The Economic Hit Man in Congo

With relevance to our readings on Confessions of an Economic Hit Man and The Chad-Cameroon pipeline is another instance of private opportunism in the proposed Grand Inga Project in Congo. This booklet traces the project details, context and development of the world's largest dam in a rather persuasive and interesting format.

Conrad's Nightmare: The World's Biggest Dam and Development's Heart of Darkness

(I hope it loads, otherwise please google it)

Excerpts:

"PPPs have become notorious among activists in recent years for two reasons: they have a track record of massively inflating project costs, and they place the cost burden firmly on governments while retaining the profits, and very often the ownership of the project itself, for the private sector."

"Grand Inga is the perfect lens to bring many of the key elements of development capitalism into focus—the absurdity and inapplicability to local needs of the great white elephants the IFIs build; the unfulfilled promises to local people, and the social and environmental misery the projects inflict; the sinecure of subsidies, contracts and markets for Western multinationals, a scheme often described as ‘corporate welfare’; and the passing of the responsibilities and costs for the projects onto the hapless ‘developing’ country, while keeping the profits closer to home (what Chomsky describes as the essence of modern capitalism: the socialisation of risk combined with the privatisation of profit)."

Samyuktha

Does TEA is an active stakeholder in the Tirupur water supply project?

K. Narayanaperumal,

The active and meaningful participation of stakeholders are very much important for successful implementation of any PPP project. In the Tirupur water supply and sewerage system project, TEA is one of the important stakeholders. The project was designed for the benefits of both domestic and industrial consumers specifically textile exporters. Out of the total designed quantity of 185MLD, 85MLD would be supplied for the municipality and balance 100MLD would be supplied to industrial units. As such, the requirement of TEA would have been fulfilled.

But all efforts were gone on vain; as the actual demand from the industrial units is (40MLD) far lower than the estimated demand (100MLD). The door-to-door survey shows that the industrial units are unwilling to draw water from the new facilities for various reasons like Ground water is free though it is illegal; the quality of water supply is not good; Global recession; technology and monsoon is good etc.

The above reasons spelled out are more artificial. The main reasons for the failure of financial model of the Tirupur water supply project could be due to the following;

Ø  The industrial units are not much committed to the project. Since their contribution to the investment is very low.

Ø  The industrial units are not much bothered about the environment. Large scale violations of environmental regulations are more common and these resulted with closure of 750nos of dyeing unit until zero discharge was achieved as per the Madras High Court order for polluting Noyyal river. This requires huge amount of investment.

Ø  Global recession is not a fact as it is no way affected the growth of the Tirupur garment export industry except a slight fall in the year 2008; Refer Figure: 1.

Ø  Claiming good monsoon is not a valid reason, as the garment industrial units would be required plenty of water; this could not be met with few days of rain water harvesting.

The following are the few possible remedies to redirect the project into success path;

Ø  Expand the water supply network to the nearby areas.

Ø  Strict enforcement of environmental laws

Ø  Government should assist the dyeing units for achieving zero discharge.

Ø  Government should work out a special discounted water tariff for the large industrial consumers which are obtained zero discharge.

                   Noyyal river before and after pollution

I had the opportunity to meet Dr. Isher Ahluwahlia yesterday and learnt that she has written a series of very interesting articles on infrastructure in the Indian Express, along with Ranesh Nair who is currently with IDFC. The first article can be found here and if you are interested, you can google and read the other articles as well. They are excellent and provide a good overview of some very interesting infrastructure projects undertaken in India,