Standing Committee for Implementation of Public Procurement seeks probe in Pune Metro tender

MMRCL is a special purpose vehicle equally owned by the government of India and the government of Maharashtra.

PUNE: The standing committee for implementation of public procurement has asked the Central Vigilance Commission (CVC) to look into Pune Metro rail’s tender for procurement of rails, as the committee has observed that conditions were revised to make them restrictive for local manufacturers, a move that “seems to be with a malafide intent”.

The CVC has been asked to take “strict action against erring officials”, according to minutes of a meeting held earlier this month. The committee took cognizance of a complaint by Jindal Steel and Power (JSPL), which has alleged that Maharashtra Metro Rail Corporation (MMRCL) – which is implementing the Pune Metro rail project – changed the initial bid requirement that a bidder should have supplied at least 18,000 tonne of head-hardened rails in the past seven years to other countries, to 22,500 tonne. JSPL claims to have supplied close to 20,000 tonne of such rails to the Iranian Islamic Republic Railways. So, the company would have qualified under the previous criterion, but not the revised one.

MMRCL is a special purpose vehicle equally owned by the government of India and the government of Maharashtra.

JSPL is the only Indian company apart from SAIL that produces rails. SAIL’s entire production goes to Indian Railways and yet falls short of the transporter’s yearly requirement, leaving JSPL the only firm which can participate in domestic tenders.

In a meeting held earlier this month, the Ministry of Housing and Urban Affairs (MoHUA), which overseas Metro rail projects, informed the committee that it has taken up the matter with the authorities concerned and issued directions to ensure tender conditions are not restrictive for local manufacturers, according to the minutes.

One of the requirements in the initial bids was that a company should have supplied at least 90,000 tonne of rails during the last seven years, of which 45,000 tonne should have been supplied to countries outside the country of production. Other requirements included that of the rails supplied to overseas countries, 18,000 tonne should be of international standard as required for the Pune project. While the first clause was retained in the revised tender, the second was tweaked.

A JSPL spokesperson declined to comment.

Brijesh Dixit, managing director of MMRCL, however, clarified the initial number of 18,000 tonne was a typographic error made by a lower level official, and that action is being taken against him. “There is no malafide intent,” he said, adding that the company has not received any communication from the CVC.

MMRCL has briefed MoHUA officials about the typographical error.

Dixit said the figure of 22,500 tonne was arrived at as per the standard formula which is followed by all other metros including Delhi Metro, Chennai Metro, Bangalore Metro, Kochi Metro and Lucknow. “The Pune Metro project are being funded by international agencies and it has to follow international norms,” he said.

According to Dixit, the demand for rails in Pune Metro is 9,000 tonne which requires supply experience of 10 times of that in last seven years and 50% of that has to be exports.

On JSPL’s complaint, Dixit said it is a genuine case and that the tender is still to be finalised. “We will take a positive view. We are in the process of settling those issues and we will explain our position.”

JSPL has been aggressively looking to supply rails to the Indian Railways as well. It has supplied 1.4 lakh tonne of rails for the Eastern Dedicated Freight Corridor and more than 80,000 tonne to the railways separately, according to the company.

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