Maharashtra spurns World Bank, looks for love in Tokyo
Smita Deshmukh
WB loses most preferred status, Vilasrao woos Japan funds.
The honeymoon is over. World Bank will no longer be the state government’s “most preferred bank”.
Upset with the bank’s “illogical” policies on rehabilitation and resettlement, the government has decided not to borrow money from the bank. The state’s next preferred partner is Japan, along with some Indian financial institutions.
In fact, loan for several infrastructure projects in the city is likely to top the chief minister’s agenda during his visit to Japan next month. He will hold talks with the Japan Bank of International Cooperation (JBIC).
The government has also decided against borrowing from the World Bank for the Mahatma Gandhi Pathkranti Yojana, which will relocate pavement dwellers in the city to low-cost houses. The government decision means the Mumbai Urban Transport Project (MUTP) will be the last big project with the World Bank’s involvement.
“It was our oversight that we signed an agreement, which said those displaced can’t be worst off. Technically, we are safe as the policy is not applicable to shopkeepers, something which the bank is not willing to accept,” said a senior bureaucrat.
The government is miffed over the bank’s policy of sending inspectional teams to rehabilitated areas. “The panel members ask questions from people who are eager to get more resources and report directly to the bank’s board. There are many within the bank who are aware of the negative fallout of a policy like this, but are helpless,” said another official.
“The bank wants us to deal with each case separately and on merit, which is tough when hundreds of people have to resettled. They (the bank) want us to allow their officials to be present during negotiations with the displaced people, which is totally unacceptable,” the official said. Under such circumstances, the JBIC’s policy of sticking to the local government’s policies on rehabilitation is more acceptable.
As for the World Bank, the polices remain unchanged. Hubert Nove-Josserand, senior urban transport specialist of the bank, said, “We sent a consultant to Mumbai in March to assist in the monitoring of progress in all key actions the bank is looking for in the resettlement plans.”
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