Aizawl Smart City Project, a money making venture for the tainted BEL

Bharat Electronics Limited (BEL), a PSU of the Government of India was allotted with the work of installing the System integrator for implementation of integrated Command and Control Centre, ITMS and City surveillance system at Aizawl by the Aizawl Smart City Limited (ASCL) on the nomination of the Ministry of Urban and Housing Affairs as said. But there are serious allegations against BEL regarding their poor performance in the Smart City Projects in the other parts of the country, unprofessional modus-operandi, quoting high and unreasonable price for the products/equipments installed, the material used by BEL in networking hardware, camera technology being substandard Chinese products etc. Hence, handing over of such a visionary project funded by the Tax-payers money unto BEL would be an unworthy risk and instead open tender is suggested; so that efficient firm may be selected through the regular bidding process. To counter such allegation, BEL made a press-release on dated July 6th, 2020 and to the utter surprise, the statement made by BEL are misleading in nature. In response to the question of BEL being served with the notice of termination by BELAGAVI SMART CITY with charges of unreasonable delay in payment to the vendors of their dues; for not being able to deploy their ICCC platform and inability to integrate to be used either by administration and citizens. BEL has mentioned that “These were delays due to lack of supporting infrastructure required for implementation”, the statement holds no ground as the letter of termination clearly states “Non-Performance in implementation of Integrated Command and Control centre by MSI (BEL) & Termination Notice for the same”.

An another Press-Release is made by the CEO, Smart City Aizawl, which is seemed solely to support BEL by way of ignoring the greater interest of the state; as the statements made by the CEO only reflects his ignorance regarding his claim of exclusion of operations and maintenance in the current tender floated by BEL dated 13th June 2020. But in reality, the current tender floated by BEL is inclusive of 5 years of Operations and maintenance including the spare parts as well.

Moreover as said, BEL was not nominated by Ministry of Housing and Urban Affairs. However, the reality is that in order to expedite the process, the MoHUA had advised the State Government to check BEL as MSI but there was no such compulsory directive or directions for tucking in BEL. The decision of signing the Memorandum of Understanding (MoU) and contract was left unto the State Government. Considering all the perspective, the similar Smart City Project of Guwahati and Shillong though under the same scheme of the Government of India, had chosen not to sign the MoU and the contract and instead are heading for an open tender. So, the statement declaring that BEL is nominated by MoHUA is not true and is made with a dubious intention to support the transgression of BEL.

BEL is charging a very high rate of profit margin despite being a Public Sector Unit. Their unit prices for items in Aizawl Smart City differs upto more than 50% of profit/margin as compared to their own project of Belagavi Smart City allotted to them. The total cost of implementation of the Aizawl smart City Project is in the range of 101 crores  which includes capital expenditure of INR Rs. 79,08,71,555.00 and the operations and maintenance cost of INR Rs. 21,93, 80,050.00.

Astonishingly, the market rates suggests that the current capex can be delivered at INR Rs. 46,00,75,047.00 as compared to the price quoted by BEL. Table below shows the market analysis. It is clearly evident that BEL is cutting heavily and pocketing the money of People of Aizawl, which could have been substantially used for the development of the city and shall virtually secure the well being of the people of Aizawl. Importantly, in Line number 14 of the above table, the cost of undertaking civil works including false floor, ceiling, ducting, access doors, painting, partitioning etc is 70% higher than the market price, which could have been easily accessed by a general individual but the CEO of the Aizawl Smart City Project could not figure it out; such lackadaisical approach of a responsible officer creates doubts in the minds of the citizens of the state. The CEO should be keen to save public money.   The subsequent table below shows the difference in the price quoted by BEL in Aizawl and in Belagavi Smart City for same set of equipment/product. And the reason for charging excessive price, i.e. 66% more in aggregate for the same set of products by BEL in Aizawl Smart City is not understable. On the other hand, the State Government/Aizawl Smart City had also avoided to cause any analysis of the market price of the items with the rate suggested by BEL before signing the contract, is indicative of some nexus.


So, the BEL is seemed to have stressed more on making profit and the approach of the PSU towards a project, involving public interest is literally unethical. As the competency of BEL is in question, the CEO, Aizawl smart City Project should have collected work completion certificate of the various other Smart City Projects undertaken by BEL before entering into any kind of contract with the PSU. The CEO, Aizawl smart City Project has not initiated to take any step, which could have ensured that the public interest is in the better hands and on the contrary, the aspect of transparency is never taken into consideration, which is also against public policy.

Besides, reputation of BEL is tainted by internal issues of corruption; as very recently, the CBI has initiated a probe against four persons, including officers of Bharat Electronics Ltd (BEL) in Chennai and Hyderabad and three firms for an alleged Rs 9 Crores fraud, caused by way of making payments to the Vendors, without even making any purchase in a span of seven years.

In such circumstances and in the interest of restricting the wastage of public money, the State Government should immediately intervene by directing the cancellation of the contract with BEL and passing necessary directions for an open tender to be monitored directly by the State Government itself. Such step shall be very well in the interest of the public at large.



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