Around 10 months back, Ahmedabad Municipal Corporation (AMC) floated tenders for two significant projects aimed at constructing new Sewage Treatment Plants (STP) and upgrading existing ones in the city. The projects valued at Rs. 1057 crores were funded through a loan from the esteemed World Bank. However, due to unforeseen circumstances both tenders had to be cancelled as the bids received were 50 to 80% higher than anticipated.
The AMC has taken the initiative to request approval from the World Bank for modifications in the project specifications. This step aims to re-tender for both projects, seeking more suitable bids. Until now, no approval has been received from the World Bank, which is scheduled to meet with officials from AMC in August to consider approving the proposed modifications. Should the World Bank consent, the updated specifications will pave the way for the issuance of new tenders.
The delay in the administrative process of AMC has hindered the implementation of any of the projects planned under the Rs 3000 crores loan from the World Bank.
In July 2022, the AMC invited tenders worth Rs. 1057.67 crores, with financial assistance from the World Bank’s loan of Rs. 3000 crores. The first tender aimed to establish a new 375 MLD (Million Litres per Day) capacity sewage treatment plant and three terminal sewage pumping stations. The project also included a 15-year operation and maintenance contract for the residential area of Ahmedabad city, with an estimated cost of Rs. 697.77 crores.
The second tender focused on upgrading the existing 240 MLD sewage treatment plant, along with the construction of one terminal sewage pumping station and a 15-year operation and maintenance contract. This project was intended for another residential area of Ahmedabad city, with an estimated cost of Rs. 359.90 crores. Both tenders were initially scheduled to be opened in September 2022.
However, when the technical bids were opened on September 8, 2022, it was obvious the bids received were significantly higher. For the first tender, which involved the operation and maintenance of the 375 MLD capacity plant, three companies participated, with the lowest bidder quoting an estimated cost of Rs. 697.77 crores. This amount was approximately 50 to 60% higher than the expected cost of Rs. 450 crores.
The second tender, which encompassed the upgrading of the 240 MLD plant and other works, received bids from two companies. The lowest bidder quoted an estimated cost of Rs. 359.90 crores, which was approximately 80% higher than the expected cost of Rs. 200 crores. Due to contractors’ unwillingness to compromise and the World Bank’s instruction not to negotiate with them, the commissioner cancelled both tenders.
To address the cost issue, AMC officials are currently working on removing the sludge dryer item from the tender. This measure is expected to bring down the overall cost. Additionally, they are contemplating reducing the operation and maintenance contract duration from 15 years to 5 years to make the projects more financially viable. Once these adjustments are implemented, the corporation plans to reissue the tender and has already sought approval from the World Bank team.
The primary goal of these projects was to tackle pollution in the Sabarmati River. Among the six major projects undertaken with the World Bank’s loan, the sewage treatment plant in Vasna was a crucial one. However, the plant did not comply with the rules set by CPCB (Central Pollution Control Board) and GPCB (Gujarat Pollution Control Board) for treating gutter water, leading to pollution in the river.
Unfortunately, the delay in project implementation resulted from a lack of coordination and decision-making among the leaders and higher authorities of the AMC. This one-year delay has caused significant damage to the city.
Despite the potential approval from the World Bank, it is unlikely that these projects will receive the green light in the next six to eight months. The Corporation is determined to expedite the process and achieve its objectives for a cleaner and healthier Ahmedabad.