World Bank’s auditing arm CAO, which is reviewing the $450 million for Tata Power’s 4,000 MW Mundra project in Gujarat, is expected to submit its audit report by March next year.
The Compliance Advisor Ombudsman (CAO), an independent arm of the World Bank group, is assessing whether the investment in Mundra project is in compliance with various environmental and social norms.
International Finance Corporation, the private lending agency of the World Bank group, has invested $450 million in Mundra project, the country’s first Ultra Mega Power Project (UMPP).
“The preliminary time schedule is for CAO to have a draft audit report ready by March 2013,” CAO has said.
Tata Power’s wholly-owned subsidiary Coastal Gujarat Power Ltd (CGPL) is implementing the Mundra UMPP in Gujarat.
Primarily, the compliance audit would focus on whether the IFC exercised due diligence in reviewing Coastal Gujarat Power Ltd’s environmental and social assessments.
Among others, the CAO would look at whether “IFC gave adequate consideration to the cumulative impacts of Adani Power and the construction of the Mundra West Port in its environmental and social assessments“.
The audit follows complaints related to alleged and anticipated adverse impacts of Mundra UMPP on livelihoods and environment brought up by ‘Machimar Adhikar Sangharsh Sangathan (MASS) —— the Association for the Struggle for Fishworkers’ Rights’
The CAO in July this year decided to conduct an audit of IFC’s environmental and social performance in relation to the investment made in Mundra project.
The total cost of Mundra project is estimated at $4.14 billion and IFC’s investment of $450 million is in the form of straight senior loan.
Meanwhile, once complete, the CAO draft audit report would be given to the senior management of IFC as well as all relevant departments for their comments. After receiving the comments, the final report is prepared.