‘Corruption’ in World Bank-funded grid station: Minister urged to take NTDC officials to task

ISLAMABAD: The Chairman of the Standing Committee on Economic Affairs, Senator Saifullah Abro, has approached the Minister for Power, Sardar Awais Leghari, seeking action against officials of the National Transmission and Despatch Company (NTDC) involved in financial irregularities related to the 765kV Grid Station at Islamabad West (Lot-IV) financed by the World Bank.

Senator Abro, who was removed from the Chairmanship of the Standing Committee on Power for holding officials of the Power Division and its attached departments/entities accountable for their incompetence and alleged involvement in financial mismanagement, raised concerns over this issue.

In a letter to the Power Minister, Senator Abro emphasized the crucial role of Standing Committees of the Senate of Pakistan in overseeing and monitoring relevant ministries, as per Rule 158 of the Senate’s Rules of Procedure.

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In parliamentary democracies, these committees are often referred to as the “eyes, ears, hands, and brain” of Parliament. They uphold parliamentary sovereignty by addressing national and public issues, ensuring accountability and transparency in government functions.

As Chairman of the Committee, Senator Abro brought to the Minister’s attention a serious issue that has been extensively discussed in the Senate Standing Committee on Economic Affairs.

The Committee has been reviewing ongoing power sector projects funded by multilateral development partners, including proposals, tendering processes, consultants, progress updates, and interest payments made by the federal government.

Members have expressed significant concerns regarding the 765kV Grid Station at Islamabad West (Lot-IV), which is financed by the World Bank.

While reviewing the project, the Committee was provided with detailed information on the funding agency, including loan details such as loan number, tranche, amount, signing date, effectiveness date, and closing date.

The contract with M/s NWEPDI-TBEA (JV) was signed on May 21, 2024, after approval from the NTDC Board and the World Bank’s No Objection Letter (NOL). The project was declared effective on July 21, 2024, with an overall physical progress of 6.9% to date.

The Committee learned that M/s NWEPDI-TBEA (JV), as the lowest bidder, initially declared a final price of $202 million (Rs. 35 billion). However, the actual price at the time of bid opening was Rs. 33.6 billion.

According to the NTDC Board of Directors’ letter dated March 16, 2024, and the letter of acceptance dated March 27, 2024, the contract price was the aggregate of CNY 531,069,421.27, EURO 14,560,627.91, plus Rs. 12,253,741,637.

Senator Abro noted that exclusive of taxes and duties as per the provisions of the bidding documents, and including a provisional sum of Rs. 3,360,000,000 as corrected and notified in accordance with the instructions to bidders, the contract was accepted by the agency.

Taxes for schedules 2 and 4, up to a maximum of Rs. 1,282,445,164, were stated to be reimbursable as per the provisions of the bidding documents.

Senator Abro further stated that the Committee was informed that taxes (Rs. 1,282,445,164) were initially excluded during the bid opening but were later included upon contract signing.

The evaluation of firms was conducted according to the tender documents, and M/s NWEPDI-TBEA (JV) accepted the letter without including the tax amount.

The Committee expressed serious concerns about accountability and discovered an irregularity involving the additional cost of Rs. 1.282 billion, added due to income tax, which was not part of the original tender cost quoted by the contractor at the time of bid opening.

This was also in violation of the approval granted by the NTDC Board of Directors on March 16, 2024, the letter of acceptance issued on March 27, 2024, and the bidding documents.

The Committee emphasized that the Managing Director of NTDC and the previous Chief Engineer/Project Director (PMU-DTLP) admitted during a Committee meeting on December 24, 2024, that adding Rs. 1.282 billion in taxes to the contract was a mistake by NTDC officials and the NTDC Board of Directors, which was completely outside the provisions of the bidding process and resulted in a significant loss to the national exchequer.

“The department failed to satisfactorily explain this malpractice, and the Committee has called for strict action against those involved,” Senator Abro said, adding that members of the Committee have expressed serious reservations about the lack of a robust check-and-balance mechanism and transparency in handling foreign-funded projects—from the tendering process to timely completion—ensuring the accuracy of cost proposals.

Given the strategic importance of the 765kV Grid Station in ensuring the reliability of power distribution across the region, Senator Abro urged the Power Minister to take immediate action by initiating a full-scale investigation into this irregularity.

He called for the recovery of Rs. 1.282 billion from the company, accountability for those responsible, and the implementation of corrective measures to rectify the deficiencies.

“It is imperative that any individuals or organizations involved in this irregularity are held accountable according to the law to prevent further damage to national infrastructure and uphold the principles of good governance,” Senator Abro maintained.

Copyright Business Recorder, 2025