Sunday, October 28, 2007

On technical grounds

That's what has delayed the the Shewri-Nhava Sheva Transharbour Link (or the MTHL - Mumbai Transharbour Link).

First, some facts that I know.
  • The MTHL, like many other Mumbai projects, was thought of a long time back (1970 to be precise). As usual, nothing (has) happened.
  • A few years back the Maharashtra State Road Development Corporation (MSRDC) began thinking about building this bridge and bids were invited. When I first posted, there were three groups in the race as follows.
  • (a) Mukesh Ambani Group (IL&FS+Seaking+John Laing+Laing O'Rourke)
  • (b) L&T-Gammon-Sistema
  • (c) IIMC (IFFCO+ITD+MAEDA+Skanska)
  • At some point of time, the Anil D. Ambani Group (ADAG which is Reliance Energy+Hyundai Construction), joined the race to build the bridge.
  • MSRDC disqualified ADAG from bidding on technical grounds, i.e.because its partner Hyundai had incurred cash losses in the past. Therefore, the combined net cash profit of the Group fell below MSRDC norms, even though other norms were met. (More in this article).
  • And therein began the controversy: how can you disqualify the group when it meets all the conditions except one, which can be a technicality? Not surprisingly ADAG went to court.
  • Two facts to remember (a) elder brother Mukesh Ambani, also in the bid to build the bridge, is at loggerheads with Anil Ambani and (b) MTHL is critical to Mukesh Ambani's Navi Mumbai/Maha Mumbai Special Economic Zone, because the MTHL will link the SEZ to Mumbai.
So, chew on this for a minute. From 1970 to 2006, nothing really happened on the MTHL. 36 years nothing. What were our ministers doing? When they did decide to go ahead, the issue went into court.

Where are we now? On Sept 11th 2007, the Supreme Court scrapped an earlier High Court order and allowed ADAG to bid for the project. The extended date for filing financial bids now stands at 15th December 2007.

The latest update came courtesy a front page HT article last week. The MSRDC had disqualified a Chinese firm from the bidding process on technical grounds, i.e. because the Chinese firm has built a longer bridge at a cheaper cost. This is what MSRDC Chairman, Shri Anil Deshmukh, has to say.
The pre-bid qualifications laid down that the bidder should have built a sea link of at least Rs1,000 crore. Their sea link had cost Rs850 crore. Labour and construction material in China is cheaper.
As with so many things that this city has endured from various governments, this doesn't make sense. As in the past, there is no transparency in the whole process. As in the past, there's a stench of foul play. As in the past, courts have had to intervene. As in the past, an important project gets delayed. Keep waiting Mumbai