Rajesh Rai | Phuentsholing

After failing to complete even half of the water supply work at the Dhamdum Industrial Park (DIP) in Samtse, the proprietor of Ratnapung Construction has not only abandoned the project, but gone missing.

Work on the project worth more than Nu 40 million (M) started in December 2016, according to officials of the Ministry of Economic Affairs’ Department of Industries (DoI).

“The water supply project was one of the packages, which was awarded in December 2016 and expected to be completed by March 2018,” an official said. However, the contractor failed to complete even 30 to 40 percent of the work.

DoI’s director general, Yonten Namgyel, said they have been looking for him since quarantine began, but they were unable to find him. “Then we attempted an arbitration case. But it didn’t work because the person was not present.”

DoI’s chief engineer, Kezang Deki, said they had even provided him with a two-month time extension.

“Another 100 days was also allowed, as per the liquidity damage rules, but the contractor couldn’t deliver. There was no progress over the 20 months working on the project.”

She said the site urgently needed to be developed, and after several committee meetings, the agreement with the contractor was terminated.

The Royal Audit Authority (RAA) had also issued an observation about the work in 2019, but it pointed to excess payments DoI had made without actual work to show for it.

“The DoI had not calculated and deducted the applicable liquidated damages for the delay in the Government of India (GoI)-funded project that involves construction of a water supply at Dhamdum Industrial Park, Samtse,” the RAA report stated. “The work remains incomplete even after a time extension of 60 days, and the contractor has abandoned the work. However, the DoI had released the 4th RA Bill without deducting the applicable liquidated damages.”

After looking for the contractor for two years, the ministry and the department awarded the work to the Construction Development Corporation Limited (CDCL) as of May 2021.

Kezang Deki said the new work is a ‘deposit work’ which was directly given to CDCL, where CDCL will submit the monthly financial reports and expenditure details for payments to be released.

The water supply project has also been redesigned. However, all former aesthetics have been incorporated.


What now?

From filing for arbitration to following up with the Cabinet Secretariat and Office of the Attorney General, DOI officials said they had exhausted all means of formalities.

Director General Yonten Namgyel said they are planning to file charges in court.

“We have been going through this for one full year. Since we were under pressure to complete the work, we had to give it to CDCL,” he said.

Kezang Deki also said they are working closely with the legal division now.

She said it takes time because the division has to research and understand all the details and background of the project.

“We will file the case with the court by the end of this month.”

The construction works at the DIP, which was affected by the pandemic, is gradually picking up with the initiation of some factory construction. Of the nine industries that initially agreed to start construction at the DIP in December last year, the construction of a textile factory, a furniture house, and a fruit juice factory is ongoing.

The work on the 349-acre park began in August 2016.  It is one of the four special economic zone projects in the country. Under Project Tied Assistance, the Government of India is providing funding of Nu 300M.

DIP will have 77 plots for companies.