Newly installed 90-MW Fenchuganj power plant likely to go into operation in 3 months
Sunday, 6 September 2009
The 90-MW Fenchuganj power plant is likely to go into operation by next three months as the tax related dispute between the Power Development Board (PDB) and the Chinese contractor Harbin has been resolved recently, reports UNB.
PDB set up the power plant about a year before, but it could not be commissioned because the dispute between the PDB and its Chinese contractor.
According to official sources, the Chinese contractor, Harbin Power Engineering (HPE), supplied and installed the 90 MW Fenchuganj combined cycle plant in October last year and conducted a test run of the plant.
But after the test run, when PDB asked Harbin to start its operation for the national grid, the contractor refused to do so. It demanded the PDB to pay back the money which it had to pay as tax.
Particularly, the Harbin demanded the money to be paid back by the PDB which it (Harbin) had to pay as tax to the National Board of Revenue (NBR) for capital equipment import.
Harbin claimed the employer (PDB) of the contractor should pay the tax as the equipment were the capital machinery.
On the other hand, PDB declined to pay the money back to Harbin as it claimed that as per the tender terms and conditions, the contractor should pay the tax.
Both sides remained adamant in their own positions, keeping the power plant idle.
In the meantime, PDB pursued the Foreign Ministry through the Power Ministry to negotiate the matter with the Chinese Embassy in Dhaka. But the Chinese Embassy supported the Harbin's position and claim.
After assuming office, the present Awami League government took a move to settle the issue. The Power Ministry recently sat with the Chinese contractor and reached an understanding accepting the contractor's claim.
Finally, the Power Ministry asked the PDB to pay back the money paid by Harbin to the NBR.
Now Harbin is taking preparations to commission the plant in the next three months. Power Secretary Abul Kalam Azad, PDB chairman ASM Alamgir Kabir and other PDB officials on Saturday visited the plant to oversee the preparation.
Industry sources said two top leaders of the ruling party, who now became new agents of the Chinese company, played a significant role in settling the dispute with Harbin.
PDB set up the power plant about a year before, but it could not be commissioned because the dispute between the PDB and its Chinese contractor.
According to official sources, the Chinese contractor, Harbin Power Engineering (HPE), supplied and installed the 90 MW Fenchuganj combined cycle plant in October last year and conducted a test run of the plant.
But after the test run, when PDB asked Harbin to start its operation for the national grid, the contractor refused to do so. It demanded the PDB to pay back the money which it had to pay as tax.
Particularly, the Harbin demanded the money to be paid back by the PDB which it (Harbin) had to pay as tax to the National Board of Revenue (NBR) for capital equipment import.
Harbin claimed the employer (PDB) of the contractor should pay the tax as the equipment were the capital machinery.
On the other hand, PDB declined to pay the money back to Harbin as it claimed that as per the tender terms and conditions, the contractor should pay the tax.
Both sides remained adamant in their own positions, keeping the power plant idle.
In the meantime, PDB pursued the Foreign Ministry through the Power Ministry to negotiate the matter with the Chinese Embassy in Dhaka. But the Chinese Embassy supported the Harbin's position and claim.
After assuming office, the present Awami League government took a move to settle the issue. The Power Ministry recently sat with the Chinese contractor and reached an understanding accepting the contractor's claim.
Finally, the Power Ministry asked the PDB to pay back the money paid by Harbin to the NBR.
Now Harbin is taking preparations to commission the plant in the next three months. Power Secretary Abul Kalam Azad, PDB chairman ASM Alamgir Kabir and other PDB officials on Saturday visited the plant to oversee the preparation.
Industry sources said two top leaders of the ruling party, who now became new agents of the Chinese company, played a significant role in settling the dispute with Harbin.