Assessment Report does not understand the complex issues and is unfairly protective of the company
Disappointing. This is how we, members of the Machimar Adhikar Sangharsh Sangathan (MASS – Association for the Struggle for Fishworkers’ Rights) see the assessment report of the Compliance Advisor Ombudsman (CAO) on our case against Tata Mundra coal power project. One, CAO fails to understand the deep-seated issues we raised in our complaint. Two, its Ombudsman goes out of the way to justify the company for its omissions and violations.
An assessment begun in August 2011, the report projects, us, the complainants as adamant and unreasonable; that we are not prepared to enter into a collaborative process of dispute resolution. For us, this finding indicates that CAO has fallen into the sweet talk and PR of the company, whose track record in many other projects in the country is notoriously dismal.
The report cites CAO’s view that a collaborative process may have been helpful in this case to address many of the concerns. Had we engaged in an open dialogue, CAO reports, the company could have enhanced benefits such as provision of health and schooling services for fishing communities. This is a very myopic view and a simplistic solution to the complex problems the company has brought to us. The report is also profoundly silent about the violations we have raised in the complaint.
We had pointed out in our complaint the absence of cumulative impact assessment; IFC and its client’s failure to recognize fishing communities as affected population; and the absence of environmental clearance for in-take channel, conveyer belt, port and railway line (all being shared with the adjacent Adani project), and for the open cooling system. CAO purposefully ignored to mention these issues in its report. We do not think CAO fully understands the issues we brought to their attention.
In the report, CAO has not failed to mention that some fishworkers are satisfied with what the company has compensated them, without remembering that the complaint was from the aggrieved communities and not the other. We believe CAO should have covered in its assessment the other adversely impacted people, like the farmers, shepherds/ cattle herders, whose lands have been usurped for the project and the other externality costs.
CAO’s utter failure to accurately assess the broad concerns in our complaint and to ensure a conducive mediation process is disappointing. We hope that the compliance process will be more prudent, objective and forthright in looking at the issues that we have raised, particularly in the context of the poor assessment report, the long-term harms this project has created, and the multiple policy violations.
Hard decisions must be taken to save threatened communities and the marine and land resources from the long-term havocs of the coal power plant. There must be a full audit, not just a desk-based review from distant experts, and ToR for the audit must be disclosed.
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Additional information
In June 2011 Machimar Adhikar Sangharsh Sangathan (MASS – Association for the Struggle for Fishworkers’ Rights) sent a complaint to the Compliance Advisor Ombudsman, the recourse mechanism at the International Finance Corporation, of the World Bank Group. The complaint now moves to the compliance arm of the CAO, after the Ombudsman has submitted the assessment report.
The complaint emerged to hold IFC accountable for co-financing the 4,000 MW coal-based Tata Ultra Mega Power Plant. Lodged by fishing and farming villagers, the complaint claims that due to flawed design and execution, including breaches of mandatory client obligations, the mammoth coal-fired power plant is contributing to the destruction livelihood of thousands of families and will cause irreparable damage to their fragile marine resources and agriculture.
With a total project cost of US$ 4.14 billion, the IFC is investing a $450 million loan and $50 million in equity. Other financial institutions funding the project are the Export-Import Bank of Korea, Asian Development Bank, India Infrastructure Finance Co. Ltd., Housing and Urban Development Corporation Ltd., Oriental Bank of Commerce, Vijaya Bank, State Bank of Bikaner & Jaipur, State Bank of Hyderabad, State Bank of Travancore, the State Bank of Indore and other local banks.
As the plant is located in the special economic zone (SEZ) that cuts across fishing grounds, habitat of diverse marine lives and wide expanse of farm land, complainants state that the project’s social impact assessment is significantly flawed. Fishing communities were excluded from the list of those directly impacted; the major damage and potential loss of their livelihood was deliberately overlooked.
On the economic side, the recent Indonesian government’s revision of its coal export pricing structure effectively doubled prices. This revision has immediate and severe impacts on the Tata Mundra plant. Tata Power Managing Director has said that it could become a “non-performing asset” and began actively lobbying the Indian government for a tariff revision as well as a diplomatic push to get the Indonesian government to revise its pricing structure. Whatever happens on the tariff front, if all costs are taken into account, including the huge social and environmental costs, we believe that the project can never be economically viable.
