Interference in bidding for NCT to cost the economy heavily
Tuesday, 14 December 2010
For procedural flaws one after another and deletion of clauses the much awaited tender of New Mooring Container Terminal (NCT) is being cancelled or revised after final stages of bidding and the cost is going sky-high while the country keeps smarting from nagging efficiency of Chittagong Port.
Problems are getting worse as none is being held responsible for the intentional or unintentional wrongdoings, a representative of the apex trade body FBCCI SM Nurul Hoque said in an exclusive interview with the Financial Express recently.
He said that due to interference of the parliamentary standing committee on port in the bidding process of the NCT the government is likely to face huge financial loss apart from damaging the image of the port in the international shipping arena.
"The Tk 5000 million invested for construction of the project has to count an interest of 13 per cent over the last three years. If the terminal commissioned earlier the turn around time of ships would have reduced much resulting positively in the operational freight charges and image of the port would have brightened across the shipping world," Hoque said.
"Who will pay for this huge national economic and image loss caused by the vested quarters that do not have any executive authority in doing so?" he questioned.
When Hoque enquired about the matter it was learnt from concerned sources in the port that the CPA has already given their objection to the clause. They have stated in their remarks on the proposed amendments that the "pre-qualification document refers to 'maintaining the terminal infrastructure, superstructure, utility installations and the equipment' as being a major obligation of the terminal operator. Deleting this clause will frustrate the objectives of this Tender."
The project of New Mooring Container Terminal was undertaken during the 1996-2001 Awami League government at a cost of Tk 5000 million with a holding capacity of one million TEUs container.
The project was completed in late 2006 and the caretaker government started pre-tender process of appointment of operators for development and management of the terminal on the basis of supply, operation and transfer (SOT).
It was decided that the applicant must have the capability of investing at least Tk 10,000 million with experience of developing and operating container terminal at international level, because full-swing operation of the terminal will need 10 cranes to be set up, apart from huge involvement of fund for other equipment and development works, Hoque said.
As the present government assumed power international quotations were invited on 16 February 2009 through which four companies were short-listed. They are APM Moller, Hutchison Port Investment Ltd that operates terminal at Hong Kong, International Container Terminal Ltd and Dubai-based Peninsular & Orient Steam Navigation Co.
Tender documents were prepared for them on conditions of approval by the Prime Minister. The documents were also supplied in 2009, Hoque said.
The project was undertaken to keep the port's export-import business in greater motion, reduce the lead time (stay time) of ships in the port by improving efficiency and reduce costs to the port users upon adoption of a policy to operate, manage and maintain the port through private sector participation.
"The port authority (CPA) has recognized the urgent need to mobilize resources to further increase port capacity through expansion of facilities and improvement of efficiency, as well as to improve the quality of services to make the port more responsive to the commercial needs of the port users," the CPA said while floating the international tender for pre-qualified bidders.
SM Nurul Hoque, a leading industrialist, former first vice president of the BGMEA and senior vice president of Chittagong Chamber of Commerce and Industry (CCCI), alleged that the CPA keeps on doing amendments and deleting bidding terms and conditions "upon dictates coming from no professional expert but from a vested quarter linked with the bidding of NCT."
The proposed amendments to the existing terms and conditions set up by the CPA's own appointed professional consultant of international standard for the said tender, will simply "delay the process by at least another 20 months, which will frustrate the government plans for transit and transshipment of cargo through the port."
On 17 February 2010 the parliamentary standing committee on port in its meeting at the office of the shipping minister cancelled the earlier tender and decided to invite fresh tender.
Hoque said that the committee held another meeting with Shah Alam in the chair on 16 April which decided to delete the clause no 5.2.2 of the tender document regarding experience of the applicant.
The clause stated that the applicant must demonstrate that within last 10 years it has equipped and developed, as a majority shareholder of the terminal operating company being considered for this experience for operation starting from the stage of completion of the terminal infrastructure and superstructure works having annual throughput capacity of at least 5, 00, 000 TEUs.
As regards terminal operation the it was said in the clause that the applicant must have experience of operating at least three terminals in at least one country or more, with no less than 5, 00, 000 TEUs container in one terminal and 2, 00, 000 TEUs container in another terminal.
Another clause of the original tender was that any applicant engaged as berth operator in the port will not be eligible to participate in the NCT tender if it possesses 15 per cent shares in that berth operator.
"The clause intended to keep the port away from absolute control of any single operator. But a member of the parliamentary committee has deleted the clause apparently to give an operator the absolute control over the port operations violating tender rules," he said.
"It is learnt from the port sources that the parliamentary standing committee on Port has ordered the CPA to completely delete as many as five clauses relating to pre-qualifications involving financial capacity and experience of the applicant," Hoque said.
"How did the CPA agree to comply with such amendments in spite of the fact the parliamentary committee or any of its members do not possess any executive authority? It is a matter of concern that IIFC, the consulting firm of the NCT project, has given its verbal dissent and declined to be involved with the pre-tender and tender activities." he added.
Hoque further said nobody in the parliamentary committee is taking responsibility of the said amendments. The Shipping Minister has said that he is not involved in the process while Shah Alam, chairman of the standing committee, said the amendments have been made by the committee.
Problems are getting worse as none is being held responsible for the intentional or unintentional wrongdoings, a representative of the apex trade body FBCCI SM Nurul Hoque said in an exclusive interview with the Financial Express recently.
He said that due to interference of the parliamentary standing committee on port in the bidding process of the NCT the government is likely to face huge financial loss apart from damaging the image of the port in the international shipping arena.
"The Tk 5000 million invested for construction of the project has to count an interest of 13 per cent over the last three years. If the terminal commissioned earlier the turn around time of ships would have reduced much resulting positively in the operational freight charges and image of the port would have brightened across the shipping world," Hoque said.
"Who will pay for this huge national economic and image loss caused by the vested quarters that do not have any executive authority in doing so?" he questioned.
When Hoque enquired about the matter it was learnt from concerned sources in the port that the CPA has already given their objection to the clause. They have stated in their remarks on the proposed amendments that the "pre-qualification document refers to 'maintaining the terminal infrastructure, superstructure, utility installations and the equipment' as being a major obligation of the terminal operator. Deleting this clause will frustrate the objectives of this Tender."
The project of New Mooring Container Terminal was undertaken during the 1996-2001 Awami League government at a cost of Tk 5000 million with a holding capacity of one million TEUs container.
The project was completed in late 2006 and the caretaker government started pre-tender process of appointment of operators for development and management of the terminal on the basis of supply, operation and transfer (SOT).
It was decided that the applicant must have the capability of investing at least Tk 10,000 million with experience of developing and operating container terminal at international level, because full-swing operation of the terminal will need 10 cranes to be set up, apart from huge involvement of fund for other equipment and development works, Hoque said.
As the present government assumed power international quotations were invited on 16 February 2009 through which four companies were short-listed. They are APM Moller, Hutchison Port Investment Ltd that operates terminal at Hong Kong, International Container Terminal Ltd and Dubai-based Peninsular & Orient Steam Navigation Co.
Tender documents were prepared for them on conditions of approval by the Prime Minister. The documents were also supplied in 2009, Hoque said.
The project was undertaken to keep the port's export-import business in greater motion, reduce the lead time (stay time) of ships in the port by improving efficiency and reduce costs to the port users upon adoption of a policy to operate, manage and maintain the port through private sector participation.
"The port authority (CPA) has recognized the urgent need to mobilize resources to further increase port capacity through expansion of facilities and improvement of efficiency, as well as to improve the quality of services to make the port more responsive to the commercial needs of the port users," the CPA said while floating the international tender for pre-qualified bidders.
SM Nurul Hoque, a leading industrialist, former first vice president of the BGMEA and senior vice president of Chittagong Chamber of Commerce and Industry (CCCI), alleged that the CPA keeps on doing amendments and deleting bidding terms and conditions "upon dictates coming from no professional expert but from a vested quarter linked with the bidding of NCT."
The proposed amendments to the existing terms and conditions set up by the CPA's own appointed professional consultant of international standard for the said tender, will simply "delay the process by at least another 20 months, which will frustrate the government plans for transit and transshipment of cargo through the port."
On 17 February 2010 the parliamentary standing committee on port in its meeting at the office of the shipping minister cancelled the earlier tender and decided to invite fresh tender.
Hoque said that the committee held another meeting with Shah Alam in the chair on 16 April which decided to delete the clause no 5.2.2 of the tender document regarding experience of the applicant.
The clause stated that the applicant must demonstrate that within last 10 years it has equipped and developed, as a majority shareholder of the terminal operating company being considered for this experience for operation starting from the stage of completion of the terminal infrastructure and superstructure works having annual throughput capacity of at least 5, 00, 000 TEUs.
As regards terminal operation the it was said in the clause that the applicant must have experience of operating at least three terminals in at least one country or more, with no less than 5, 00, 000 TEUs container in one terminal and 2, 00, 000 TEUs container in another terminal.
Another clause of the original tender was that any applicant engaged as berth operator in the port will not be eligible to participate in the NCT tender if it possesses 15 per cent shares in that berth operator.
"The clause intended to keep the port away from absolute control of any single operator. But a member of the parliamentary committee has deleted the clause apparently to give an operator the absolute control over the port operations violating tender rules," he said.
"It is learnt from the port sources that the parliamentary standing committee on Port has ordered the CPA to completely delete as many as five clauses relating to pre-qualifications involving financial capacity and experience of the applicant," Hoque said.
"How did the CPA agree to comply with such amendments in spite of the fact the parliamentary committee or any of its members do not possess any executive authority? It is a matter of concern that IIFC, the consulting firm of the NCT project, has given its verbal dissent and declined to be involved with the pre-tender and tender activities." he added.
Hoque further said nobody in the parliamentary committee is taking responsibility of the said amendments. The Shipping Minister has said that he is not involved in the process while Shah Alam, chairman of the standing committee, said the amendments have been made by the committee.