Fishing and farming communities from Gujarat, India, represented by US-based NGO EarthRights International (ERI), filed a lawsuit against the World Bank’s private sector arm, the International Financial Corporation (IFC), in April. The IFC filed a motion to dismiss the case in July.
The IFC provided a $450 million loan to the Tata Mundra coal plant in 2008 which the plaintiffs claim has caused the loss of their livelihood and environmental destruction. The IFC’s accountability mechanism, the Compliance Advisor Ombudsman (CAO), found in 2013 that the IFC had failed to enforce the obligatory provisions of the loan agreement, which the IFC largely rejected (see Observer June 2014). Rick Herz from ERI said: “while the IFC purports to support this project in the name of poverty reduction … its impacts fall hardest on the poorest.”
Earthrights has until September to oppose the IFC’s motion, which the IFC has the right to respond to by October. The case, which will be heard in the US, is expected to be scheduled after the IFC’s response has been submitted.