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November 07, 2013

Grassroots Activists Across the Globe Condemn World Bank President’s Continued Support of Tata Mundra Coal Plant

Photo credit: BIC

After a yearlong investigation, the Compliance Advisor Ombudsman (CAO), the independent accountability mechanism at the World Bank Group’s International Finance Corporation (IFC), issued a damning report that found serious lapses in the IFC’s $450 million loan for the 4,000-megawatt Tata Mundra coal-fired power plant in Gujarat, India.

The CAO report upheld the complaints of local fishing communities, which have been struggling with severe health effects and the loss of livelihoods due to the project. But instead of withdrawing from the Tata Mundra power plant, or at a minimum, offering reparations to residents and drafting a rehabilitation plan, World Bank President Dr.  Jim Yong Kim abandoned his obligation to the affected communities and instead signed off on a response – written by the same people who approved the project at the IFC – dismissing the CAO findings.

Today, 68 groups from 28 countries across six continents sent a letter to Dr. Kim condemning the World Bank Group’s continued support for the deadly project. This action comes on the heels of a letter from over 100 groups in India demanding that the IFC withdraw from Tata Mundra.

Click to enlarge. Photo credit: BIC

Dr. Kim has made numerous public statements on his commitment to public health and fighting climate disruption, charging the World Bank to learn from past mistakes, but this decision flies in the face of his claims and shows the system for accountability within the institution is broken. The CAO found clear violations within the IFC, but instead of addressing the problems, Dr. Kim allowed them to be swept under the rug – and the fishing communities in Gujarat are forced pay the price.

Moreover, Tata Mundra is a failing project. Even its backers admit it is running at unsustainable losses. When the project was proposed, Tata Power argued the local impacts were justified because it would provide power for the poor, but this has proved to be a lie. Instead, the company is asking to raise rates for consumers, putting the price of electricity beyond the reach of the people it was supposedly built to help. Unfortunately, this is hardly surprising. According to the International Energy Agency, if we are ever going to reach 100 percent energy access, over half of services must come from off-grid sources. This means we must start making serious investments in clean, off-grid renewable energy that we can deploy today, without poisoning the air and water, instead of continuing to support centralized coal projects while waiting on costly grid extensions that may never happen.

The overwhelming response from groups throughout India and the world shows that the call to move from coal to clean energy is not an isolated drive, but rather a global movement that is gaining momentum as communities band together to demand their right to clean air, drinkable water, and access to land and livelihoods. It is time to abandon once and for all the notion that coal is inevitable and unquestioningly welcomed in places like India, and that it is acceptable to sacrifice local residents to coal development. It’s time, Dr. Kim, to hold the World Bank Group accountable for its failures and withdraw from the dangerous Tata Mundra project.

--Nicole Ghio, Representative, Sierra Club International Climate Program


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