Railways Minister Ghulam Ahmad Bilour presided over a lengthy meeting with senior Railway officials in Islamabad on Tuesday which was also attended by US embassy officials and some American engineers to reconsider Pakistan Railways' contract with a Chinese company for purchase of 75 locomotives.
Business Recorder has learnt that the United States has been pressurising Pakistan and has taken up this matter at the highest level to get the cancellation of PR's locomotive purchase contract amounting to Rs 8 billion and award it to a US company.
Senior officials who attended the meeting told Business Recorder that no decision has been taken in Tuesday's meeting and another meeting would be held on Thursday to decide the matter. He said Pakistan Railways awards contract after an open and transparent tender process. In the present purchase of 75 locomotive deal, Chinese company Dongfang was the lowest bidder and its price was half of the other competitors.
The Chinese company had offered to provide 75 engines at the cost of $107 million as against the US company's tender of $227 million. The cash starved Pakistan Railways had entered several agreements with Chinese railway companies for its development and modernisation of its outdated system In 2001, Pakistan Railways signed a $91.89 million contract with China National Machinery Import and Export Corp for the manufacture of 175 new high-speed passenger coaches. The project was funded by Exim Bank China on a supplier credit basis.
Under an agreement signed with China in 2003, Pakistan Railways purchased 69 locomotives of which 15 were delivered as completely built units while remaining 54 were built at Pakistan Railways' locomotive factory. The locomotives were purchased on suppliers' credit basis with funding provided by Exim Bank China through the Dongfang Electric Corporation.
However, some influential circles have been propagating that the Chinese railway engines were not up to the mark, therefore, Pakistan should not buy additional railway coaches and engines from China.
Nevertheless a senior Railway official remarked that the coaches and locomotives provided by China on credit are being successfully used on Pakistan's mail and express trains from Rawalpindi-Lahore-Karachi, Lahore-Faisalabad and Rawalpindi-Quetta.
He said: "Pakistan Railways is already facing an annual deficit of Rs 42 billion. Therefore we have to keep in mind the price tag of each locomotive engine. A man who could afford only a Suzuki car should not dream for a Mercedes or BMW car," he emphasised.
He said the technical and the tender committee had not unduly favoured Dongfang in awarding the contract as it has fulfilled all required technical requirements and standards.
Under another project, Chinese companies are rehabilitating 450 passenger coaches at an estimated cost of Rs 2.14 billion. The project also included the conversion of 40 coaches into air-conditioned cars and the conversion of 10 power vans. Furthermore, there was a provision of 100 new high-speed bogies, 30 of which were imported from China, while 70 were manufactured locally on a transfer-of-technology basis.
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