World Bank asks the government to resolve issues before theyare brought
up for its board's approval
A$600 million (Rs2,802 crore) World Bank loan for a 444MW hydropower
project in Uttarakhand may be in trouble following allegations over the
manner in which it received environmental clearance.
The project is being constructed by state-owned Tehri Hydroelectric
Development Corp. Ltd, or THDC.
According to documents reviewed by Mint, the World Bank has asked the
Indian government to address allegations about improperly held public
hearings for the clearance of the Vishnugad-Pipalkoti dam in Chamoli
district. The bank's action came after it was sent a letter detailing
these allegations by Vimalbhai, convenor of the Matu People's
Organization, a Delhi-based activist organization.
These concerns have been raised at a time when there is already
considerable scrutiny of hydro projects in the country due to
environmental concerns. The ministry of environment and forests (MoEF)
had recently spiked plans for hydro power projects on river Bhagirathi,
also located in Uttarakhand and a major tributary of the Ganga.
The finance ministry sought the power ministry's views on the bank's
concerns in a communication on 29 June addressed to Gireesh Pradhan,
While MoEF officials declined to comment, Pradhan did not return phone
calls or respond to messages left at his office and on his cellphone.
The project, earlier scheduled to have been commissioned by 2013, is
located on the Alaknanda, a Ganga tributary, and is expected to have
four units of 111MW each.
The activist body has alleged in its letter that public hearings for the
clearance of the project were not in accordance with stipulations, and
that the environmental clearance protocol was not followed.
According to the environmental impact assessment (EIA) notification of
1994, amended in 2006, project proponents first have to prepare a
report. Copies of this are then to be distributed to the local
administration and affected people. An EIA assesses the impact of a
project on the environment.
Public hearings are scheduled thereafter. The public hearing of
grievances and discussions are noted and sent to MoEF for a final
decision. The activist body says there were several gaps in the process
"At the first public hearing, no documents were disclosed," said
Vimalbhai, who uses only one name. "Another hearing was held after
protests but the same thing (happened)."
A World Bank spokesperson in India indicated in an email that all
procedures had been followed: "The wide dissemination was aimed at
soliciting feedback on the specific environmental impacts identified in
the EIA and on the mitigation measures being proposed. In keeping with
World Bank project preparation requirements, THDC invited the public at
large, through newspaper inserts and press publications and via its
website, to comment on the draft consolidated EIA/EMP, and to
participate in a public stakeholders' meeting, which took place in
Pipalkoti on 13 September."
R.S.T. Sai, chairman and managing director of THDC, said "nothing wrong
has been done". "This is a project loan. We're yet to enter into any
negotiation. The exact details of the loans are yet to be finalized. We
don't know why they're agitating and why it is coming at this moment. As
far as we know, all procedures have been completed. If somebody makes an
allegation, it's for them to prove it. Various procedural steps and
criteria laid down have been adhered to. We've to see what this fuss is
The World Bank's head office, however, responded to Vimalbhai's letter
by asking the finance ministry to "send...comments on submissions made
in the email (from Vimalbhai) at the earliest." It also said the
"allegations are very serious" and that "the loan will be scheduled for
board approval after issues on the project...are resolved."
The spokesperson for the World Bank in India declined to comment on this
communication and, responding to a question on whether the protest would
affect the project's chances of receiving the loan, said: "The bank
proceeds to support a project only after it has satisfied itself that
all national and bank policy requirements have been met; adequate
consultation and preparation has been done; and effective measures have
been put into place to mitigate and manage project risks and any adverse
In 1994, the World Bank was forced to withdraw from its plan to fund the
Sardar Sarovar project across the Narmada in the face of social and
environmental concerns. The 192MW Allain Duhangan hydro project in
Himachal Pradesh faced similar protests, but that didn't hinder
approvals for funding by the International Finance Corporation, a World
India has a hydropower generation capacity of 36,085MW and plans to add
15,627MW by 2012. Most hydro projects involve some amount of
displacement of the local population.
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