Yacyreta and Singrauli Update: Action Needed Now

May 13, 1998


The Board of Executive Directors is expected to discuss the Yacyreta and Singrauli claims during May, although no date has yet been set. Both claims are at the point where the Board must make a decision about the remedies it will implement to address the Bank’s policy violations and to act on the findings of the reports of the Inspection Panel. Without outside pressure, the Board may simply fail to act and thereby allow the situation of the claimants to continue to languish. It is important to note that the Inspection Panel no longer has an official role in monitoring either project; this will be one aspect that we will ask you to address in your letters (see below).

Singrali Update

1. Human Rights Watch/Asia sent a team to the Singrauli region after hearing about ongoing, and escalating, human rights abuses associated with the project. Their report, released on April 21, 1998, calls on the World Bank to “Monitor Abuses in India.” Their findings confirm reports from local, national and international NGOs and affirm the importance of the Inspection Panel involvement in the project. The report documents numerous examples of human rights violations in the Singrauli region, as well as violations of Bank policies.

In a memorandum addressed to President Wolfensohn and the Executive Directors, HRW/Asia links these human rights abuses directly to the National Thermal Power Corp. (NTPC), the Bank’s largest-ever borrower. It says that NTPC and other project and local authorities “often acting in concert, have engaged in a pattern of clear human rights violations, including arbitrary detention, degrading treatment in custody, and indiscriminate use of force, against persons displaced by the Bank-funded” thermal power plants and “against those who have protested compensation levels, conditions of resettlement, and environmental damage.”

The report goes on to say that “Following a visit in July 1997, the Inspection Panel had requested that it be permitted to conduct a more thorough on-site investigation. Had it been able to do so, some of the subsequent problems might have been averted. The Bank should now deploy the Inspection Panel team to the Singrauli area to conduct an on-site investigation and to formulate measures to prevent further human rights abuses. Continued involvement of the Inspection Panel is critical to ensuring that a fair resolution of the problems affecting the displaced communities in the Singrauli project area is achieved.”

For a copy of the report, click here http://www.hrw.org/press98/aprl/wrldbnk.htm . This will get you to the HRW press release, with a link for the memorandum.

2. Also in late April, Bank Management delivered its updated Progress Report to the Board. Last time the Board met to discuss the Singrauli claim, they postponed further consideration until receiving more up-to-date information from management about the implementation of the action plan that had been developed in response to the claim.

Management’s report on the Action Program includes the findings of the Independent Monitoring Panel (IMP) and the XAVIER Institute (which was doing a socio-economic survey of project-affected people). The Bank progress report identifies serious deficiencies in resettlement and rehabilitation, and recommends replacing all field level R&R staff. This is good news, as several members of the NTPC staff have been responsible for harrassment and abuse of affected people in the Singrauli area, particulary those who are demanding compliance with the Bank’s policies.

In one paragraph, the management report lays out an action program for the next six months, which will include (a) arranging for payment of outstanding claims for land compensation; (b) reforming Village Development Advisory Committees to make them more participatory; (c) making the Public Information Centers more functional; (d) introducing health care improvements in Chilkadand; (e) improving welfare assistance to vulnerable PAPs; (f) “resolving the outstanding problems of the PAPs refusing to move in Rihand and Vindhyachal with the assistance of the IMP”; and (g) implementing recommendations for institutional strengthening of NTPC. While these steps seem to be important towards achieving more equitable treatment of locally affected communities, there is a lot of ambiguity about how those objectives will be achieved (particularly the one relating to the villagers’ ongoing resistance to resettlement without adequate rehabilitation).

Both the XIDAS and the IMP reports, which are attached to the management report, document clear policy violations. The IMP report notes that “the rehabilitation package and the implementation of the rehabilitation policy are inadequate. They do not appear to meet the requirements of the constitutional justice . . . ” In particular, both XIDAS and the IMP criticize NTPC for making an inadequate analysis of the land-for-land option and call for further evaluation of the availability of land. Note that this problem is NOT identified in management’s one-paragraph 6-month action plan, described above.

CIEL was sent a copy of this report by regional management. If you would like a copy, please let us know.


1. Summary of Recent Developments: This is a really pathetic saga. Many of you have heard about recent events in Yacyreta though updates from Bank Information Center and International Rivers Network. Its a story worth telling, but I will keep my description brief, and list contact info below if you want more information.

Recently, Elias Diaz Pena of Sobrevivencia, Friends of the Earth Paraguay (the NGO representing anonymous claimants) and Pedro Arzamendia (Comision Inter-Barial de Afectados por Yacyreta) came to Washington DC as part of the Board’s Inspection Panel Review, and presented their concerns about the project to the EDs. In a follow up letter to Mr. Wolfensohn and the EDs, Mr. Arzamendia again articulated their concerns and invited Mr. Wolfensohn to come to Yacyreta to see for himself the situation they were dealing with. Recent flooding has caused serious problems for people living near the reservoir, even though according to the Banks they are not yet considered “affected”.

Writing on behalf of Mr. Wolfensohn, Isabel Guerrero, Acting VP for Latin America and the Caribbean, wrote back to Sobrevivencia and Mr. Arzamendia on February 27, 1998 denying any problems in the project and saying “The Bank is satisfied with the conclusions of the report [of the Inspection Panel] which affirm that its policies on resettlement, environment, community participation, and others were fully respected and applied in the case of Yacyreta.” This is a flagrant lie and misrepresentation of the Panel’s findings. The panel found serious policy violations that were causing significant harm to the local population, and also found the Action Plans to be inadequate to solve the problems and bring the project into compliance with Bank policies.

To add insult to injury, the letter from the Bank was published in the Paraguayan newspapers by EBY (the Bank’s borrower) BEFORE it was even sent to Sobrevivencia or Mr. Arzamendia.

Sobrevivencia wrote to Mr. Wolfensohn to protest the Guerrero letter, and IRN coordinated a sign-on letter in support that was endorsed by 83 NGOs from around the world. They demanded that the Bank publish a retraction of the letter in the Paraguayan press, issue the Inspection Panel report in Spanish, and make public the Action Plans. (The Bank has until now consistently refused to release the Action Plans, which were developed in a non-participatory manner, in violation of its policies on resettlement and environment.)

On May 4th, the Financial Times wrote a critical article about the Guerrero letter and Inspection Panel findings. On may 8, in response to both external and internal pressure, Mr. Burki, the VP for Latin America wrote to Sobre and Mr. Arzamendia. He states that Ms. Guerrero’s letter “conveyed an incomplete description of the Bank Inspection Panel’s report.” He also stated that the Panel report would be translated into Spanish and that the Action Plans would be provided. He ignores the fact that the Action Plans were developed in a non-participatory manner.

2. Management Report on the Yacyreta Action Program. We recently obtained Management’s report on the Status of the Action Program for the Yacyreta project, and were not surprised to discover that implementation of the two action plans (designed by management in March 1997) is seriously behind schedule. This confirms complaints we’ve heard from the field, where local
people are frustrated by the fact that nothing is happening to respond to their plight. Plan A was supposed to accomplish the things that should have been done before the reservoir was filled in 1994. Plan B was to bring the project to the point where it could operate at its CURRENT level (76 meters above sea level) and be in compliance with Bank policies. Neither of the Plans address the additional mitigation that will be needed if the Bank decides to authorize filling the reservoir to its original design height of 83 meters asl. Management’s report shows that Plan A is 4 months behind schedule and Plan B is at least a year behind schedule. The report says that implementation of Plan B will take at least until the end of the year 2000.

The management report also complains that “existing security arrangements in Encarnacion are not effective in curbing illegal settlement in the affected area” and notes that “the Bank has recommended that Encarnacion also contract security services with the private sector” to control illegal occupation.

This is disturbing because of the fact that recently, local non-violent protesters were brutally beaten by private security forces (hired by EBY) wielding lead pipes, sending 22 people to the hospital. 3,000 people had gathered to protest EBY’s failure to mitigate the suffering from frequent flooding. Given the recent use of violence against protesters, it is chilling that the Bank is calling for greater use of security without informing the Board of the true situation on the ground.


What we need you to do

Please take half an hour to write to your Executive Director to demand Board action on these two projects. Last fall, we sent out via email the contact info for each ED, including phone, fax, email, and the countries each ED represents.

Letters to EDs should ideally call on the Board to take action on both Yacyreta and Singrauli, and to publicly announce what steps it is authorizing to remedy the policy violations and rehabilitate the local people and the environment. In both cases, the Board now has ample evidence of the deteriorating situations on the ground, combined with a complete lack of trust by the local communities of either the Bank or its borrowers, due to human rights abuses in Singrauli and Bank Management lying to thepublic in Yacyreta.

The Inspection Panel reports in both cases confirmed significant policy violations which require a remedy. For a remedy to be effective, it must involve (1) the participation of the local people and (2) evaluation and oversight by the Inspection Panel. The trustworthiness and independence of the Inspection Panel is critically important to making progress on these issues — it provides an independent forum that local people can trust, and it will provide the needed incentive for Bank staff to implement effective reforms in compliance with Bank policies and responsive to the claimants. The Panel also provides an impartial source of information and evaluation for the Board.

Specific points to highlight include the following:


  • accountability/restitution for the well-documented human rights violations;
  • attention to the documented R&R failures in Singrauli;
  • respect for those communities that are refusing to shift absent effective R&R (which requires that construction of the ash dikes stop);
  • allowing the Inspection Panel to visit Singrauli to conduct a full investigation of the claim; and allowing the Inspection Panel to evaluate the effectiveness and quality of the Action Program for Singrauli


  • demanding that the Bank publish in the Paraguayan press a retraction of the lies in Ms. Guerrero’s letter;
  • a re-design of the Yacyreta Action Plans in a participatory manner that involves the claimants and other affected people, in compliance with Bank policies;
  • a continued role for the Panel to ensure that participatory and effective
    Action Plans are designed and implemented.

Without outside pressure, it is unlikely that the Board will act to remedy the policy violations identified by the Panel. This remains a stumbling block to accountability, and it is an important test of the Inspection Panel process. It is time for the Board to live up to its responsibity and fix the problems in these projects. We especially urge concerned citizens from borrowing countries to make their views known to their Executive Directors and urge them to support the claims and work to make the World Bank more effective as a development institution. Please don’t hesitate to contact us if you have any additional questions.