Joining hands: Members of the Peoples Forum say hands off to ADB

Taking stock: Over 3,000 delegates and 65 FMs converged at Hyderabad

ADB's Kuroda: Willing to change

HYDERABAD, ANDHRA PRADESH
May 3-6

Seated on a plastic chair under a makeshift canopy, Bruce Rich is trying to explain what he thinks is wrong with the Asian Development Bank's (ADB) development model. "The problem is," says the Director (International Program), Environmental Defense, a Washington-based NGO, "particularly for a country like India, the model of development that ADB is pursuing and financing does not directly help or benefit the poor. In fact, often times, in the short term, it makes them worse off directly through displacement and so on." Unmindful of Hyderabad's sweltering summer, Rich and about 100 protesters like him have flown in from different parts of the world to highlight the flipside of development initiatives of multilateral agencies such as ADB.

Neither the timing nor the choice of venue of Rich & Co., gathered under a loose confederation of NGOs called the Peoples Forum Against ADB, is incidental. About 25 km west from where 1,000 delegates (including a 100 from abroad) are powwowing, ADB is holding its 39th AGM at the state-of-the-art Hyderabad International Convention Centre, where I was earlier this morning. Some 3,000 delegates and finance ministers from 65 countries-including India's P. Chidambaram-have gathered here and will be spending the following four days talking about development and inclusive growth.

For ADB President Haruhiko Kuroda, the meeting hasn't begun on a cheerful note. A Greenpeace activist from Thailand, Tara Buakamsri, had earlier in the day sent a bowlful of dirty coal as a gift to Kuroda. His point: Each year, the lignite burnt at the ADB-funded power plant at Mae Moh in northern Thailand releases into the air an estimated 1.6 million tons of acidic sulphur gas, which has blackened streams, burnt rice fields and resulted in severe health problems for countless villagers. "Over the past 20 years," says the 39-year-old Buakamsri who delivered the 'gift', "the bank has approved a series of loans totalling more than $350 million to build supplementary units at this plant, which is South Asia's largest coal-fired power plant."

"The model of development that ADB is pursuing and financing does not directly help or benefit the poor, particularly in India" Bruce Rich Director, Environmental Defense

Clean energy is a focus area for NGOs like Greenpeace not only because of its immediacy, but also because the next ADB annual meet is to be held in Kyoto, Japan, where 10 years ago various nations signed an agreement on emission control under what is now popularly called the Kyoto Protocol. "These issues are becoming very important in India and would have to be increasingly discussed," says K. Srinivas, the Greenpeace activist based in India, referring to some power projects that are to come up in the country. "ADB could well be seen as bad if the lending organisation is not conscious of where it is going and what it is doing," adds Buakamsri.

"ADB could well be seen as BAD if the lending organisation is not conscious of where it is going and what it is doing" Tara Buakamsri Activist/ Greenpeace

What's striking about the event is ADB's reaction to the criticisms. For the first time in its history, the bank announced an energy efficiency and renewable energy commitment of up to $1 billion (Rs 4,500 crore) per annum. It has also promised to double to $2 billion (Rs 9,000 crore) its investment in water projects to ensure better provision of safe water and better sanitation. Greenpeace's Maria Athena Ronquillo-Ballesteros, a climate and energy campaigner, isn't too impressed and calls ADB's plans "baby steps". "These measures will turn out to be really significant if the total $1 billion commitment is solely for renewable energy and if it also means the bank is going to stop funding coal-based projects," she says. At present, the lady points out, less than 5 per cent of what ADB invests in energy projects goes into clean and renewable energy. Raising the allocation to $1 billion would increase the share to 17 per cent.

At the wrap-up press conference, though, Kuroda seems happy with the four-day meeting. He announces that the bank is in the process of formulating an action plan to improve its governance and anti-corruption policies (called for by Chidambaram too), and promises a new strategy for regional cooperation to better respond to the new economic and political dynamics. With private inflows into Asia outstripping funds from multi-lateral agencies, there's no doubt that ADB needs to reinvent itself. The good part is that ADB, under Kuroda, seems willing to do that.