6 September 2007
The Wall Street Journal has leaked a 2005 report by the World Bank's Department of Institutional Integrity (INT) that documents consistent fraud and corruption under Bank-financed health care projects in India.
An editorial published on September 4, by the Wall Street Journal (WSJ) states that, "Senior bank officials are especially eager to discredit, and if possible deep-six, a forthcoming internal report on corruption in a major bank-supported health care project in India." According to the WSJ, it is one of a series of reports by the Bank's own Department for Institutional Integrity (INT), its anti-corruption unit, which Bank officials are eager to suppress.
The report dates back to 2005 and documents the results of INT's multi-year investigation into the procurement of pharmaceuticals and kitting (packaging of pharmaceuticals) under the Bank-financed Reproductive and Child Health (RCH 1) project in India. INT's investigation found that two India-based firms, Nestor Pharmaceuticals Ltd. (Nestor) and Pure Pharma Ltd. (Pure Pharma), collaborated to receive a majority of the funds from the project; consistently engaged in bribery of government officials and procurement support agencies; falsified performance certificates; and coerced other companies. The companies also provided substandard drugs. The companies were awarded a total of $73.4 million from the RCH 1 project and its preceding project, the Child Survival and Safe Motherhood Project.
In July, the INT announced that the two companies were found to have engaged in "collusive practices" and have been disbarred from receiving Bank funds; Nestor has been debarred for a period of three years, and Pure Pharma for one year. The Bank has yet to make any decisions on the INT's recommendation for it to restructure all its health-sector projects in India.
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