South Korean rolling stock manufacturer Hyundai Rotem Company, the second lowest bidder, is set to be awarded a locomotive supply contract worth Tk 26.79 billion.
The railway ministry sent a proposal in this regard to the cabinet committee on government purchase (CCGP) a couple of days ago.
The lowest bidder, Vossloh Espana, was excluded as its name was changed during the tender-awarding process, Railway Secretary Mofazzel Hossain said in the proposal.
Bangladesh Railway (BR) floated the tender for purchasing 70 metre-gauge diesel electric locomotives two years ago under a government-financed project.
A total of 26 companies purchased schedules, but finally five companies took part in the bidding process. They are CSR Ziyang Co of China, CSR Sifang Co Ltd of China, Hyundai Rotem of South Korea, Vossloh Espana of Spain and Grindrod Locomotives of South Africa.
The tender evaluation committee in collaboration with the technical subcommittee recommended two companies-Vossloh Espana of Spain and Hyundai Rotem of South Korea-as responsive bidders.
The committee recommended Vossloh as the lowest bidder as they quoted Tk 18.35 billion. Hyundai was the second lowest bidder as they quoted Tk 18.37 billion.
In the meantime, Vossloh Espana, a subsidiary of the German rolling stock giant Vossloh AG, was acquired by another leading rolling stock manufacturer Stadler Rail of Switzerland.
After negotiations, Vossloh's offer stood at 18.64 billion. When the railway ministry showed Stadler (formerly Vossloh Espana) as the lowest bidder in its proposal placed to the CCGP in February this year, the CCGP observed that Vossloh did not qualify as its name was changed.
The CCGP also rejected a suggestion for floating a re-tender, arguing that it will be time-consuming.
The CCGP asked the railway authorities to award the contract to the second lowest bidder Hyundai. In line with instructions, BR started corresponding with Hyundai.
After negotiations, the total price for the 70 locomotives along with spare parts and tools was fixed at Tk 19.86 billion. With inclusion of VAT and relevant duty, it would stand at Tk 26.79 billion, said the proposal.
Contacted, economist and former finance adviser to the caretaker government AB Mirza Azizul Islam said he was not aware of whether changing the name was a disqualification as per the public procurement regulations. However, it would be better to go for re-tender to ensure transparency, he added.
It should also be looked into whether such a move to exclude the lowest bidder would raise any legal issue, he said.
mirmostafiz@yahoo.com