China-led, India-supported AIIB funding hyper-inflated infra projects, promoting crony capitalism: Mumbai meet

Medha Patkar addressing the convention

By A Representative
A civil society-sponsored convention, concluded ahead of the high-profile AIIB (Asian Infrastructure and Investment Bank) board meet, to take place on June 25-26 in Mumbai, has sharply criticized the "China-led" international financial institution (IFI), insisting, it "rejects" AIIB claim that it "serves as a healthy and essential alternative to undemocratic IFIs such as the World Bank, Asian Development Bank and International Finance Corporation which are controlled by western powers."
Held in Mumbai on June 21-23, a resolution adopted at the end of the convention said, "The design and structure of the $100 billion AIIB functions equally undemocratically. What is worse, it invests in projects without in any manner complying with necessary environmental and social safeguards. In the process, AIIB is doling out billions of dollars of loans to critical sectors such as energy, road building and urbanization causing extensive negative environmental and social impacts."
The resolution noted. "As a result, India, the largest recipient of AIIB loans, has become a site for corporate land grab resulting in massive loss of livelihoods and displacement of rural and urban communities, the prime example being that of the Amravati capital city which is being developed on flood plains and 50,000 acres of fertile agricultural land forcibly acquired from farmers and workers."
Participated by over 1,000 delegates from 200 organizations, the convention was attended by senior activists, academics and financial analysists including Medha Patkar, economist Prof Arun Kumar, Praful Samantara, financial analyst Sucheta Dalal, activists Ulka Mahajan, Roma, Shaktiman Ghosh, Leo Colaco, T Peter, Dr Sunilam, Ram Wangkheirakpam, Leo Saldanha, Rajendra Ravi, Gabriele Dietrich, among others.

Prof Arun Kumar

Taking directly on Prime Minister Narendra Modi for "the IFI promoted development model without any public debate", and terming it "Modani model", the resolution said, it is "pushing big and unnecessary hyper-inflated infrastructure projects like industrial corridors, Bharatmala, Sagarmala, bullet trains, smart cities and others" -- all this "at the cost of basic necessities" of the people such as food, housing and clothing.
"This model is designed to strengthen the hegemony of capital, maximisation of profit and promotion of crony capitalism. The model is best described as: free hand to corporations and loot of labour, farmers, workers and adivasis. We reject this model and the governments and political parties who promote it. They have lost the moral and political legitimacy to rule", the resolution said.
It said, "The Government of India is hosting the AIIB AGM at a time when the Indian economy is reeling under multiple crises which are largely an outcome of a series of reckless and draconian actions of the administration led by Prime Minister Narendra Modi. The colossal disaster of demonetisation (November 2016), which was followed by an ill-planned unveiling of the Goods and Services Tax (GST) regime (2017), has resulted in a terrible attack on the fragile economic status of the poor, devastating millions of livelihoods in farming, fisher and pastoral communities as well as seriously damaging the entrepreneurship of small and medium enterprises and the unorganised sector."
It added, "These policies build on the failed neoliberal reforms and the agenda of liberalisation, privatisation and globalisation which began in 1991 at the behest of the IMF. The working systems of the Reserve Bank of India and other financial regulatory institutions, as well as public sector banks, have been undermined by the constant interference from the Finance Ministry of India, endangering the resilience of the country's financial architecture which has withstood multiple economic and financial crises over time."
"As a result, billions of dollars of bad debt remains unrecovered. Their volume is mounting. Some of India’s richest men, and the massive and powerful corporations they lead, are major debtors to India’s banks. Because of their deep access to high political power, their bad loans and Non-Performing Assets are being systematically written off without attaching their personal assets or taking legal action to tackle such serious economic violations", it said.
Demanding that the "loans, debts and tax benefits given to corporations, amounting to Rs 48 lakh crore approximately, be recovered, and be used to provide education, health and employment for all and to eliminate hunger and poverty", the resolution said, "This should also be used for waiving the farm loans of millions of marginal farmers, workers, adivasis and small enterprises, and to help them rebuild the economy."