Procurement News Notice |
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| PNN | 361 |
| Work Detail | The Kachhi Canal project was delayed and its price soared from Rs 57.6 billion to Rs 102.1 billion due to poor planning, faulty design, corruption and haphazard implementation. According to sources in the Ministry of Water and Power, the Kachhi Canal project was launched in 2002 without preparation of PC1 and funds were released for this project. They said that the PC1 of the project was prepared in 2003 with project completion to be in 2007 but it was delayed due to serious irregularities and embezzlement by Ministry of Water and Power. The source also told Business Reorder that the Ministry did not consult the related stockholders including agriculture engineers and water management experts and relaxed rules of contracts to give favour to specific companies. They said that under the directives of Prime Minister Nawaz Sharif, a consortium of the National Consulting for Business and Management Solutions (Pvt) Ltd (NCBMS) and Euroconsult Pakistan (Pvt) Limited was engaged to carry out the technical and financial audit of the project. According to this audit report, relaxation of criteria enabled SMADB-Lilley-Sharukh JV to participate and win the tender KC-04 at an exorbitant price of Rs 9.74 billion which is 41.73 percent higher than the engineers' estimate (Rs 6.87 billion). Ministry of Water and Power admitted the relaxation and said that the tender documents were issued to the pre-qualified firms/JV. The Ministry said that due to relaxed criteria sufficient competition was generated amongst five firms instead of only one (as per original criteria). The Ministry said the bid price of M/s SMADB-Lilley-Shahrukh JV amounting to Rs 9.84 billion was the lowest among the participants. Prime Minster Muhammad Nawaz Sharif has also constituted an inquiry commission headed by former Chief Justice of Pakistan Tassaduq Hussain Jillani to fix responsibility for the alleged illegalities in Kachhi Canal project. The sources said that the inquiry commission has raised serious questions about the project and sought their written replies from the Ministry of Water and Power and Ministry of Planning, Development and Reforms. The inquiry commission sent written queries to the relevant ministries. According to replies of the Planning Commission, then Member (Water), Wapda, Muhammad Mushtaq Chaudhry opposed the lining on technical grounds, however the succeeding Member (Water), Wapda Raghib Abbas Shah supported the lining which caused several issues, including a delay. The Ministry also replied that the then Member (I&M), Lieutenant General Muhammad Zubair approved lining of distributaries in Phase-I in violation of the technical grounds. The Planning Commission also clarified stated that the cost of PC1 was Rs 32.45 billion which was based on in-house studies conducted by Wapda while PC1 was approved at rationalized cost of Rs 31.2 billion. Planning Commission added that Ministry of Water and Power and Wapda should have fixed individual responsibility as the sponsoring and implementing agencies as per the recommendations of consultants who pinpointed the lapses. The sources said that an internal inquiry committee of Wapda also identified the reasons and those responsible for poor planning, faulty design and irregularities which delayed and increased the price of project. They added that Wapda is neither professionally managed nor monitored the project. After completing the project, Balochistan is expected to irrigate 713,000 acres of land in Dera Bugti, Naseerabad, Bolan and Jhal Magsi districts and earn Rs 19 billion a year through improved agricultural yields. The Kachhi Canal project comprises construction of around 500-kilometre long lined main canal of which 300 kms lies in Punjab and 200 kms is in Balochistan. Kachhi Canal off-takes from Taunsa Barrage on Indus River and passes through districts Muzaffargarh, Dera Ghazi Khan, Rajanpur in Punjab and then meanders through districts Dera Bugti, Naseerabad, Bolan and Jhal Magsi in Balochistan, the province in which the project's command area lies. |
| Country | Pakistan , Southern Asia |
| Industry | Water & Sanitation |
| Entry Date | 02 Sep 2016 |
| Source | http://www.brecorder.com/market-data/stocks-a-bonds/0/79853/ |
