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November 10, 2000

Mr. James Wolfensohn
The World Bank
1818 H Street, NW
Washington, DC 20433

Subject: World Bank's Responsibility for Sardar Sarovar Project

Dear Mr. Wolfensohn,

We are writing as organizations that have long been involved in monitoring the Sardar Sarovar Project (SSP). On the occasion of your visit to India, we wish to point out the continuing plight of people affected by SSP and to call on the Bank to assume its obligations to the people of the Narmada valley.

As you are aware, the Indian Supreme Court recently authorized continued construction of SSP despite major unresolved issues on resettlement, the environment and the project's costs and benefits.

The Government of India is still legally obligated to meet the terms and conditions in its loan and credit agreements with the Bank on SSP despite the Bank's withdrawal from the project in 1993 (refer to Memo from Ibrahim F.I. Shihata to D.J. Wood, March 30, 1993). These obligations were reiterated in India Country Director Edwin R. Lim's November 19, 1999 letter to Both Ends and International Rivers Network where he stated that "the Bank has in the past and will continue to urge the Government of India to meet its obligations regarding the people affected by the Sardar Sarovar Project."

The problems that plagued the project before the cancellation of the Bank's loan remain unresolved. The Bank approved its $450 million loan for the project in 1985 despite glaring violations of its own guidelines concerning resettlement and the environment. According to the Bank-sponsored Morse Report, "In 1985, when the credit and loan agreement were signed, no basis for designing, implementing, and assessing resettlement and rehabilitation was in place." The Bank approved the loan without knowing how many people would be displaced or consulting affected people. Even to this day, no credible resettlement plan exists and no survey has been completed for villages affected by the reservoir's backwaters.

To make matters worse, government officials, including the Chief Minister of Madhya Pradesh, have stated that there is no land available for resettlement in Madhya Pradesh or Maharashtra. Villages that have been resettled have been scattered among different resettlement sites in blatant violation of the 1979 Narmada Water Disputes Tribunal Award and the Bank's loan and credit agreements.

The rights of people affected by the project for reasons other than submergence continue to be violated and ignored by project authorities. People who will lose land or livelihood due to the project's irrigation canal, compensatory afforestation, wildlife sanctuary, construction colony and other dam-related infrastructure are not currently entitled to rehabilitation. People affected by the construction colony have yet to be resettled even though the need to resettle them was recognized in the Bank's 1985 Staff Appraisal Report. Canal-affected people have not received proper compensation packages as stipulated in Bank conditions issued after the Morse report was published.

Furthermore, no environmental impact assessment has ever been produced for SSP. The Bank approved its credit and loan for SSP despite the lack of a comprehensive environmental assessment and the fact that the environmental clearance required under Indian law had not been granted.

Further construction of the Sardar Sarovar Project will have grave consequences. The Bank has already accepted its responsibility to ensure that its loan agreements are complied with. We call on the World Bank to turn its words into action and ensure that the Government of India meets its obligations to the people affected by the Sardar Sarovar Project. Until then, the Bank should suspend all further disbursements or approvals of new loans for Gujarat, Madhya Pradesh and Maharashtra.


Patrick McCully,
International Rivers Network

This letter is also endorsed by the following organizations.

  • Melanie Gillbank, AID/WATCH, Australia
  • Peter Bosshard, Berne Declaration, Switzerland
  • Alex Wilks, Bretton Woods Project, UK
  • Soren Ambrose, 50 Years Is Enough: U.S. Network for Global Economic Justice, USA
  • Tonje Folkestad and Elisabeth F. Olsen, FIVAS (Association for International Water and Forest Studies), Norway
  • Ikuko Matsumoto, Friends of the Earth Japan, Japan
  • Subbu Sastry, Preeti Sampat, and Subbu Vincent, Friends of River Narmada, USA
  • Patricia Adams, Probe International, Canada
  • Antonio Tricarico, Reform the World Bank Campaign, Italy
  • Himanshu Thakkar, South Asia Network on Dams, Rivers and People, India
  • Heffa Schuecking, Urgewald, Germany