journal

The Journal of International Policy Solutions

- 11 - Spring 2007 | Volume 7

Addressing the Social Impacts of Large Hydropower Dams

SOPHIE NAMY University of Washington

Jackson School of

International policy and

Daniel J. Evans School of

Public Affairs

Edited By Paul Schuler

KEY DEFINITIONS

• Compensation: Alternative resources (land, property or money) provided to displaced people or others adversely affected by a project as mitigation for losses suffered.1

• Dispossession: The deprivation of land, common resources, homes and other assets depended on for livelihood and/or cultural practices.

• Large dam: Defined by the International Commission on Large Dams (ICOLD) as a dam measuring 15 meters or more from foundation to crest. Dams of 10-15 meters may also be considered “large dams” if they meet the following requirements: crest length of over 500 meters, reservoir capacity of at least 1 million cubic meters, and maximum flood discharge of 2,000 cubic meters per second.2

• Project-affected persons: People whose economic, social and cultural lives are negatively affected by construction of dams, related infrastructure, or alteration of river flows and any ecological consequences. The term includes displaced people, host communities, and downstream and upstream populations.3

• Social impact assessment: The processes of analyzing, monitoring and managing the intended and unintended social consequences, both positive and negative, of planned interventions and any social change processes invoked by those interventions.4

THE CHALLENGE During the 20th century large dams emerged as symbols of modernity. Hailed for being an effective way to harness water resources for food production, energy generation, flood control and domestic use, dams became synonymous with progress and economic development. Construction peaked during the 1970s when an average of two or three large dams were commissioned per day throughout the world. An estimated $2 trillion has been invested in large dams since the early 1900s,5 justified by a range of projected outcomes from poverty reduction to increased local water supply. However, in recent decades dam projects have become mired in controversy. Opponents charge that benefits have been grossly overstated while the social and environmental costs have been largely ignored. In April 1997, the World Bank (WB) and the World Conservation Union created the World Commission on Dams (WCD) to “conduct a rigorous, independent review of the development effectiveness of large dams . . . and develop internationally acceptable criteria, guidelines and standards for the planning, design, appraisal, construction, operation, monitoring and decommissioning of dams.”6 The final report (2000), entitled “Dams and Development: A New Framework for Decision Making,” drew from eight detailed case studies, 125 surveys, hundreds of consultations worldwide, and over 900 evaluative submissions.7 While acknowledging the historical contributions dams have made to economic growth, it concluded that “in too many cases an unacceptable and often unnecessary price has been paid to secure those benefits, especially in social and environmental terms, by people displaced, by communities downstream, by taxpayers and by the natural environment.”8 Although some efforts to curb the negative effects of dams have been made, governments continue to embark on large-scale hydropower projects without adequately considering the social and environmental consequences. Clearly a need exists to develop alternative frameworks for future projects. As a

primary financial backer of large dams, the Bank has an obligation to take a lead in this effort. According to the International Rivers Network, the WB has provided an estimated $75 million dollars to support 538 large dams (as of 1998) and remains one of the largest single sources of funds used for large dam construction worldwide.9 Recognizing that dams will continue to be built for hydropower production, this analysis is an attempt to evaluate policy alternatives that the WB can impose on its borrowers to minimize the social impacts of dams.

ENERGY & INTERNATIONAL DEVELOPMENT Energy supports all facets of human development, such as providing for basic needs, assisting productive activities, and facilitating effective health care. The United Nations Development Program (UNDP) emphasizes the importance of affordable energy in the developing world, citing improved access to energy sources as critical for the realization of all Millennium Development Goals10 put forth by the United Nations to improve living conditions for the world’s most vulnerable populations by the target date of 2015. The goals range from achieving universal primary education to ensuring environmental sustainability11. Similarly, the WB argues that energy shortages prevent growth by “increasing the costs of doing business, reducing productivity, and hampering the development of industry and commerce.”12 Unfortunately, due to increasing populations, urban expansion and global economic growth, many countries find their energy supply far outpaced by demand. In 2004, the United Nations Symposium on Hydropower and Development estimated that over 2 billion people are currently without electricity or a secondary source of energy.13 The total energy shortfall in South Asia alone has been reported at 125 million tons of oil equivalent, with demands expected to double before 2010.14 As fears of an impending crisis gain legitimacy, finding sustainable energy sources has become a priority for nations worldwide.


Spring 2007 | Volume 7 - 12 -

THE CASE FOR HYDROPOWER After the initial capital investments are made, hydrosystems have many advantages over fuel-burning energy sources. Although not without greenhouse gas impacts, hydropower is considered a relatively clean source of renewable energy production. Once built, hydroelectric plants have low operating costs and long service lives. At the World Summit on Sustainable Development (WSSD, Johannesburg, 2002), a commitment was made to increase hydropower production as a means of addressing environmental concerns. Stéphane Dion, President of the United Nations Climate Change Conference, argues that “in our increasingly carbon-constrained world, renewable energy forms, such as hydropower and wind power, have the potential to meet the economic, social, environmental, and sustainability criteria demanded of our times.”15 Currently 140 countries have hydropower facilities contributing to one-fifth of the world’s energy supply.16 However, two-thirds of economically viable hydropower potential has yet to be tapped, and 90 percent of this potential is in developing countries.17 Although dams have existed for thousands of years, the past century has witnessed a huge surge in large dam construction, most notably in the developing world. Over 45,000 large dams have been built,18 primarily to support growing water and energy needs, and in light of the current emphasis on sustainability noted above, this trend can be expected to continue. Additional advantages are also widely perceived. Considerations such as increased irrigation capacity, regional development, job creation, enhancing export capability and flood control often accompany decisions to build dams. However, many dam projects have fallen short of expectations, and unquantified social and environmental costs have dramatically obscured traditional cost-benefit assessments. Embarking on a large hydropower dam project is currently a highly contested issue.

THE CURSE OF THE DAMMED? During the past 20 years, a growing international movement against dams has emerged, rallying behind the charge that governments have notoriously ignored human and ecological costs when beginning hydropower projects. The dangers that dams pose to the natural environment have been widely documented. The International Rivers Network (IRN) reports that 60 percent of the world’s major rivers are dammed and just under one percent of the world’s land surface has been inundated by reservoirs worldwide.19 The detriment to rivers, wetlands and forests have been extensive, and “led to irreversible loss of species and ecosystems.”20 This paper, however, centers its analysis on the social effects of hydropower dam projects. The WCD found that between 40 and 80 million people have been physically displaced by dams worldwide.21 A WB review of projects between 1986 and 1993 estimated that 4 million people were displaced annually by the 300 large dams (on average) that were constructed each year.22 This scale of mass-displacement makes it imperative that the potential impacts on livelihood, health, and traditional cultures be carefully monitored and managed. Equity concerns are also relevant. Displaced communities are frequently indigenous people and other ethnic minorities whose voices have too often been silenced by existing power structures. The most commonly cited negative social impacts of dams are described below: • Dispossession: The WCD reports that most indigenous

communities and other ethnic minorities faced with dam-based development projects have experienced

dispossession and denial of their basic rights.23 Most obviously, the construction of dams and related infrastructure leads to the loss of considerable areas of agricultural land, forest, fishing grounds, grazing lands and other resources on which impacted communities rely for their livelihoods and cultural practices. Additionally, downstream communities may be intricately linked with the river system and surrounding wetlands. The WCD further notes that alongside other negative impacts, structural changes to river patterns are likely to adversely affect agricultural, grazing and fishing economies downstream and reduce land values.24 Subsequently, the ecological consequences of dam projects also have secondary effects on livelihood, food security and traditional practices in nearby communities.

Although safeguards exist in international treaties such as the International Labor Organization (ILO) Convention Nos. 107 and 169, as well as the WB’s Operational Directive 4.20 on Indigenous Peoples, in practice these agreements are rarely binding. For instance, in direct violation of ILO Convention 107 (requiring states to recognize “the right of ownership, collective or individual, of the members of the populations concerned over the lands which these populations traditionally occupy”25) to which India is a signatory, the WB-funded Sardar Sarovar Project treated 70-85 percent of tribal oustees as “landless” and subsequently did not provide compensation. The backlash against the Narmada Valley Project has become a focal point for much of the anti-dam movement. In its entirety, the project is projected to cause the displacement of 1 million people, one of the largest displaced populations in dam-building history. The Narmada Sagar and Sardar Sarovar dams are expected to flood a total of 289 villages, submerge 865,000 acres of forest and more than 400,000 acres of cultivated land.26 The Three Gorges Dam on the Yangtze River in China has also been highly contentious, planning to flood an area of more that 632 sq. km and displace 1.4 million people from their homes.27

• Cultural Alienation: The fertile soils of river valleys have always been densely populated, giving rise to some of the world’s most ancient civilizations. Displacing these communities risks the loss of valuable traditional knowledge systems and destroys part of the world’s cultural heritage. The WB has recognized that forced displacement threatens traditional kinship associations. Moreover, the abandonment of symbolic markers such as grave sites and ancestral lands can sever linkages with the past and undermine a community’s cultural identity.28

The physical landscape of indigenous communities is often intimately linked to their social, cultural and political way of life. For example, Survival International notes that “the Akawaio have invested the landscape with special significance. It is an environment transformed by their ancestors in conjunction with the mystic forces of the universe . . . thus the landscape is dynamic, every part is living, functional, has meaning and moral value” (referring to the Akawaio Indians of Guyana threatened by the Upper Mazaruni Dam in the 1970s). 29 In its extreme form, the involuntary resettlement of indigenous groups as a result of large-scale dam projects has been deemed ethnocide. The World Council of Indigenous Peoples in 1985 lamented that:

Next to shooting Indigenous Peoples, the surest way to kill us is to separate us from our part of the Earth. Once separated, we will either perish in



body or our minds and spirits will be altered so that we end up mimicking foreign ways, adopt foreign languages and build a foreign prison around our Indigenous spirits, a prison that suffocates rather than nourishes as our traditional territories of the Earth do. Over time, we lose our identity and eventually die, or are crippled as we are stuffed under the name of ‘assimilation’ into another society.30

• Health: The World Health Organization (WHO) has

reported that the reservoirs created behind dams are often breeding grounds for water-borne illnesses (such as schistosomiasis, malaria, and cholera) and other potentially toxic bacteria.31 Numerous studies have corroborated these health risks. For example, a study undertaken in the Cote d'Ivoire documented significant increases in schistosomiasis after the construction of two large hydroelectric dams (from 14 to 53 percent around Lake Kossou and from 0 to 73 percent around Lake Taabo).32 A study in Sri Lanka revealed that increased outbreaks of malaria “seem intimately related to hydrological changes brought about by major irrigation and hydroelectric schemes on the Mahaweli river,” exacerbated by the increased migration caused by resettlement. The report concludes that “this story is a classic of health impacts overlooked in favor of agricultural and industrial development.”33

Elevated mercury levels in fish downstream of dam projects have also been documented, posing long-term health risks linked to fish consumption. One study in Brazil found fish mercury increases in Lago Manso, a hydroelectric reservoir. The authors expected mercury levels to return to normal “within some decades,” but warned that the reduced fish populations downstream from the dam would most likely be permanent because of decreased water flow. According to the study, “the risk of elevated mercury (Hg) concentrations in fish has become one of the most important issues in assessing the environmental impact of hydroelectric reservoirs.”34 Finally, the stress of relocation and disruption of social networks is also known to adversely affect health and well-being. Women may be particularly vulnerable to the resettlement process, as noted by the WCD report: “Compulsory resettlement is stressful because of the way in which people are uprooted from homes and occupation and brought to question their own values. Gender is an important factor in resettlement. Women as marginalized entities within marginalized communities are often forced to shoulder the ordeal of displacement far more intensely.”35 • Discrimination: In 1994, the WB acknowledged in its

“Bank-wide Review of Projects Involving Involuntary Resettlement” that those resettled as a result of dam projects are generally from the poorest and most vulnerable sections of society.36 The WCD Thematic Review on Social Issues also concluded that due to structural inequities and institutionalized racism, indigenous populations and other minorities have “suffered disproportionately from the negative impacts of large dams, while often being among those who have been excluded from sharing the benefits.”37 As an example, the Indian government estimates that over 40 percent of displaced people are from adivasis (tribal) communities that represent only 6 percent of India’s total population.38 Moreover, dams may impose a disproportionate cost to women who are often more

dependent on the common resources eliminated by projects and/or more vulnerable to the social and cultural disruptions that occur with relocation. Compensation repayments are often distributed to men, further complicating women’s recovery. The WB’s Operations Evaluation Department noted in 1998 that dam projects “were largely oblivious to the gender aspect of resettlement.”39

This disproportionate impact demonstrates that vulnerable groups have been excluded from the decision-making process to build dams and more general economic and political participation in the societies in which they live. Moreover, there is little indication that the benefits from hydropower projects reach the minority populations who suffer the greatest losses. As UNDP Senior Water-Policy Advisor Carlos Linares remarks, “Nobody has ever proven that the benefits of large dams go to the poor . . . they may reflect well on GNP and other macroeconomic indicators and increase production, but that doesn’t really give us any idea of the equity aspects of large dams.”40 The standard cost-benefit analyses that typically precede the decision to build large dams often ignore many if not all of the wide ranging social impacts described above. Underlying causes of these negative impacts include violations of international treaties protecting the rights of vulnerable groups, deep-seated structural inequalities reflected in a variety of institutional practices that reinforce the marginalized status of minorities, lack of accountability of planners and implementing agencies to affected peoples, and utilitarian ideologies that enshrine the “greater common good” as the highest national priority.

DIVERGING PERSPECTIVES While all sides of the debate agree on the need to consider the social and environmental aspects of dam construction, no consensus has emerged regarding how to incorporate these issues moving forward. Critics charge dam projects of being inequitable because “the poor, other vulnerable groups and future generations are likely to bear a disproportionate share of the social and environmental costs of large dam projects without gaining a commensurate share of the economic benefits.”41 However, international organizations such as the WB support dams because they believe the economic, technological and social benefits are important for the development of nations overall and that these advantages will eventually improve the lives of all individuals.42 With a global imperative to increase renewable sources of energy, hydropower facilities will continue to be built, especially in many developing nations rich in hydro-resources. There is an urgent need to develop policies that minimize the social impacts of these projects so they can be implemented fairly and cautiously for the benefit of everyone involved.

SHOULD THE WORLD BANK INTERVENE? The WB has historically been one of the primary lenders and financial backers of dam development projects. However, in recent years there has been growing recognition that their mission of poverty reduction is undermined when lending activities disregard potential social and environmental impacts. Dams are especially problematic because involuntary resettlement often leads to a decreased standard of living, as indicated by the WCD finding that “impoverishment and disempowerment have been the rule rather than the exception with respect to resettled people around the world.”43 The paradox of development-induced displacement has been acknowledged by the WB, whose



General Counsel reported in 1993 that “the heightened risk of impoverishment as a consequence of displacement runs contrary to the bank’s goal of alleviating poverty through developing the productive potential of the poor.”44 In 2001, former President Wolfensohn responded to the WCD Report by acknowledging the “large cost” that is sometimes paid to obtain the benefits of large dams. He further emphasized that the Bank is currently “focusing more” on financing dam rehabilitation and safety than in supporting the construction of new dams.45 The WB does not have a singular policy that determines whether it will finance a dam project. Rather, operational policies related to environmental assessment, natural habitats, safety of dams, and involuntary resettlement guide the Bank’s dam-related lending decisions.46 In response to the increasing demands on behalf of civil society groups and donor governments that public funds are not used for projects that commit human rights violations,47 the WB has implemented a series of policies in adherence to the International Covenant on Economic, Social and Cultural Rights. The Operational Directive 4.20 on Indigenous Peoples (1991) that aims to ensure that the development process “fosters full respect for the dignity, human rights and cultures of indigenous peoples”48 is one such example. Bank policies have also been influenced by the WCD final report. The Commission put forth a “rights and risks” approach to assessing options and implementing dam projects, highlighting the need to protect the rights of all relevant stakeholders and take account of the risks that they bear. The WCD offered seven strategic priorities and 26 specific guidelines for operationalizing the “rights and risks” framework.49 While the WB left the adoption of the proposed guidelines up to implementing governments and/or private developers (emphasizing that they provide “guidance” and not a “regulatory framework” ),50 the Bank has initiated a “Dams Planning and Management Action Plan” to improve the evaluation, implementation and operation of WB-sanctioned dam projects. However, inconsistencies between rhetoric and practice have not escaped notice, and resentment towards the WB is growing at the grassroots level.51 It is imperative that the WB uphold its commitment to poverty alleviation by ensuring its lending decisions do not inadvertently impoverish affected citizens. Moreover, it is important to recognize that disparate impacts resulting from dam projects contribute to social inequalities and threaten stability worldwide. As former WB President Wolfensohn acknowledged, “Only with poverty reduction will peace be possible: an unequal planet will be a planet of war and violence.”52 The WB is a powerful actor in the arena of international development and must take the lead in establishing explicit policies that are effective in minimizing the social impacts of large dams.

CRITERIA FOR POLICY ALTERNATIVES In order to minimize the social impacts of dams, effective policies must strive to reduce or eliminate dispossession (including loss of livelihood, land, common resources, and other assets), cultural alienation, and health risks. As best as possible, both primary and secondary impacts should be considered. Based on the findings reported above, the following criteria were established to guide policy recommendations: •••• Effectiveness: The ability to minimize social impacts. •••• Just Resettlement: The degree to which basic rights are

respected throughout the resettlement process. In

accordance with the International Covenant on Economic, Social and Cultural Rights, just resettlement should be evaluated regarding efforts to maintain (or improve) quality of life including: right to livelihood (Article 11); right to adequate food, clothing and housing (Article 11); and right to participate in traditional culture (Article 15). Additionally, just resettlement includes attempts to protect the integrity of communities, and sensitivity to the gendered aspects of relocation.

•••• Equity: The distribution of benefits and costs to the project-affected peoples, emphasizing a Rawlsian sense of “justice as fairness” rather than equal access. Special consideration should be given to women, economically marginalized communities and indigenous and other ethnic groups who have been historically disadvantaged.

•••• Accountability: The ability to ensure that planning/implementing agencies follow through with the specifications of the project, as well as the transparency of the overall process.

• Ease of Implementation: The likelihood that the policy can be implemented in diverse contexts. This criterion is expected to capture economic costs as well as other administrative or political obstacles to implementation. Because it is not possible to separately consider every country where the WB has projects, this criterion assumes the context of a political democracy.

POLICY ALTERNATIVES Based on the literature reviewed and the 26 guidelines suggested by the WCD, this paper proposes three approaches to reducing the social impacts of large dams: 1. Induced Adherence to Projected Impacts Approach: This policy is a two-pronged attempt to minimize the social impacts of large dams. First, this policy mandates that any hydropower project backed by the WB must include a Social Impact Assessment evaluating both intended and unintended consequences on project-affected people. Second, mandatory monitoring of actual impacts must occur on a yearly basis, with a reward/penalty for significant deviations from projections.

Details: The initial social impact assessment must include economic, cultural, and community implications of the project, as well as a strategy for managing and monitoring these impacts. Findings must be based, in part, on consultations with the affected communities. Also, every effort must be made to understand customary laws and traditional management of the watershed in order to accurately assess cultural impacts. This assessment must consider directly affected oustees who will lose their lands and livelihoods as a result of infrastructure or flooding as well as downstream impacts, such as loss of fisheries, agricultural land, drying up of wells, decline in nutrition, public health concerns, etc. During this stage, baseline information to make future comparisons must also be collected. The mandatory monitoring should consist of periodic (once a year) re-examination of impacts, also in collaboration with affected communities. Should results be significantly higher than projections, strategies to remedy the situation must be immediately put into place and compensations made by the government or private developer. 2. Social & Economic Insurance Strategy Approach: This option ensures that the living standards of all project-affected persons are not made worse off in any tangible terms as the result of large dam construction. The policy requires that dam projects backed by the WB include a comprehensive resettlement plan to secure the genuine



rehabilitation of all displaced people. Additionally, compensation must be given to downstream populations whose means of livelihood is adversely affected (for example by the disruption to local fisheries, etc).

Details: “Just” resettlement is highly context-specific and this policy requires flexibility to maintain (or improve) living standards throughout resettlement. However, all cases should begin with a needs-assessment of project-affected people, and certain standards must be adhered to. Whenever possible, land should be replaced by land, territory for territory, and commons for commons. In accordance with the International Labor Organization Convention No. 107, fair compensation for property (either equivalent size/productivity value or operative market rate at the time of purchase) must be given even in the absence of a legal title. No distinction should be made between landed and landless ousters, and women should receive compensation equal to men. New land must be allotted a minimum of one year prior to relocation to allow the displaced to adjust to cultivating the land and help the process proceed more humanely. Additionally, joint-title must be awarded for married couples. Culturally appropriate new housing should be provided that restores standards of former dwellings, and if project-affected persons express a preference for constructing their own housing (as is the case among some tribal communities) they must be granted the freedom to do so. Finally, every effort must be made to relocate communities together in order to maintain the integrity of social networks and kinship ties. As best as possible, calculations should be made for the loss of livelihood and opportunities for both oustees and down-stream communities. Reflecting this policy’s inherent flexibility, compensation could be provided in creative ways, for example by allowing affected persons to have the first right to obtain employment in the project, or enforcing preferential rates for electricity. Restitution could also be made with cash, however only if cash transactions are culturally practiced. 3. Cooperative Approach Approach: This policy encourages wide-ranging local participation of affected groups, spanning the life cycle of the project (design, construction and monitoring). In accordance with ILO Convention 169, this option also requires that the “free, informed consent” of indigenous peoples is obtained prior to resettlement.

Details: The requirement for this policy option is that a forum exists to collaborate with affected people in every phase of dam projects and that these individuals are aware of what is planned and their right to participate. “Every phase” could feasibly include conducting impact assessments, choosing relocation sites, building replacement housing, establishing just compensation, and monitoring outcomes. For this participation to be authentic and effective, it must take place within a timeframe that allows meaningful influence over project decisions. Because the communities at greatest risk must be heard, understood, and ultimately persuaded of the projects benefits even to them, the goal is that developers will have a built-in incentive to incorporate remedies and mitigation measures into the project design.

RECOMMENDATIONS The goal of this analysis is to uncover the most appropriate policy for the WB to impose on its borrowers in order to effectively minimize the social costs of large dam projects. Although it is ultimately impossible to completely eliminate the inequities between those upstream who are displaced—or

otherwise adversely affected—and those who directly benefit at the end of the power line, this paper puts forth three options that help mitigate disparities. Trade-offs between the criteria are inescapable, and unsurprisingly the alternatives have varying degrees of success relative to effectiveness, just resettlement, equity, accountability, and ease of implementation. The incentive scheme in Policy Option 1 is expected to provide a high measure of accountability and be implemented with relative ease (social impact assessments are an established methodology and a substantial literature exists on the subject). However, while dispossession and health risks are relatively straightforward to quantify, the range of impacts associated with cultural alienation are often intergenerational, overlapping, and inherently challenging to measure. Subsequently, the option’s overall effectiveness in reducing social impacts is difficult to predict. The “Social and Economic Insurance Strategy” outlines culturally appropriate requirements for resettlement, including compensation for opportunity costs. Accordingly, the policy is likely to perform well with regard to effectiveness, just resettlement, and equity issues. It is important to note, however, that many tribal populations believe their land has an incommensurate value. For example, the Ibaloy, a Filipino ethnic minority group scheduled to be relocated by the San Roque dam reservoir, explain that, “It is not easy to destroy our sacred burial grounds . . . We believe that[our ancestors] are with us in their spirit as we are with them in our traditional and cultural values. That is why no amount of money will constitute a just price for their sacred graves.”53 This difficulty in assessing fair compensation for cultural sites may complicate the implementation of Policy Option 2. Moreover, if recent large scale dam projects can be used as an indicator, governments are unlikely to incur substantial resettlements costs (that may be prohibitive in the case of massive displacement), especially on behalf of their most politically and economically disenfranchised citizens. Finally, to the extent that affected communities are truly heard and their perspectives fairly incorporated into project decisions, Policy Option 3 ranks highest in terms of overall effectiveness. The policy is expected to perform well under the just resettlement and equity criterion, however two caveats should be noted. First, it is possible that communities may not be aware of the economic value of their assets or the potential health risks associated with dam construction. This information asymmetry may undermine just resettlement and compensation despite the requirement of obtaining “free, informed consent” on behalf of the oustees. Second, political and social realities present in much of the developing world make it pertinent to consider the risk of coercion. The WCD reported a high number of complaints regarding “government manipulation of the consultation process to try to engineer the result that they sought.”54 For example the Himba pastoralists, opposing the loss of their grazing lands due to the Epupa Dam in Namibia, were met with heavily armed policemen during an attempt to consult with lawyers.55 Large scale dam projects are often conceived as projects to fuel economic development and modernization. This nationalistic discourse threatens to make the needs of the most marginalized communities even less audible. In light of this evidence, this analysis recommends caution in trading off any measure of accountability for greater effectiveness. The WB has received increasing criticism throughout the past decades for its “pervasive preoccupation with new lending”56 that takes precedence over other considerations, in particular



compliance with stated policies and international covenants. Patrick Coady, a former Executive Director of the WB legitimized this line of criticism in his public comment that “no matter how egregious the situation, no matter how flawed the project, no matter how many policies have been violated, and no matter how clear the remedies prescribed, the Bank will go forward on its own terms.”57 Subsequently, whatever policy is embraced, it must be enforceable and implementable in order for the WB to be taken seriously in its mission to alleviate global poverty. This analysis recommends that the WB adopt the policy with the greatest ease of implementation and strongest measure of accountability: Policy Option 1, the Induced Reduction of Projected Impacts Policy. However, in select cases where democratic nations have demonstrated good governance and respect for the rights of their minorities, the Collaborative Approach should be pursued. Finally, it is also recommended that the WB seek out and adopt complementary policies that aim to reduce environmental impacts.

CONCLUDING REMARKS This report has made clear that because of the severity of social impacts suffered by impacted populations, a traditional cost-benefit analysis is not an adequate justification for the decision to build a large dam. For example, the potential beneficiaries from electric power produced by the Saradar

Sarovar dam is estimated at several million compared to the dispossession of between 100,000 and 400,000 individuals.58 However, in the most extreme cases dispossession results in the extinction of traditional cultures, and by the WB’s own calculations the cumulative effect of involuntary resettlement is often “that the social fabric and economy are torn apart.”59 Clearly the seriousness of sustained losses overrides the balance of numbers in such cases. Fundamental human rights cannot continue to be sacrificed in the name of national economic interests, and as a principal lender of large-dam projects, the WB must take a stand. While evaluating options that redefine when and where building large dams is appropriate falls beyond the scope of this paper, the analysis presented goes far towards developing policies that minimize the range of social impacts once the decision to build has been finalized. The hope is that in the near future the developing world will consist of just, sustainable democracies, providing the right context for the Collaborative Approach to be successful. However, until that condition is met, by adopting the Induced Reduction of Projected Impacts Policy, the WB has the opportunity to safeguard the rights of vulnerable communities and demonstrate its commitment to fighting poverty worldwide.

ENDNOTES 1World Commission on Dams. Dams and Development: A New Framework for Decision Making. (London: Earthscan Publishers, 2000). 2Patrick McCully, Silenced Rivers: The Ecology and Politics of Large Dams. (London: Zed Books, 1996). 3 Dams and Development: A New Framework for Decision Making. 4 International Association for Impact Assessment (IAIA), “Social Impact Assessment International Principles.” (IAIA Special Publication, Series No 2, May 2003). 5Dams and Development: A New Framework for Decision Making. 6Gujja Biksham, “Dams and Development–A Call for Follow-up Action,” (WWF Position Statement, February 2001), 1. 7 Denis Goulet, “Global Governance, Dam Conflicts, and Participation.” Human Rights Quarterly, Vol 27, (2005): 881-907. 8Dams and Development: A New Framework for Decision Making, 28. 9 International Rivers Network, “The World Bank’s Legacy: $75 billion has funded misery and destruction worldwide”. [cited April 29, 2007] <http://www.irn.org/wcd/worldbank.shtml> 10United Nations Development Program (UNDP), Energy and Environment. [cited December 11, 2006] <http://www.undp.org/energyandenvironment/> 11 UN Millennium Development Goals. [cited December 11, 2006] <http://un.org/millenniumgoals/> 12 World Bank, Hydropower Development in India.[cited December 11, 2006] <http://www.worldbank.org/in> 13 United Nations Symposium on Hydropower and Sustainable Development, Bejing, China, 2004. [cited December 11, 2006] <http://unhsd.icold-cigb.org.cn/memoire.html> 14 Speeches and Remarks, Robert Blake, USAID South Asia Regional Initiative for Energy “Developing Energy Markets Seminar,” New Delhi 2006. [cited December 11, 2006] <http://newdelhi.usembassy.gov/pr032106a.html> 15 Hydropower, An Essential Part of the Solution to Climate Change, 2005. [cited December 11, 2006] <http://www.ich.no/Why%20Hydro/Adv_6.htm> 16 United Nations Symposium on Hydropower and Sustainable Development. 17 Hydropower, An Essential Part of the Solution to Climate Change, 2005. [cited December 11, 2006] <http://www.ich.no/Why%20Hydro/Adv_6.htm> 18 Dams and Development: A New Framework for Decision Making. 19 International Rivers Network, Dammed Rivers, Damned Lies, 2003. [cited December 11, 2006] <http://www.irn.org/basics/ard/index.php?id=wwf3.html> 20 Dams and Development: A New Framework for Decision Making, 31. 21 Dams and Development: A New Framework for Decision Making. 22 Ibid. 23 Ibid. 24 Ibid. 25 M Colchester. Forest Peoples Program: Dams, Indigenous Peoples and Ethnic Minorities (Thematic Review 1.2 prepared as an input to the World Commission on Dams, Cape Town, 2000), 21. 26 Nguyen Thi Dieu. “The State versus Indigenous Peoples: The Impact of Hydraulic Projects on Indigenous Peoples of Asia.” Journal of World History, Vol 7, No 1, (1996): 101-127.



27 The United Nations, IRIN News.org. “Running Dry: the Humanitarian Impact of the Global Water Crisis.” [cited Dec 11, 2006] <http://www.irinnews.org/webspecials/runningdry/55530.asp> 28 Smitu Kothari. “Whose Nation? The Displaced as Victims of Development.” Economic and Political Weekly, (June 15, 1996): 1476-1485. 29 Colchester, 25. 30 Ibid. 31 W Adams. The Social Impact of Large Dams: Equity and Distribution Issues (Thematic Review I.1 prepared as an input to the World Commission on Dams, Cape Town,� 2000). 32 EK N’Goran et al. “Changes in human schistosomiasis levels after the construction of two large hydroelectric dams in central Cote d'Ivoire.” Bulletin of the World Health Organization, Vol 75, Iss 6; (1997): 541-546. 33 Mde S. Malaria Wijesundera. “Outbreaks in New Foci in Sri Lanka.” Parasitol Today. Vol 4, No 5, (May 1988): 147-150. 34 Lars D Hylander et. al. “Fish mercury increase in Lago Manso, a new hydroelectric reservoir in tropical Brazil.” Journal of Environmental Management. Vol 81, Iss 2 , (Oct 2006): 155-166. 35Adams, 7. 36 Colchester. 37 Ibid, 8. 38 International Rivers Network, Dammed Rivers, Damned Lies, 2003. 39 Recent Experience With Involuntary Resettlement. Overview. Document of the World Bank. (Report No. 17538, 1998), 11. 40 The United Nations, IRIN News.org. “Running Dry: the Humanitarian Impact of the Global Water Crisis.” [cited Dec 11, 2006] <http://www.irinnews.org/InDepthMain.aspx?InDepthId=13&ReportId=61050 > 41 Ibid. 42 The World Bank and the Environment: Frequently Asked Questions. [cited December 11, 2006] <http://web.worldbank.org/WBSITE/EXTERNAL/EXTSITETOOLS/0,,contentMDK:20147675~menuPK:344193~pagePK:98400~piPK:98424~theSitePK:95474,00.html#5> 43Leopoldo Jose Bartolome et al. Displacement, Resettlement, Rehabilitation, Reparation, and Development (Thematic Review Social Issues I.3 prepared as an input to the World Commission on Dams, November,� 2000), 16. 44 Dana Clark. “The World Bank and Human Rights: The Need for Greater Accountability.” Harvard Human Rights Journal, Vol 15, (Spring 2002): 205-226. 45 News & Broadcast, “World Commission on Dams Launches 'Landmark' Final Report A new direction for future water and energy policy decision-making” [cited April 29, 2007] <http://web.worldbank.org/WBSITE/EXTERNAL/NEWS/0,,contentMDK:20019197~menuPK:34459~pagePK:34370~piPK:34424~theSitePK:4607,00.html> 46 The World Bank: “The World Bank Position on the Report of the World Commission on Dams,” December 2001 [cited April 29, 2007] < http://siteresources.worldbank.org/INTWRD/903857-1112344791813/20424179/TheWBPositionontheReportoftheWCD.pdf> 47 Ibid. 48 World Bank Submission, “Revised Draft Operational Policy/Bank Procedures Indigenous Peoples: Issues and Proposals,” April 2005. [cited December 11, 2006] <http://siteresources.worldbank.org/INTINDPEOPLE/Publications/20571164/Issue%20Notes.pdf> 49 Dams and Development: A New Framework for Decision Making. 50 The World Bank: “The World Bank Position on the Report of the World Commission on Dams,” December 2001 [cited April 29, 2007] < http://siteresources.worldbank.org/INTWRD/903857-1112344791813/20424179/TheWBPositionontheReportoftheWCD.pdf> 51 Clark. 52 The World Bank: News Release No. 2002/013/S, “Rule of Law Central to Fighting Poverty,” (July 9, 2001). 53 Colchester, 44. 54 Ibid, 48. 55 Ibid. 56 Ibid, 48. 57 Ibid. 58 Goulet. 59 World Bank 1994, cited in Colchester, 24.

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