THE setting up ofthe Inspection Panel in September 1993 as apermanent body which will monitor World Bank-fundedprojects is a significant, far-reaching development.Unfortunately, the World Bank (WB) governing board of executive directors' mode of selection of sensitive areas was highlydisappointing. There have been serious objections to theboard's arbitrary one-sided decision that has left out the investigation of some fundamental controversies like environmental assessment, indigenous people's Xrights and resettlement strategy,regarding the Arun in project.
Economic analyses of the Arun IIIproject, timely disclosure of basicproject documents and informationby the WB, as well as public participation is of utmost importance. Thereis a lack of sufficient explanation asto why these issues of controversywere unilaterally removed from theinvestigation, even though they werespecifically highlighted by the panel.
On the one hand, it seems thatthe WB management - the defendant - has used all available meansand tactics to directly influence theboard's decisionmaking, since it hasthe accessibility to do so. On theother hand, the claimants have neither the privilege of such accessibilitynor were they ever consulted by theboard before it took such decision against calls for investigating alternatives to the Arun in project. Most people strongly feel that this is a serious denial ofjustice to the claimants and the undermining of a fair adjudication process.
The board's deliberate misinterpretation of the panel'srecommendations and the disclosure of information has seriously undermined the credibility of the panel as a new watchdog mechanism to focus on policy violations by the WB. Nowthere are deep-rooted doubts about the panel's independence&M credibility as an agent to monitor the WB'S compliancewith International Development Association (IDA) policiesaDd procedures, and its accountability.
Ile board must be aware of the gravity of the debate overthe Arun w project, and rising protests against the WB'S indiftect pressure and intervention in Nepal's sovereignty and deciuournaking authority. There is no reason for the board todemand that the panel should "commence field work onlyafter the bank receives a decision from the Government ofNepal, requesting the bank's financing of the project". Thisconditional decision of the board is pushing Nepal into a "No-option trap". The question here is who will be responsible ifthe panel's investigations of policy violations are found to beserious enough to jeopardise Arun m's financing. Thus, it isstrongly urged that the board reconsider its decision andfirmly establish that the WB shall only request the governmentof Nepal to affirm or negate the project after the completion of a through investigation of all aspects of the claims and a guarantee by the WB that it would fully comply with the IDA's policies and procedure.
The water resource minister,Han Priasad Pandey, has been iterating that is the Arun in project is not aleast-cost" or even a "cheap" project. Acording to him, it is anexpensive project and the electricityit will Onerate can never be sold at acompetitive price. The governmentalso has serious reservations over thelending' conditionalities that areagainst the long-term interests ofNepal.
It is very important to showcase the credibility ofthe panel by consid ering its conclusions and recommen dations in line with the complete investigation of the project. The board's failure to do so will undou btedly discourage the victims of such projects worldwide, and disempower them from using the inspection process.
The panel backtracked on the central issues of alternativeswhen it finally recommended to the board that it carry out aninvestigation on 3 of the 5 alleged policy violations. By notincluding the issue of alternatives in the authorisation ofinvestigation, the executive directors have hung a questionmark on the credibility of the investigation's outcome.
If alternative models cannot be considered in the inspection process in the light of new information and aspirationsof the people id the country today, the investigations willrun the risk of being an incomplete exercise of limitedacademic interest.
---Bikas Pandey is a member of the Alliance for Energy; Gopal Siwakoti is a member of the Arun Concerned Group, Nepal.