an inter press service feature

amsterdam, sep 10 1993 (ips) - next week the world bank will ask donor governments for more money to combat environmental problems like global warming, but activists say that this is a farce.

weeks ago, the bank approved a loan for a project that will be the single largest new contributor to global warming.

government representatives will be gathering in washington dc to attend a meeting convened by the world bank controlled global environment facility (gef).

the purpose of the meeting is to ask for between two billion and four billion dollars in new funds to combat issues like global warming, pollution of international waters and protecting the diversity of the planet's animal and plant species.

it will take place days before ministers of finance from almost every country gather in the same city for the annual meeting of the bank and the international monetary fund.

but activists like the u.s.-based environmental defence fund (edf) say that the money, which is intended for small projects over the next five years, will not even be able to compensate for the effects of a loan that the bank made earlier this summer for a massive new series of coal-fired electricty plants in india.

this june the bank's board of directors approved the first of a series of new loans to india to build up coal-fired electricity generating capacity.

the loans are intended to finance a doubling of india's burning of coal for energy production.

taken together activists estimate that the new projects will add the single biggest new source of greenhouse gas emissions on the entire planet. edf estimates that it will add 23 percent to india's carbon emissions (1989 figures) and four percent to the global carbon emissions total.

the first loan, which will give 400 million dollars to the national thermal power corporation (ntpc), to finance the first stage of a gigantic, multi-billion dollar investment plan to intensify coal mining and expand coal-fired production of electricity in nine super thermal power plants all over india.

the bank loan will build 2,000 mw of capacity and future loans will support an additional 6,000 mw of capacity through 1997. after 1997, plans call for an additional 8,000 mw of capacity. (more/ips)

environment: world bank to pay for global warming disaster(2)

not only will this new capacity add significantly to global warming, the activists say that this is a clear contradiction of the bank's own studies of india's power needs that were conducted two years ago.

the bank issued a paper entitled 'long term issues in the indian power sector' that said increased emphasis needs to be placed on improving the efficiency of supply, consumption and pricing of electricity.

it added that supply capacity expansion alone will not substantially improve the critical power demand/supply situation and is likely to be financially unsustainable.

worse still the new loan also allocates virtually no funds for compensating and rehabilitating 140,000 indian people forcibly resettled by these related bank projects.

bruce rich of the edf said that a full environmental action plan for the blighted area is supposed to be based on public consultation and disclosure but even members of the bank's own environmental department have not been allowed to see it by the india country department of the bank.

finally rich points out that previous bank missions to the badly hit area of farakka have shown that the ntpc's statements that it had complied with existing environmental and resettlement policies were ''in fact, untrue''.

rich says that this is exactly the opposite of what it promised to do when it set up the gef and even lent money to india for alternative energy projects. only eight months previous to the ntpc approval, the gef had approved a 30-million dollar grant to india for a ''non-conventional energy project''.

the loan is also expected to add significantly to india's foreign debt, which currently stands at 70 billion dolllars. some of this is due to previous bank loans for similar projects -- the bank has made a total of 36 energy sector loans to india that total 6.8 billion dollars and 19 credits that amount to 2.4 billion dollars.

in the bank's july monthly operation summary, the bank listed the ntpc project as the second most expensive currently under consideration for india (after a 478.6 million dollar loan to the ministry of finance).

activists say this huge cost is precisely why india should be looking into cheaper alternatives.

''the issue is not whether the world bank should finance more loans to the ntpc -- but how the international community can help india meet its power needs with less expensive and more environmentally friendly alternatives.

''india cannot afford business as usual in the energy sector," said karan capoor, an edf policy analyst.(more/ips)

edf's complaints have drawn attention to the project although it hasn't stopped it.

the united states and belgium abstained from the june vote and after the vote, susan levine, a u.s. treasury official wrote to rich to explain why they abstained and what they hoped to do in the future.

levine said that the united states was concerned about the issues that he had raised -- resettlement and rehabilitation, lack of consideration of demand side management and energy efficiency measures, greenhouse gas emissions, impacts of increased coal mining etc.

''we therefore decided to abstain on the project, while making clear that u.s. support for future loans to ntpc will be contingent on certain objectives being achieved,'' wrote levine.

but the bank is unlikely to talk about this 400 million dollar power loan at the gef meeting next week. instead it will focus on the small projects like the 30-million dollar alternative energy project. it also plans to hold another two meetings later this year to wheedle the money out of governments. (end/ips/en/pc/mf/93)

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