The Hindu : National : World Bank unearths fraud in 5 health projects

Online edition of India's National Newspaper
Sunday, Jan 13, 2008
ePaper | Mobile/PDA Version

National

National

World Bank unearths fraud in 5 health projects

Special Correspondent

Review was in the nature of fact-finding report: government

Fraud and corruption surfaced during a review
Government promises action against guilty

NEW DELHI: The World Bank has unearthed serious cases of fraud and corruption in five projects on eradication of tuberculosis and malaria and HIV/AIDS control.

The bank-aided projects are, the $114-million malaria control project, the $82.1-million Orissa health systems development project, the $54-million food and drug capacity building project, the $193.7-million second national HIV/AIDS control project and the $124.8-million tuberculosis control project.

The fraud and corruption came to light during a detailed implementation review (DIR) by the bank last year with the support of the Government of India.

“Unacceptable indicators”

In a statement, World Bank President Robert B. Zoellick said a probe revealed “unacceptable indicators” of fraud and corruption and the Government of India promised to take “exemplary” action against those found guilty.

With assistance from the World Bank and other donors, the projects were implemented during 1997-2003.

Of these, four were over and the fifth one, pertaining to food and drug capacity building, was on and funds were yet to be disbursed. This project, the statement said, would be reviewed to incorporate the DIR findings.

Following an investigation in 2005, the bank discovered cases of corruption in the Reproductive and Child Health project.

This prompted the institution to withhold aid to the project for sometime. Subsequently, two pharmaceutical companies were debarred by the bank.

The statement pointed out that it was that investigation, which prompted the DIR.

Mr. Zoellick stressed that the Government of India and the bank were committed to get to the bottom of how these malpractices occurred.

Government statement

In a statement, the government clarified that the review was in the nature of a fact-finding report and did not extend to detailed investigation.

“Necessary action would be taken against those suspected of wrong-doing and, if found guilty, they will be visited with exemplary punishment,” the statement said.

On the Government of India’s response, Mr. Zoellick said: “I appreciate the resolute commitment of the government, which will be in the lead in pursuing criminal wrong-doing. On the bank’s side, there were weaknesses in project design, supervision and evaluation. There are also systemic flaws ... the Volcker Report points the way towards what has to be done.”

The official statement said the DIR findings would result in putting in place additional measures in procurement and implementation arrangements for the ongoing as well other projects in the pipeline.

The action plan for the health projects, finalised in 2006, would be reviewed in consultation with the bank and the revised action plans would be applied to the on-going and future projects.

The statement noted that the government intended to increase transparency in procurement for the projects.

Already, the Ministry of Health and Family Welfare had commenced implementation of a MIS-based “procurement and logistics management system.”

In the first phase, it was being implemented in procurement activities of the Ministry and in Orissa, Madhya Pradesh and Maharashtra. Based on the experience, it would be rolled out later in the entire country.

Printer friendly page
Send this article to Friends by E-Mail

National

News Update

Stories in this Section