In a major setback to investments in the state and considered a victory for green activists, the World Bank has decided to step aside from funding the controversial 612MW Luhri power project, which is being opposed by the residents of nearly 80 villages.
Environment conservation activists and the local residents, who had been campaigning to conserve the free-flowing stretch of the Satluj river under the banner of Sutlej Bachao Jan Sangharsh Samiti, have expressed elation over the World Bank’s decision not to lend financial assistance to the massive Luhri hydro power project on the Sutlej river in Kullu and Shimla.
Green activist group Himdhara Environment Research and Action Collective member Manshi Asher said the bank was supposed to provide a $650million (`39.11 crore) loan to the $1,150 million (`69.2 crore) project, but now the project status on the World Bank’s website indicates that the project has been dropped.
Asher said the decision to cancel the funding has come after an appraisal by the United States Agency for International Development (USAID) team which had been commissioned to check the environmental and social consequences of the project.
In November, 2013, the USAID team visited the area and interacted with all stakeholders, including project developer Satluj Jal Vidyut Nigam Limited, the World Bank, people from the affected villages and some environment conservation groups including, including the Himdhara Collective in Himachal Pradesh, and South Asian Network on Dams, Rivers and People (SANDRP) in New Delhi.
The bank had apparently done an intensive review of the project (which must have included USAID trip), and when the USAID wanted to discuss the project with the bank in Washington, it told them that they had dropped it.
SANDRP coordinator Himanshu Thakkar said on Thursday, he received an e-mail from the World Bank official concerned with the project. Thakkar said the official said, “I would like to confirm that the project was dropped in January 2014 at the request of the Indian government.”
He said direct and indirect impact should be considered in the environmental impact, adding that this project would have led to the drying up of the major river and hampered the horticultural activities in the area. “We are not against any project but we should also see the use, need and impact of the project so that ecology can be conserved,” Thakur told HT.
Thakkar said people of 78 villages in Kullu, Mandi and Shimla districts would have been affected by the Luhri project and its 38-km tunnel that would have bypassed at least 50km of the river flow.
Nek Ram Sharma of the Satluj Bachao Jan Sangharsh Samiti said the decision of the World Bank had given a major boost to the local people’s belief that common people’s voice mattered in deciding their own future. “The Samiti, which challenged the environment clearance granted to the project last year at the National Green Tribunal, has been in opposition to the project mainly because of the impact of the proposed 38km tunnel to be constructed as part of the project,” he added.