Swiss firm decries rules violation in wheat tender

Says contrary to rules, lowest bidder failed to submit bid bond

ISLAMABAD:

Switzerland-based company Aston Agro-Industrial has alleged that the Trading Corporation of Pakistan (TCP) has flouted rules in the award of a wheat import contract to a Gulf-based supplier.

In a letter sent to Ministry of Commerce Secretary Muhammad Sualeh Ahmad Faruqi, the Swiss firm said the TCP opened a tender for the import of 400,000 tons of wheat on November 18, 2020.

The lowest bidder did not submit bid bond at the time of opening the tender, which was required according to rules, the company alleged, adding that the TCP gave the bidder a chance to submit the bond after opening the tender, in violation of the Public Procurement Regulatory Authority (PPRA) rules.

“At the time of opening the tender/ submission of bids, the bid bond of the company with the lowest bid was not opened, which contradicts conditions of the TCP tender,” the Swiss firm said.

It then left the third lowest bidder and picked the fourth lowest offer to match the lowest bid price, the company said. The second lowest bidder matched the price and was given a contract for import of 120,000 metric tons.

Within the extended bid validity period, the Swiss firm said it, being the third lowest bidder, expressed willingness as per TCP’s request to match the lowest bid price of $286.75 per metric ton for 110,000 tons with shipment according to tender terms and conditions. It pointed out that the TCP board of directors had decided to limit per-party exposure and limit the award of contract to 120,000 tons, which was not stated in the tender terms.

“In order to ensure transparency, merit and adherence to PPRA rules and principles of natural justice, we kindly request the Ministry of Commerce to review the request and not allow us to be bypassed and to unilaterally award the 4th lowest bidder, which would be extremely unjust and unfair to us,” the Swiss firm said.

Meanwhile, the TCP approached the commerce ministry, seeking advice for the award of wheat import contract to the Gulf-based supplier. In a letter to the Ministry of Commerce, the TCP management pointed out that the Economic Coordination Committee (ECC) had decided to import an additional 400,000 tons of wheat through the TCP for the government of Punjab.

The additional quantity was included in the shipment schedule and discussed with the Punjab food department secretary, it said.

On the request of Punjab government and in the wake of decrease in requirement of Sindh government, some adjustments were made in the shipment schedule. As a result, three ships with 165,000 tons would arrive in March 2021, it said.

Accordingly, an international tender was floated on November 11, 2020 with shipment window of February-March 2021. After approval by the ECC, the TCP opened bids and announced results of the tender.

TCP anticipated that the total required quantity of 340,000 tons would be secured against the tender by opting for the option of matching the lowest bid.

It said the price of $286.75 per ton was $52.85 higher than the price of $233.85, which was accepted for the quantity of 330,000 tons on August 26, 2020. It was also $8.25 higher than the rate of $278.5 per ton, which was accepted for the quantity of 330,000 tons on July 10, 2020.

The fresh bid was $2.75 higher than the rate of $284 per ton accepted for the quantity of 340,000 tons on October 16, 2020 and higher by $0.55 than the rate of $286.20 per ton accepted for the quantity of 320,000 tons on November 6, 2020.

TCP said in view of the directives of Prime Minister Imran Khan during a meeting on October 1, 2020, endorsement of the ECC was required for the prices offered in the tender. Therefore, it requested the Ministry of Commerce to approach relevant quarters for endorsement of the rates received in the tender.

When contacted, a TCP spokesperson said the lowest bidder submitted its bid by mentioning a bid guarantee along with the amount in US dollar.

“On evaluation, the original document was found to be missing. Therefore, as per PPRA Rule 31, clarification was sought from the supplier. The supplier thus furnished bank SWIFT in favour of TCP, which was duly verified by the bank.”

He revealed that he wrote a letter on November 18 for the matching option and it was telephonically followed up as well ahead of the board of directors meeting. He said the Swiss firm admitted to have first-hand knowledge of meetings scheduled for the award of tender the next day. But it reverted back very late when the decisions were made.

Published in The Express Tribune, November 25^th, 2020.

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