Document background
The Construction Disbursement Agreement is a crucial document used in Indian construction financing arrangements to regulate the release of funds from lenders to developers or contractors. This agreement is particularly important in the Indian context where construction projects are subject to multiple regulatory requirements under RERA, banking regulations, and state-specific construction laws. The document sets out specific conditions precedent for disbursements, links payment releases to construction milestones, and includes mechanisms for project monitoring and quality assurance. It's typically used in situations where substantial construction financing is required and where the lender needs to maintain control over fund utilization while ensuring project completion according to agreed specifications. The agreement includes provisions for compliance with Indian banking regulations, construction standards, and environmental requirements, while also incorporating security arrangements and default remedies.
