COMMENTARY
INTERVIEWS
SPECIALS
CHAT
ARCHIVES

Row brewing in WB as India and other countries flay inspection panel

Desikan Thirunarayanapuram in Washington

A World Bank watchdog panel, largely an outcome of the Great Narmada Dam Tangle, has come under attack from large borrowing countries, led, predictably, by India and Brazil.

A proposal to curtail the operations of the Inspection Panel, which handles complaints over harm to people and environment caused by Bank-assisted projects, will come up before the Bank's board of directors on February 9. The move, which will pit developing countries against donor nations, is expected to stir a controversy in the Bank's Washington headquarters.

Donor nations and economic experts see the panel as a way of holding the bank accountable. However, several large developing nations complain that the panel, instead of examining whether the bank conforms to its policies, is investigating the countries where the projects are located.

The panel has been the only channel of complaint and redressal for thousands of poor people in developing countries who are affected by mega developmental projects. But almost invariably, while working to find justice for the so-called ''project-affected'', the panel gets on the wrong side of the borrowing countries. The most contentious aspect of the panel's operations is its tendency to make independent on-site investigations in the borrowing countries, which see it as meddling in their internal affairs.

"It should be done in such a manner that the borrowers don't get the feeling that they are under the microscope being investigated instead of the bank," Surendra Singh, the Indian government's representative on the Bank's board and former cabinet secretary told the Wall Street Journal recently. Singh refused to be interviewed for this report.

The panel's chairman, Ernest Gunter Broder of Germany, denies the charge. "We have always tried hard to comply with the requirements identified in the resolution (on the establishment of the panel)," he told Rediff On The NeT. "We have never extended our operations beyond our mandate."

In 1993, at the height of Medha Patkar's struggle on behalf of thousands of villagers who would be displaced by the Narmada dam project, a resolution to set up the panel was passed and the three-member committee began functioning the next year. The Narmada project itself, however, was never examined by the panel. The panel's secretary, Eduardo G Abbott, said the Narmada project was "a crucial factor" in setting up the panel.

Since then several projects in the Indian subcontinent have come under the panel's scrutiny. In 1996, it responded to a complaint from thousands of island residents whose livelihood would have been affected by the construction of a three-mile-long Jamuna River Bridge in Bangladesh.

The panel found the design of the project failed to consider the 70,000 people living on the river islands. On the panel's recommendation, the World Bank worked with the Bangladeshi government to redesign the project.

On another project in Bangladesh, on the reorganisation of the jute industry, the bank received certain complaints from private jute mill owners. After initial investigation, the panel found nothing for it to do, and in the end no disbursements were made on the structural credit.

From India, the panel has two projects on its plate: National Thermal Power Corporation's Singrauli project and an environmental project in the Rajiv Gandhi National Park in Nagarahole, Karnataka.

Even now, before the board of directors vote to dilute its operations, the panel depends on the board to approve actions on various complaints. As details of the Indian cases reveal, the panel is often handicapped by the interests of borrower countries represented on the board.

According to Samir Vyas, adviser to Singh, NTPC's Singrauli project was cleared for financing in 1993. However, the World Bank records reveal that in May 1997, Madhu Kohli, a resident of the project area in Uttar Pradesh, sent a complaint on resettlement and fly ash pollution to the then chairman of the panel, Richard E Bissell.

After a "limited investigation", the panel found serious policy and procedural violations by the bank. In June, the bank and the Indian government agreed to "action plans" to improve the conditions and a local independent panel and consultants were appointed. In July, the panel recommended a full investigation.

The bank board, which includes an Indian executive director, approved an investigation "restricted to a desk study in Washington". The panel is awaiting one more report from the bank management before winding up the case.

Even though the Singrauli investigation was restricted to a desk study, panel chairman Broder says, "Enormous progress was made to improve the social life of the people affected by the project."

In the case of the Nagarahole biodiversity project, a group of tribals living in the forest area complained about the resettlement plan. The panel submitted its report in December and, after initial clarifications and assurances from the Indian government and Karnataka, the board decided no action was needed in the case.

The panel's request for an investigation of complaint over a Brazilian dam project in 1997 was rejected by a board vote. The Brazilian representative on the board is away on a tour and hence unavailable for comment.

World Bank officials and panel members are reluctant to discuss the proposals before the board of directors. But present and past members of the panel have been unanimous in defending its operations.

"The panel has turned up some serious irregularities and made bank staff and concerned governments unhappy," reasoned former panel chairman Bissell, who now works for the US National Academy of Sciences. He said a lot of "human pain" is caused when the Bank overlooks certain aspects of its policy and procedures and the panel helps find corrective measures. It is not the panel's intention to embarrass borrower governments, he said.

Daniel Bradlow, American University law professor and external academic adviser to the inspection panel, says the panel's work is in the interest of the borrower countries and its findings will only help their people. It would be unfortunate for thousands of otherwise voiceless people if the board votes to weaken the panel.

Business news