The state government is all set to award the contract for the Rs 4,717-crore Polavaram dam to the Transstroy India-led joint venture. The administration top brass has apparently given approval in principal to award the contract to Transstroy, which quoted 14.5 per cent less than the estimated value. This will mean a saving of Rs 700 crore to the state exchequer. Congress MP from Guntur Rayapati Sambasiva Rao has major stakes in Transstroy that has executed several irrigation and infra projects including a portion of the Outer Ring Road.
Official sources told this newspaper that Chief Minister N. Kiran Kumar Reddy was also convinced with the argument of the high-level committee headed by chief secretary Minnie Mathew that financial implications alone should be taken into consideration as all the five bidding companies had some shortcomings or the other in the technical side. Transstroy had made a dramatic entry into the race for the multipurpose irrigation project. The engineers’ committee had disqualified the company along with two others on technical grounds and had opened the financial bids of Soma and SEW. Of the firms, Soma had stood L1 (lowest bidder) by quoting just two per cent less than the contract value.
The government later came under fire for shortlisting only two companies and Opposition parties alleged that the state would lose Rs 478 crore if Soma’s tender was approved. Subsequently, the high-level committee, which also comprises principal secretary of finance V. Bhaskar and principal secretary of irrigation S.K. Joshi, decided to open the financial bids of all five competing firms.
Sources said that the Chief Minister would be comfortable with awarding the contract to Transstroy as the state would be saving Rs 700 crore. “Even the two companies shortlisted by the engineers’ committee had certain deficiencies,” sources said, adding that the same would be highlighted if any of the companies took a legal course. Apparently, keeping in view the allegations about Transstroy’s previous track record, the state government will be extra cautious while awarding the tender and will secure adequate financial commitments from the company in case of a failure to execute the project properly.