A high-level committee formed by the government on March 23 presented the new selection process for the national pride project to the government on Monday. [break]The government had formed the panel under former secretary Birendra Bahadur Deuja to suggest the government on the process to select investors to develop the proposed four-lane super highway under Build, Operate and Transfer (BOT) implemented as Public Private Partnership (PPP).
The government had revoked the entire process of selecting investor companies after the then parliament´s Public Account Committee (PAC) instructed it to ensure at least 10 percent local investment in the implementation of the project, going against existing laws.
The Private Financing in Build and Operation of Infrastructure Act 2006 and its regulations requires aspirant investors to have experience of implementing projects under Built Operate and Transfer (BOT) system.
The government started the fresh process after PAC backtracked on its earlier instruction and asked the government to go ahead with the process as per the existing laws.
The panel, which was formed immediately after the PAC´s latest instruction, on the day presented to the government Kathmandu-Tarai Fast Track Procurement Document that includes samples of Expression of Interest (EoI) as well as Request for Proposal (RFP) to be submitted by the aspiring firms and Concession Agreement.
As per the criteria prepared by the committee, firms that have completed construction of highways and bridges worth over US$ 500 million under BOT and any infrastructure project worth over US$ 1,500 over the last ten years are eligible to participate in the EOI process.
“To ensure involvement of local investors in such a mega project, we have proposed to the government to provide extra points to firms that enter into joint venture with local contractors,” Dinesh Prakash Basnet, chief of the Kathmandu-Tarai Fast Track Project, said. “This provision will facilitate technology transfer and enhance Nepali investors´ capacity in implementing big projects.”
The panel has specified a maximum of 10 percent extra points for such global firm in EOI evaluation process and 7 percent additional mark in RFP evaluation process.
The shortlisted companies in the EOI will be given five months to submit field visit report, including designing, alignment, among others, to the Ministry of Physical Planning, Works and Transport Management (MoPPWTM).
According to Basnet, who is also the member secretary of the seven-member team, six companies short-listed from EOI process will be given six months time to submit their RFP with technical and financial proposals to the government. The government will then sign Concession Agreement -- formal permission - with the company, which is selected after evaluation of RFP, specifying details about consortium equity holding, obligation and conditions, force majeure as well as standards and scope of works.
Tulasi Prasad Sitaula, secretary at MoPPWM, said the ministry will study suggestions of the high-level committee and make preparations for inviting EOI from interested firms within a couple of weeks.
A study conducted by the Asian Development Bank (ADB) in 2008 has estimated the construction cost of the 76-km express way at US$819 million. The project is expected to bring about greater mobility of goods and people between Kathmandu and Tarai, saving fuel cost by up to 46 percent.
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