Pakistan: Karot Hydro-02/Jhelum River
Severance pay, discrimination against local workers.
$100 million loan
IFC has an active project with Karot Power Company Limited (KPCL), a special-purpose vehicle incorporated in Pakistan and majority owned by China Three Gorges South Asia Investment Limited (CSAIL). The project involves providing a long-term corporate loan facility of up to US$100 million to support the construction, operation, and maintenance of a 720MW run-of-the-river hydropower plant being developed on the Jhelum River, in Pakistan.
The complaint was submitted to CAO by a former employee of the Karot project. The complaint raises concerns about lack of payment of exit wages, as well as discrimination against local workers in relation to access to drinking water, conditions of accommodations and transportation at the project site. Irregularities about employment contracts and salary increases are also mentioned.
The complaint was found eligible for further assessment on August 3, 2020. During the assessment process, CAO lost contact with the complainant and was unable to re-establish communication and advance the process. Since the dispute resolution process requires the respective complainant and the IFC client to voluntarily agree to participate in mediation, this case was referred to our Compliance function, in line with our 2013 Operational Guidelines.
The Karot Hydro 02 and 03 cases have been merged.
A compliance appraisal was completed under the 2013 Operational Guidelines, based on the transitional arrangements agreed upon in the adoption of the 2021 CAO policy. CAO conducted a preliminary analysis of the concerns raised by the complainants regarding labor issues. A summary of the analysis related to each issue is available in the appraisal report. The report is published in English and Urdu, accessible via the “Case Documents” section below this page.
Status as of January 27, 2022