ISLAMABAD – Before giving go-ahead, as claimed by the city managers, to costly Rs 6.5 billion project of installation of light emitting diode (LED) lights in the federal capital, Prime Minister Yousuf Raza Gilani seemed ostensibly unaware of the fact that shrewd city bosses have awarded this contract to a firm that is incapacitated in technical terms to launch such mega project.

The firm Oslo Lighting Solutions that has been given this lucrative project is registered under Category C-2 with the Pakistan Engineering Council (PEC) under registration number 0201305. The matter of fact is that the firms labelled as category C-2 could get work with maximum limit of Rs 500 million.

But interestingly the firm Oslo that could not undertake the projects worth more than Rs500 million has not only been pre-qualified out of three firms by the city bosses but has also been awarded the project worth Rs 6500 million in clear violation of rules.

“It is a common practice - indeed an obligation of competent authority - to verify the category of firm before issuing it tender documents for some project. As per rules the concerned quarters issued the tender documents to firm Oslo for Rs6500 million project in clear violation of rules defined by PEC,” informed an official.

He said that the project of replacement of traditional lights with LED lights involved not only the procurement of lights but also their installation and thus the project falls under purview of construction.

Talking to TheNation Additional Registrar PEC Engineer Dr Ishfaq confirmed that Rs6.5 billion project would be taken as construction work as it not only involve procurement of lights but also their installation and dismantling of traditional light.

“In case of procurement only, the limit of contractor goes beyond not more than 15 percent of described limit as per category. So in both cases either its procurement only or construction the firm is not capable to execute this project,” he observed.

He said soon PEC would formally write to CDA about this irregularity. Quoting several examples, Dr Ishfaq said in such cases PEC strongly recommends re-tendering of project. Dr Ishfaq suggested that CDA should re-advertise this project after being committing a “grave mistake”.

This scribe tried to contact Member Engineering Abrar Hussain Shah - who was designated as CDA Member Engineering just a day before CDA’s presentation to Prime Minister regarding LED lights project - but he did not respond for some obvious reasons despite a text message regarding queries was also sent on his cell phone.

Earlier, a few days ago Ministry of Finance has also refused to provide Cash Development Loan amounting to Rs1.6 billion to CDA for this project. Provision of Rs 1.6 billion (25 per cent of the total cost of the project) by CDA was essential to initiate this project while foreign loan amounting to Rs4.8 billion (75 percent of the project) would be taken from Italy as export credit finance, which CDA would pay back with interest in upcoming years.

Upon federal government’s refusal to provide CDL, the city mangers have taken the ground that CDA itself would fund this project. Chairman CDA Engineer Farkhand Iqbal while talking to TheNation has said, “Over the period of time now the Authority is in a position to fund its part of share in the project, while rest 75 per cent (Rs 4.8 billion) by obtaining export credit finance from Italy.

 Mr Iqbal has said that federal government does not have funds to provide cash development loan to the authority.