NEW DELHI, Jan 12, 2008 (AFP) - The World Bank has exposed serious fraud in Indian healthcare programmes it has funded and said New Delhi had agreed to help stamp out corruption, officials said Saturday.
Serious lapses in auditing, malpractice and corruption were found in five healthcare programmes launched between 1997 and 2003, it said, adding that the projects were jointly funded by donors, India and the World Bank.
A "detailed implementation review launched by the World Bank and the Indian government in 2006 found serious incidents of fraud and corruption in the five health projects," it said.
Four of the projects under investigation have already been completed while the fifth is ongoing and was facing an in-depth review, the Bank said in a statement.
An Indian health ministry spokesman said the projects that received overseas funds dealt with tuberculosis, malaria and HIV/AIDS control.
The World Bank said the in-house review was prompted by an internal investigation in 2005 into a reproductive and child health project in India.
"It found corrupt practices by two pharmaceutical companies which were subsequently disbarred by the Bank and the (Indian) government," it said.
World Bank president Robert Zoellick lashed out at random corruption in India, where state-run hospitals and clinics are seen as incapable of caring for the nation's billion-plus population.
"The probe has revealed unacceptable indicators of fraud and corruption," Zoellick said in a statement issued in India.
"The government of India and the World Bank are committed to getting to the bottom of how these problems occurred and I appreciate the resolute commitment of the government, which will be in the lead in pursuing criminal wrongdoing," he said.
Zoellick also blamed administrative lapses by the Bank for the fraud.
"On the Bank side, there were weaknesses in project design, supervision and evaluation. There are also systemic flaws. I'm determined to fix these problems," he said.
The government and the Bank have committed to improving oversight of the total nine health projects supported by the organisation, Zoellick added.
World Bank Managing Director Ngozi Okonjo-Iweala, who visited New Delhi for talks with top officials Friday, said the Bank would invite external auditors to help fight corruption in the future.
India also warned it would take speedy action. Health Secretary Naresh Dayal said four teams of people from the finance and health ministries would be set up to "probe the irregularities" and action would be taken against those found guilty.
The government has already decided that procurement for Bank-funded health projects should be done through the United Nations Organisations of Procurement, Dayal said.
India's finance ministry also promised "exemplary punishment" for those found guilty, a ministry spokesman said.
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