In the first such case in India,the Compliance Advisor Ombudsman (CAO) has recommended for a compliance audit of $450 million investment by the International Finance Corporation (IFC),private lending arm of the World Bank,in Tata Powers ultra mega power project (UMPP) in Kutch district of Gujarat to see if internal guidelines of IFC was followed while making the investment. Tata Power,while responding to The Indian Express queries,said,There seems an ulterior motive behind targeting corporate citizen like Tata-Mundra UMPP which will meet 2 per cent of India power requirement once fully commissioned and reiterated that it has fully complied with the norms. The CAO,an independent arm of the IFC and the Multilateral Investment Guarantee Agency of the World Bank Group has been conducting a compliance appraisal for the last one year and has recommended,in an yet to be released Appraisal Report,a copy of which is assessed by The Indian Express,that further inquiry is required to see if IFC exercised due diligence in reviewing the projects environmental and social assessments and regulatory and lender requirements. Having reviewed the complaint and related documentation CAO concludes that a number of issues raised by the complainants merit further enquiry. Thus,in accordance with its operational guidelines,CAO will develop terms of reference for an audit of IFCs social and environmental performance, the report said. CAO initiated the appraisal following a complaint from local fishermen group Association for the Struggle for Fishworkers Rights that the project adversely affect local fisher folk and challenged the quality of environment and social impact assessments and adherence to Indian law. The IFC spokesperson in an emailed response said,IFCs investment in the project was made as part of an ongoing broader program to address Indias significant demand for electricity. The power outages this past week bring to bear Indias severe energy shortage. According to the CAO website,its appraisal process is underway. We respect the CAOs process and will continue to provide all facts and details as required by the CAO. Coastal Gujarat Power Limited (CGPL),a $4.14 billion project is a fully owned company of Tata Power with a capacity to over 400 MW. The first of its five 800 MW units was commissioned on March this year and the second unit is due this month. Tata Power in a statement further said,Mundra UMPP project strictly abides by stipulated norms for its operations including environment,community engagement and ecological impact and we are confident that we have no non-compliance issue.
