After over nine months of stalled attempts, the government and the Italian civil contractor for Melamchi Water Supply Project's (MWSP's) have finally reached an agreement. The government accuses the contractor of delaying tunnel works and head works of MWSP citing one excuse or other.

 

There were at least two previous attempts to make Cooperativa Muratorie Cementisiti - CMC di Ravenna -- the contractor -- 'responsible' through meetings with project officials, donors, and consultants. The government also tried to get the contractor to submit its schedule for completing work in the much-awaited drinking water supply project for the Kathmandu Valley.

 

In the two meetings -- held in April -- the parties had agreed on a number of issues, including an agreement that the contractor would submit its new work-schedule and recovery plan. But the contractor then did not sign the minute about the decision and did not give a clear reason for doing so either.

 

A third meeting was held on August 26 at the Ministry of Urban Development with urban development secretary Arjun Karki present. On Monday, 13 days after the meeting, the contractor's representative Jitendra Man Pradhan signed the minutes after receiving serious threat from the project's consultant.

 

"The contractor has a month to submit its short-term plan for work on the tunnel, a recovery plan for behind-the-schedule work, and compensation proposals for extending the deadline to account for the time lost because of the earthquake and for any other losses," Ghanashyam Bhattarai, the executive director of MWSP, said.

 

The contractor will also have to prepare and submit a longer term plan within three months.

 

The project has to be completed by the end of September 2016.

 

But with two-third of the 1,095-days schedule already gone, only a third of the work has been completed. The project has a 21-km tunnel.

 

The contract was signed in January 2013. EPTISTA, the project's consultants had issued several notices asking the contractor to submit its work plan after it failed to keep up with the required pace of the work since December 2014. Work on the tunnel was also disturbed in two sections by the earthquake.

 

After the new decision, work is expected to accelerate but Bhattarai says this cannot be said for sure until the short-term and long-term plans are received.

 

The parties also decided that CMC di Ravenna would submit a design modification for replacing the rib design in the permanent support work in the tunnel by lattice girder to save time and cost.

 

Earlier, the contractor had submitted a modification design but without details on time or cost saving or value engineering. Likewise, CMC di Ravenna had also demanded 5 million euros (approximately Rs 565 million) as additional advance payment to solve its cash-flow problems and also to pay for the tunnel's permanent support system which was not yet complete.

 

Sources also said the contractor had wanted the consultants to do design modification intending for variation order in the project.

 

The contractor has also been accused of trying to lobby for deadline extension and get it demand fulfilled by using 'illicit connections' to put pressure on the office of the prime minister, political leaders as well as the Nepal Resident Mission of the Asian Development Bank (ADB) in Kathmandu.

 

"There should be mutual trust, coping with uncertainties and managing uncertainties with the disciplined flexibility and essential things," Kenichi Yokoyama, country director of ADB, had said.

 

An agreement has also been made to pay for the remaining support work to help in expedite the project.

 

"Completed section without modified design of permanent support system would be paid upon the confirmation of quality by the consultant," Yokoyama said.

 

Sources say the contractor will also get approximately 1.7 million euros but its request for additional payment to address its cash flow problem will not be addressed.