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The World Bank will continue to pay for the controversial Sardar Sarovar
dam project on the Narmada River in India, ignoring warnings from its own
advisers. Earlier this year, a team commissioned by the bank to investigate
the scheme produced a damning report which concluded that there were ‘serious
deficiencies’ in the project. Yet at a meeting last week, 59 per cent of
the bank’s executive directors voted to continue funding. The American,
German and Japanese directors voted against continuing support for the project.

The bank has done a lot of soul-searching over the dam project since
the review team presented its scathing report. At the time, its president,
Lewis Preston, issued a statement acknowledging problems with the project,
and promising ‘remedial actions’ (This Week, 27 June). Last month, the bank’s
management submitted a detailed plan for making changes in accordance with
the review’s findings.

But two weeks ago the leaders of the review team, Bradford Morse and
Thomas Berger, wrote to Preston claiming that the remedial plan ‘ignores
or misrepresents the main findings’ of their review. The bank’s plan fails
to take into account specific points, including the unfair treatment of
people ousted to make room for what would be the largest canal ever built,
they say. The leaders of the review panel also say that the plan’s ‘indifference
to the proper place and utility of environmental work is astonishing’.

In reply, Preston wrote that he found the charge of misrepresentation
‘very disconcerting’. He maintained that recent changes in the project made
by the Indian government and the states affected by the dam had been ‘very
constructive and justify a continuation of Bank support’ for the next few
months.

Meanwhile, an international coalition of nongovernmental organisations,
led by the Environmental Defense Fund in the US, wrote to the World Bank’s
executive directors to say that not only does the bank’s plan not properly
address the findings of the review, it also fails ‘to acknowledge the widespread
opposition and associated human rights abuses’. They accuse the bank of
watering down its earlier demands and conditions for the resettlement and
rehabilitation of people affected by the dam. They suggest that the ‘credibility
of the bank is at stake’ and called on the directors to withdraw support
for the project.

The bank will send a team to India next April to check how the new plan
is being implemented. It will then consider whether to continue funding
the project.