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China company out, Indians coming to rebuild northern roads
View(s):The Government is proposing to drop a Chinese bidder selected on a competitive tender to rehabilitate Road Development Authority (RDA) roads in the North and to obtain fresh proposals from two Indian companies for the same project because of “geopolitical concerns”.
Proposals were invited through international competitive bidding with 100 percent confirmed financing for six packages to rehabilitate roads in the Northern and Eastern provinces. Forty-four applications were received. The Cabinet Appointed Negotiating Committee (CANC) and a Project Committee evaluated the proposals on technical, financing (price) and financial criteria.
Two packages were awarded to Sinohydro Corporation Ltd (one in the North and one in the East). The others went to CEC-NEM Joint Venture, KDA Weerasinghe & Co Pvt Ltd, Consulting Engineers & Contractors Pvt Ltd and Nawaloka Construction Company Pvt Ltd.
But the Indian authorities, through the Indian High Commission, “requested to award some road development work in the Northern Province to the Indian companies for which funding could be arranged through the Exim Bank of India,” states a Cabinet memorandum to be presented on Tuesday by Prime Minister Ranil Wickremesinghe’s Ministry of National Policies and Economic Affairs.
“The High Commission of India in Colombo has facilitated two contractors of which one is a Government of India owned company IRCON and a partially Government of India owned company IL&FS Transportation Networks Ltd (Public Private Partnership company),” the memorandum says.
“Therefore, it may be prudent and appropriate to assign the Contract package on Rehabilitation of RDA Roads in the Northern Province (NIR/NP/RDA/o1) that has been recommended by the CANC to Sinohydro Corporation Limited to the Indian Company IRCON or IL&FS Transportation Networks Ltd (Public Private Partnership company) as Sinohydro Corporation Limited has already been selected for 01 Contract package on Rehabilitation of LGD Roads in the Eastern Province (NIR/NP/LGD/01) which is also the largest Contract package,” it holds.
The memorandum states that in the recent past “there has been serious concerns expressed by the Government of India, especially in the involvement of Chinese contractors in the Northern Province”.
“As this is a geopolitical concern, a suitable decision has to be taken considering the good relationship Sri Lanka has to maintain with the neighbouring country and considering the past support and cooperation extended by the Government of India on socio-economic development of Sri Lanka,” it asserts.
If approved, Sinohydro will no longer carry out road rehabilitation in the North. The Cabinet assent is being sought now to invite proposals from the two Indian bidders, as requested by the Indian authorities, for the major RDA roads that link the North and East from Thalaimannar to Trincomalee via Vavuniya (208.6km); and the Jaffna-Trincomalee road which has two options (196km via the Kokkulai Bridge through the Paranthan-Mullaitivu Road or 220.36km via Kokkulai Bridge through the Point Pedro-Maruthankerni Road). Also to be examined are other possible priority roads which the Exim Bank of India has agreed to fund.