Government’s last-ditch effort to bring back Italian contractor for Melamchi project fails


Feb 8, 2019-

After nearly two months of drama, a series of failed negotiations and the eleventh hour trip to Singapore aimed at bringing the Melamchi project back on track, the government has officially terminated the contract with its Italian builder on Thursday.

The Melamchi Water Supply Development Board has dispatched a final project termination letter to the contractor Cooperativa Muratori e Cementisti di Ravenna, its executive director Surya Raj Kadel told the Post.

Unlike the previous letter sent to the CMC on January 20, in which the contractor was given a 14-day window to respond, this correspondence does not contain such provision.

Read: Officials and Italian contractor have differing stories on Melamchi dispute and travel ban

“We had sought a strong commitment from them to resume works within the deadline. But they didn’t respond. So we have decided to scrap the contract,” Kadel confirmed.

The termination letter was drafted in the presence of the board officials, Minister for Water Supply Bina Magar, and Secretary Gajendra Kumar Thakur. The fiasco surrounding the project started on the midnight of December 16 last year after the CMC officials were apprehended, and the government charged them with fleeing the country and abandoning the project site.

Although the two parties communicated with each other, albeit irregularly, about resuming the national pride project, the bid failed. The ministry even used back-door channels in its bid to bring the CMC back to the project.

A four-member team led by Bhoj Bikram Thapa, the board’s deputy executive director, went to Singapore in a last-ditch effort to convince the Italian builder to complete the project even as the ministry opposed the move initially. The meeting was arranged in a hush-hush manner at the behest of local sub-contractors and agents, according to senior officials at the ministry.

Read: Melamchi contract with Italian firm ends but government is still in talks

The latest negotiation was initiated after a group of local sub-contractors and agents associated with the Italian contractor persuaded Water Supply Minister Bina Magar to send a team for the one last meeting before terminating the contract with the Italian builder.

“Local sub-contractors and agents feared that contract termination will lead to a situation where they will lose billions of rupees owed by the Italian contractor,” said a source seeking anonymity. “As the project implementing authority doesn’t recognise the sub-contractors appointed by the Italian firm, they will not be paid once the CMC leaves the country. That’s why the sub-contractors were trying desperately to bring back the Italian contractor.”

A group of sub-contractors had long been demanding nearly Rs1.5 billion that the CMC owed them ever since project termination loomed in December. Officials at the ministry also said that the sub-contractors have been lobbying hard to grab the contract for the remaining works.

Published: 08-02-2019 07:27

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