• July 14, 2024, 12:30 am
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Awarding mega projects to foreign company with shady history hamstringing dev spree

News Desk
News Desk
Update: Wednesday, May 17, 2023

Public money goes down the drain
In many instances, awarding mega projects to a foreign vendor or company with a questionable past and history of corruption is putting the future of many prospective development projects in jeopardy despite the fact that the Bangladesh government has been relentlessly working to expedite development initiatives and handing over those to the foreign company in good faith.
Take, for example, the case of the Modernization of Telecommunications Network (MOTN) project meant for modernizing and expediting the process of digital connectivity. Under this project, huge modernization of the network capability of the Bangladesh Telecommunications Company Limited (BTCL) was planned.
This project hit a snag at the very beginning as there were wide allegations of irregularities while awarding this project to a specific Chinese company flouting standard rules. A hue and cry ensued at that time regarding favoring a specific Chinese company, as the bidding price the company offered was inconsistent.

According to the Procurement Act, the approval of the Cabinet for Economic Affairs is mandatory for resorting to the direct procurement method. But even before securing the Cabinet approval, BTCL selected China’s ZTE Holding Co. Ltd. and ZTE Corporation in December 2015 and finalized a cost of 231 million US dollar , which was a clear violation of the law to favor one particular company.

Fingers are pointed both at BTCL and ZTE for huge mismanagement and corruption in this project. The accusations against this particular Chinese company for snatching away mega projects by resorting to under-the-table arrangements are old and have been reported time and again.

In February last year, the government approved BTCL’s optical fiber transmission network project with an estimated cost of BDT 1,059 crore. As of now, BTCL could not even complete the tender process. Meanwhile, a written complaint has been sent to the Ministry of Posts and Telecommunications from one of the associations of internet users, alleging irregularities in the tender process for awarding work to this particular company without appointing a consultant.

Charges of corruption and abuse of kickbacks against this particular company are nothing new, and it has an image of repeated exploitation in other countries as well. Allegations of widespread corruption have been found against ZTE in at least 18 countries, including Bangladesh. For violating US trade sanctions with Iran and North Korea, ZTE was slapped with a three-year probation period as punishment in 2017. Moreover, the news of the Philippine National Broadband Network controversy, also known as the NBN–ZTE mess, dropped like a bombshell a few years ago.

Even in Bangladesh, ZTE has been in the headlines for all the wrong reasons. A serious allegation of tax evasion was brought against them by the National Board of Revenue (NBR) in 2020, and NBR’s Investigation Center (CIC) sent letters to 5 Bangladeshi companies working with them to immediately cancel the contract for their alleged controversial roles.
Handing over important mega projects to such a company with murky history brings a very pertinent question to the fore – is it a prudent decision to award a project to such a foreign company? Doing so will only cost the public money, putting an undeserving question mark on all the good and diligent efforts of the government. The Anti-Corruption Commission (ACC) is already investigating allegations of squandering BDT 800 crore (public money) by giving work orders (MOTN project) at a high cost.
Development experts opine that the government, as well as implementing agencies need to have a look at the history of the vendors/foreign companies and strike a deal with companies having clean work history with a view to increasing project management efficiency and saving public money.

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