U.S. Supreme Court gave relief to Gujarat Farmers and Fishing Communities

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The Supreme Court of the United States has held that the International Finance Corporation is not absolutely immune from suit filed against it by farmers and fishermen of Gujarat.

The International Finance Corporation had loaned $450 million for the construction of Tata Power’s Mundra power plant in 2008. The loan agreement gave IFC supervisory authority over the project which included implementation of an Environmental and Social Action plan. The fishing and farming community had sued IFC claiming that its failure to supervise this plan had caused environmental damage — pollution from the plant harmed the surrounding air, land, and water.

Chief Justice Roberts, observed that: "The International Organizations Immunities Act grants international organizations the "same immunity" from suit "as is enjoyed by foreign governments" at any given time. Today, that means that the Foreign Sovereign Immunities Act governs the immunity of international organizations. The International Finance Corporation is therefore not absolutely immune from suit."