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International Financial Institutions in India (IFIs)

World Bank’s SHAM CONSULTATIONS: NO MORE

SHAM CONSULTATIONS: NO MORE

Statement by Indian Peoples Movements along with Environmental and Social Action Groups condemning the World Bank’s Consultations on Environmental and Social Safeguards Review

 The World Bank Group is conducting what it claims are consultation meetings, “announced with as much advance notice as possible to facilitate informed participation from a diverse set of stakeholders” to review and update its environmental and social safeguards policies. Once these ‘consultations’ are concluded, it is reported that the Bank will consider these areas, through internal dialogue, consultations, and a global series of dialogues with external experts, for reform.

It is clear that the World Bank is in no way doing anything different from what has been done in past decades. Many such reviews have been conducted and thousands of groups and individuals have participated in the hope of seeing genuine reform of the institution’s policies and possibly its democratization, only to be utterly disappointed. The current exercise, therefore, is yet another charade to mask the true intentions of its major shareholders: France, Germany, Japan, the United Kingdom and the United States, who are grappling with serious economic downturns and are conveniently using the Bank to force open global investment opportunities with scant regard to environmental and social impacts.

If the World Bank was seriously concerned about the impacts of its investments, then the best test would have been to demonstrate sensitivity in their investments. In India, the International Finance Corporation (IFC), the Bank’s private sector lending arm, is complicit in massive human rights and environmental violations that form the basis of a majority of its investment. For instance, the IFC lending to Lafarge in Meghalaya, mortgaging tribal lands protected under the 6th Schedule of Indian Constitution, to do illegal mining activities had been exposed even in the Supreme Court of India. Similar is the case of the IFC financed the super-mega USD4 billion Tata-Mundra 4000 MW power project in the ecologically sensitive Kutch region of Gujarat. World Bank-funded big hydropower projects like Allain Duhangan and Rampur projects in Himachal Pradesh and mega coal projects like Tata Mundra have been registered to get millions of dollars as free doles under the fraudulent Clean Development Mechanism (CDM) scheme under the United Nations Framework Convention on Climate change. The massive coal based project will clearly accentuate global warming emissions while the big hydro projects are neither clean nor sustainable. The World Bank has further endorsed such environmental crimes by offering a USD 1 billion loan to the Fifth Power System Development Project, which essentially is a transmission line for huge coal based thermal power plants including Tata-Mundra, Reliance-Sasan Power and Reliance-Krishnapatnam Power. By participating in such a manner, the Bank conveniently escapes blame for the disaster and yet benefits from financing ‘development projects’.

Some years ago, the IFC played down its intention to finance the expansion of the notorious West Coast Paper Mills (WCPM) in Karnataka. WCPM is a company that has worked without any functioning environmental safeguards for decades ultimately resulting in ecological devastation of the biodiversity-rich Kali River. This dastardly act of WCPM has however now been rewarded by the IFC with 17 half-yearly loans of approximately Rs. 150 crores since 2011.

The World Bank’s Policy on Piloting the Use of Borrower Systems for Environmental and Social Safeguards has in the past decade been a mantra to pave the way for promoting investment at any cost.  Over a decade ago the World Bank funded the Indian Ministry of Environment and Forests’ Environmental Management Capacity Building Project. The result was a massive dilution of India’s environmental and social safeguard norms. The resultant processes gave voice to those within the administration and industry who were crying hoarse that the carefully evolved rigour of “forest” and “environmental” clearance standards in India was thwarting economic growth. Now again the Bank is offering to lend USD 1 Billion for the Ganga Action Plan following the same infrastructure-centered, governance-ignoring model that has failed over the last 25 years, while at the same time funding river-destroying hydropower projects like the Vishnugad Pipalkoti project upstream. The Bank’s funding to the Tehri Hydro Development Corporation has been challenged before the World Bank’s own Inspection Panel, but the Bank is indulging in propaganda against the critics rather than withdrawing from the project. None of the affected people from any other ongoing or past Bank funded project or groups working with them have been invited to these consultations.

Many such examples can be cited to prove beyond any reasonable doubt that the so-called environmental and social safeguards of the Bank are nothing more than a veneer of protection to mask the real impacts of this dangerous financial institution which works only to increase profitability of its shareholders at any cost.

The World Bank is extremely inventive in producing documents and jargons that sound good, feel good, and are often genuinely trusted by many. It relies heavily on maintaining a good reputation and positive opinion of itself within governments and wider society, especially the media, in advancing its objectives. The current exercise is a part of this process.  But, as is said, if the proof is in the pudding, then that would have been best revealed by the World Bank saying “NO” to many investments that have disastrous consequences. Instead, it has gone on to not only aggressively finance such projects, but also defend such investments as necessary components of the “globalization” process that it actively propagates.

Even if we were to assume for a moment that the current exercise of ‘consultations’ is a genuine effort of the World Bank to consult stakeholders, the documents accessed on the range and depth of these ‘consultations’ reveal that they are highly segregated and sectoral. Moreover, participants have been carefully selected and largely include only those who may say what the Bank wants to hear. There is nothing public about such exercises, held, as they normally are, in highly secure 5 Star hotels in capitals around the world, with little or no prior information to the public. Further, World Bank officials typically ‘consult’ bureaucrats and do not engage with Legislators or Parliamentarians.

The best indicator of the shallowness of this exercise is evident since the communities grievously hurt and suffering from the Bank’s lending and investment policies are not invited to these consultations.  As a matter of fact, looking at things globally, the only complaint that the IFC’s Compliance Advisor/ Ombudsman has processed for Compliance Audit against a Financial Intermediary lending is from a project in India:  IFC lending to IDFC and IIF, which in turn used that money to fund a destructive thermal power project of the notorious GMR Energy. Despite a formal complaint pending review against this investment, the Bank, its bureaucracy and consultants, have not invited the complainants and affected communities to the current ‘consultation’ process, thus revealing the sham and mockery that the current review mechanism is!

Former World Bank employee, India’s Prime Minister Dr. Manmohan Singh and Planning Commission Vice Chair Montek Singh Ahluwalia, have repeatedly stated their opposition to genuine, democratic decision-making about environmental issues, and India’s Finance Minister P. Chidambaram has even infamously stated: “willing to tolerate debate, and perhaps even dissent, as long as it does not come in the way of 8 per cent growth”. The World Bank is in fact involved in putting substance to such wishes of these top politicians. In such a political climate, the World Bank’s environmental and social safeguards are mere window dressing. Exactly two decades ago the Bank had to get out of the Narmada Project, which was a historic development brought about by peoples’ struggles. However, the disaster created by the World Bank’s early funding to the Narmada project is still continuing, with lakhs of people suffering while the project is still far from complete. The Bank has clearly learnt no lessons and refuses even to follow the recommendations of the World Commission on Dams.

It took peoples’ movements, grassroots networks and allied organisations across the world more than 30 years to pressurize the World Bank Group to formulate and have in place mechanisms that would safeguard social-environmental-cultural-traditional interests of communities affected by the Bank’s financing of so-called ‘Development projects.’ However, it took the World Bank, in particular IFC, only one stroke of destructive imagination to bring in the new model of ‘Financial Intermediary Lending’ that wiped out all mandatory requirements posed by environmental and social safeguard principles on lending, as ‘Intermediaries’ are not bound by such standards. At a time when the FI model of lending in India by the IFC and the World Bank at large are expected to cross the halfway mark of their collective investments, it does not make any sense at all for the World Bank to be holding reviews of their environmental and social safeguards; they simply do not matter at all to the actual practice of the World Bank group’s member agencies.

The current ‘consultations’ are a complete sham and must be denounced by anyone genuinely committed to the principle of Free, Prior and Informed Consent (FPIC), climate justice, sustainable development through democratic decision-making and the Principle of Intergenerational Equity.

Signatories:
1. National Alliance of People’s Movements (NAPM)
2. National Forum of Forest People and Forest Workers (NFFPFW)
3. National Fishworkers’ Forum (NFF)
4. National Hawkers’ Federation (NHF)
5. National Handloom Weavers Federation (NAHFED)
6. National Domestic Workers Union (NDWU)
7. National Cyclists Union (NCU)
8. All India Forum of Forest Movements (AIFFM)
9. South Asia Network on Dams, Rivers & People (SANDRP)
10. Bharat Jan Vigyan Jathha (BJVJ)
11. Adivasi Mahila Mahasangh, Jashpur, Chhattisgarh
12. Alternate Law Forum, Bangalore
13. Beyond Copenhagen Collective
14. Bhindrai Institute for Research and Social Action (BIRSA), Jharkhand
15. Citizens Concern for Dams and Development, Imphal, Manipur
16. Citizens Forum for Civil Liberties, New Delhi
17. CIVIC, Bangalore
18. Delhi Forum
19. Delhi Solidarity Group
20. Dialogue on Indigenous Culture and Environment (DICE) Foundation, Kohima, Nagaland.
21. Dynamic Action, Kerala
22. Environment Support Group (ESG, Bangalore)
23. Equations, Bangalore
24. FOCUS on the Global South
25. Forum for Indigenous Perspectives & Action, Imphal ,Manipur
26. Ghar Bachao Ghar Banao Andolan, Mumbai
27. Himdhara – Environment Research Collective, Himachal Pradesh
28. Indian Social Action Forum, New Delhi
29. Institute for Democracy & Sustainability (IDS, New Delhi)
30. Intercultural Resources (ICR, Delhi)
31. International Rivers, India
32. Jan Jagruti Kendra, Chhattisgarh
33. Jan Sangharsh Vahini, Delhi
34. Jharkhand Mines Area Coordination Committee (JMAAC)
35. Kerala Swatantra Matsya Thozhilali Federation – Independent Fishworkers Federation of Kerala (KSMTF)
36. Kriti Team, New Delhi
37. Lok Shakti Abhiyan, Odisha
38. Machimaar Adhikar Sangharsh Sangathan
39. Manthan Adhyayan Kendra, Badwani, Madhya Pradesh
40. MATU Jan Sanghattan, Uttarakhand
41. Mozda Collective, Gujarat
42. Nadi Ghatti Morcha, Chhattisgarh
43. Narmada Bachao Andolan (NBA)
44. North East Peoples Alliance, Manipur
45. Odisha Chas Parivesh Surakhya Parishad (Odisha)
46. Partners in Justice Concerns – India
47. Paryavaran Suraksha Samiti, Gujarat
48. People’s Campaign Against Water Privatisation
49. People’s Union for Civil Liberties, Karnataka
50. Plachimada Samrakshana Samiti, Kerala
51. Programme for Social Action (PSA, India)
52. Right to Food Campaign, Uttar Pradesh
53. River Basin Friends, Assam
54. River Research Centre, Kerala
55. Society for Rural Urban & Tribal Initiative (SRUTI, Delhi)
56. Srijan Lokhit Samiti, Singrauli, Madhya Pradesh
57. Theeradesa Mahila Vedi, Kerala
58. Urban Research Centre, Bangalore
59. Vikalp Social Organisation, Uttarakhand
60. Vimochana, Karnataka
61. Water Initiatives, Odisha

 

 

 

About Intercultural Resources

Intercultural Resources is a forum for research and political intervention on issues related to the impacts and alternatives to destructive development. Our effort draws upon the social, cultural, material and intellectual resources that have been generated in the course of dialogues between people of different cultures on questions of social justice, development and self-rule. We are of the view that dialogue can sustain plurality and open possibilities for recovery of the ground lost on account of inter-cultural alienation, which is manifest in a variety of forms of violence that we encounter everyday at different levels of social life. Intercultural Resources is based in Delhi, India. Email: ihpindia@gmail.com

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