WHOSE WORLD IS IT AFTER ALL?

Can multilateral banks usher in equitable and sustainable development in South Asia?

I know many who can read words and many, like me, who can only read the land. Both are important. We are not backward or less intelligent: we live in exactly the same up-to-date year as you. I was going to say we all live under the same stars, but no, they're different, and there are many more in the Kalahari. The sun and moon are the same.”
— Roy Sesana, acceptance speech, The Right Livelihood Awards 2005.

When Lalani Chandrika cries, her tears say it all. Chandrika was chased out from her ancestral home in Sri Lanka. And along with it she lost her children, as well as her identity. The reason for her condition is not the ethnic strife. But a project of the Asian Development Bank (ADB) that has displaced thousands of people in the country. She was promised compensation, but ended up getting little. She believes that the bank did not follow its own guidelines while disbursing compensation. Her children are now scattered across the country.

Chandrika is not alone. Local people in Nepal have also been opposing many projects due to various reasons. “The World Bank pulled out of a hydroelectricity project because the inspection panel found gross violations with regard to the environment and the rights of indigenous people,” says Prabin Man Singh of Water and Energy Users’ Federation-Nepal. Many projects in the kingdom have since been abandoned. Not surprisingly, the cost of water and electricity has shot up in many areas. In Bangladesh, projects to embank the country’s many rivers have led to breaches and heavy loss of life and property. The experience of multilateral projects in India has also been the same. Whether it is the Sardar Sarovar or Tehri dam, they have been greeted with protests and have led to the displacement of millions of local people. Stifled voices such as Chandrika's made a refreshing appearance at a recent meeting of the Bank Information Center in Delhi, where participants made some interesting observations on the developmental effectiveness — or ineffectiveness — of Multilateral Development Banks (MDBs) in South Asia.

Growing inequities
Walden Bello, executive director of Focus on the Global South, once said that MDBs believe that development can best take place in a free market economy where governance systems are weak. “They (MDBs) have slowly tuned the bureaucracy — the permanent arm of the government — and trained them,” says Ravi Revapragada, of Samatha, an Andhra-based NGO. The displacement of people due to such projects is because of an insensitive bureaucracy, which has allowed itself to become an agent for a new paradigm of development. A model that is throwing up more inequities in developing countries and is clashing with traditional and time-tested local economies. Soon there could be a ground swell against such projects, adds Ravi.

The conflicts are primarily over access for natural resources — land and water. In the rural economies of South Asian countries, land and water play a critical role in the livelihood of marginalised communities. When communities are displaced due to big projects, they not only lose their lands, but also their livelihoods. Not surprisingly the buzzword for compensation packages of MDBs is relocation, not rehabilitation. Maybe that’s why Chandrika cannot stop wailing as she feels like an orphan in her own country.

Poverty of ideas
“MDBs usually have one development model for all countries. But they must understand that every country is unique. So they need to sensitise their developmental models to suit local concerns. They also need to create open spaces for people to create their own models,” says Neil Tangri, who is with the Center for Economic Justice.

In their attempt to eradicate poverty, many projects in Asian countries have widened the rich-poor divide, maybe unwittingly. Some experts believe that MDBs have been moving community resources from the poor to the wealthy sections of society. And that’s what makes local people hostile to any developmental idea. “MDBs cannot claim credit for reducing India’s poverty. India has been slowly reducing poverty since Independence. If you look at countries like Kenya, Argentina, they have reduced poverty without much help from MDBs. The same is the case with China, South Korea and Taiwan. MDBs have been moving resources from the poor to the wealthy sections of society,” says Tangri. This has also led to a crucial shift in power.

The problem with MDBs is that they are not directly answerable to the government. In some cases, the banks have acknowledged how their own rules have been violated at the ground level while implementing projects. There is also the issue of corruption: funds meant for projects often siphoned off by implementing agencies. According to some estimates, the World Bank has lost around 25 per cent of money since 1944 due to inadequate monitoring mechanisms. Analysts say that while governments and civil society must work closely with MDBs, local institutions and voices of the marginalised must also be understood. Panchayati Raj institutions in India, for instance, can make development and governance more participatory and equitable. Maybe MDBs need to listen to the voices such as that of Chandrikas to make development truly sustainable.

(New Indian Express, February 23, 2006)