The World Bank at 60
by - 23.04.2004 17:32
The World Bank at 60: A Case of Institutional Amnesia?
Bank Resumes Lending for Big Dams in India
Narmada
IRN media release, April 22, 2004
The World Bank is poised to resume lending for destructive large dams
in India. Bank staff are currently scouring India for new dam
projects to fund in the coming year. The last time the Bank supported
a dam in India - the Sardar Sarovar project in the Narmada Valley -
strong opposition and an independent review documenting numerous
policy violations led to an embarrassing withdrawal of Bank support
and the establishment of the Inspection Panel.
"On its 60th anniversary, the World Bank seems to be suffering from a
case of institutional amnesia. The World Bank's legacy of support for
large dams has been shameful. Bank-funded dams have displaced more
than 10 million people, flooded millions of hectares of lands and
pushed many countries deeper into debt. Yet the Bank is set to repeat
its mistakes all over again. In its 60th year, one would hope that
the Bank would be a bit wiser by now," says Peter Bosshard, Policy
Director for IRN.
The foray back into large dams in India comes on the heels of the
Bank's approval of an Infrastructure Action Plan (IAP) in July 2003.
The Plan aims to increase Bank support for what it terms "high
risk/high reward" infrastructure projects such as large dams over the
next two years. The implementation of the plan will be discussed by
the Bank's Development Committee at the Spring Meetings in
Washington, DC on April 25.
As part of the IAP, the World Bank recently announced a doubling of
its lending for India, predominantly for projects in the power, water
and transport sectors. Development of infrastructure in India is
urgently needed, but the Bank's plans for the Indian water and power
sectors ignore important lessons of the past. According to a former
World Bank India country director, the most important reform in the
power sector would be to combat the "widespread theft, graft and
corruption" in the distribution of electricity.
The Bank's latest evaluations of the Indian power and water sectors
recommended that the Bank should not support further power generation
and water supply projects in such an environment. Yet vested
interests of politicians, aid bureaucracies and equipment suppliers
favour the promotion of new, capital-intensive investments over the
efficient management of existing infrastructure or the development of
decentralized, community-based infrastructure.
"The Bank's new dam-building plans in India not only defy the lessons
of rational sector planning, they will quite likely also have massive
social and environmental consequences. They will pour more water into
the leaking tubs of India's water and power sectors, rather than
plugging the holes in the system," says Bosshard.
The new strategy also disregards current best practice such as the
recommendations of the World Commission on Dams, and a new World Bank
Sourcebook on Options Assessment, both of which recommend involving
all relevant stakeholders in development decisions, and assessing all
options "strategically and comprehensively". A manager of the Bank's
Delhi office labeled these best practice recommendations as
"Washington speak" in a meeting with IRN.
Today, International Rivers Network released a new report on how the
Bank is implementing its Infrastructure Action Plan. Entitled, The
World Bank at 60: A Case of Institutional Amnesia?, the report
concludes that the new high-risk strategy "will exacerbate conflicts,
but will not help to reach the Millennium Development Goals".
In a letter to the Bank's Executive Directors, IRN called on the Bank
to follow the recommendations of the World Commission on Dams in
future water and energy projects, assess all needs and options in a
balanced and participatory way, strengthen the rights of
project-affected people, and halt its engagement in new high-risk
projects such as large dams.
For more information:
The new report, The World Bank at 60: A Case of Institutional
Amnesia?, and the letter to Executive Directors is available at
http://www.irn.org.
IRN supports local communities working to protect their rivers and
watersheds. We work to halt destructive river development projects,
and to encourage equitable and sustainable methods of meeting needs
for water, energy and flood management.
The World Bank is poised to resume lending for destructive large dams
in India. Bank staff are currently scouring India for new dam
projects to fund in the coming year. The last time the Bank supported
a dam in India - the Sardar Sarovar project in the Narmada Valley -
strong opposition and an independent review documenting numerous
policy violations led to an embarrassing withdrawal of Bank support
and the establishment of the Inspection Panel.
"On its 60th anniversary, the World Bank seems to be suffering from a
case of institutional amnesia. The World Bank's legacy of support for
large dams has been shameful. Bank-funded dams have displaced more
than 10 million people, flooded millions of hectares of lands and
pushed many countries deeper into debt. Yet the Bank is set to repeat
its mistakes all over again. In its 60th year, one would hope that
the Bank would be a bit wiser by now," says Peter Bosshard, Policy
Director for IRN.
The foray back into large dams in India comes on the heels of the
Bank's approval of an Infrastructure Action Plan (IAP) in July 2003.
The Plan aims to increase Bank support for what it terms "high
risk/high reward" infrastructure projects such as large dams over the
next two years. The implementation of the plan will be discussed by
the Bank's Development Committee at the Spring Meetings in
Washington, DC on April 25.
As part of the IAP, the World Bank recently announced a doubling of
its lending for India, predominantly for projects in the power, water
and transport sectors. Development of infrastructure in India is
urgently needed, but the Bank's plans for the Indian water and power
sectors ignore important lessons of the past. According to a former
World Bank India country director, the most important reform in the
power sector would be to combat the "widespread theft, graft and
corruption" in the distribution of electricity.
The Bank's latest evaluations of the Indian power and water sectors
recommended that the Bank should not support further power generation
and water supply projects in such an environment. Yet vested
interests of politicians, aid bureaucracies and equipment suppliers
favour the promotion of new, capital-intensive investments over the
efficient management of existing infrastructure or the development of
decentralized, community-based infrastructure.
"The Bank's new dam-building plans in India not only defy the lessons
of rational sector planning, they will quite likely also have massive
social and environmental consequences. They will pour more water into
the leaking tubs of India's water and power sectors, rather than
plugging the holes in the system," says Bosshard.
The new strategy also disregards current best practice such as the
recommendations of the World Commission on Dams, and a new World Bank
Sourcebook on Options Assessment, both of which recommend involving
all relevant stakeholders in development decisions, and assessing all
options "strategically and comprehensively". A manager of the Bank's
Delhi office labeled these best practice recommendations as
"Washington speak" in a meeting with IRN.
Today, International Rivers Network released a new report on how the
Bank is implementing its Infrastructure Action Plan. Entitled, The
World Bank at 60: A Case of Institutional Amnesia?, the report
concludes that the new high-risk strategy "will exacerbate conflicts,
but will not help to reach the Millennium Development Goals".
In a letter to the Bank's Executive Directors, IRN called on the Bank
to follow the recommendations of the World Commission on Dams in
future water and energy projects, assess all needs and options in a
balanced and participatory way, strengthen the rights of
project-affected people, and halt its engagement in new high-risk
projects such as large dams.
For more information:
The new report, The World Bank at 60: A Case of Institutional
Amnesia?, and the letter to Executive Directors is available at
http://www.irn.org.
IRN supports local communities working to protect their rivers and
watersheds. We work to halt destructive river development projects,
and to encourage equitable and sustainable methods of meeting needs
for water, energy and flood management.