As the BRICS made New Development Bank met in New Delhi, investments and future plans have been discussed even as civil society fears non inclusivity ‘sustainable development’.
The five emerging economies, Brazil Russia India China and South Africa or BRICS, created the New Development Bank (NDB) aiming to finance sustainable development and infrastructure projects in their economies and other developing countries which they are looking to incorporate as members. Even as this year has marked the second annual meet for the NDB, civil society formations such as the Peoples Forum on BRICS have raised concerns over sustainability of projects funded.
BRICS is estimated to incorporate almost 50 pc world’s population and about one-fifth of the economic output globally. However, with the exception of India and China, GDP growth rates for the emerging economies have remained rather stagnant. In India though, even as the finance minister Arun Jaitley predicted a sustained growth, income disparity has grown to call for a look into the concept of sustainable inclusive development, which some fear hasn’t found incorporation in NDB’s projects.
Jaitely spoke at the NDB’s meet, stating “India has huge unmet infrastructure funding needs. EUR 606 billion is required in the next five years. About 70 pc of this will be required in the power, roads and urban infrastructure sectors.” Adding that India is set to work with the NDB to develop projects in areas such as Smart Cities, renewable energy, urban transport, and urban water supply, he voiced hope that “the NDB will emerge as a development bank representing the voice and aspirations of developing nations, and will set a new trend in multilateral funding.”
The two projects India has sought investment for targets up-gradation of major district roads in Madhya Pradesh and Renewable Energy generation. The first project was proposed to be looking at inclusive economic growth through “increased incomes as a result of improved connectivity and access to markets for interior regions of the state,” according to a statement released by the Press Information Bureau (PIB) of India. The Second Project financed by the NDB in India will “lead to generation of about 500 MW Renewable Energy thereby preventing generation of 815,000 tonne CO2 per annum. EUR 234 million sovereign guaranteed loans will be given to Canara Bank in three tranches under this project,” added the PIB report.
Ahead of NDB’s meet in New Delhi, the Peoples’ Forum on BRICS conducted a day-long convention in the city, which was addressed by civil society members such as academicians, economists, environmentalists, journalists and indigenous communities from the BRICS countries. In the meeting, Madhuresh Kumar, convener of the National Alliance of Peoples Movement explained, “We are not against renewable energy but it has to be decentralised. The current funding is for the large scale projects, which leads to the large scale displacements. For any project to be sustainable and inclusive the benefits have to be equally distributed.” Susana Barria, Project Coordinator, Public Service International, gave an example of the promotion of the rooftop solar panels as a strategy to reduce displacement.
Ciao Borges, a lawyer representing Conectas, a not-for-profit organisation that holds consultative status from UN-ECOSOC from Brazil, had stated earlier that “So far the Shanghai based Bank, which claims to focus on ‘sustainable infrastructure’, has approved seven investment projects in all member countries for a total of over EUR 1.4 billion, with 75 pc investments on renewable energy. Despite this, the Bank has not felt the need to define the concept of sustainable infrastructure. Moreover, with lack of transparency and redressal mechanism, the affected communities would have no recourse to file their complaints and concerns.”
As NDB’s President KV Kamath shared targets of the bank funding 15 infrastructure projects in member countries worth approximately EUR 2.8 billion, the large scale impact of NDB becomes important. The NDB can potentially ensure it takes an alternative path to IMF with considerations of inclusive development, however, it yet remains to do the same.
— Caio de Souza Borges (@caiosborges) April 2, 2017