KARACHI, Aug 16: A local subsidiary of a German company has informed the Public Procurement Regulatory Authority (PPRA) and the finance ministry about a case of the Pakistan Security Printing Corporation (Pvt) Limited (PSPCPL). The corporation is procuring a bank note printing machinery worth Rs5 billion from a Swiss company.
Enecon Marketing Services, which represents Drent Goebel of Germany in Pakistan, informed the PPRA and the finance ministry that the PSPCPL had not provided an opportunity to all manufacturers of bank note printing machines to participate in the global competitive bidding.
Enecon Managing Director Kunwar Qutubuddin Khan in a letter addressed to the PPRA and the finance ministry said that he was not suggesting procurement of the note printing machinery from any particular company. He, however, believes that all the manufacturers be provided an equal opportunity.
He said the PSPCPL was procuring the machinery from KBA Giori of Switzerland. The corporation, according to him, had not explored alternative technology and other sources of supply of the machinery.
He urged the ministry and the authority to look into the matter and asked the corporation to go through international competitive bidding so that the process could be made transparent and as per prescribed policy of the government.
When PPRA Managing Director Muhammad Khalid Javed was approached by Dawn to seek his comments on the issue on Tuesday, he said that he had been absent from office for the last three weeks and would not be able to go to the office for at least two more weeks because of illness. “I cannot say anything on this issue.”
However, in his earlier remarks, Khalid Javed said that the authority had received a complaint from Enecon. A copy of complaint was sent to the printing corporation and the PPRA had also received a reply from the PSPCPL.
The PSPCPL has confirmed that the machinery in question is being purchased on a single tender basis and no press tender was issued. The corporation has also provided a list to the PPRA about the clients of their machinery suppliers. The list indicates that KBA Giori does not have total monopoly on these types of machines, as other countries in the world may also be using these machines manufactured by other companies. The PSPCPL also agrees that similar machines from other sources are also available at a cheaper price, but the quality of their products, the corporation stresses, is not good.
Mr Javed in the letter maintained that rule 10 of the Public Procurement Rules 2004 had been violated in this case. He asked the finance secretary to look into the matter and direct the corporation to purchase new machinery on open tender basis and in compliance with the Public Procurement Rules 2004.
A senior lady executive of the PSPCPL, on the condition of anonymity, told Dawn said that the purchase was being made in a transparent and efficient manner with prior approval of the board of directors, the ministry of finance, the CDWP and Ecnec.
She said that a tender had been called for the procurement of machinery some weeks back. However, she refused to give a clear reply as to when the new machinery would land into Pakistan.
She said the bank note printing machinery had been purchased from KBA Giori of Switzerland, which was in fact a replacement of old machinery with upgraded version. She pointed out that the proposed machines to be purchased would be the latest version of old bank note printing machines. “Managers, engineers and other crew trained on these machines can easily operate and maintain these new machines after certain amount of familiarization and training by the supplier,” she added.
Earlier, PSPCPL official Hassan Irfan had informed the PPRA and the finance ministry that the proposal of Drent Goebel of Germany, represented by Enecon Marketing Service, for web-based security printing machine, could not be considered for bank note printing.
“PSPCPL is using printing machines from KBA Giori and its sheet-fed technology is in use in almost 90 per cent of countries in the world involved in the security printing of bank notes. The PSPCPL has been using the sheet-fed technology for the last five decades,” he said, adding that changing to a complete new technology (from sheet-fed to web-based) would be an experiment involving drastic changes with huge associated risks. “Therefore, it is certainly not advisable to go for such a risk,” he pointed out.
PSPCPL Executive Director Mrs Naiyer Muzafar Hussain had earlier informed the PPRA that in 1979-78 and 1996-97, the corporation had acquired printing machinery and auxiliary equipments from KBA Giori. At that time, the question of single source procurement was raised and debated, but later the CDWP and Ecnec approved the purchase from the Swiss company.
The finance ministry in 2003 had advised the PSPCPL to invite international competitive bids instead of purchasing machines from KBA Giori since a huge amount was involved in the transaction.
To justify the procurement from a single source, the PSPCPL had informed the finance ministry that KBA Giori had a monopoly in bank note machines and the only other source of sheet-fed machines was KOMORI of Japan, which could supply less sophisticated machines but their quality could not be ensured. Later, Ecnec approved the procurement from Switzerland.
