12:02 AM, February 05, 2014 / LAST MODIFIED: 01:53 AM, March 08, 2015

Contractor delays 4-lane project

Contractor delays 4-lane project

Chinese firm asks for Tk 500cr more to complete its job; project cost goes up
M Abul Kalam Azad

Instead of blacklisting a Chinese company for breaching contract and refusing to complete the expansion of Dhaka-Chittagong highway, the communications ministry has opted to persuade it into doing the job within the terms of the contract.  
But its efforts to that end for two years now have yet to yield any result, as the company keeps dragging its feet, saying it would not finish the work unless the allocation is increased.
In January 2010, Sinohydro Corporation won the contract for expanding around 140 kilometres of the 192km highway into a dual carriageway by December 2013. So far, it has completed only 30 percent of the work, according to the progress report on the Dhaka-Chittagong four-lane project.
The company has on many occasions informally told the government that it got the job at a lower rate and so the budget for the project must be raised.
Officials of the ministry said Sinohydro had been demanding an additional Tk 500 crore to finish the job, which is a gross violation of the contract.   
Under the procurement rules, the company could be blacklisted for such a breach of contract. But the ministry has been trying to persuade the firm into finishing the job as per the contract.
The officials say cancelling the contract and giving the job to a new contractor will increase the project cost and delay its completion further.
Already, the project deadline had to be extended by a year. And its cost rose to Tk 3,190 crore from the original Tk 1,655 crore due to inclusion of three rail overpasses and five bridges in the project, changes in its design, price adjustments and the Chinese company's delaying tactics.
A 52-km stretch of the highway, known as the economic lifeline of the country, is being expanded by two local companies and their progress of work is much better.
The two firms -- Reza Construction and Taher Brothers -- have completed about 60 percent of a 37.7km stretch and 55 percent of the rest 15.3km stretch of the highway.
So far, the three companies have altogether completed only 37km of the 192km highway.
Irked by the Chinese firm's delay, Communications Minister Obaidul Quader in April last year spoke to the Chinese ambassador in Dhaka, urging him to mount pressure on the firm to do its job. But it yielded no result.
After the January 5 election, the communications ministry assessed Sinohydro's work progress and found that the company hardly made any headway in three out of its seven packages (portions of the job).  
The abysmal performance prompted the ministry to hold another meeting with the Chinese diplomat two weeks ago.
“The diplomat assured the government of holding a meeting with the company officials in Dhaka and China soon to resolve the matter,” said Communications Secretary MAN Siddique, adding that they were constantly putting pressure on the firm to complete the job.
About Sinohydro's claim for additional money, he said the amount was not acceptable.
He, however, said the ministry may consider it if the company comes up with a logical demand.
“Their work in four packages is good,” the secretary added.
Contacted, Obaidul Quader said they had sought the Chinese government's cooperation in resolving the issue.
Chinese ambassador in Dhaka Li Jun has assured the government of talking to Sinohydro officials, he added.
Obaidul had planned to have a part of the dual carriageway inaugurated by Prime Minister Sheikh Hasina last year, but he had to abandon the plan because of the poor work progress.
The long delay has irritated the PM who wanted to talk to the top officials of the Chinese firm. She has already asked the communications ministry to call the company officials to Dhaka, ministry officials said.  
Hasina has also asked the ministry officials to see if the contract for three packages could be cancelled and given to a new firm. But the officials told the PM that it might cause further delay in completing the project.
Before Hasina talks to the company officials, the communications ministry and the Chinese embassy will hold a meeting with the firm officials on their claim for additional money.
Although the government has been refusing to pay any extra money, it may accept the decision of the tripartite meeting, ministry officials said.
The project was initially undertaken by the BNP-Jamaat government in 2005. But due to a series of procedural hurdles and two failed tenders, the project did not see any light.
 Assuming office in 2009, the Awami League government took up the project and floated a fresh tender to upgrade the highway, which is the most used road for exports and imports. Heavy traffic sometimes doubles the six-hour travel time on the highway, hampering foreign trade and causing public sufferings.
The government in January 2010 signed deals with the three firms to expand the highway in three years.
But the work began in 2011 as problems relating to the appointment of project's consultant ate up a year. However, the work did not get momentum for scarcity of dirt to fill the lanes, fund crunch and demand for money by local politicians and thugs from the contractors.
This led the ministry to revise the DPP (development project planning) and re-fix the cost at Tk 2,382 crore.
Later, the cost was raised to Tk 3,190 crore when the DPP was revised again, bringing some crucial changes to the project and changing its design.



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