PR using delaying tactics to award LC

LAHORE - The Pakistan Railways is using delaying tactics in awarding Letter of Credit (LC) for the import of 75 locomotive worth Rs 4 billions from China, it was learnt on Thursday.
The sources in Pakistan Railways told The Nation that National Assembly Standing Committee (NASC) is also creating hurdles in the completion of the 75 Locomotive project just for the sake of personal interests and to provide financial benefit to a US company, which was the highest bidder of this contract.
Due to delaying tactics, now the PR has failed to open Letter of Credit (LC) for the import of the locomotives, they added.
Sources said that according to the contract agreement, the Railways was bound to pay one per cent payment of the total amount to the contractor till March 3l and 85 per cent till May 02, which has expired now.
They said that the contract for the purchase of 75 locomotives worth Rs 4 billion was awarded to the lowest international bidder Chinese State owned company on December 31,2008 after the inordinate delay of four years.
The authorities in Pakistan Railways intended to give favour to an American company, which also participated in the international bid of 75 locomotives but failed to win because of highest rates, they added.
The sources said that committee constituted by the NASA was consisted of 6 members and only two were technical expert, which was the severe violation of the rules of the PPRA because non-technical people cannot be the members of the technical committee. Hence the conclusion of such committee must not be considered authenticated, sources added. Asad Saeed, GM Services and Manufacturing, was not available for his view point because he left for China to finalize financial matter with the Exim Bank.
It may be mentioned here that Exim Bank of China is funding the project of 75 locomotive on a supplier credit basis. It is also pertinent to mention that Pakistan Railways awarded on merit 75 Locomotives contract worth Rs 4 billions to lowest international bidder Chinese State owned Donfang Electric Company (DEC). Pakistan Railways authorities and DEC Company officials signed the contract award ceremony on December 31 of last year in lslamabad in the presence of Federal Minister for Railways. It may be mentioned here that the Chinese company had offered to provide 75 engines at the cost of $107 million as against the US companys tender of $227m. The cash starved Pakistan Railways had entered several agreements with Chinese railway companies for its development and modernization of its outdated system.
In 2001, Pakistan Railways signed a $91.89 million contract with China National Machinery Import and Export Corp for the manufacture of 175 new high-speed passenger coaches.
Exim Bank China funded the project on a supplier credit basis. Under an agreement signed with China in 2003, Pakistan Railways Pakistan Railways locomotive factory. The locomotives were purchased on suppliers credit basis with funding provided by Exim Bank China through the Dongfang Electric Corporation.
However, some influential circles have been propagating that the Chinese railway engines were not up to the mark, therefore, Pakistan should not buy additional railway coaches and engines from China.