21 August 2009
Money for urban infrastructure in India is being spent on megaprojects that benefit only a tiny, wealthy minority of the population, while access to basic services like clean water and health facilities remains rare. A new report by Vinay Baindur and Lalitha Kamath shows how governance of the World Bank and Asian Development Bank allows privileged access to money for some while the poorest are left in the dust.
For immediate release
Report seeks greater accountability in urban infrastructure projects
Mumbai, August 21: "In Mumbai, fifty percent population lives in slums and on footpaths. They have no proper access to urban services and many deemed ineligible for those services. Yet, the government has secured huge loans to finance Mumbai Metro Rail and MUTP from the World Bank worth 1000s of crores - projects which will serve only a fraction of the population. How can such mega infrastructure projects be justified when majority of Mumbai's citizens remain deprived of basic services such as proper sanitation, water supply and public health facilities?" asked Lalitha Kamath, one of the authors of the report 'Reengineering Urban Infrastructure: How the World Bank and Asian Development Bank Shape Urban Infrastructure Finance in India' published by Bank Information Center (BIC).
She was talking to the media after the release of the report along with her co-author Vinay Baindur. Noted economist Ajit Ranade released the report in a program jointly organized by Ghar Bachao Ghar Banao Andolan, Focus on Global South, Youth for Unity and Voluntary Action and Bank Information Center.
The report unpacks the key mechanisms, strategies and processes the IFIs have used to build agreement with their policies among government, donor and corporate circles. It also throws light on the ways in which the state (Union and State Governments) has accepted and actively advanced a policy programme for an urban reforms agenda that privileges private sector participation in urban infrastructure. Of focal importance is the role played by the Jawaharlal Nehru National Urban Renewal Mission (JNNURM), the Union Government's flagship urban development programme, which promotes Public Private Partnerships (PPP) as a means for financing and delivering infrastructure for 63 cities across the country.
JNNURM gives more importance to infrastructure creation over maintenance of completed projects, and adherence to reforms over accountability for performance. "JNNURM has a dismal record of very few (only 10%) completed projects, limited local capacity to spend funds and tremendous delays and cost overruns. Despite these low levels of achievement, Government of India is already proposing to launch JNNURM Phase II for all towns having a 5-10,000,000 population and there is a proposal to take additional Rs 25,000 cr loan from World Bank for JNNURM Phase I, without a transparent process of performance review. This is a matter of grave concern to us," said Jelson Garcia, Asia Manager of Bank Information Center.
The report reveals that the market model procides a blueprint for building infrastructure that meets the interests of IFIs, and select groups inside and outside og government. Convenced of the value of this approach, these groups unceasingly propagate it without sufficient scrutiny of how this approach unfolds on the ground and the impacts on local groups. Failure to consider alternatives to this policy framework is particularly serious in view of the fact that performance on the ground (in terms of number of projects completed on time, and with inclusive outcomes) has been far from satisfactory.
"Today, the global finance capital that is being invested in the Indian cities is invariably leading to displacement of unprecidented numbers and Mumbai is a classic example of the same, with the opening of doors for international finance & institutions like the World Bank; in a short period of 5 years more than 4 lakh people had to be displaced, undermining and violating their human & constitutional righta and anti-people decisions like the repeal of ULCRA aggravated the violations," said Simpreet Singh, activist of Ghar Bachao Ghar Banao Andolan.
The report stresses the need for greater and more rigorous examination of the outcomes of PPP projects, through studies by independent researchers/institutes and social audits by community groups. Such a grounded understanding could lead to sustained pressure for greater debate and reflection on the current trajectory and implications of urban reforms.
"The massive urban infrastructure projects driven by private capital has resulted in human rights violation of the urban poor, particularly in housing and livelihood in the city. The World Bank's continued apathy towards the vulnerable people who were displaced in Bank funded projects make the Bank an acquiescent in the violations," said Maju Varghese, Housing Rights Coordinator of YUVA.
The World Bank (WB) and the Asian Development Bank (ADB) have played an especially important role in building the ideological foundation for this policy shift. Underpinning their ideology is the notion og decentralization as a "narrative of capital" which practically translates to creating 'incentives' for cities to take loans from financial markets, thereby breaking the dependence of cities on higher levels of government for funds, and creating a "market-friendly" role for governments and civil society organizations.
"The convergence of the views of the Government with the World Bank's Country Assistance Strategy and the Asian Development Bank's Country Strategy Paper was evident when Parliament sanctioned the JNNURM in 2005 based on precisely these strategies. And in spite of the absence of the Ministry's review of the mission so far, more funds have been allocated in the recent bedget towards infrastructure initiatives under JNNURM," said Sarita Reamamoorthy, Research Associate at the Focus on Global South.
The report is divided into two parts. Part I looks at the role IFIs are playing in shaping urban infrastructure finance and governance policy in India and the approaches that have been used to gain the 'buy-in' of government officials in the three tiers of government. Part II focuses on the impact this has on municipal government and basic services for the urban poor. The concluding section sums up the analysis and provides some thoughts to consider for the future.
read the report
Reengineering Urban Infrastructure: How the World Bank and Asian Development Bank Shape Urban Infrastructure Finance in India, by Lalitha Kamath and Vinay Baindur, Bank Information Center, August 2009 (PDF 490 KB)
contact:
- Simpreet Singh, Ghar Bachao Ghar Banao Abhiyan
Cell: 9969363065
- Sarita Ramamoorth, Focus on Global South
Cell: 9819176548
- Maju Varghese, Youth for Unity and Voluntary Action
Cell: 9869798976
- Joe Athialy, Bank Information Center
Cell: 987115377
About the organizations
Ghar Bachao Ghar Banao Andolan is a social movement of slum dwellers & un-organized sector workers of Mumbai. It is involved in the struggle for transforming Mumbai into an inclusive city with a firm belief in the constitutional framework
Focus on Global South (www.focusweb.org) is a policy research organization based in Asia (Thailand, Philippines and India). Focus provides support to social movements and communities in India and the Global South by providing research and analysis on the political economy of globalization and on the key institutions underlying this process. Focus' goals are the dismantling of oppressive economic and political structures and institutions, the creation of liberating structures and institutions, demilitarization, and the promotion of peace.
Youth for Unity and Voluntary Action (YUVA - www.yuvaindia.org) is a voluntary development organization, founded in 1984, to create access and enable process to a gamut of rights and opportunities for the marginalized within the human rights framework. YUVA's mission is to empower the oppressed and the marginalized by facilitating their organizations and institutions towards building equal partnerships in the development process, and ensuring the fulfillment of the human right to live in security, dignity and peace.
Bank Information Center (BIC - www.bicusa.org) partners with civil society in developing and transition countries to influence the World Bank and other international financial institutions (IFIs) to promote social and economic justice and ecological sustainability. BIC is an independent, non-promit, non-governmental organization that advocates for the protection of rights, participation, transparency and public accountability in the governance and operations of the World Bank, regional development banks, and the IMF.