A series of news items has appeared in a section of Press authored by few journalists alleging TCP for delay in import of sugar making Chairman TCP personally responsible for this delay. Chairman TCP wishes to clarify that the real causes of delay in imports is due to strict observance of codal formalities required under PPRA Rules to maintain transparency in all deals.
The allegations made with regard to opening of L/C in Kabul, inviting few suppliers for presenting their offers to the Ministerial Committee and failure to implement Prime Minister''s one time exemption for price matching are denied. "The ECC of the Cabinet in January, 2010 assigned the task of import of 0.5 million tons of sugar by TCP, initially by end April 2010 and subsequently 1.2 million tons by June, 2010. TCP started the tendering process instantly and provided 30 days response time to the bidders as per PPRA Rules (rules framed by Public Procurement Regulatory Authority for procurement in the public sector). Initially all non pre-qualified and pre-qualified firms were allowed to participate with the view to provide opportunity for wider competition amongst them. Unfortunately, the initial four bids were either scrapped or had to be cancelled for invalid bid bonds or on account of non-performance.
"The ECC in March, 2010 took note of this situation and directed Ministry of Commerce and TCP to improve tendering process. TCP accordingly decided to entertain only pre-qualified firms but kept its window open for fresh pre-qualifications. All tenders since 22nd February, 2010 have been awarded at a price which remained always less than the international prices quoted for that day. The tender awarded in February, 2010 was for US $779.95, 6th March at US $649, 20th March at US $596 PMT, 17th April at US $591, 8th May at US $586, 15th May, 2010 at US $488 PMT. The international prices since then have started going up and the last two tenders awarded on 22nd May and 29th May, 2010 were at the price of US $598 and 558 PMT respectively.
"A setback was faced when the bids were received for minimum quantity of 50,000 MT against advertised quantity of 200,000 MT. The PPRA Rules did not allow matching of the price or direct negotiations with the second lowest bidder. The overcome this difficulty, one time exemption was obtained from the Prime Minister to match the prices. However, unfortunately none of the bidder either agreed to match the price of lowest bidder nor the lowest bidder agreed to increase the quantity to meet the overall requirement. Thus as against total tendering of 2.1 million tons, tenders could only be awarded for 825,000 MT.
"TCP opened L/C through National Bank of Pakistan (NBP), FTC Branch, Karachi in favour of the corresponding bank favouring NBP, Kabul on the request of supplier. This is a normal practice recognised under UCP 600 (Uniform Customs Procedure) and followed world-wide. TCP has in the past opened many L/Cs for countries other than the country from where the goods are shipped. No advance payment has been made to the supplier and payment through L/C is effected through the banks in the required standardised manner.
"A few firms had made offers for direct purchase by the Government to Ministers for Finance and Industries and Production realising that government will procure the sugar to meet any unexpected storage. On the directions of Minister for Industries, Mir Hazar Khan Bijarani Chairman, TCP wrote only to those suppliers who made offers to Ministerial Committee. A total of around 19 such suppliers attended the meeting and no offers were considered except for overall review of the situation.
"Sugar imported by TCP is delivered to Utility Stores Corporation (USC) and Canteen Store Departments (CSDs) but government being fully aware of current price increase, is taking necessary steps and has decided to offload 100,000 MT sugar in the open market through Provincial Governments. The government is also planning to procure additional quantities of 375,000 MT through two tenders to be opened on 31st July and 7th August, 2010 where every effort will be made to ensure that sugar arrives in the country by September 2010.
"The current stocks of the sugar mills as well as imported sugar of TCP were reviewed on 26-7-2010 confirming that sugar stocks of 1.1 MMT are available to meet demand of next three months at the rate of consumption of 350,000 MT per month during which period additional quantities will augment the stocks till new crushing season ushers in.
"TCP is working on the commercial lines and has unfortunately witnessed cancellation of two contracts due to increase in international prices. The parties, which had offered very low prices, backed out and have defaulted. Clearly this was not desirable, but default on account of these transactions is not uncommon in international trade. In these two cases of default, TCP has forfeited the performance guarantee. In order to avoid such reoccurrence, TCP has now decided to increase the bid bond to 5 percent and performance guarantee to 10 percent as permitted under the PPRA Rules," the clarification concludes.-PR
Comments
Comments are closed.