ISLAMABAD: The National Highway Authority (NHA) has ‘revoked’ an Rs85 billion contract for the construction of the 117km Kharian-Rawalpindi motorway, against the wishes of the Senate Standing Committee on Communication, it has emerged.

The contract to build the mot­orway was awarded to the Tech­no-Matracon joint venture (JV) after the NHA issued it a Letter of Intent (LoI) on Aug 15, 2022.

An LoI is said to be the first stage in the award of any contract, after which a Letter of Support (LoS) is issued in the second stage, before the agreement between the contractor and the client is inked in the final stage.

Under the Rs85 billion contract, a 117km four-lane motorway was to be constructed under a public private partnership on a built, operate and transfer (BOT) basis.

The successful bidders, Techno-Matracon, had submitted its technical and financial bids for the project on June 9, 2022, listing Power China Chengdu as a technical partner with no investment.

At a meeting of the Senate panel last month, however, NHA revealed that Techno-Matracon was required to obtain confirmation from Powerchina Chengdu about its lead role and percentage share to substantiate the submission of a bid, failing which, NHA’s executive board would withdraw the LoI and annul the procurement process.

But this did not go down well with the committee, whose chairman Ahmed Umer Ahmedzai warned of the impact of increasing rates and the substantial rise in dollar prices, which could drive up the project cost of NHA opted to go for retendering.

“Clarity should be observed while taking decisions on projects costing billions of rupees and the country should not suffer monetary loss in [this] dire economic crisis,” the official statement issued by the Senate secretariat after the meeting quoted Senator Ahmed Zai as saying.

The body also cautioned that they may refer the matter to the National Accoubtability Bureau and the Federal Investigation Agency if the estimated project cost exceeded Rs85 billion in the re-tendering process.

No NHA officials were willing to go on the record in this regard, saying that the matter was subjudice as the contractor has also moved a court to seek relief.

However, an NHA official told Dawn that the project LoI was withdrawn after Tecnho-Matracon failed to explain the role of its lead technical partner, Power China Chengdu, which has a 51 per cent share in the project.

However, he conceded that if the contract was cancelled and NHA opted for rebidding, the project cost would rise, as per the Senate panel’s fears.

Published in Dawn, November 22th, 2023