The Indian Government's decision not to use World Bank money to build the Sardar Sarovar (Narmada) Project was a victory for Indian environmentalists and human righters. The Bank heaved a sigh of relief, as questions on the environment, equity and resettlement of "oustees" had made the project an albatross that promised endless public embarrassment. Better to bail out from this one and continue with projects elsewhere in the Bank's, realm.
It is business as usual for the Bank elsewhere in South Asia, though, particularly where there are no groups with the singlemindedness, media savvy and grassroots reach of the Narmada activists. Nepal's Arun III Project, for one, has no Medha Patkar. And Bradford Morse will not come out of retirement to do another evaluation (as he did for Narmada) on a project which all but a handful hope will slip through while no one is watching.
The World Bank has pushed the Arun III under the fig leaf of its "Least Cost Generation Expansion Plan", which in 1987 passed judgement that this was the only project in Nepal that was ready for implementation. A "no option trap" was set, and despite Prime Minister Girija Prasad Koirala's allergy to the Bank when he took office, the Nepali Congress Government has walked straight into it. The communist opposition, which has maintained such a barrage over the Tanakpur case, has been strangely silent, possibly because the eastern hills of Nepal, which includes the Arun river basin, is a Left stronghold. A boondoggle is a boondoggle. A Left parliamentarian who questions the project confessed, "Our voter strength is in the east, so we cannot openly oppose Arun. Sadly, we do not have enough representatives from the West of Nepal."
Then there are the commission merchants as not-so-silent partners. A 10 percent kickback is accepted even by officials as the minimum for a project like Arun. Which means that the Baby Arun agents could make off with U$ 70 million, the sort of money that rarely makes an appearance in bulk in Nepal. This was what got Nepal into the no-option trap in the first place.