Melamchi project left high and dry

KATHMANDU, SEP 25 -

The Asian Development Bank (ADB) is in favour of appointing a new contractor to complete the tunnel digging work of the Melamchi Drinking Water Project after the current contractor pulled out. The ADB is the major donor to the project.  

The fate of one of the country’s top priority projects has been thrown into uncertainty after the Chinese contractor China Railway 15 Bureau Group terminated the contract blaming the government for not releasing payment on time and frequent worker strikes. ADB Country Director for Nepal Kenichi Yokoyama has written in an e-mail response to the Post, “In case of the termination of the contract, the government and the ADB recognise the need for re-bidding and mobilisation of a new contractor at the earliest.”

Yokoyama said that the ADB hoped there would be a resolution to the situation soon given the importance of the project to alleviating the acute water shortage the 2.6 million people in the Kathmandu valley have been suffering from. “The ADB stands ready to provide full support to the government for the necessary activities,” he added.

The ADB’s Director General for South Asia Juan Miranda is scheduled to visit Nepal from Sept 26-27 to discuss ADB’s overall current and future operations in the country. “As part of the mission, the Melamchi project will also be discussed,” said Yokoyama. The ADB has provided loan investment worth US$ 137 million for the project.

Government officials said that they are preparing to end the contract with the Chinese contractor and will claim compensation and fines for breach of contract. The Chinese company was awarded the contract worth Rs 4.28 billion three years ago on the condition that it would construct 700-800m of tunnel monthly and start work from four points simultaneously. Ho-wever, the company has dug only 6.5 km of tunnel while it was supposed to complete 20 km so far.

Source: The Kathmandu Post