Transparency International - Pakistan (TI-P) has raised questions on the tendering process of multi-billion rupees Greater Karachi Bulk Water Supply Scheme known as K-IV Phase-I (260 MGD).

According to a letter written to Secretary to Prime Minister, Azam Khan, TI-P said that it has received a complaint in which the complainant has made allegations about discrepancies in the tendering process.

According to the letter written by TI-P Chairperson Ms. Yasmeen Lari and Vice Chairperson, Justice (retd) Nasira Iqbal, the complainant has made the following allegations that during visit to China on February 6, 2022, Imran Khan, Prime Minister held meeting with Chairmen of China Energy Engineering Corporation (CEEC) in Beijing.

In the meeting with PM, in which Shaukat Tarin Finance Minister, Mansoor SAPM on CPEC affairs and the Ambassador of Pakistan were also present, CEEC agreed to assist Pakistan in Rs 126 billion K-IV project, and offered to assist Wapda in execution of project under CPEC terms, including the technical assistance and financial arrangements of the project. The PM and Finance Minister highly appreciated the gesture of CEEC and asked to submit a proposal.

On February 14, 2022, Moinul Haq, Ambassador of Pakistan asked Dr. Song Hailiang, of M/s CEEC to expedite their proposal including offers on K-IV in writing.

On February 18, 2022, CEEC sent its proposal to the Chairman Wapda, confirming the discussion held between Prime Minister Imran Khan and his team with Chairman CEEC on K-IV, and also suggested collaboration with M/s FWO as its consortium members.

However, the Wapda, hurriedly and against PPRA Rule 2004, instead of inviting open international bids, in violation of Rule No. 12 & 13, which allows 30 days for international bidding, in first week of February 2022, in violation of PPRA Rule 2004, asked four State Owned Companies to send their quotations for Rs 126 Billion K-IV project, by February 21, 2022.

TI-P maintains that no construction company in world can prepare its tender comprising of over 500 BOQ items in 16/18 days, unless the details have already been provided to the pre-selected company months ahead.

PPRA Rule 2004, Rule No 42 (f), provide Direct Contracting with State Owned Entities but following condition cannot be met in the EPC/ Turnkey Project -K-IV by any of the 4 State Owned firms.

“A procuring agency may engage in direct contracting with state owned entities such as professional, autonomous or semi-autonomous organizations or bodies of the Federal or Provincial Governments for the procurement of such works and services, including consultancy services, which are time sensitive and, in the public interest, subject to the following conditions, namely:- (i) the organization or the body to be engaged in direct contracting shall be eligible to perform the works or render the services; (ii) the organization or the body shall accomplish the work or the services including consultancy services, exclusively through its own resources without involving private sector as a partner or in the form of a joint venture or as a sub-contractor;”

None of the four state owned firms, FWO/ NLC/ KS&EW and RAILCORP has the in-house expertise of designing Rs 126 billion water supply project, nor facility for carrying out geotechnical investigations of the 150-KM K-IV route.

TI-P has stated that based on the facts, the allegation of violation of PPRA Rules 2004, Rule No 12 & 13, and misuse of Rule No 42 (f), (not applicable in this procurement as it a EPC/ Turnkey project and outsourcing of many components are mandatory) renders the procurement as mis-procurement under PPRA Rule No 50.

TI-P has requested Prime Minister to inquire about facts and direct the concerned authorities to expedite the completion of K-IV in next 18 months, as announced by him without violation of public procurement rules.

This report was first published in Business Recorder on February 21, 2022.