The Hindu : JBIC project: list of consultants approved

Online edition of India's National Newspaper
Tuesday, Dec 17, 2002

Southern States

Southern States - Kerala

JBIC project: list of consultants approved

By Our Special Correspondent

THIRUVANANTHAPURAM DEC. 16. The Cabinet on Monday approved the list of consultants for the controversial Kerala Water Supply Project to be funded by the Japanese Bank for International Corporation (JBIC).

The list ranks consortia formed by the Japanese companies, the Tokyo Engineering Consultants and Pacific Consultants International, as first and second. The consortium by the Mott McDonald of the United Kingdom is ranked third.

The Chief Minister, A.K. Antony, told presspersons after a Cabinet meeting that the list would be sent for approval of the JBIC. The list had earlier been approved by the implementing agency, Kerala Water Authority (KWA) and the Tender Evaluation Committee.

The Water Resources Minister, T.M. Jacob, said 27 companies had bid for the contract after the Government decided to call global tenders for the consultancy. Of them, five were short-listed. However, two did not submit financial and technical bids.

The short-listing had been done on the basis of their experience, staff and work plan and methodology.

Once the list is approved by the JBIC, the financial bids by them would be opened and negotiations held on the basis of their ranking. If no agreement could not be reached with the first, the second would be considered. Negotiations would be held with the third, if the financial bids by the other are rejected, the Minister said.

Mr. Jacob recalled that the project was drawn up by the previous UDF Government led by Mr. Antony in 1995-96. The project comprises the Thiruvananthapuram and Kozhikode augmentation schemes and schemes for Cherthala and neighbouring villages (Alappuzha district), Chathannur and neighouring villages (Kollam district) and Pattavam and neighbouring villages (Kannur district). It was estimated to cost Rs. 1,800 crores (five years ago). It would benefit about 45 lakh people. The total yield would be 371 million litres of water a day.

Asked about the high cost per kilolitre of water to be produced under the project, the Minister said the KWA was supplying water at Rs. 2 a kilolitre now while the production cost was Rs. 7 a kilolitre. The Government was subsiding the cost. High costs could be managed similarly in future also, he claimed.

The project had attracted controversy over irregular inclusion of the Pacific Consultants (PCI) in the original short-list, high interest cost and high project cost. The LDF Government had cancelled the original short-list following an inquiry. This was objected to by the JBIC, which insisted on inclusion of the Japanese company in the short-list. The LDF Government declined and decided to invite fresh global tenders. The UDF Government that came to power in 2001 rescinded the decision and decided to consider PCI for the contract. However, this decision was later dropped in view of mounting criticism and fresh tenders were called for.

The per capita cost of the project is nearly double that of the current costs.

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