WASHINGTON, D.C., October 10, 2025 – Last week, the internal accountability mechanism at the International Finance Corporation (IFC), formally ended its monitoring of the devastating impacts of the Tata Mundra coal-fired power plant project in Gujarat, India, and confirmed that IFC will do nothing to remedy harm caused to local fishing and farming communities. The Compliance Advisory Ombudsman (CAO) issued its final monitoring report and closed the case that was initiated more than 14 years ago by communities impacted by the IFC-funded project.
As the private lending arm of the World Bank Group, IFC’s stated mission is to end poverty and “do not harm.” This project, however, has devastated the local marine environment, depleted fresh water resources, harmed human health, polluted the air, and contaminated crops, fish, and homes with fly ash and coal dust.
In 2013, the CAO concluded that IFC had failed at virtually every stage of the project to abide by its own policies and commitments to prevent harm and called for IFC to take remedial action. IFC rejected those findings, and subsequent monitoring reports in 2015 and 2017, the CAO found that IFC had failed to take any action to address its compliance failings or to remedy harm. In its final monitoring report last week, the CAO concluded it was “unlikely” that IFC would ever take action and formally “closed” the case.
The following is a statement from Michelle Harrison, EarthRights Acting U.S. Legal Director:
“IFC’s failure to address the legacy of harm caused by this project remains a dark stain on its reputation and on the credibility of the World Bank Group more broadly as a supposed development institution.
Far from supporting the IFC’s mission to end poverty, this project has left people worse off. Families living in the shadow of the project have spent nearly two decades trying first to protect themselves against harm, then struggling to secure any measure of justice. Yet at every turn, IFC has refused to do right by these communities, and affirmatively undermined their ability to seek access to any avenues for remedy.
The CAO report reveals IFC acted to undermine that process, repeatedly refusing to provide CAO with critical information essential for monitoring. Yet the CAO gave up, closing the case on the basis that it is powerless to get IFC to do anything.
Although the report inexplicably seems to accept IFC’s claim that it no longer has leverage over the Tata borrower after repayment, the loan agreement for this project reveals that is false. IFC continues to have significant legal authority to act, it simply chooses not to use it. That IFC brazenly misleads communities, CAO, its Board, and the public about the terms on which it provides financing only further demonstrates the crisis of accountability at IFC. Despite long recognizing contract transparency as a norm of international law, IFC still does not make its loan agreements publicly available. That is unacceptable and must change.
The loan agreement for this project was produced during the landmark Jam v. IFC lawsuit. Rather than deny the allegations of the communities, IFC defended itself in that case by arguing that it was above the law; it simply could not be sued, no matter how much harm it caused. The U.S. Supreme Court rightfully rejected the idea of “absolute immunity” in a 2019 decision, holding that international organizations like IFC are entitled only to a more limited form of immunity in U.S. courts. While the lower court went on to find IFC still immune from the particular claims in the Jam case, the case further exposed how IFC has abandoned its mission to “do no harm,” and has led to increased public and governmental scrutiny of IFC’s conduct and its basis for immunity.
IFC has made it clear that it is far more concerned with competing with private commercial banks to get money out the door than carrying out its development mission. If IFC wants to be able to act like any other commercial bank, the time is right to examine whether any continued immunity is justified. The United States government may very well decide it no longer makes sense to continue to extend any special privileges or immunities to IFC under U.S. law, that aren’t enjoyed by other private banks.”
