The complaints of the affected communities of the proposed Vizhinjam International Deepwater Seaport project raise “potentially significant concerns about the environment and social (E&S) impacts” of the International Finance Corporation (IFC) initiated Advisory Services (AS) project to support the State.
The complaints also raise questions about the application of IFC’s E&S requirements to the advisory services project, the CAO (Office of the Compliance Advisor Ombudsman), an independent post that reports directly to the World Bank Group, has stated in “Compliance Appraisal: Summary of Results.” The compliance appraisal was published on June 1 before the Cabinet gave its nod on June 10 for the sole bid submitted by Adani Ports and Special Economic Zone Ltd (APSEZ) for the project for executing on PPP mode partnering the State.
The complaints were filed in 2012 and 2013 by a representative of Kerala Hotels and Restaurant Association, a former representative of Fisheries Department and social activist, Kerala Swatanthra Matsya Thozhilali Federation, and 14 residents of Muloor village located near the project site. All the three complaints were considered in the compliance appraisal due to the related nature of issues raised.
The CAO has raised questions as to the robustness of the cost benefit analysis carried out by IFC consultants and the extent to which the analysis considers the project’s impact on the livelihood of the communities in the immediate vicinity.
Ongoing involvement
The CAO noted that IFC had no “ongoing involvement” in the project. However, any future exposure to the construction of the port, either directly or through a financial intermediary, would be of relevance in the context of the compliance mandate.
The CAO decided to conduct a compliance investigation of IFC’s E&S performance in relation to this AS project. The terms of reference for this compliance investigation will be prepared in accordance to CAO’s operational guidelines. In October 2012, Scot T. Adams, Ombudsman at the IFC, visited Vizhinjam to study the complaints relating to the IFC’s role in setting up a deepwater port and to hold discussion with the stakeholders and others.
The AS project extended to the preparation of environmental and social impact assessment documentation required for the project to get clearance from the Union Ministry of Environment and Forests. The task was completed by IFC in March 2013. IFC’s role also included marketing the project to potential bidders in the country and abroad.
