CETP remains a distant dream for Karachi

With billions earmarked in current fiscal year, project gets delayed indefinitely

Ashraf Ali February 05, 2020
A representational image. PHOTO: REUTERS

KARACHI: A project for setting up Combined Effluent Treatment Plants (CETP) for industrial waste treatment in Karachi was coined in August last year; with the expectation that the plants will be functional by June 2021. However, given the joint criminal negligence of the provincial government and the Karachi Water and Sewerage Board (KWSB), the project is yet to show any signs of commencement after a year-long delay.

Prepared at the cost of Rs28 billion, the revised PC-I for the project will be first submitted to the Sindh government and then require the approval of the federal government -- a procedure which will take a long time. Whereas under the current and approved PC-I costing Rs11.789 billion, tenders for three primary developmental tasks have already been awarded but work is yet to begin in the absence of approval from provincial government’s top officials; leading the city to continue siphoning untreated industrial waste into the open sea at the risk of irreparable ecological harm.

Incompetent planning, odd legislation created Karachi's chaos

According to a senior KWSB official speaking to The Express Tribune on condition of anonymity, there are three main reasons for the delay in the project. “The first reason being that the water board and consultant Osmani & Co (Pvt) Ltd underestimated the project’s transmission line cost in the current PC-I. According to the estimate, the cost of installing transmission lines was calculated to be around Rs1.3 billion while the cost of purchasing machinery itself is over Rs10 billion. The second reason is the increase in the dollar value, which was worth at Rs105 to the rupee by the time of project approval, inflating the cost of importing machinery by tens and thousands. And the third reason is the irresponsible intervention of Sindh government officials, who’ve thrown a spanner in the works of CETP for their own ulterior motives.”

In principle, the CETP project should have been initiated last year under the current PC-I but at the behest of Sindh government, the project was handed over to the Public Private Partnership Unit of the Provincial Finance Department under the direction of Sindh Chief Minister Murad Ali Shah, where it has been pending after six months of meetings.

The mutual incompetency of the KWSB and the provincial government has remained a source of delays and setbacks for several water and sewage related mega projects in the city. Like CETP, the design work for K-IV bulk water supply project was also awarded to the private consultant Osmani & Co, which made several errors in project cost estimation. Both, the K-IV bulk water supply project and the greater Karachi Sewage Plan (S-III) have since remained in a standstill for the past seven years.

On the other hand, the Sindh government had earmarked Rs2 billion in the budget for the construction of five Combined Effluent Treatment Plants and the installation of sewerage lines in the industrial areas of the city. As reported earlier by The Express Tribune, the project­-- which was planned to be completed by June 2021- was estimated to incur a cost of Rs 11.7 billion, in which the federal government would have a share of 33% while the provincial government will provide the remaining 67%. Under the project, 94 millions of gallons per day (MGD) of treated industrial waste were to be discharged into the sea. However, due to non-commencement of construction work, the project has run into a course of extraordinary delays and setbacks; pushing the project completion date to the twelfth of never.

According to sources at the water board, The Executive Committee of the National Economic Council (ECNEC) had approved the PC-I worth Rs 11.78 billion in 2017. After which KWSB called for a separate contact in 2018 to monitor the detailed design of the project, preparation of construction contract documents as well as the construction works. “When the tender for this was awarded to Techno Consultants, the dollar was valued at Rs140 but by the time the company produced the project design, the project cost had risen due to subsidies. The cost of installing transmission line had also increased to Rs8 billion in the detailed design while procurement of machinery has been estimated at Rs20 billion. The private company submitted the revised PC-I worth Rs28 billion to the water board in November last year, but is still pending the water board’s approval. The revised PC-I will also require the approval of the Sindh government first and then the approval of the federal government.”

‘Elites have captured the state and market’

After a year-long delay, last month the newly appointed Provincial Secretary for Industries rejected the proposal of the former Secretary and sent recommendations to top provincial government officials stating that construction work should be started under the current PC-I to avoid further delays in the project.

According to Project Director CETP Imtiazuddin, the dollar price was relatively low at the time of project approval, whereas today the price has skyrocketed to a whooping Rs154.45 which has taken a toll on the price of machinery which is to be imported. Further adding that the revised PC-I has not been submitted yet, the consultant is setting up the revised PC-I and it is expected that the revised it will be submitted soon.

“Osmani & Company had made some mistakes in the project but they were not so big, the real reason for the increase in project costs is the increase in dollar value,” said Imtiazuddin.  “However, work cannot be initiated under the current approved PC-I, approval of the revised PC-I is required and only then the project can be started. I was unaware of the public private unit and hope that the project will be started soon after the approval of the revised PC-I,” he concluded.

Published in The Express Tribune, February 5th, 2020.


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