REQUEST FOR INSPECTION NTPC POWER GENERATION PROJECT Cr. 3632
Part Three

XX. Jobs

49. While promise of jobs was made to all during Stage I only a few were actually given. Many people who were made to go through the farce of interview for job feel very bitter and frustrated. They spent money on completing formalities but got no jobs. In case of Vindhyachal PAPs allege bribe being paid for jobs. In Rihand outsiders were given jobs on the basis of forged records. The Bank failed to take note of these realities while approving the R&R policy.

50. The rehabilitation option offered by the borrower inlcude income generation schemes. The much publicised schemes are an eye wash whether it is in Rihand or Vindhyachal. At Rihand many of these projects are planned and implemented through a management sponsored and controlled NGO - Chetna - which the Bank refers to as an innovative creation (Ref. SAR, NTPC Power Generation Project, June 4, 1993, Part-II, Annexes-page 18, paras 1.12 and 1.13). Most of the income generation activities are either non-existent or have not graduated beyond the pilot phase. Any support organised through Chetna is given and withdrawn at the whims and fancies of those manning it. Examples of harassment by the so-called NGO abound. The structure of the NGO is inherently undemocratic. It gives extra right of vote to members who make a monetary contribution of over 1000 rupees. (See the by laws of Chetna in the annexures to Rehabilitation Action Plan for Rihand II).

51. The experience in Singrauli shows that the contract work which is projected as a rehabilitation option, is ridden with all kinds of problems the worst is the fear of being thrown out anytime. The hazards of contract work are all too well known. It is a cost cutting measure, a measure to make the operations more 'efficient'. The policy of the borrower under the advice of WB has been to put out most jobs of perennial nature, on contract. These include some of the most dangerous jobs in the boiler sections, coal handling where accidents are not infrequent. The R&R Manager NTPC Rihand admitted openly in the presence of WB representatives on February 14, 1996 that WB has restricted the manpower ratio norm so that recovery of loans would be ensured. The cost of such an unjust notion of efficiency is being borne by thousands of contract workers engaged in some of the most dangerous processes inside the power station without adequate protection and social insurance. The liability of dealing with accidents is conveniently passed on to private contractors whose effort is to hush the matter and dispose it off with least cost. This is how profits are posted and claims of efficiency made. With ever new people being rendered without livelihood as a result of land acquisition, the number of people seeking work swells ensuring that real wages always remain depressed.

52. The SAR for the current project refers to the existing legal framework for acquisition in India as responsible for limiting the efforts that Government can make to adequately compensate PAPs. But has the WB ever brought this up before the government and used its leverage to get the relevant legislations amended in the interest of PAPs. In the SAR itself a detailed analysis of legal framework regulating participation of private sector in power generation and distribution has been made. The Bank as part of Structural Adjustment Programme (SAP) loans has used its leverage to get the various legislations amended to allow for greater participation of private sector. It is not clear why the Bank could not have similarly undertaken an analysis of laws governing compensation and suggested their amendment as well to bring them in tune with its directives on involuntary resettlement. When ever we brought such aspects to the attention of WB their response was that its hands were tied and that it cannot interfere with sovereignty of the Government. But the Bank has been using the stick in issues like recovery of bills, tariff rate, privatisation, amendment of laws to bring them in line with the objectives of liberalisation without in the least caring for issues like sovereignty.

XXI. Corruption

53. During the visit to Singrauli area in April 1994 many project affected people told a delegation of national and foreign NGOs that R&R officers were charging bribes for providing NTPC jobs. Certain names had been mentioned in particular. Rumours of corruption keep surfacing again and again.There have been instances where outsiders were given jobs against forged records. In 1996, the representatives of NTPC spread a rumour that an activist had left the region after accepting bribe from NTPC. While such accusations were obviously targeted at demoralising the PAPs, they nevertheless lend credence to the theory that bribes are indeed given as a reward to those who can secure submission of unwilling PAPs. Well known power brokers are invited as representatives of PAPs to VDACs. In one case infrastructure created out of R&R funds has been allowed by the borrower to be appropriated by a local power broker. Senior officials of NTPC have been named by this power broker as having colluded to defame activists/NGOs working amongst the displaced.

XXII. Induced development

54. According to OD 4.10 Annex A2, induced development and other socio-cultural aspects of a project should be addressed by Environmental Assessment (EA) where applicable. The annex elaborates that secondary growth of settlements and infrastructure, often referred to as induced development or boomtown effects, can have major indirect environmental impacts, which relatively weak local governments may have difficulty addressing.

55. The May 1992 report of World Bank Environmental Department India: Sustainable Development in the Singrauli Region - Towards an Action Plan, elaborates that this issue is indeed very applicable to the Singrauli region. According to this report, a key lesson of development in the region to date is that the pace of development should not exceed the capacity of the development process and institutional arrangements to successfully accommodate growth. Existing problems are the direct result of this occurring, (p iii). As a short-term consequence, the pace of regional development should be contain[ed] to a level able to be accommodated by an evolving development process without undue strain (p. Iv). The Executive Summary/Main Report of the Environmental Study of Singrauli Area submitted by Electricite de France (EdF) in July 1991 equally warned that further development of thermal power in Singrauli will have unquestionable direct impacts (p.15, emphasis in the original text). The report spells out land use issues, socio-economic issues, pollution generated by new industries, etc., and concludes that their impacts on the regional environment will be exacerbated under any development scenario for the region which continues to disregard them (p. 15 emphasis in the original text).

56. As a consequence of these findings, the May 1992 report recommended that the EA for the 1993 NTPC project embrace both the direct effects of the proposed investment on the physical environment and its impact on the broader social environment (emphasis in the original text). The EA Summary gives the impression that this recommendation by the 1992 report was completely ignored by the actual EA. The impact of the 1993 NTPC project on the broader social environment was not analysed at all.

XXIII. Environmental Violations

57. The Bank is well aware of the environmental problems of Singrauli which was once a densely forested area rich in biodiversity. The environmental study of the Singrauli area by EdF had been the most expensive and voluminous study financed out of an undisbursed loan to NTPC. The 1993 NTPC project was supposed to support a series of environmental mitigation measures following the EdF study. One of the three main components of the 1993 project was an Environmental Action Plan (EAP). This included the environmental upgrading of power plants, technical assistance to improve environmental capacities of NTPC and strengthening of R&R activities and capacities. The Bank for several years, since 1993, has been claiming that the EAP was being implemented as scheduled. But inquiries into the status of the EAP which NGOs made in November/December 1996 pathetically expose the fallacy of World Bank claims. To cite only a few examples, EAP includes the analysis of ash leachate from ash ponds which have the potential to contaminate the groundwater. The analysis supposed to have been finalised by November 1993 had not been completed in November 1996! A study on the fate and transport of mercury was supposed to have been carried out between November 1993 and January 1996, the study is now expected to be carried out only in May 1998 or possibly not at all ! An analysis of food crops in Singrauli revealed mercury contamination above levels of concern and high flouride and chromium levels. As part of the EAP food crops were to be analysed every two to five years starting in 1992. NTPC could not provide an executive summary of the latest crop monitoring report to NGO representatives in spite of promise to do so. A base line survey on community health in areas surrounding the power stations was supposed to have been conducted as a condition for clearance from Ministry of Environment and Forest. The borrower in a meeting with NGOs in December 96 was completely ignorant about any such obligation! The Bank had also tried to undermine the contribution of power plants to the problem of mercury in the food chain. In a letter to Berne Declaration, the Bank's India Department claimed that the principal source of mercury in Singrauli area was the Kanoria chemical plant and not the power plants. Yet, the EdF study (1991) had revealed that Singrauli power plants topped in the emission of mercury - the power plants released 720kg per annum whereas the Kanoria plant was responsible for only 90kg per annum! The Bank has turned a Nelson's eye to such shocking negligence of the borrower in the implementation of EAP. The few examples cited above demonstrate that neither the borrower nor the Bank are concerned about the environmental impacts of the power plants. The borrower has on the contrary used these impacts against hapless PAPs. In November 1995 ash slurry was suddenly allowed to be dumped on to the fields of a PAP at night gravely damaging her hut and other possessions besides causing severe trauma. Such barbaric actions of the borrower were brought to the attention of the World Bank officials but they paid no heed. Given such a situation the EAP and its implementation can only be termed an eye wash.

58. The unmitigated environmental effects have adversely affected the health of the people of Singrauli. The region north of the Rihand reservoir is crowded with power plants, coal mines, and other heavy industries and has taken its toll on the health of the people. Unattended ash pipe leakages is a common sight. The leakages have contaminated drinking water sources, the soil and the crops. The current expansions would further endanger the health of the people. The area on the southern bank of the reservoir faces a social and environmental havoc of similar intensity as experienced by people on the north. The fact that the affected people do not have a regular source of income and lack access to the expensive but better equipped township hospitals compounds the risks to their health many times over .

XXIV. Failure of Supervision by the Bank

59. The OD 13.05 clearly states that project supervision is one of the Banks most important activity. It requires that the borrower implements the project with due diligence to achieve agreed objectives. It further requires that problems are identified promptly and the borrower is helped to resolve them. The Bank has failed to supervise the project effectively and violated its own directives on supervision. The PAPs often had no information about World Bank mission visits. Mostly it was through hearsay that they learnt that a WB team was in the project area. Unless hijacked, the WB representatives preferred not to meet PAPs in situations where NTPC representatives did not have a dominating presence. The Bank missions often relied on NTPC officials to translate statements of PAPs and vice versa. The latter has been known for distorting messages. To a team of foreign NGOs in February 1995 a Bank official is understood to have stated that the Bank should not even try to meet PAPs without the NTPC officials. This official further suggested to the NGOs that if PAPs felt intimidated by the presence of NTPC officials they should resort to legal action. With such arrogant and uncaring attitude the Bank missions can hardly be trusted to make unbiased and accurate reports. The very purpose of missions becomes meaningless. The people of Singrauli have the experience of humiliation of cascades of World Bank jeeps cruising through their villages without stopping. When the World Bank mission reports in rare situations did acknowledge problems, for example the March 1995 mission report severely critcised undemocratic structure of VDACs, little was done to follow up on these inadequacies during subsequent visits. Instead, the Bank officials have eagerly defended the omissions of the borrower.

60. False progress reports, status papers were provided to the WB by the borrower based on which latter concluded that there were real improvements. The Bank never thought it necessary to verify the contents of such reports. Twice police force in large numbers was summoned to crush the resistance of PAPs of Rihand II. The second time force came was in June 96 inspite of assurance from WB, New Delhi office chief of Social Development Unit, to the contrary. The police came even though WB had been forewarned that such a possibility existed (letter of M. Kohli to David Marsden Chief Social Development Unit dated 30.5.96). Reports of threats, intimidation to PAPs as well as to those who supported their cause were regularly given to WB officials, to no avail. Even statements of the borrower made in the High Court at Allahabd arguing that the Rehabilitation Action Plan cannot be challenged because it had not come into force, or that the compliance of the conditions of the loan was a matter between the NTPC and the Bank with PAPs having no say, were taken most casually. Supervision and monitoring through WB missions was extremely superficial and ignored the fact that NTPC projects in Singrauli had a very poor track record on social and environmental mitigation.

XXV. The Responsibility of World Bank

61. We hold the World Bank responsible in pushing the PAPs of Singrauli towards a situation of impoverisation. World Bank is well aware of the impacts of large scale investments in this region. Nor is NTPC a borrower of WB funds for the first time. In giving yet another loan to NTPC the Bank has not taken into account the feedback available through numerous official studies and NGO reports. An important report of a delegation of NGOs- national and international - which visited Singrauli in 1994 was ignored by the Bank which did not respond to any of the issues raised therein. Since February 1995, after the construction of ash dike in Rihand began in the presence of police force, World Bank has been repeatedly informed about the violations through a series of letters, meetings with New Delhi office as well as representatives of the Country Department in Washington. Each time the response was to accept the denials by the borrower. For example, even the police action and repression of villagers on June 27, 1996 was not taken seriously. NTPC denied with impunity that any force had been used or any crops had been bulldozed. The World Bank officials did not consider it necessary to obtain first hand information from those affected. Neither Corporate office representative of NTPC nor WB representatives came to the site to talk to the PAPs. Even when David Marsden, Chief, Social Development Unit came to the area in August end, he did not meet with affected people and went back after attending a closed door meetings with selected people arranged by the NTPC.

62. The World Bank officials did not believe aggrieved peoples testimonies. For example, at a meeting on February 14, 1996 the WB officials (David Marsden and Sam Thangaraj) were given details about an incident that took place on 22 Jan 96 when contractors' men came armed with sticks and rods with the intention of fomenting trouble and to force their way onto the villagers' fields. Testimony by a respected leader of the region who was present on that day was not given any importance to by the WB representatives. In the end the Bank concluded that the allegations were unsubstantiated.

63. The experience of correspondence and meetings with WB representatives have been long since 1995, but frustrating. Not even once did they take any stern action against the borrower or put adequate pressure on them of which people know. On the contrary, they praised the borrower for their commitment to R&R setting up of a full-fledged department of R&R, appointment of sociologists were pointed out by the Bank as proofs of this commitment. In a meeting with WB officials held in Delhi on April 12, 1995 the representatives of PAPs stated that the actions of borrower had been violative of the WB guidelines and that an important condition of the loan had been breached in the very first test case. They appeared to note our concerns but did nothing.

64. Enclosed are important correspondence and record of meetings with WB representatives. A letter dated Dec. 26, 1996 to WB President remains unanswered, receipt of which was confirmed.

65. We believe that the WB response to our complaints has been casual, indifferent and unsatisfactory. The typical response has been to pass on our letters to NTPC or at most to District officials asking them for their reactions. Instead, the response should have been to institute independent investigation, arrive at the truth and suspend the loans till the borrower complied with the commitments relating to R&R and environment. On the contrary, the WB officials have even tried to defend the borrowers omissions and commissions. The classic example is the letter from David Marsden dated January 2, 1997 wherein he has tried to explain in defence of the borrower why the progress on R&R has been slow. He attributed the same to the pending suits filed by PAPs in various courts. It is strange that pending suits did not restrain the borrower from resorting to police action, destruction of villagers' fields, imprisoning them but prevented them from doing the best that they could have done to minimise the loss being suffered by the PAPs.

XXVI. Other Actions to Resolve the Problem

66. In addition to the above PAPs and their representatives took the following steps to try to resolve the problem. * A question raised in the Upper House of Indian Parliament on May 5, 1995. * A writ in High Court at Allahabad was filed in February 1995 seeking a stay on construction of ash dike till the people were properly and fairly rehabilitated. NTPC had filed its reply to the petition but the petition still remains to be heard. The stay was not granted. The petition has now been admitted for hearing. An application for expediting the hearing has been moved in the court. * In June 1996, a plea in the High Court was made to quash the criminal proceedings against villagers instituted illegally by the sub-Division Magistrate at Dudhi. The court in its decision on 21.6.96 quashed the proceedings. * In April 1996 the Peoples Union of Civil Liberties ( the UP Chapter) investigated the situation of PAPs of Singrauli and brought out a report of its findings. * The National Human Rights Commission was approached in June 1996, to investigate the harassment by police and Administration. The Commission sent a team for fact-finding in October. The report is out and presents only the version of NTPC and District Administration ignoring the testimonies of the aggrieved persons. * A revision in the District and Sessions Court was filed in February 1997, against illegal continuation of criminal proceedings against 23 men and women of Mitihini and Khairi instituted against them by the Sub Division Magistrate on 27.6.96. The court vide an order dated April 1, 1997 struck down the proceedings as illegal. * The PAPs of Churchuria village affected by extension of ash dikes for Vindhyachal approached the Apex court. * Besides the people of Singrauli made numerous petitions to the district and State and central authorities seeking redressal of their grievances.

67. We believe that the above actions of the borrower and omissions of the WB were contrary to the policies and procedures of WB. These actions/omissions have adversely affected the people and jeopardised their basic rights and interests. We request an investigation into the same towards a resolution of the problems of people of Singrauli affected by the projects. We also seek the Panel s intervention for advising the Bank on remedies which should be implemented to compensate the people affected by the project for the adverse impacts they have suffered and will suffer due to inadequate social & environmental mitigation. We reiterate that provision of alternative livelihood acceptable to the people of past and present projects of NTPC remains the most critical issue for redressal. Remedial action for dealing with social and environmental effects of old projects had also been envisaged as a condition of the R&R policy approved as a condition of NTPC power project 1993. Provision and upgradation of basic infrastructure in existing resettlement sites with involvement and participation of the affected people is also a priority . We expect the Panel to further advise the Bank on provision of adequate financial and institutional arrangements to enable the borrower to carry out its commitments in conformity with WB guidelines. And finally we would like the Panel to pressurise the Bank such that resolution of existing social and environmental impacts must become a condition for remaining disbursement under the project.

We can provide any further information, if and when required. We also request that the claim be made public.

Madhu Kohli