India: Lafarge Surma Cement-01/Shella
Land, Indigenous people
Loans totaling $50 million plus $10 million equity
IFC has a project with Lafarge Surma Cement for the construction and operation of an integrated, dry process cement plant in Bangladesh very close to the border with the Indian state of Meghalaya, from where the limestone is sourced. A limestone quarrying and crushing operation located in Meghalaya serves the cement plant and the two centres of operations are connected by an overhead belt conveyor. IFC approved an A Loan of $35 million, a B Loan of up to $10 million and equity of $10 million in 1998, and invested in 2003.
In January 2013, a complaint was filed by a number of individuals on the Indian side of the project. The complaint raises concerns about the legitimacy of the land acquisition and use process for the project’s limestone quarrying operation close to the villages of Shella and Tynger in Meghalaya. The complainants further state that as Khasi indigenous people they have been deprived of their land, their livelihood has been impacted, and their customary land rights and systems have not been respected. The complainants have requested confidentiality.
CAO found the complaint eligible for further assessment in January 2014. During the assessment, CAO found no agreement among the key parties to proceed with a dispute resolution process under CAO auspices. Therefore, the complaint was transferred to CAO’s Compliance function for appraisal, per CAO Operational Guidelines.
CAO completed its Compliance Appraisal in October 2014. The Compliance Appraisal notes that the primary concerns of the complainants in this case relate to the company’s acquisition of land that they claim to own. While a just resolution of these issues is no doubt important for the parties, the information available is not found to support a conclusion that they raise substantial concerns about environmental and/or social outcomes of the project. CAO also notes the complainants’ concerns about the adequacy of IFC’s engagement with the project’s impacts on the indigenous people. Absent a complaint from a broader group of project-affected people, however, CAO is reluctant to pursue an investigation on this basis. While Compliance Appraisal raises a number of questions about the strength of IFC’s preparation and its supervision of E&S aspects of the project, these are not found to be of sufficient systemic importance to justify an investigation. On the balance of considerations, CAO thus decides to close the case.
CAO closed the case on October 14 , 2014. CAO's Appraisal Report and Assessment Report are available under 'View Documents' below.
Status as of October 17, 2014
Note: A CAO assessment does not entail a judgment on the merits of complaints. Rather, the aim is to listen to people's concerns, understand the different perspectives, and gauge whether it is possible to address the concerns in a collaborative process.