RIGHTS: World Bank Warns Nepal Over Abuses

By Emad Mekay Reprint | | Print |

Emad Mekay

WASHINGTON, Mar 9 2005 (IPS) - The World Bank, under pressure from development and human rights groups to intervene in escalating human rights abuses in Nepal, said Wednesday it was considering stopping its projects and programmes in the country if the current political tension continued and constitutional freedoms were not respected.

The World Bank, under pressure from development and human rights groups to intervene in escalating human rights abuses in Nepal, said Wednesday it was considering stopping its projects and programmes in the country if the current political tension continued and constitutional freedoms were not respected.

The international community and international financial institutions are responsible for funding more than 60 percent of Nepal’s development budget and more than 28 percent of its total budgetary expenditures. Their influence over the country is enormous, many observers say.

In a carefully worded statement, the World Bank said it was monitoring events in Nepal closely and could take further action in two months.

The Bank’s staff had reportedly written to the Bank’s Board of Directors saying that more time would be needed to make a "ground-level assessment" of whether it can continue implementing ongoing projects in Nepal.

The Board expressed concerns about the security situation in Nepal and whether World Bank projects could actually be carried out.

The Board, however, still broadly supported the cautious approach proposed by management.

"Management noted the Board’s concerns and will continue to consult closely with other development partners in assessing the progress that the government makes in reform implementation, as well as issues related to the broader governance environment of the country, including the rule of law and protection of human rights," the Bank said in the statement.

On Wednesday, World Bank Country Director for Nepal Ken Ohashi gave the government a window of one to two months to show renewed commitment to reform and governance issues.

Ohashi said the Bank will watch whether the new government demonstrates genuine commitment to the country’s development vision as expressed in the so-called Poverty Reduction Strategy (PRS), an economic reform plan.

Watchdog groups welcomed the bank’s new "measured" posture.

"I’d call this a very significant threat by the World Bank," said Mark Schneider, senior vice-president of International Crisis Group (ICG) in Washington, a group that has been calling for the Bank to use its influence in the country to help halt human rights abuses.

"It essentially puts into question the major resource flow through the poverty reduction strategy to Nepal from the IFIs (International Financial Institutions)."

The Bank and other public lenders like the Asian Development bank had come under fire for failing to publicly denounce anti-democratic measures taken by the country’s king.

King Gyanendra seized power, ordered the house arrest of dozens of political leaders and disbanded the government on Feb. 1, claiming it was necessary to end the Maoist insurgency.

He immediately imposed a state of emergency in the Himalayan country, one of the world’s poorest. An official policy of censorship was imposed, and the king banned any criticism of his actions for six months.

Human rights activists say that abuses have only increased since then, and that several political activists have disappeared.

Development experts say that with the prospects for foreign trade or investment remain very slim because of the small size of the economy and the civil strife, so there is room to pressure the government to roll back its abuses.

The World Bank says the country needs foreign aid because of the high overall poverty ratio, about 40 percent of the country’s 27 million people. With a per capita income of only 230 dollars per year, Nepal remains one of the poorest countries in the world.

Human rights groups have said that the situation in Nepal has deteriorated sharply since the royal coup.

The county has seen continuing curbs on civil liberties, and more restrictions on the freedom of the media.

The country’s record on disappearances and extra-judicial killings has become one of the world’s worst, human rights groups say. Hundreds of political figures and activists have been detained, and protests have been violently suppressed.

In February, the ICG, a Brussels-based research organisation, called on international donors and lenders help to help stop the abuses.

The group said that the key countries and organisations involved in the country – India, the United States, Britain and the U.N. – need to work together to strengthen a collapsing state and establish a plan to deal with the Maoist insurgency.

"The government is vulnerable to external pressure because it is heavily dependent on foreign aid," said the group in its report.

A human rights activist who spoke on condition of anonymity told IPS that the World Bank and other international financial institutions like the International Monetary Fund and the Asian Development Bank should work towards suspending all assistance (including development assistance) apart from humanitarian aid if the country does not see a return to the constitutional process.

Non-governmental organisations have recommended the use of financial "pressure points".

The ICG, for one, called for a freeze of all direct budgetary support to the government and any commitment to forge new agreements with the IFIs.

They also demanded plans for a phased suspension and withdrawal of foreign assistance.

Certain effective actions have already been taken internationally. India, the country’s powerful neighbour, has cut off military aid and Britain has suspended delivery of a planned new package of military assistance.

But until today’s World Bank statement, international financial institutions had stayed clear of the controversy.

"We deliberately took a ‘wait and see’ stance, not making any public statements or seeking meetings with the ministers for the first three weeks," Ohashi told the Bank’s Board.

"It was designed to give the new cabinet the space to demonstrate how it was going to approach the development agenda, rather than crowding that space with our ideas and advice."

His comments came after a meeting of the World Bank’s executive board in Washington, which had summoned Ohashi for a briefing on the Nepal situation.

While considered by some to "long overdue", the Bank’s statement was still interpreted as a step in the right direction.

"I think this is a very positive statement I am hoping that the king will recognise the seriousness of this and move to remedy the situation by restoring constitutional order and reversing essentially the decision to eliminate democratic institutions," Schneider said.