The Department for Promotion of Industry and Internal Trade (DPIIT) on Friday ordered the scrapping of a Rs 1,950 crore tender for the BharatNet project in Tamil Nadu stating the bidding conditions were “restrictive” and “discriminatory”.
In a communication to state Chief Secretary K Shanmugam, the DPIIT asked for floating fresh tenders.
The communication stated that Tamil Nadu Fibernet Corporation Limited (TAFINET) should immediately scrap the
Rs 1,950-crore BharatNet tender and should float fresh tenders with “non-restrictive” qualification criteria.
The tender got mired in controversy with allegations of corruption and charge raised by Chennai-based Arappor Iyakkam, that changes in the tender were made to favour a few companies.
The Union Commerce and Industry Ministry also sought an urgent report on action taken following its order to scrap the tender.
The BharatNet project aims to connect Indian villages with high speed broadband connections through optical fibre. In Tamil Nadu, the plan was to connect all 12,524 gram panchayats.
The project had first generated controversy when an IAS officer, Santhosh Babu, who was in charge it, opted for voluntary retirement, reportedly after he was pressured to make changes in the tender after it was uploaded.
In January, Opposition leader M K Stalin had asked Shanmugam to ensure protection for “truthful” IAS officers, referring to Santhosh Babu’s VRS request. “Was Babu, who was in-charge of the project (BharatNet), under pressure? Is the Information Technology minister behind this? The Chief Minister should reply,” Stalin had said then.
“However, Babu’s request was later withdrawn owing to pressure from his senior colleagues,” a senior official, in the know of developments in the initial stage, said.
After Babu, Hans Raj Verma, a senior IAS officer, was given additional charge of the IT department.
In a complaint questioning the government’s move, Arappor Iyakkam wrote to the Centre, “When the whole state is focused on fighting the pandemic, TANFINET has brought about big changes in the tender in the form of a Corrigendum, the major of which seems to be with the intention of restricting competition and to favour a few specific companies.”
The Commerce and Industry Ministry’s decision came following an online meeting on June 23, in which the allegations raised were heard in the presence of state government’s experts and officers, including Verma.
Referring to the meeting, the Centre’s order to scrap the tender said that “based upon comments and feedback received from stakeholders, it has been considered that the bidding conditions incorporated by TANFINET in the bidding documents are restrictive and discriminatory in nature.”
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