Economic Co-ordination Committee (ECC) of the Cabinet has allowed Trading Corporation of Pakistan (TCP) to adopt price matching formula in the urea import tender of Rabi season to ensure timely import of the commodity. With this approval, the TCP now can offer other participants of the tender price matching of the lowest bidder, in case complete quantity is not offered by a single party.
Sources told Business Recorder on Thursday that for the last few months, TCP had been seeking some relaxation in Public Procurement Regulatory Authority (PPRA) rules to ease terms and conditions of the urea import tender in order to finalise deals for import through a single tender.
The PPRA was said to be opposing the proposal of price matching formula floated by TCP due to which it failed to get price matching permission from PPRA in the previous urea import tender issued for Kharif season. However, the ECC, in its meeting held last week while approving the import of 0.3 million tons of urea, also allowed price matching to TCP to avoid any delay in import of the commodity.
Recently, the ECC had asked TCP to import 0.3 million tons of urea for Rabi season as domestic urea plants were unable to produce sufficient urea because of gas cartelization. Following the ECC directive, TCP has already issued a tender for the import of 0.3 million tons of urea to be opened in the last week of August 2012. Sources said the ECC had also allowed relaxation with regard to tender period as only pre-qualified suppliers can participate in the urea tender. Therefore, TCP on August 9, 2012 issued a normal procurement tender with 15 days time frame instead of 30 days. The new urea import tender will be opened on August 27, 2012.
TCP Chairman Tahir Raza Naqvi also confirmed that ECC has allowed price marching for the urea import tender. “In the last urea import for Kharif season, TCP was compelled to issue multiple tenders for the import of 0.3 million tons of urea as price matching was not allowed and the submitted bids were less than tender quantity,” he added. He further said that now TCP could finalise deals for the import of 0.3 million tons of urea through a single tender.
“It is not possible for a single party to supply complete 0.3 million tons of urea as it requires huge funds for bid money and performance guarantee,” he said and added that a single big deal was also risky as if a party became defaulter, complete import would be delayed. He was of the view that the ECC”s decision was in the largest national interest as it would ensure timely import and availability of urea in the domestic market. He further said that out of 0.3 million tons of urea for Kharif season, some 160,000 tons of urea had already arrived and two more ships weree expected to reach the country on Friday.