SC directs DoT not to stall loan

The case was filed in the Supreme Court through a Special Leave Petition in June by Punjab Communications Ltd (PCL), one of the two companies short-listed by DoT for supply of equipment for the rural phone project. The company alleged mala fide on DoT’s part for cancelling the Wireless in Local Loop (WLL) tender after going through a cumbersome process for two years. It was alleged that the two short-listed bidders — PCL and Bharat Electronics Ltd (BEL) — were made scapegoats as most of the MNCs participating in the tender had been disqualified.

The proposal for the loan for the rural phone project in UP first came up in 1993 where Rs 400 crore was supposed to come from the ADB and the remaining Rs 200 crore for the project was supposed to be chipped in by DoT. DoT, subsequently, took three years to finalisethe tender specifications finally floating the tender in 1996. The tender was opened in March, 1997, and a report finalising the short-listing of PCL and BEL was submitted by a committee within DoT in July. However, even these two companies were later said to be "nearly" compliant bids but not 100 per cent satisfactory.

This led to the setting up of a High Level Committee subsequently which finally advised cancellation of the tender. Soon after this the DoT informed the ADB that it did not require the funds for the project. As an answer to the controversy over MNC pressure resulting in the cancellation of the tender, former Communications Minister Beni Prasad Verma had said that the DoT would meet the requirements for the project from its own funds. However, so far, there has been hardly any move by the department in this direction and the 36,000 villages in eastern UP are still a long way from getting connected through telephone lines.