The Chief Minister's statement came in the wake of the World Bank proposal to conduct a survey of the `state's financial status.'

The rejection of the proposal has prompted the World Bank to `go slow' on disbursing of loans worth Rs 1,000 crore towards several Bank-aided rural development projects.

Speaking to The Indian Express, state finance minister Ashim Dasgupta said: ``We do not know why the World Bank insisted on carrying out a study on the finances of the state. Our repayment capacity of the World Bank (or for that matter other financial institutions) loans are excellent when compared to the record of many other states."

``But we cannot accept these additionalconditionalities. If we accept their conditions now, in future, they may even try to influence our policies on tax and subsidies,'' Dr Dasgupta felt.

He added, ``We are ready to reply to their specific questions on specific projects on which we are using their money, but we cannot accept their proposal for conducting a study on the finance of the state.''

However, the refusal of the World Bank proposal is set to push the fate of the rural development projects into uncertainty in areas like health, sanitation and drinking water, roads and some of the housing projects in the urban areas.

And the State Government, already preparing itself to look for alternative funds to meet the challenge, in case the present `go slow' by the World Bank proves an eventual withdrawal from these projects, has not taken the threat lightly either.

``At any rate we will not let the projects suffer, if the loan process is not continued with, we will arrange the funds from domestic financial institutions and our budgetaryresources,'' Dr Dasgupta said.

``Anyway, all our development projects are not dependent on the World Bank loans which we are paying back with an interest at the rate of 12.5 per cent,'' Dasgupta claimed.

However, according to observers here, the World Bank may have its doubts about the channelling of the loan money through various zilla panchyats for these projects.