In the wake of the World Bank’s (WB) cancellation of its contract with the Government of Bangladesh for $1.2 billion credit for the Padma Bridge, the government faces an acid-test which like any challenge in life can be converted into opportunity. This can, however, happen only if the government shuns the apparent denial syndrome and generates the courage and commitment to ensure a fully independent, credible investigation into the allegations of corruption and deliver exemplary punishment, if found guilty.
The WB loan is a part of the $2.9 billion Padma Bridge project which has been well recognised as extremely important for Bangladesh for many reasons, not least as a key route to the present government’s electoral pledge embodied in a vision of Bangladesh to achieve the status of a middle-income country.
One of the five top strategic components of the government’s election manifesto was a very uncompromising stance against corruption backed by over a dozen specific pledges to build capacity to control this menace. For obvious reasons, like any other aspect of government’s delivery against pledges, and perhaps even more, the Padma Bridge project implementation was expected to be free from corruption.
In this context, the challenge that the government faces today is deeply regrettable, embarrassing and disappointing. But it is in the hands of the government itself to face it with dignity. The government should proceed fast to set up a fully independent special judicial committee of highest possible credibility to investigate into the allegations of corruption.
In determining the mandate of this investigation, the government must distance itself from the policy of denying that corruption couldn’t have taken place because no funds have yet been released. Corruption is more than exchange bribery or kickback. It consists of abuse of power in influencing policies and decisions, particularly involving conflict of interest. It will be particularly important in this case to assess if such abuse has taken place in this case.
The proposed committee should be bestowed with full powers, independence and technical support to investigate into the matter and recommend action in accord with the relevant laws within a specific deadline. The report of the Committee must be published for public information at the same time as it is submitted.
The WB for its part allowed itself to take a controversial decision and miss the opportunity to continue to engage with the government to assist the investigation process, and keep the credit open parallel with the investigation process.
The World Bank’s decision was in some ways expected. It is common knowledge that a significant part of the funds of WB financed projects in the developing countries have been lost to corruption and misuse over the years, for which the main burden lies in the hands of the governments of those countries.
However, it is also well known that part of the onus also lies on the Bank itself. A 2009 report by the Bank’s own Independent Evaluation Group (IEG) that was released only after a protracted battle with the Bank’s management which fought hard to avoid disclosure concluded that the Bank doesn’t protect its funds adequately. Lack of safeguards in the Bank was found to be in the category of “material weakness.” the most serious of financial accounting failings. (http://fpif.org/reports/world_bank_corruption) The report also commented that after over a decade of high-level speeches and rhetoric against corruption the Bank has progressed very little to protect its projects and financial management from risk of fraud.
Against this backdrop, as a newcomer to the world of openness and accountability, faced with the challenge of addressing the allegations of corruption in the Padma Bridge project, the Bank seems to have adopted the easiest approach of chopping off the head because of a headache.
Instead of depriving the people of the benefits of funds that the Bank draws from global public sources, it could have been, and should now be, more strategic and continue to engage with the government. While investigations on alleged corruption continues in Bangladesh and Canada, to which WB should provide full support, it should review the decision and find ways to provide the credit by sharing the responsibility as a key fiduciary agent of the project to ensure integrity, transparency and accountability in the implementation process.
Neither the WB, nor the government can deprive the people of the country of the development opportunity for alleged corruption of a handful of people.
The government’s initiative to secure funds for the Padma Bridge from alternative sources may be perceived as a way to divert attention from the allegation of corruption rather than actually moving ahead with the project, but even if it so succeeds, it would not help the credibility crisis that the government faces.
There is no alternative for the government other than taking the challenge head-on. By taking the Padma Bridge project as a test case the government must demonstrate that it has the capacity and courage to send a strong signal that corruption is indeed a punishable offence in Bangladesh without fear or favour to anybody. This will not only persuade the people of the country a year and a half before the next general elections, but also help overcome the reputational crisis of the government in the eyes of the international community.
The writer is Executive Director, Transparency International Bangladesh.