Board hints at resuming Melamchi works if Italian firm doesn’t respond


Jan 1, 2019-

The government has said it won’t wait much longer for the Italian contractor if the ongoing dispute drags on, disrupting the Melamchi Water Supply Project.

Melamchi Water Supply Development Board Executive Director Surya Raj Kandel told the Post that the government might look for alternatives if the Italian Cooperativa Muratori e Cementisti di Ravenna (CMC) does not resume works soon.

“We can’t let this hassle obstruct our project forever. The national pride project can’t fall prey to the dispute,” Kandel said. “If they don’t want to work, we’re ready to bid them goodbye and explore options.”

Since the fiasco come to the fore, government officials have repeatedly said they would resume work on their own by hiring new contractors to complete remaining works on the tunnel that diverts water to Sundarijal in Kathmandu from Melamchi River in Sindhupalchok.

The project has been disrupted since the CMC submitted the project termination letter to the government on December 17, accusing the government of not clearing their payment.

The situation worsened after the government seized CMC staff’s passports and barred them from leaving the country, claiming that they were leaving the project incomplete. In a step ahead, the government decided to seize their bank guarantee.

Officials, however, said the contractors could still resume works and complete the project, which is in its last phase.

The authority is also considering resuming works with the same contractors in a win-win situation. 

“If they wish to work, we are ready for that too,” Kandel added.

The CMC withdrew the project termination letter and expressed its commitment to working again with the government after Christmas holidays before project officials were permitted to leave.

After a loose agreement between the two sides following the revoking of the termination letter and the contractor’s commitment to working again, a new hurdle appears in the recent developments.

The Patan High Court last Thursday ruled in favour of the government’s move to seize the Melamchi project contractor’s guarantee amounts deposited in two banks in Nepal. With the latest decision, the government can now access the Rs2.56 billion that the CMC has deposited as performance security at the Standard Chartered Bank Nepal and the Nepal Investment Bank.

“Even if they don’t return, the government won’t be at a loss,” Kandel added.

However, government officials have not heard anything from CMC representatives since they left the country. “There has been no communication in the last few days,” Kandel told the Post.

Published: 01-01-2019 06:38

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