0
LAHORE, Feb 25: Wapda on Tuesday scuttled a legal tender to place an order for 1.2 million single-phase meters to a group of local manufacturers at a higher price of Rs90 per meter, causing consumers a loss of Rs108 million. The authority accepted the price of Rs820, after some ‘negotiations’, by four local manufacturers despite having a valid bid of Rs730 from a Chinese company through its tender No 2728.
The authority will now recover the cost (Rs108 million) from hapless consumers, already burdened by power tariff, which is the highest in the world.
In addition to aborting a tender and creating possible legal complications for the authority, Tuesday’s order also flies in the face of Wapda’s earlier stand. The authority has been maintaining for the last many months that it cannot place order with local manufacturers because of higher price and the purchase being a sacred trust of the consumers.
The authority had earlier placed an order for 600,000 meters at the rate of Rs850 to the same group of manufacturers who had quoted a price of Rs1050 in the tender. The price has been further cut after “negotiations” by Rs30 in a few weeks time. But it is still higher by Rs90 from the lowest bid quoted by the Chinese company.
It may be mentioned that the Chinese company has already involved its embassy and foreign office in the deal and pointed out, through a letter, possible negative effects on the business ties between the two countries. But it failed to deter the authority in placing order with the local manufacturers.
TENDER: The authority had floated an international tender for purchase of 1.5 million meters in June 2002. It opened bid on Aug 1, 2002 in which eight companies participated. The four local manufacturers had quoted a price of Rs1,050 per meter against Rs768 by a Chinese company.
The authority further negotiated with the Chinese company and was able to bring down the price to Rs730 per meter. It granted a Letter of Award in October last to the Chinese company after a due process.
Meanwhile, the local manufacturers, in spite of being Rs300 expensive, sought the intervention of the Ministry of Water and Power, Finance and Industries. All three ministries joined hands to seeks different explanations from the authority.
In its reply to the ministries on Jan 6, Wapda said the award of the contract to the Chinese would save it and consumers Rs200 million. The four local manufacturers had quoted the price of Rs1,050 and later reduced it to Rs850 per meter. Their act though cut the price down but also indicated the margin of profits they had been extorting from consumers through Wapda.
The authority, led by Chairman Zulfiqar Ali Khan, had been maintaining that the Wapda Act provided full autonomy to it and the ministry could not interfere in any deal.
A former member power maintained that no one ever interfered in the process when the authority was purchasing meters without tenders at an unbelievable price of Rs1,125 per meter. Wapda had not floated tenders for the last three years and purchases were made through the closed-door negotiations from local manufacturers.
“Now, for the first time in the last four years, it is following it own rules and everyone from the government is at it and seems determined to ruin the process,” he lamented.
