Chief Adviser Fakhruddin Ahmed holds his first meeting of the Executive Committee of National Economic Council (Ecnec) today to consider approval of 15 projects, including a couple of controversial ones, worth Tk 2,230.98 crore.

The projects include the revised budget for the Chandpur 150MW power project awarded to the blacklisted Chinese company Harbin amid allegations of gross irregularities and corruption. Harbin's Chinese competitor in the project's tender CMEC has already sought the government's intervention to stop this corrupt scheme and ensure justice.

The Power Development Board (PDB) seeks a revised budget of Tk 686 crore for this power project, including an increase of the cost for power plant components by $16

million.

The PDB proposal seeks to increase the budget of $45.2 million for the first phase 100MW gas turbine plant to $61.57 million. The price quoted by Harbin for this was around $45.2 million (Tk 288 crore). The PDB awarded the project to Harbin ignoring a government review committee's reservations on the plea that Harbin was doing it for a cheap price tag. The Hawa Bhaban pushed this project all along when the BNP-led four-party alliance government was in power.

The other controversial project is the third Karnaphuli 50MW hydropower unit rehabilitation project. Whereas a new plant can be installed at a cost of Tk 150 crore, the proposal seeks to obtain Tk 180 crore for its rehabilitation under an Italian soft loan. This project was pushed by ANH Akhtar Hossain, who is now in jail as a graft suspect.

Sources said the Cabinet Purchase Committee has already approved the proposal on February 8. Although Akhtar was no longer the power secretary at that time, the proposal approved by the purchase committee bears his signature. The original project proposal was approved by the Ecnec back in 1998 with a budget of Tk 62 crore.

"There has been no study for this project. There is a lone Italian bidder for this project who will be immensely benefited by this scheme," said an expert.

The other projects include revised budget for the rehabilitation and modernisation of Ghorashal-1 and 2 power units at a cost of Tk 210 crore, repair and rehabilitation project for Zia Fertiliser and Jamuna Fertiliser

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companies at Tk 190 crore and Tk 181 crore, Mohraghat Kalurghat Water Treatment Plant at Tk 82 crore, and Atomic Treatment Centre extension at Tk 45 crore.

More projects include: Tk 31 crore infrastructure development for Military Institute for Science and Technology at Mirpur Cantonment, Tk 116 crore fund for infrastructure development in greater Rajshahi, Tk 214 crore phase three Barind Development Project in northern region, Tk 90 crore Debagram-Progoti Sarani link road, Tk 69 crore first phase project for solving water logging problem in Bhabadaha of Jessore, Tk 65 crore project for developing support services of Bangladesh Police, Tk 34 crore project for improvement of the brake system of Bangladesh Railway, and Tk 32 crore Paglapir Tista Barrage road development project.

Sources said the meeting will also be informed of 45 other projects approved by former finance and planning minister M Saifur Rahman during the immediate past BNP-led coalition government's rule.

The finance minister can approve projects involving under Tk 25 crore without the approval of the Ecnec.

CHANDPUR PROJECT CONTROVERSY

Placing of the revised budget proposal for the Chandpur power project indicates that the corrupt axis that had created power crisis in the country is still in control of the PDB. On January 25, the PDB framed its revised budget proposal seeking to increase the project cost so that the blacklisted Chinese company can get $16 million as additional payment.

To award the project to Harbin, the BNP-led alliance government brushed aside a review panel's decision declaring Harbin's bid null and void and asking the PDB to negotiate the project with CMEC.

Blacklisted last year by the Eastern Refinery Ltd (ERL) for failing to install a small power unit, Harbin is known for its gross bid manipulation hiding the cost of plant spare parts to show a low price offer.

"After the ERL blacklisted the company how can any government agency even want to use this company for installing a new power plant?" said a PDB official.

Following a report in The Daily Star last month, the CMEC wrote a letter to the chief adviser describing the wrongdoings of this project.

The CMEC said on September 29, 2005 it lodged a written complaint with the chairman of the Review Panel formed by IMED, Ministry of Planning, to investigate illegal practices and corruption of the PDB in the bid evaluation process of Chandpur 150MW Project. On October 18, 2005 the panel gave its decision declaring Harbin's bid null and void and asking the PDB to negotiate with the CMEC.

The CMEC added that although the decision of the panel was supposed to be final as per the Public Procurement Regulation 2003, more than 16 months have passed and the PDB in connivance with the Power Division disregarded the decision.

"The PDB and Power Division rather managed to convince the Cabinet Purchase Committee in its meeting on January 2, 2006 to award the project in favour of the bidder that was disqualified by the Review Panel on October 18, 2005," the letter said.

It added, on October 18, 2006, the Ecnec decided not to approve the project and recommended further examination. During this time, the CMEC sought justice from every possible quarter including the offices of the then prime minister, finance minister, secretary of Power Division, and PDB chairman.

"Due to the corruption and disregard for law, the CMEC has been denied the execution of the verdict issued by the 1st such Independent Review Panel," the letter said.

"This case is an example as to how even with PPR 2003, procuring entities can continue to practise illegal acts disregarding the decision of the Review Panel formed by none other than the [Government of Bangladesh] itself and BPDB is an entity owned by the GOB," it said.

The CMEC requested the chief adviser's intervention in this regard and ensure that the decision of the 1st Review Panel on the Chandpur 150MW CCPP Project is implemented at a time when the country is suffering from acute power shortage largely attributable to the rampant corruption that has seen a number of foreign companies withdraw from the power sector of Bangladesh.

"The assumption of power by the current [caretaker] government has raised hopes in the minds of all that the misdeeds and corruption of the past will finally be brought into account and those unfairly deprived will finally get justice. All we seek is access to justice and protection from corrupt and illegal practices," it added.