NGO Forum on ADB Statement for the AIIB Annual Meeting 2026
September 14, 2026
Pres. Zou Jiayi
President and Chair of the Board of Directors
Asian Infrastructure Investment Bank (AIIB)
Dear Pres. Zou,
We welcome the President of AIIB to her first Annual Meeting as President of the Asian Infrastructure Investment Bank (AIIB). As the Bank enters its second decade, civil society is also looking at this moment as an opportunity for a reset—not in the ambition of AIIB to finance infrastructure, but in the question of what kind of infrastructure the Bank will finance, whose interests it will serve, and who will carry the risks when those investments go wrong.
For the NGO Forum on ADB, 2027 will be a decisive year. The Energy Sector Strategy (ESS) review, the review of the Gender Action Plan, the first full year of implementation of the revised Project-affected People’s Mechanism (PPM), and AIIB's continued expansion across Asia and beyond mean that the decisions taken during the presidency can shape the development pathway of communities for decades. Our own 2027–2028 strategy therefore places the AIIB Energy Sector Strategy, Environmental and Social Framework (ESF) delivery, the PPM, private-sector finance and community accountability at the centre of our work.
The first test is fossil fuels and particularly fossil gas.
AIIB's present ESS still defines fossil gas as potentially playing a "transitional role" and permits financing for LNG terminals, pipelines, gas-fired generation and downstream gas infrastructure subject to a set of conditions. The problem is that a transition fuel without an exit date can simply become another generation of fossil-fuel lock-in.
Our 2026 AIIB Observer recognises that AIIB has increased renewable-energy financing since the 2022 Strategy. We acknowledge that progress. But our portfolio analysis also finds continuing fossil exposure and growing investment in contested pathways such as large hydropower.
The 2027 ESS review must begin with a meaningful, inclusive, transparent and accessible consultation process, including adequate opportunities for civil society and affected communities to participate. The review should also ensure robust scrutiny of any potential introduction of new sectors. The 2027 ESS therefore cannot merely tighten the wording around gas. It must establish a transparent and time-bound fossil-fuel phase-out. There should be an immediate end to new fossil-gas and LNG approvals, accompanied by a clearly dated pathway for eliminating fossil exposure through direct lending, financial intermediaries, funds, capital-market instruments and fossil-linked transmission infrastructure. The loophole cannot simply move from a project loan into a fund or a securitised asset.
Forum network has already called for the coal exclusion to become a full fossil-fuel exclusion, with rights-based transition finance for workers and communities and investment redirected toward appropriately scaled solar, wind, storage, grids and decentralised energy access.
The second test is whether AIIB's decision-making processes give affected communities and civil society a meaningful voice.
There is another issue that has become impossible to ignore: large-scale hydropower.
The devastation unfolding in Nepal should fundamentally change how AIIB evaluates large hydropower in fragile mountain systems.
AIIB's first investment in Nepal was the 216 MW Upper Trishuli-1 Hydropower Project, backed by an AIIB loan of up to USD 90 million. AIIB's own project documentation recognised vulnerability to natural hazards among the project's key environmental and social risks.
Those risks are no longer theoretical.
Following the 2025 glacial-lake outburst flood in the Trishuli corridor, ADB's current project information acknowledges that facilities of Upper Trishuli-1 were damaged and that the morphology of the Trishuli River was significantly altered. In that same 2025 disaster, Nepalese authorities reported that the dam site of the 111 MW Rasuwagadhi Hydropower Project was washed away and that Upper Trishuli-3A also suffered damage. These projects are not all AIIB-financed, but they demonstrate the systemic vulnerability of concentrating major hydropower infrastructure in the same climate-sensitive river corridor.
And now, following the catastrophic August 2026 flood, Upper Trishuli-1 has again become one of the major hydropower sites at the centre of rescue operations. Reuters reports that rescue efforts have focused on several projects across Rasuwa and Nuwakot after the flood devastated the Trishuli system.
This should matter directly to AIIB because the Bank is simultaneously considering another major hydropower investment in Nepal—the proposed USD 200 million Dudhkoshi Storage Hydroelectric Project, including a dam of up to 220 metres in height.
We call on AIIB to halt further financing of new large-scale hydropower projects while the Bank undertakes a fundamental reassessment of their climate, geological, cumulative-basin, biodiversity and community risks. Hydropower should not automatically receive a green label simply because water rather than coal turns the turbine.
The present ESS explicitly supports storage, run-of-river and pumped-storage hydropower. The 2027 review should reverse that presumption. In highly fragile river basins, free-flowing rivers, Indigenous Peoples' territories, and rapidly changing Himalayan cryosphere systems, the starting point must be protection and avoidance, not project bankability.
The climate dimension is particularly important. We should be scientifically precise in assessing the relationship between individual events and climate change. Attribution of a specific glacier collapse or flash flood to climate change requires careful analysis, and scientists are still examining the precise chain of events behind the August 2026 Nepal–China disaster. ICIMOD's preliminary assessment points toward a major ice-rock avalanche entering the river system.
But the wider trend is no longer uncertain. International Centre for Integrated Mountain Development (ICIMOD) has documented increasingly severe glacial-lake outburst flood risks across the Hindu Kush Himalaya and has warned that rising temperatures are driving glacier retreat and the proliferation of dangerous glacial lakes.
For AIIB, Nepal therefore carries two messages at once.
Decarbonisation cannot wait. And climate adaptation cannot mean financing increasingly massive infrastructure without recognising that the physical geography on which those investments were designed is itself changing. A Bank that finances gas while glaciers retreat, and then finances enormous dams downstream from those glaciers, risks addressing one part of the climate crisis while deepening another vulnerability.
The third test is accountability.
The revised PPM became effective on 1 January 2026. AIIB has made important changes to accessibility, confidentiality, parallel proceedings, and the treatment of accountability findings in co-financed projects. We recognise those improvements. But a mechanism is only credible when communities can actually use it. Our AIIB Observer noted that, as of June 2026, AIIB's public information showed no registered PPM submissions, even while accountability mechanisms of co-financiers had dealt with dozens of submissions connected to co-financed AIIB projects. That does not prove the absence of remedy, but it raises a serious question about whether affected people can identify AIIB's role, understand their rights, and reach the mechanism in practice.
So the new PPM must now be tested in the field.
People affected by AIIB operations should know, before financing is approved, that the PPM exists. Information must be available locally, in relevant languages and in forms communities can understand. Communities must be able to raise concerns without retaliation. And where AIIB relies upon another MDB's safeguards or accountability mechanism, co-financing must never become an excuse for fragmented responsibility. The ultimate measure of accountability is not simply whether a complaint can be filed after people lose their land, livelihoods, or environment. It is whether communities had the power to influence the decision before the harm became irreversible.
The presidency begins at a critical juncture.
The 2027 ESS can close the gas loophole and put AIIB on a genuine time-bound fossil-fuel exit pathway. It can move the Bank away from large-scale hydropower and other technologies whose social and ecological risks are being hidden behind the language of renewable energy. And the revised PPM can demonstrate that accountability at AIIB means accessible remedy rather than policy language alone. As AIIB's operations expand across Asia and increasingly into regions such as Latin America, these standards will travel with the Bank. The precedent AIIB establishes now therefore matters far beyond any single project or country.
The question for AIIB's second decade is ultimately very simple: Will Infrastructure for Tomorrow reproduce the risks of yesterday, or will AIIB finally make climate responsibility, community rights and accountability the conditions upon which infrastructure finance is built?
Respectfully,
Rayyan Hassan
Executive Director
NGO Forum on ADB
Cc:
Vice President and Chief Administration Officer
Vice President, Investment Solutions
Vice President and Corporate Secretary
Vice President, Policy and Strategy
Chief Partnerships Officer and Director General, Sectors, Themes and Finance Solutions Department
Chief Investment Officer, Public Sector (Region 1) & Financial Institutions and Funds (Global) Clients
Chief Investment Officer, Public Sector (Region 2) & Project and Corporate Finance (Global) Clients
Chief Internal Audit Officer
Managing Director of the Complaints-resolution, Evaluation and Integrity Unit (CEIU)
Head of Stakeholder CSO Engagement for Asia, Africa and Latin America
All Board of Directors
Endorsed by the following organizations -
Accountability Counsel, International
Aksi! for gender, social, and ecological justice, Indonesia
Bangladesh Food Security Network (KHANI Bangladesh), Bangladesh
Bangladesh Working Group on Ecology and Development (BWGED), Bangladesh
Big Shift Global, Global
CEPR (Centre for Environment and Participatory Research), Bangladesh
Coastal Livelihood and Environmental Action Network (CLEAN), Bangladesh
Forum on Ecology and Development (FED), Bangladesh
Friends with Environment in Development, Uganda
Growthwatch, India
Insaf, India
Jubilee Australia Research Centre, Australia
KRuHA - people's coalition for the right to water, Indonesia
Latinoamérica Sustentable (LAS), Regional
Life Haven Center for Independent Living, Philippines
Mekong Watch, Japan
Oyu Tolgoi Watch, Mongolia
Pakistan Fisherfolk Forum, Pakistan
Participatory Research & Action Network- PRAAN, Bangladesh
People of Asia for Climate Solutions, the Philippines
Recourse, The Netherlands
Rivers without Boundaries (RwB), Regional (registered in Kazakhstan)
Rivers without Boundaries Coalition, Mongolia
SAMATA, India
Society of Development and Education For Small House Holds (SoDESH), Bangladesh
South Asia Just Transition Alliance (SAJTA), Regional
Sustentarse, Chile
Urgewald, Germany
WomanHealth Philippines, Philippines
Sources:
Asian Infrastructure Investment Bank. (2022). AIIB energy sector strategy update. https://www.aiib.org/en/policies-strategies/strategies/sustainable-energy-asia/.content/index/_download/AIIB-Energy-Sector-Strategy-Update_Final_Nov-2022.pdf
Asian Infrastructure Investment Bank. (2019). Upper Trishuli-1 hydropower project. https://www.aiib.org/en/projects/details/2019/approved/Nepal-Upper-Trishuli-1-Hydropower-Project.html
Asian Development Bank. (n.d.). Upper Trishuli-1 hydropower project. https://www.adb.org/projects/49086-001/main
Radio Nepal. (2025, July 8). [Title of the article/report]. Radio Nepal
Reuters. (2026, August 31). Nepal hydropower sites centre of flood rescue efforts. Reuters
Asian Infrastructure Investment Bank. (2026). Dudhkoshi storage hydroelectric project. https://www.aiib.org/en/projects/details/2026/proposed/nepal-dudhkoshi-storage-hydroelectric-project.html
International Centre for Integrated Mountain Development. (n.d.). ICIMOD. https://www.icimod.org/
Asian Infrastructure Investment Bank. (2026). AIIB Board approves revisions to Policy on Project-affected People’s Mechanism. https://www.aiib.org/en/news-events/news/2026/aiib-board-approves-revisions-policy-project-affected-people-mechanism.html
