Disturbed by the adverse remarks from the World Bank which alleged irregularities like collusion between the Government officials and pharma firms, the Centre has swung into action to prepare a joint action plan to review the WB-assisted projects including the Food and Drug Capacity Building Project worth 54 million dollars.

Besides suspending business with a couple of pharmaceutical companies, the government has also ordered CBI inquiries into the irregularities even as the Centre expressed reservations on the finding of the recent Detailed Implementation Review (DIR) report by the WB on five health sector projects.

While the capacity building programme, aimed to improve the state drug control mechanism, is expected to be completed by June 2008, all other programmes have been over. Revised National TB Control Programme (RNTCP-I)(8 May 1997 to 31 March 2006 (USD 124.8 million), Enhanced Malaria Control Project (EMCP) (27 Oct 1997 to 31 Dec 2005)(US $114 million), Orissa Health System Development Project (OHSDP) (8 Sept 1998 to 31 March 2006)(US $82.1 million), National AIDS Control project-II (NACP-II)(11 Sept 1999 to 31 March 2006)(US $193.7 million) and Food and Drug Capacity Building Project (FDCBP)(17 Oct 2003 to 30 June 2008)(USD 54 million) were the projects which came under the scanner of the WB.

``In this report, the World Bank has mentioned about indicators of deficiencies relating to procurement, oversight and implementation like collusion, bid rigging, deficiency in civil works, equipments not installed because of lack of staff etc. Majority of the deficiencies reported relate to decentralized procurements at the district level, which are implemented at the State level",' health ministry sources said.

``The World Bank report suffers from several infirmities. Ministry of Health and Family Welfare has already conveyed its response on the infirmities in the methodology adopted by World Bank emphasizing that the World Bank did not discuss with any of the programme officers either during the review or before finalizing the review report. These discussions would have clarified most of the issues raised in the report. Had this been done, most of the inferences would have been different,'' an official said.

Notwithstanding the differences on the finding, the report has prompted the Government to take disciplinary and penal actions. The business with two firms - Nestor Pharmaceuticals and Pure Pharma were suspended on charges or reported collusion. A case was registered by CBI against both the companies and the investigation was in advanced stage, sources said.

To address the systemic deficiencies pointed out in the report relating to procurement, implementation and oversight, a Joint Action Plan has been finalized after intensive discussions with the WB keeping in mind specific interventions and timelines.

Three new cases pertaining to Chhattisgarh and Karnataka referred to CBI for further investigation. One of these was identified through an analysis of the audit report. In a similar case, the Government of Orissa has filed a criminal case and initiated departmental proceedings. Orissa has now ordered a full-fledged vigilance inquiry to look into all alleged deficiencies regarding the State Health System project.