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Where will the Neelum-Jhelum rot stop?

While the story of kickbacks, misuse of authority and bungling of all sorts in the Neelum-Jhelum Hydel Project is no more a secret, another act of bureaucratic wiliness has come to the fore burdening the national exchequer with an additional loss of $10.25 million per annum that could be avoided had the project been handled according to the rules by its ex-serviceman CEO and Wapda.

The News has learnt on authority from well-informed, reliable sources that the Neelum-Jhelum project has finally been insured by three Malaysian underwriters for 10.25 million American dollars annual premium without fully meeting the major precondition of insurance of performance of Tunnel Boring Machines’ (TBMS’), as this matter is being negotiated, may be for yet bigger price.

The provisions of the project contract require Wapda and the Neelum-Jhelum project authorities to provide insurance cover for the performance of Tunnel Boring Machines that were imported from Germany in violation of PPRA rules – without inviting international tenders.

As if the previous violations were not enough, the CEO of the project, with the personal blessing (the CEO office says it was with the approval) of his administrative head, the Wapda Chairman, sent his ‘trustworthy’ agents to Malaysia for striking this expensive deal that means another setback to the national kitty but in this case he could only manage insurance to cover the risks of earthquake and floods that is much less the main risk-cover – that of machines’ performance. As for the main risk whose coverage is a must, that is still under consideration and the Malaysian underwriters don’t seem inclined to cover even more than 70 per cent of the total aggregate of (flood and quake) risks.

But that would require the final nod, rather formal approval of Wapda’s board of directors, which according to sources has not yet materialised.

The sources further confided to The News that some senior office-holders in Wapda have already raised formal objections to the no-risk-cover of abandonment or that of machinery’s failure in the midst of its working.

Should then the country’s economy poise itself for encountering yet another financial and energy disaster for which the taxpayers are being taxed on a constant footing in the shape of expensive insurance premiums and other unnecessary costs that are not going to stop at any point in the foreseeable future?

It is also believed among the knowledgeable circles and engineers monitoring such national-level projects that had the responsible functionaries resorted to transparency, the TBMs imported from Germany at the cost of US $93 million could have been procured from other international sources at lesser price and without so many risks and hitches involved.

It has been further revealed by well-informed circles that a Pakistani insurance company has also been lately engaged but it has not agreed to provide insurance cover beyond 10% level.

The authorities concerned including secretary, water and power were repeatedly approached for their version through text and fax messages but no response came from their side.

However, Director PR, Wapda clarified to this scribe that complete transparency was resorted to and all the rules were properly followed, but he had no answer to the question why the main risk of performance was not covered by the Malaysian underwriters that are charging the huge sum of more than a million dollars as premium. He also stated that one such published story emanated from Transparency International whose rebuttal by water and power authorities was recently published in three prominent newspapers of the country.

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