Brakel team meets Himachal officials over controversial project

November 21st, 2008 - 7:00 pm ICT by IANS  

Shimla, Nov 21 (IANS) Executives of Holland’s Brakel Corp NV, the firm contracted to set up the Thopan-Powari-Jangi hydropower project in Himachal Pradesh, Friday met the government once again to present its financial and technical credentials that have been questioned.The executives met a seven-member review panel headed by Chief Secretary Asha Swaroop for more than three hours to emphasise Brakel was capable of completing the Rs.40-billion ($869-million) project in Kinnaur district within the requisite timeframe.

Officials in the state power department told IANS that Brakel expressed surprise over the concerns raised by the government time and again, though it had presented its credentials several times.

The state cabinet Nov 3 decided to give a final hearing to the Dutch firm and allow it to rectify its alleged financial and technical misrepresentation to the state government.

This was the second hearing before the government panel.

According to sources, the Dutch firm executives, along with officials of Standard Chartered Bank and the UK-based infrastructure consultancy Halcrow, presented Brakel’s case on the various issues raised in the two show-cause notices issued by the government, asking the company why its contract should not be scrapped.

A Brakel team last month met a one-member panel of Principal Power Secretary Ajay Mittal, who had recommended to the government that the contract be cancelled, and the Rs.1.95 billion that Brakel had deposited upfront be returned.

Mittal had observed that Brakel won the project by misrepresenting its technical and financial strengths.

Before Friday’s review panel hearing, Brakel had raised objections to the inclusion of Mittal in the larger panel again.

“It is a strange paradox that the official (Mittal) who had ruled against the company in the past has been taken into the panel again. It’s against the principal of natural justice,” the company said in a letter to the government.

Incidentally, Mittal was not present in the review panel meeting as he was in Rajasthan on an official assignment.

The project was allotted to Brakel in December 2006 by the previous Congress government through open international bidding.

When the Bharatiya Janata Party (BJP) came to power this January, it awarded the same project to Brakel, which made an upfront payment of Rs.1.95 billion.

However, the government is yet to sign the pre-implementation agreement, which is mandatory before beginning work on any project.

“There is a lack of clarity on the part of the government,” a senior bureaucrat said on condition of anonymity.

A senior Brakel official in Shimla said his company was confident of completing the project on schedule.

“We are confident of completing the project by 2013. So far, we have spent Rs.215 crore (Rs.2.15 billion) on the project,” he said.

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