ISLAMABAD, June 12: The ministry of industries and production’s move to seek sought tax and duty-free import of fully-built 300 Black Cabs from the United Kingdom in a way that only one bidder would be successful is being described here as a violation of procurement rules.

The tender for the import has appeared on inside pages of a Urdu newspaper and is not available on the ministry’s own website or that of the Public Procurement Regulatory Authority (PPRA) which is a requirement under the rule.

More interestingly, the first consignment of “Purpose Built Black Cabs” is already on its way even before the bidding date, inside sources said.

Under PPRA rules, all tenders above the value of Rs1 million should be advertised in at least two widely circulated Urdu and English dailies. The tender should also be available on the website of PPRA and the relevant agency, according to the PPRA rules. The import should not be allowed under a specific name and instead generic specifications be given.

None of these conditions and others defined under the PPRA Act of 2004 have been met. Besides, the criteria approved by the ECC is so designed that it fits only for the Black Cab brand produced by LTI Vehicles Limited of the UK. The sponsors had already lined up all the formalities before a decision was taken by the ECC.

According to documents, the Prime Transport Company alone has been permitted by the LTI of UK to assemble and them manufacture the Black Cab brand in Pakistan and also to operate the said taxis.

The tender allows only 15 days to the bidders to arrange proof of land acquisition, technical agreement with the foreign firm, plan for annual production capacity and plan for setting up facilities for after sale service. Completion of these formalities in 15 days is considered by people in the business as an impossible task. After doing all this, the bidder is required to open the letter of credit (L/C) within 90 days and delivery of cabs should start by June 30, 2007.

The conditions for the vehicles include, a purpose built cab, non-convertible for private use, should have a distinct shape of not less than 2.4 litre diesel, passenger seats facing each other, space for luggage, separate lockable driver and passenger compartments and having fold down ramp for wheel chairs. This again fits only the British Black Cabs.

The tender required very generous guarantee with practically no burden on the importer. The importer is required to provide bank guarantee equal to the amount of duty waived on 300 cabs. This would be refunded in two instalments, first on the opening of the L/C for import of plant and machinery, and second on roll-out of the first cab. The company is required to start manufacturing in two years.

The whole process of approval and issue of tender took no more than 45 days. In the second week of April this year, the prime minister Secretariat directed the ministry of industries to formulate a straight-jacket policy within a week as decided at a meeting presided over by the President which said: “Import of Black Cabs on the analogy of tractors, to be allowed, subject to payment of customs duty at the same rates for CKD and CBU, for tax operation only”.

The import of tractors in itself had attracted a lot of criticism because a major chunk of these imports having gone to a son of a incumbent federal minister.

The sub-committee comprising secretary industries, one representative each of the ministries of finance, commerce, CBR and Board of Investment was expanded by including additional secretary economic affairs of prime minister secretariat to meet the specifications of the Black Cab.

The sub-committee, although under pressure, kept on record that while “formulating its recommendations, the committee was conscious of the specific directions in the directive that the analogy of an approved policy in the case of tractors was to be used as a basis”.

The committee recommended 35 per cent customs duty for import of CBU-condition (completely built units) cab being applicable rate for CKD (completely knocked down) units in the case of cars.

In case of tractors, the rate applicable for CKD at zero per cent was allowed for import of the tractors in CBU condition. The ECC, however, allowed five per cent customs duty on CKD and 20 per cent on CBU condition beyond the import of 300 cabs.

The importer will be required to run its own registered company for the cabs and would not be allowed to transfer to anybody except to recognised taxi fleet operators. This transfer would, however, be in the lots of 50-cabs each. The summary was submitted to the ECC without the approval of minister concerned due to a deadline given by the prime minister.

Economic Advisor to the Ministry of Finance Dr Ashfaq H. Khan said the assembler would have to set up assembling plant in the country for further assembling of black- cab cars, which would be exempt from deletion programme of the engineering development board.

When asked that the criteria seemed to have prepared for a single company which had already lined up these facilities, he said the open bidding would provide level playing field to all 0 - ? bidders. He did not comment when asked that a Karachi-based Prime Transport Limited had already signed an agreement with LTI Vehicles of UK to set up Black-Cab assembling plant in Pakistan and import 300 cabs with its brand name.

He said he was assigned to announce ECC decisions only and was not authorised to speak more than that.