India / Vizhinjam-01/Kerala
Vizhinjam International Seaport Limited (VISL), a special purpose company fully owned by the State Government of Kerala, is developing a multi-purpose seaport at Vizhinjam, 16 kilometers south of the state capital, Trivandrum (Thiruvananthapuram). IFC has been hired as the Transaction Advisor to strategically assist VISL in structuring and implementing the project; and seeking private sector partner(s) to implement the plan in collaboration with the State Government Ports Department. IFC is managing roughly $1.6 million in trust funds for the project.
In August 2012, a complaint was filed to the CAO by local tourism workers/businesses and other local residents, with the support of the Kerala branch of Exnora International, the Kerala Hotels and Restaurants Association, and the People’s Resistance Committee in Vizhinjam. The complainants raise concerns about detrimental impact of the port project on tourism and fishing communities situated along the coast of the area. The impacts cited in the complaint include, but are not limited to, water scarcity, loss of livelihood, loss of land and inadequate compensation. Also, the complainants specifically question IFC’s due diligence and contend that IFC failed to undertake a thorough review of documentation on the project’s environmental, social and economic impact assessments.
The CAO found the complaint eligible for further assessment in September 2012. At the request of the complainants, CAO extended the 120-day assessment period in March 2013. Ultimately, CAO found no agreement among the key parties to proceed with a dispute resolution process under CAO auspices. Therefore, the complaint has been transferred to CAO’s Compliance function for appraisal, per CAO Operational Guidelines.
In June 2015, CAO completed a compliance appraisal with regard to the Vizhinjam 01, 02 and 03 complaints. On the basis of this compliance appraisal, CAO has decided to conduct a compliance investigation into IFC's Advisory Services project with Vizhinjam International Seaport Ltd. The CAO investigation will assess whether IFC prepared and implemented the project in accordance with its policies and procedures.
CAO's appraisal report, providing a full description of CAO's decision with regard to this case, is available under "View Documents" below. The Terms of Reference for this compliance investigation will be issued in accordance with CAO’s Operational Guidelines.
Status as of June 04, 2015
- Project Name & Number
- Kerala Port, Vizhinjam 28991
- Vizhinjam International Seaport Limited (VISL)
- Port and Harbor Operations
- South Asia
- Environmental Category
- Eligible: Completed
- Assessment Period: Completed
- Under Appraisal: Completed
- Under Audit: In Process