Proposed price of Rs 600 million much higher than other complicated projects

KATHMANDU, Oct 13: The cabinet meeting on Friday decided to allow Nepal Army to purchase the detailed project report (DPR) of Kathmandu-Tarai Expressway from the Indian consortium that made the report. The cabinet has asked the army to first negotiate the price with the Indian consortium. 

Minister for Commerce Min Bahadur Biswakarma said that Nepal Army has been asked to proceed for the construction of the expressway, a national-pride project. 

“A decision has been made to purchase the DPR but the Directive Committee has to negotiate the price of the DPR with the Indian consortium,” said Biswakarma. The committee is led by a senior member of Nepal Army.  

If the 76-kilometer-long expressway was built, the time taken to reach tarai from Kathmandu would be brought down to an hour, saving fuels worth over Rs 5 billion annually. Currently, it takes at least 5-6 hours to reach terai from Kathmandu via the existing roads that wind through the hills.  The Indian Consortium led by IL and FS had demanded Rs 600 million as compensation for the DPR, which it had prepared earlier. The project was denied to the consortium. 

But a privy source said the DPR prepared in just three months’ time, without the involvement of expensive consultants, was not worth that much money. “The proposed cost of the DPR is far higher than that of another DPR of 100-kilometer-long railway prepared in recent years that involved highly-paid consultants from Korea and expensive technologies,” added the source: “We have not seen involvement of any highly-paid consultants and experts on this DPR, and it was prepared in just three months’ time.”

The cost of the DPR of 108-kilometer-long Bardibas-Simara Railway project was prepared by Indian Department of Railway in 15 months and it has cost only Rs 250 million in 2014. Several other DPRs of railway projects cost below Rs 300 million. 

Overpricing of the DPR for Kathmandu-Tarai Expressway has raised suspicion about financial embezzlement as the local agents of the Indian consortium have been pressing the government and Nepal Army to pay exorbitantly. Knowledgeable sources have said that it indicates attempts of bribery to the government and political leaders as well.  According to engineers, the DPR of the expressway lack any substance as it has not studied the feasibility of building high bridges, leaving plenty of room for the DPR to be revised and updated by experts. 

Earlier, the proposal of purchasing the DPR was rejected by the cabinet in May during former chief secretary Som Lal Subedi’s tenure, according to government sources. 

The Indian consortium had claimed to have completed the DPR in 2015, but it was denied the project amid controversies. The cost proposed by the consortium was very high and the revenue guaranteed was very low. The erstwhile government led by late Sushil Koirala had deferred the decision on the project, and the subsequent government led by K P Sharma Oli had decided to build the project on its own. 

In September, Nepal Army was preparing to pay Rs 1 billion for the DPR but the plan did not materialize probably because of media reports exposing the overpricing of the report. But the effort toward this is still on, and the cabinet’s nod has made the plan immune to any investigation by the anti-graft body -- the Commission for the Investigation of Abuse of Authority.  

In February, a study panel led by former vice chairman of National Planning Commission Min Bahadur Shrestha had recommended purchasing DPR to save time. The panel had also suggested negotiating the price before buying.

 
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• kathmandu-tarai expressway