The authorities overseeing the Matarbari Thermal Power Plant in Cox's Bazar, Bangladesh's largest and most expensive coal-fired power plant, have come under scrutiny for allegedly overpaying for coal. The government is now facing an additional cost of 916 crore 44 lakh Taka. Meghna Group has been contracted to supply coal to the power plant.
Government purchase orders have been issued to Unique Cement Industry Limited, a consortium within the Meghna Group of Industries, and Aditya Birla Global Trading Company Pte, a Singapore-based Indian company, for the supply of 35 metric tons of coal.
Concerns have been raised about potential corruption as the government is reportedly directing the purchase of overpriced ICI-3 grade coal from a particular company.
According to the Indonesian Coal Index (ICI) report and Tender Evaluation Committee (TEC) calculations, on October 18, the market price of ICI-3 grade coal, including transportation costs, was USD 84.05 per metric ton. However, the Coal Power Generation Company (CPGCBL) has awarded a contract to the Aditya Birla Consortium at a significantly higher rate of USD 105.87 per ton. This USD 21.82 overcharge per ton for 3.5 million tons of coal will cost the government an estimated 916 crore 44 lakh taka. Such a discrepancy raises concerns about potential corruption.
“Determining coal prices is a complex process, influenced by factors like tender prices and transportation costs," said Md Nazmul Haque, Managing Director (Additional Charge) of CPGCBL, to Bangladesh Pratidin. "We utilize an Open Tender Method (OTM) for procurement, rather than a Direct Purchase Method (DPM).”
An international tender for supplying 9.6 million tons of coal to the Matarbari Power Plant was issued on November 15, 2023. To ensure fair competition, the original tender required coal import experience as a qualification criterion. However, to favor the Meghna Group-Aditya Birla Group consortium, corrupt officials from the previous Sheikh Hasina government manipulated the tender. Through four successive amendments, they relaxed the qualification criteria to include import experience in various unrelated commodities like iron, fertilizer, chemicals, cement, and food grains, thereby granting an unfair advantage to the favored consortium.
On February 8, four companies, including India's Aditya Birla Consortium, participated in the tender process. After a technical evaluation, three companies were disqualified as non-responsive. Consequently, Aditya Birla Consortium emerged as the sole technically qualified bidder.
On May 8, the tender evaluation committee opened the financial proposal of Aditya Birla Consortium and proposed a supply price of USD 108.87 for per ton of coal. The tender evaluation committee evaluated the financial proposal of Aditya Birla Consortium and said, "The said price is significantly high and is not acceptable for a long-term contract for supply of 9.6 million tonnes of coal" and decided that the proposed price is not acceptable. Later, CPGCBL authorities did not issue NOA in favor of Aditya Birla Consortium and the company filed a complaint under Rule 57(5) and 57(7) of Public Procurement Rules 2008 on July 1 and July 8. But neither the CPGCBL nor the Ministry took any action on their complaints within the time frame stipulated in the Public Procurement Rules.
Thereafter, Aditya Birla Consortium did not file any appeal in the Review Panel or any writ case in the High Court within the prescribed period as per Rule 57(10) of the Public Procurement Rules 2008. After the financial proposal of Aditya Birla Consortium was rejected, they had no further opportunity to consider the tender or proposal of Aditya Birla Consortium as per Public Procurement Rules as they did not take any legal action.
Despite this, on October 17, CPGCBL issued a work order to Aditya Birla Consortium to supply 3.5 million tonnes of coal at the rate of USD 105.87 in a completely illegal manner.
Reports in leading national media have highlighted alleged irregularities, corruption, and conspiracy in the coal purchase tender process involving the CPGCBL board and the Ministry. Given the critical role of coal imports in power generation, the Ministry and CPGCBL officials are accused of hastily and illegally issuing a Notice of Award (NOA) to the Aditya Birla Consortium.
The Public Procurement Act 2006 and the Public Procurement Rules 2008 include specific provisions (Section 68 and Rule 74) for addressing temporary demand through direct coal purchases for urgent needs. However, energy sector experts argue that canceling the existing Notice of Award (NOA) for coal procurement is crucial to prevent potential corruption and significant financial loss in the power-fuel sector.
Bd-pratidin English/ Jisan
