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Inspection of Arun 111 Hydroelectric Project Authorized

Contact: Eduardo Abbott (202) 458-2617

WASHINGTON, D.C. February 3, 1995 - The Board of Executive Directors of the International Development Association on February 2, 1995 agreed to an investigation by The Inspection Panel into certain aspects of the proposed Arun III Hydroelectric Project in Nepal.

The Board's decision was as follows:

"Resolved to authorize investigation by the Panel of the three areas recommended by it, i.e., whether IDA's policies and procedures have been observed with respect to environmental assessment , indigenous peoples and involuntary resettlement, in terms of (1) the consistency of the determination of the road alignment with Operational Directive 4.01 (Environmental Assessment); (2) the consistency of the treatment of indigenous peoples, if any, with OD 4.20 (Indigenous Peoples), and (3) the consistency of arrangements for compensating seriously affected families for land acquired by Government with OD 4.30 (Involuntary Resettlement).

The Panel will take into account information and studies subsequently provided by the Government of Nepal, the Bank and other Co-financiers, as well as any remedial measures agreed by Nepal and the Bank, and taking into account the complexities of the issues involved, will examine whether the requirements of the above-mentioned ODs were observed in substance.

The Panel will commence field work only after the Bank receives a decision from the Government of Nepal requesting the Bank's financing of the Project and should, to the extent possible, complete its work within the three month period suggested by the Panel. Management should facilitate the task of the Panel with a view to enabling it to complete its task early."