Reprieve for sacred river: The World Bank cut funds to a dam project in India, writes Tim McGirk

TRIBESMEN living in the teak forests along the Narmada river, who have only the scantest idea of where New Delhi is, let alone Washington, were last night rejoicing over a decision made at the World Bank headquarters that may save their sacred river from being dammed up and their villages submerged.

Such abstractions as banks are alien to the Vasava tribesmen, who hunt and forage in the jungle canyons of central India. But they do understand a great stone wall is being built across their river which, when the monsoon rains fall this summer, will cause the flooding of many villages. The tribesmen also know that money to build the wall comes from Washington and that on Tuesday, the flow of funds dried up.

Indian officials told the World Bank in Washington on Tuesday they did not need a promised dollars 170m ( pounds 114m) loan for the Narmada project, probably the biggest dam and irrigation scheme in the world. The reason was that the bank was trampling on India's 'self-respect' by imposing too many conditions.

Bank experts had expressed concern over New Delhi's failure to resettle more than 300,000 people, mainly tribesmen, who are to be dislodged by this grandiose scheme of 4,500 miles of canals and 27 dams. India's refusal was seen as a face-saver; the World Bank was intending to cut off funds to the controversial dollars 3.5bn scheme anyway. It was conceived at a time when banks were only too happy to burden developing countries with colossal engineering projects that later proved to be expensive and of dubious value.

The World Bank's exit was made after opposition to the project by environmental groups, in India and abroad, and from several donor countries. The tribesmen were galvanised into protest by a crippled holy man, Baba Amteh, who meditates in a grass hut beside the Narmada, and Mehda Patkar, a former chemist and academic from Bombay who wanders among the river tribes.

Ms Patkar sent a message from a remote Narmada village saying the loss of World Bank funds was 'a victory for thousands of struggling tribals and farmers in the Narmada valley'. One leading environmentalist, Ashish Gotari, called for a halt in construction work and an independent review of the project, one that will consult inhabitants of the 240 villages to be submerged.

Opponents of the Narmada project predict that it will be an ecological nightmare. Bewildered tribesmen will be herded into rocky and barren compounds far from their native jungles, ecologists claim. Forests will be eroded, and the expensive canal network will provide only a trickle to the drought- stricken farmers of Gujarat state who need water the most. New Delhi, however, insists that the states of Madhya Pradesh, Maharashtra and Gujarat will draw power and water from the project.

So far, engineers have built only part of the main Sardar Sarovar dam and dug 84 miles of canals. The executive project director, Bimal Jalan, said that work will proceed even without the World Bank infusion. But India must unearth another dollars 2.65bn to finish the network of dams and canals, and without World Bank backing it will be difficult to find donors. Japan and Germany are thinking twice about helping the project.

Some Indian ecologists are worried that the cash-poor builders may now channel money alloted for the rehabilitation and resettlement of the tribes to the engineering work. Mr Gotari said: 'The government said it's planning on going ahead, but nobody knows where the resources will come from. They'll have to divert it from somewhere.'

But the monsoon rains are only three months away, and some low-lying villages may be washed away. Ms Patkar has renewed her vow that unless the dam is opened up, she and a band of tribesmen will wait at the river's edge for the Narmada goddess to rise from the waters and take them as sacrifice.