Wednesday, Oct 18, 2023 07:45 [IST]
Last Update: Wednesday, Oct 18, 2023 02:06 [IST]
No vetting was done, the then State Govt had remained silent: CM
GANGTOK,: Like a magic act, money taken as Sikkim government-guaranteed loans for developing the 1200 Mw Teesta-III HEP was deftly transferred by the project promoters from its “left pocket to the right pocket” during the murky construction phase.Details of alleged unregulated sanctions, financial irregularities and technical compromises by the Teesta Urja Ltd (now Sikkim Urja Ltd) from inception to completion of the nearly Rs. 14,000 crore Teesta-III HEP were presented by Chief Minister PS Golay on Monday afternoon at a media conference.
The Teesta-III dam at Chungthang had disintegrated in the wee hours of October 4 following a flashflood from South Lhonak glacial lake. The HEP would now take more than four years to be operational again with infusion of considerable funds, as estimated by the State government.
Golay maintains that the then SDF government remained silent when the alleged major compromises were made while constructing the ‘sub-standard’ dam, resulting in its collapse and wreaking havoc downstream in Dikchu, Singtam and Rangpo. He went on to highlight that the Teesta Urja Ltd promoters formed its own in-house construction firm and awarded all the HEP contract works to it, thereby pocketing their share even before the mega project was completed at Rs. 13,965 crore in February 2017.
Such outsourcing to its own company by Teesta Urja Ltd was in total contrast with how experienced hydel power developers like NHPC function, observed the Chief Minister.
“When NHPC undertakes a hydel project, it floats an open tender for tunnel, road and other construction works and awards it to reputed independent companies but keeps the work under its total control. However, the Teesta Urja Ltd formed its own construction company Abir Infrastructure Pvt Ltd for the project-related works. That company belongs to the Teesta Urja Ltd with same shareholders and same address. Like putting money from the left pocket to the right pocket, this was done,” said Golay.
According to documents shared at the press meet, the works of Teesta-III project was awarded on turnkey basis to Abir Infrastructure & Consortium in September 2007. It is important to note that the promoter of Abir Infrastructure was the same group which was in Athena Power pvt ltd (the Teesta-III HEP developer), they were part of the same family/sister concern, as per the document.
The initial project cost was Rs. 5,700 crore when construction work started at Chungthang in 2008. However, the project cost was escalated three times, particularly after the 2011 earthquake when the State government increased its equity stake to 60.08%, funded by a Rs. 2898 crore bank loan.
“There has been a cost escalation three times in the Teesta-III project. All the work including tunnelling was given to Abir Infrastructure and rate was increased 300 times. However no vetting was done and it was approved by the then government despite hugely inflated rates. They earned all the money taken as loans from the banks for the project through their own construction company,” said the Chief Minister.
As per the document, the engineers’ procurement and construction contract of Teesta-III project was allocated to the Abir Infrastructure. The net worth and profit of Abir continued to rise and money continued to be drained from Teesta Urja Ltd, the document states, adding that “from July 2007 to 2012, the promoters were given a free run to do anything with the project”.
Golay asserted that the then State government never did a valuation of the contract works being arbitrarily handed over to Abir Infrastructure at exorbitant costs. In this manner, the Teesta Urja Ltd’s money went to Abir Infrastructure, in other words, all the money from the left pocket went to the right pocket, and they had taken their share even before the project was completed, he said.
According to the Chief Minister, the Teesta-III promoters fully exploited the advantage that their loan burden lies on the Sikkim government (as a loan guarantor). They knew that they do not need to pay if the project sinks, he said.
The Chief Minister at the press meet announced that a proper agency would be probing the entire technical and financial lapses so that those responsible for the Chungthang dam beach are held accountable and punished as per law.
