, for/awarded Pro-         using a PMT
scholarships          PMT method         PMT method, over   over and above those Poor Scholarships              method
and above those   selected/awarded in  using a PMT
selected/awarded in  Years 1 and 2   method, over and
Yearl                                above those
selected/ awarded
in Year 1 through 3
DLR 3.1.           DLR 3.2.          DLR 3.3.           DLR 3.4.
178,020 million for  356,040 for 1,000  356,040 for 1,000  356,039 for 1,000
Allocated Amounts and  250 Pro-poor      Pro-poor           Pro-poor          Pro-poor
Financing Formula per  Scholarships, and  Scholarships, and  Scholarships, and  Scholarships, and                  2,488,889
DLR (in SDR)          thereafter, 711 per  thereafter, 355 per  thereafter, 355 per  thereafter, 355 per
additional         additional        additional         additional
scholarship       scholarship        scholarship        scholarship


-20-
DISBURSEMENT-LINKED RESULTS (DLRS)
DLI/RESULTs AREA    TARGET VALUES FOR  TARGET VALUES FOR  TARGET VALUES FOR  TARGET VALUES    TARGET VALUES    END OF PROJECT
YEAR 1             YEAR 2             YEAR 3          FOR YEAR 4       FOR YEAR 5
(JULY 15,2018)    (JULY 15,2019)     (JULY 15,2020)    (JULY 15,2021)   (JULY 15,2022)
DLI4: Share offemale   DLR 4.1.          DLR 4.2.           DLR 4.3.           DLR 4.4.         DLR 4.5.
and disadvantaged youth  50% in Year 1    55% in Year 2     60% Year 3         65% Year 4       65% in Year 5         65%
completing market
relevant short-term
training programs
DLR 4.1            DLR 4.2            DLR 4.3           DLR 4.4          DLR 4.5
355,350 upon       533,000 upon       710,700 upon       889,600 upon     889,656 upon
Allocated Amounts and  achievement of 25%, achievement of the  achievement of 35%, achievement of  achievement of
Financing Formula per  and thereafter,   target of 30%, and  and thereafter,   40%, and         40%, and            6,755,556
DLR (in SDR)           14,240 for each   thereafter, 21,320 for 28,430 for each  thereafter, 35,550  thereafter, 35,550
percentage point   each percentage point percentage point  for each percentage for each percentage
increase          increase            increase          point increase   point increase
DLI 5: Percentage of                     DLR 5.1            DLR 5.2.           DLR 5.3.         DLR5.4.
trainees employed/self-                  65% in Year 2      65% in Year 3      70% in Year 4    70% in Year 5          70%
employed within 6
months of completion of
short-term training
DLR 5.1            DLR 5.2            DLR 5.3          DLR 5.4
887,800 upon       1,068,500 upon     1,068,500 upon   1,068,506 upon
Allocated Amounts and                     achievement of the  achievement of the  achievement of the achievement of the  8,355,556
Financing Formula per                    target of 50%, and  target of 50%, and  target of 60%,  target of 60%,
DLR (in SDR)                             thereafter, 71,035 for thereafter, 71,035 for thereafter, 106,560 thereafter, 106,560
each percentage point each percentage point for each percentage for each percentage
increase           increase           point increase   point increase


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DISBURSEMENT-LINKED RESULTS (DLRS)
DLUIRESULTS AREA    TARGET VALUES FOR  TARGET VALUES FOR  TARGET VALUES FOR   TARGET VALUES    TARGET VALUES   END OF PROJECT
YEAR 1             YEAR 2             YEAR 3          FOR YEAR 4       FOR YEAR 5
(JULY 15,2018)    (JULY 15,2019)     (JULY 15,2020)    (JULY 15,2021)   (JULY 15,2022)
DLR 6.1.           DLR 6.2.           DLR 6.3.          DLR 6.4.          DLR 6.5.
6,000 youth,      6,000 youth,       6,000 youth,       6,000 youth,     6,000 youth,     30,000 youth,
including migrants,  including migrants,  including migrants,  including migrants, including migrants, including
have completed the  have completed the  have completed the  have completed the have completed the migrants,
DLI 6: Testing of Prior  NSTB skills tests  NSTB skills tests,  NSTB skills tests,  NSTB skills tests,  NSTB skills tests,  complete NSTB
Skills                                   over and above those over and above those over and above  over and above  skills test
completing them in  completing them in  those completing  those completing
Year 1             Years I and 2      them in Years 1  them in Years 1
through 3        through 4
DLR 6.1            DLR 6.2            DLR 6.3           DLR 6.4           DLR 6.5
Allocated Amounts and  285,110 for 3,000  285,110 for 3,000  285,110 for 3,000  285,110 for 3,000  285,115 for 3,000
Financing Formula per  youth, and thereafter, youth, and thereafter, youth, and thereafter, youth, and  youth, and   3,555,555
DLR (in SDR)           142 per additional  142 per additional  142 per additional  thereafter, 142 per  thereafter, 142 per
youth              youth              youth             additional youth  additional youth
DLR 7.1.           DLR 7.2.           DLR 7.3.          DLR 7.5.          DLR 7.7.         1,500 supported
PS has prepared and  500 youth received  500 trainees have  500 trainees have  500 trainees have  trainees
adopted the        job placement      successfully      successfully      successfully     successfully
Operational Manual  assistance through  completed Project-  completed Project- completed Project- complete
for the apprenticeship HR Service     supported         supported         supported        apprenticeship
DLI 7: Apprenticeship  programs           Providers.        apprenticeship     apprenticeship   apprenticeship    programs
programs           programs over and  programs over and
above those      above those
completing them in completing them in
Year 3           Years 3 and 4


-22-
DISBURSEMENT-LINKED RESULTS (DLRs)
DLI/RESULTs AREA    TARGET VALUES FOR  TARGET VALUES FOR  TARGET VALUES FOR  TARGET VALUES    TARGET VALUES    END OF PROJECT
YEAR I             YEAR 2             YEAR 3          FOR YEAR 4       FOR YEAR 5
(JULY 15,2018)    (JULY 15,2019)     (JULY 15, 2020)   (JULY 15,2021)   (JULY 15,2022)
DLR 7.4.           DLR 7.6.         DLR 7.8.
500 youth have     1,000 youth have  1,000 youth have  3,000 youth
received job       received job     received job     receive job
placement assistance placement      placement        placement
through HR Service  assistance through  assistance through  assistance
Providers, over and  HR Service     HR Service       through HR
above those assisted  Providers, over and Providers, over and services
in Year 2          above those      above those
assisted in Years 2  assisted in Years 2
and 3            through 4
Allocated Amounts and  DLR 7.1            DLR 7.2           DLR 7.3            DLR 7.5          DLR 7.7
Financing Formula per                                                          355,554          355,591 for 250
DLR (in SDR)           355,554 upon       177,777 for 250   355,554            for 250 trainees,  trainees, and
achievement of DLR  youth, and thereafter, for 250 trainees, and  and thereafter,  thereafter, 1,423
target             711 per additional  thereafter, 1,423 per  1,423 per   per additional
youth              additional trainee,  additional trainee  trainee
3,911,111
DLR 7.4            DLR 7.6          DLR 7.8
177,777 for 250    177,777 for 500  177,777 for 500
youth, and thereafter, youth, and   youth, and
711 per additional  thereafter, 355 per  thereafter, 355 per
youth              additional youth  additional youth
Total                      3,377,870          7,996,905          9,244,359         9,281408         8,499,458       38,400,000


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SCHEDULE 4
Repayment Schedule
Date Payment Due               Principal Amount of the Credit
repayable
(expressed as a percentage)*
On each March 15 and September 15,
commencing on March 15, 2024 to and including         1.5625%
September 15, 2055.
* The percentages represent the percentage of the principal amount of the Credit to be
repaid, except as the Association may otherwise specify pursuant to Section 3.05 (b) of the
General Conditions.


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APPENDIX
Section I.   Definitions
1.    "Allocated Amounts" means the amount in Special Drawing Rights allocated to
each individual DLR, or determined for each DLR pursuant to the formula detailed
in Schedule 3 to this Agreement as such amount might be increased, reallocated
and/or cancelled (whether partially or in its entirety) by the Association, from time
to time as the case may be, in accordance with the provisions of Section III. 4 of
Schedule 2 to this Agreement.
2.     "Anti-Corruption Guidelines" means for purposes of paragraph 5 of the Appendix
to the General Conditions, the "Guidelines on Preventing and Combating Fraud
and Corruption in Projects Financed by IBRD Loans and IDA Credits and Grants",
dated October 15, 2006 and revised in January 2011 and as of July 1, 2016.
3.     "Beneficiary" means the TSLC/Diploma program offering institution that has been
screened and selected to receive a Quality Improvement Grant from the MOE,
pursuant to Section I.D. I of Schedule 2 to this Agreement.
4.     "Category" means a category set forth in the table in Section 111.1 of Schedule 2 to
this Agreement.
5.     "CTEVT" means the Council for Technical Education and Vocational Training,
established in the Recipient's Council for Technical Education and Vocational
Training Act (1988), as amended to the date of this Agreement.
6.     "Diploma" means the Diploma and Proficiency Certificate Level program, a
degree awarded to students who complete an advanced 3-year technical training in
various TVET areas.
7.     "Disbursement Linked Indicator" or the acronym "DLI" means an indicator set
forth in the table in Schedule 3 to this Agreement, on the basis of which a DLR is
to be measured; and "Disbursement Linked Indicators" or "DLIs" means,
collectively, more than one, or all said indicators (as the context may require).
8.     "Disbursement Linked Result" or the acronym "DLR" means a result, referred to
in the table in Schedule 3 to this Agreement; and "Disbursement Linked Results"
or "DLRs" means, collectively, more than one, or all said results (as the context
may require).
9.     "Displaced Persons" means persons who, on account of the execution of the
Project, have experienced or would experience direct economic and social impacts
caused by: (a) the involuntary taking of land, resulting in: (i) relocation or loss of
shelter; (ii) loss of assets or access to assets; or (iii) loss of income sources or


-26-
means of livelihood, whether or not such persons must move to another location;
or (b) the involuntary restriction of access to legally designated parks and protected
areas, resulting in adverse impact on the livelihoods of such persons.
10.    "Eligible Expenditure Program" or the acronym "EEP" means the eligible
expenditure program related to Component 1 of the Project (as specified in the
PIM), for the following expenditures: 22512 (short-term training, training through
NSTB and TITI, recognition of prior learning, apprenticeships training and job
placement services), 26422 (TSLC/Diploma institutions performance grants) and
27211 (scholarships); and which budget or general ledger code numbers for
expenditure items may be revised from time to time with the prior consent of the
Association.
11.   "EMP" means each of the environmental management plans prepared or to be
prepared pursuant to Section I.C.2 of the Schedule 2 to this Agreement, in
accordance with the provisions of the ESMF, as the same may be amended from
time to time with the prior written concurrence of the Association.
12.    "EOI" or "Expression of Interest" means the document submitted by public and
private sector TSLC and/or Diploma program offering institutions, expressing
their interest to benefit from Quality Improvement Grants pursuant to Section I.D. 1
of Schedule 2 to this Agreement, and in accordance with the provisions of the PIM.
13.    "ESMF" means Environmental and Social Management Framework, the
Recipient's framework of actions, policy and measures for the management of
social and environmental aspects of the Project dated June 2017, as may be
amended from time to time with the prior consent of the Association and including
therein the EMP and VCDF.
14.    "Fiscal Year" or "FY" means the Recipient's fiscal year, which begins on or about
July 16 of each calendar year and ends on or about July 15 of the next calendar
year.
15.    "General Conditions" means the "International Development Association General
Conditions for IDA Financing, Investment Project Financing", dated July 14,
2017.
16.    "HR Service Providers" means, collectively, public and private entities operating
in the Recipient's territory, providing job placement assistance services.
17.    "HR" means human resource.
18.    "IDP" means each institutional development plan prepared by a TSLC/Diploma
program offering technical institution that applies for Quality Improvement
Grants, which plan shall detail the activities proposed to be financed under the
respective Quality Improvement Grant pursuant to the format and eligibility
criteria set forth in in the PIM, including, inter-alia: training, capacity building,


-27-
minor civil works, workshops, laboratories and/or infrastructure interventions
designed to enhance the quality of technical education.
19.   "MOE" means the Recipient's Ministry of Education, or any successor thereto
acceptable to the Association.
20.   "NPC" means the Recipient's National Planning Commission.
21.   "NSTB" means the Recipient's National Skill Testing Board, or any successor
thereto acceptable to the Association.
22.    "Operating costs" means the Recipient's reasonable incremental expenses incurred
on account of Project implementation, including office and IT equipment and
supplies, vehicle operation and maintenance, insurance costs, office administration
costs, utilities, travel, per diem and supervision costs and salaries of locally
contracted employees, but excluding salaries of Recipient's civil servants.
23.    "Participation Agreement" means the agreement to be entered into by PS and
students that have been selected through a PMT method, to receive Pro-poor
Scholarships, pursuant to Section I.D.2 of Schedule 2 to this Agreement, and in
accordance with the provisions of the PIM.
24.    "PMT" means Proxy Means Testing, a method of selection of students to receive
Pro-Poor Scholarships.
25.    "Procurement Regulations" means, for purposes of paragraph 87 of the Appendix
to the General Conditions, the "World Bank Procurement Regulations for
Borrowers under Investment Project Financing", dated July 1, 2016.
26.    "Project Director" is the Project Secretariat head as set forth in Section 1. A. 1 of
Schedule 2 to this Agreement.
27.    "Project Implementation Committee" and "PIC" mean the Recipient's committee
referred to in Section I. A.2 of Schedule 2 to this Agreement.
28.    "Project Implementation Manual" and "PIM" mean the manual to be prepared and
adopted by the Recipient pursuant to Section I.B.1 of Schedule 2 to this
Agreement, which includes the verification protocol; as the same may be amended,
supplemented or otherwise modified from time to time with the prior consent of
the Association.
29.    "Project Secretariat" or "PS" mean the Recipient's project secretariat, entrusted
with the day-to-day Project implementation as referred to in Section I.A.1 of
Schedule 2 to this Agreement.


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30.    "Pro-poor Scholarships" means the scholarships to be awarded by the PS to poor
but meritorious students and/or poor students with low academic attainment, which
grant shall be used for their participation in TSLC/Diploma programs; all in
accordance with terms and conditions detailed in the Participation Agreements,
and the PIM.
31.    "Quality Assurance Manual" means the Recipient's manual created to describe in
detail quality standards for TSLC and/or Diploma program offering institutions.
32.    "Quality Improvement Grant Agreement" or "MOU" means the agreement to be
entered into by and MOE and a TSLC/Diploma program offering institution
selected as Beneficiary of a Quality Improvement Grant, pursuant to Section I.D.2
of Schedule 2 to this Agreement, and in accordance with the provisions of the PIM.
33.    "Quality Improvement Grant" means each of the competitively awarded grants to
be made by the Recipient to a Beneficiary for the financing of an IDP pursuant to
Section I.D of Schedule 2 to this Agreement, the respective Quality Improvement
Grant Agreement, and the PIM.
34.    "Results Framework" means a logical framework which sets forth, inter alia, the
indicators to be monitored under the Project, their base-line and target values, the
frequency of monitoring activities, the sources of data, the instruments through
which relevant data shall be collected and the methods for determining
performance of all participating institutions.
35.    "Safeguards Instruments" means the Environmental and Social Management
Framework (ESMF) (which includes the Vulnerable Community Development
Framework (VCDF)) as well as the Environmental Management Plan(s) (EMP(s)),
and Vulnerable Community Development Plan(s) (VCDP(s)), as applicable.
36.    "Signature Date" means the latest of the two dates on which the Recipient and the
Association signed this Agreement and such definition applied to all references to
"the date of the Financing Agreement" in the General Conditions.
37.    "TITI" means the Recipient's Training Institute for Technical Instruction.
38.    "TMIS" means the training management information system of the CTEVT.
39.    "Training" referred to in Category 2 of Section 111.1 of Schedule 2 means the
reasonable travel, room, board and per diem expenditures incurred by Project
trainers, trainees and non-consultant training facilitators in connection with their
training, including: (i) workshops and study tours in foreign countries; (ii) course
fees; (iii) training facility rentals; (iv) classroom instruction; and (v) training
material preparation, acquisition, reproduction and distribution expenses.


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40.    "TSLC" means the technical school leaving certificate.
41.    "TVET" means the technical and vocational education and training.
42.    "VCDF" means Vulnerable Community Development Framework, a document of
the Recipient incorporated into the ESMF, setting forth the principles and
procedures, including mitigation and adaptive measures to offset, reduce to
acceptable levels, or eliminate, any adverse impact to Vulnerable Communities
under the Project, including measures designed to ensure meaningful consultation
with, and informed participation of, the Vulnerable Communities in the design and
implementation of Project activities, as well as their participation in the envisioned
culturally appropriate and socially inclusive benefits thereof; as such framework
may be amended, supplemented or otherwise modified, from time to time, with the
prior consent of the Association.
43.    "VCDP" means each of the vulnerable communities development plans prepared,
and/or to be prepared, by the Recipient and/or a Beneficiary, pursuant to Section
I.C.2 of Schedule 2 to this Agreement, in accordance with the provisions and
requirement of the VCDF, and in form and substance satisfactory to the
Association, setting forth the principles and procedures designed to ensure
meaningful consultation with, and informed participation of Vulnerable
Communities in the design and implementation of the Project activities, as well as
their participation in the envisioned culturally appropriate and socially inclusive
benefits thereof, as each such plan as such framework may be amended,
supplemented or otherwise modified, from time to time, with the prior consent of
the Association.
44.    "Verification Report" means each report to be provided by the Recipient under
terms of reference satisfactory to the Association as evidence that one or more
DLRs has been met as required by Section 11.2 of Schedule 2 to this Agreement.
45.    "Vulnerable Communities" means any distinct, vulnerable, social and cultural
group/community within the territory of the Recipient that: (i) self-identifies as
such and claims, and is recognized by others as, having a distinguishable cultural
identity; (ii) has collective attachment to geographically distinct habitats or
ancestral territories in the Project related area, and to the natural resources in those
habitat and territories; (iii) has customary cultural, economic, social and political
institutions that are separate from those of the dominant society and culture; and
(iv) has an indigenous language, often different from the official language of the
Recipient.
46.    "Year" means any of the Years 1 through 5 of the Project implementation, as the
context shall determine.


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47.    "Year 1" means the first year of implementation of the Project activities, expected
to take place from the date of the Agreement to July 15, 2018 in order to achieve
the results shown in the second column of the table in Schedule 3 to this
Agreement.
48.    "Year 2" means the second year of implementation of Project activities, expected
to take place in Fiscal Year 2018/2019 in order to achieve the results shown in the
third column of the table in Schedule 3 to this Agreement.
49.    "Year 3" means the third year of implementation of Project activities, expected to
take place in Fiscal Year 2019/20 in order to achieve the results shown in the fourth
column of the table in Schedule 3 to this Agreement.
50.    "Year 4" means the fourth year of implementation of Project activities, expected
to take place in Fiscal Year 2020/2021 in order to achieve the results shown in the
fifth column of the table in Schedule 3 to this Agreement.
51.    "Year 5" means the fifth year of implementation of Project activities, expected to
take place in Fiscal Year 2021/2022 in order to achieve the results shown in the
sixth column of the table in Schedule 3 to this Agreement.