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Musharraf's Relative Lands Another Super Duper Project of the Future
by M.A.Siddiqi
- The South Asia Tribune
http://www.satribune.com/archives/200505/P1_mas.htm

 

KARACHI, May 12: Pakistan has taken a gigantic leap into the 22nd Century, (yes the 22nd Century), and Karachi has moved overnight from a town which shut down even its archaic Circular Railway to a Metropolis which will soon boast of the World’s first Magnetic Levitation (Maglev) Commercial train. All this thanks to a close relative of General Pervez Musharraf 

This miracle has been possible not because General Musharraf wants Karachi to become modern or overcome its public transport problems but because Brig (Retd) Aftab Siddiqi, the father-in-law of First Son Bilal Musharraf, wanted the US$298 million Maglev contract and got it.

The beauty of the deal is that by building the golden three miles of super fast Maglev Track, Musharraf’s relative would not just have pocketed almost 300 million dollars, he would have pushed Pakistan into the Guinness Book of Records for launching a project which even the pioneering countries France and Japan are reluctant to launch on a commercial basis. In Virginia US it is being run on an experimental basis in a University in Old Dominion (Pix Left).

Three days ago, on May 9, 2005 South Korea held a trial run for reporters. The train was an improved version used by 120,000 people at the 1993 Daejeon Expo. It has a peak speed of 110 kilometers per hour and can carry 135 people per compartment. Korea is planning to start Maglev trains for people In spring 2007 and will become the third nation to run train, after Germany and Japan.

German company Siemens is operating a high-speed Maglev train on a 32 kilometer track from downtown Shanghai, China to the Airport, and Japan is running an urban-style Maglev train on a 9-kilometer track within the Nagoya Aichi Expo site, similar to Korea. Both are experimental runs.

Korea's top company Rotem, which has been developing Maglev trains for 17 years from the days of its antecedent, Hyundai Motor Service, is deeply troubled. This is because as local governments pursue LRT subways, they are reluctant to select domestic Maglevs because it has never been operated before.

But for doing Karachi and Pakistan this huge favor, a series of rewards have been offered to this retired lucky Brigadier related to General Musharraf.

He will also get as part of the overall package colossal benefits. The Maglev Project given to him is not on Build-Operate-Transfer (BOT) basis but on Ownership basis. He has been sanctioned one 450 MW [gas]-fired Power Plant. A Real Estate Development Commercial Loan of $100 million to his company will be guaranteed by Pakistan Government. A Non-Refundable Bank Guarantee of $60 million will be paid to his company to compensate for losses in the first 6 years of Maglev Project at $10 million per annum.

Above all, whatever he imports will be exempted from Customs or other duties and taxes. Whatever money he makes will be free of Income Tax.

It is another matter that even after such a platinum package, 99 per cent of Karachiites would still be hanging dangerously to diesel-emitting over-packed buses or waiting endlessly in traffic jams in the world’s most polluted environment.

The story of how Brig Siddiqi has landed another multi-billion contract, this time beating the friendly Chinese out of the race, is not just intriguing but fascinating and reminds analysts of the historic statement of Sheikh Yousuf, Chairman of Husnain Construction, the company which first hired Brig Siddiqi who used the Musharraf connection and turned his construction business into a gold minting machine. Yousuf achieved this just by paying a two per cent commission to this talented father-in-law of General Musharraf’s son.

On September 25, 2002, Yousuf talked to reporters at the site office of M-3 at Ghartal, Faisalabad According to a report in Daily Dawn, he was asked as to how much his company had been helped by Brig Aftab Siddiqi the useful father-in-law of Bilal Musharraf. Yousuf admitted that the gentleman had worked with his company as a consultant. Click to Read Full Dawn Report   

Then he said: “It was originally agreed that he would get two per cent of the profit from the project for 25 years, but since the project had been converted to a government funded plan, Aftab Siddiqi was no longer with his company. The cost of M-3 is Rs7 billion.”

Yousuf also revealed that Mr Siddiqi “had been paid for the 'services' which he rendered,” but refused to give more details. “Everything was documented, and the payments to Mr Siddiqi had been made through checks, the copies of which had been provided to a number of government departments," he said.

Exactly at that moment his smart son rushed to the stage and asked Yousuf not to answer more queries on the subject, according to the Dawn report. He was obviously revealing State secrets and could get into serious trouble and the son realized that more than the father.

That was 2002 but Brig Siddiqi and Husnain Construction have never looked back. Already in the first years of General Musharraf's rule, this construction company, according to its Chairman, had acquired at least 12 sick mills from the Government.

But Siddiqi’s biggest catch has been in Karachi. The story of Maglev started with the City District Government of Karachi inviting Tenders on BOT Basis in October 2003 from the private sector to undertake the Karachi Mass Transit, Priority One Corridor.

Two tenders were received in November 2003, one from M/s American Maglev Technologies and other from a Chinese Company. The Chinese Company Tender was on finance cum construct basis for US $570 million, with long term credit on easy term made available by the Government of China.

But M/s American Maglev Technologies which did not submit even the required Bid Bond of US $1 million was awarded the Contract in December 2004. This was done by a Special Committee headed by a retired bureaucrat, Dr Akram Sheikh, the man planted for the job by the master-mind behind this manipulation, the father-in-law of the son of the President of Pakistan.

Siddiqi had contacted Dr Akram Sheikh who had retired as Federal Secretary. Sheikh is well known for his dubious past as he was suspended from service three times but was always able to work, or pay, his way out of the black hole.

Among the many examples of his reputation as a “Chaloo” officer (shrewd person) was the case of obtaining a 1000 square yards residential plot at half a million rupees from Karachi Port Trust in 1999. when the market price of this piece of land was Rs30 million.

Siddiqi reached a deal with Sheikh that he will be made Deputy Chairman of the Planning Commission if he promised to award the contract of the Maglev Train to M/s American Maglev Technologies. The deal was done and Siddiqi got the orders of his appointment from General Musharraf.

But before the contract could be awarded, Siddiqi moved in as a partner of M/s American Maglev Technologies. All other partners were replaced with Siddiqi’s company M/s Infrastructure Development.

The contract winners had turned into the sons-in-law of the State of Pakistan by virtue of Siddiqi’s relationship with Musharraf. So much so that the $1 million Bid Bond which was to be submitted with the tender, was submitted 13 months late and that too neither by M/s American Maglev Technologies nor by M/s Infrastructure Development Company but by two Pakistani Contractors, M/s Techno Engineering Services (Pvt.) Limited and M/s Saadullah Khan & Brothers.

Siddiqi was promised and given concessions which experts quantified in dollar terms as horrendous. Adding all exemptions and $160 million Government and bank guarantees, this project will cost Pakistan over $900 million. In short, thanks to Siddiqi, poor Karachiites and the State of Pakistan will end by getting 3 miles of Maglev Train for $900 million.

On the face of it, the Maglev contract to Siddiqi would be of $300 million but these hidden costs would push the price to $900 million. As against this huge cost, China would have done the same job for around $500 million and that too on easy loans. But then how would Mr Siddiqi earn his millions.

According to the latest information, Siddiqi has again defaulted to sign the Contract Agreement within the time limit, which expired in March 2005, but thanks to you-know-who, he has managed to get another indefinite extension.

Not knowing how the wheels in Islamabad work and who was doing what behind the wheels, the innocent Mayor of Karachi Naimatullah Khan announced that the first phase of Corridor I Karachi Mass Transit Program (KMTP) would start by December 31, 2006 with a Magnetic Levitation Train.

Experts were aghast at the announcement as suddenly instead of improving the smoke detectors of Karachi buses, the Nazim had thrown Pakistan into the unknown future, while he himself is unable to determine whether he belongs to the past, present or the future.

The total length of the Maglev Train track is said to be 17 kilometers, from Sohrab Goth to Mereweather Tower. But is such a short stretch of rail worth deploying a super-technological invention which was still in its embryonic stages of development in the countries where it was invented.

There are no answers and no details available to the media or the Parliament but what is clear is that a contract of $300 million has been awarded to a Musharraf’s relative and he has been showered with a lot more concessions. Why all this generosity is yet to be determined.


Full Dawn Reprot

More motorways to be constructed: Tenders being issued

 

ISLAMABAD, Sept 25: The government, after reviewing its policy about the motorway, has decided to construct more similar motorways as it no longer considered the motorway as 'luxury road'.

National Highway Authority (NHA) Chairman Maj-Gen Farrukh Javed said on Wednesday that the government was in the process of issuing tenders for another section of the motorway, starting from Faislabad to Khanewal.

Talking to reporters at the site office of M-3 at Ghartal, Faislabad, he said it was correct that the existing motorway was not being used by the motorists and truckers, which was projected during its approval, but added that 'such roads were needed for future.'

When asked to comment as to why the present government had abandoned the project by calling it a luxury road, the chairman said that he was of a different view on the issue.

He said the NHA was working on a plan for improving its road network to make Pakistan a transit country for approaching the Central Asian States riches. "Germany, the USA, UK and other developed countries had used this concept to improve their economies," he remarked.

Earlier, Sheikh Yousaf, owner of Husnain Construction, which is the contractor for M-3, explained the phases for which his company passed for converting the M-3 project from the Built, Operate and Transfer (BOT) plan to the government funded project.

When asked as to how much his company had been helped by Brig Aftab Siddiqui (Rtd), father-in-law of Bilal Musharraf, he said the gentleman had worked with his company as a consultant.

Mr Yousaf said it was originally agreed that he would get two per cent of the profit from the project for 25 years, but since the project had been converted to a government funded plan, Aftab Siddiqui was no longer with his company. The cost of M-3 is Rs7 billion.

He, however, said Mr Siddiqui had been paid for the 'services' which he rendered, but refused to give more details.

Everything was documented, and the payments to Mr Siddiqui had been made through cheques the copies of which had been provided to " a number of government departments," he said. Then his son rushed to the stage and asked Mr Yousaf not to answer more queries on the subject.

Mr Yousaf said the company was heading the consortium of the Pakistani construction companies called PAMIC, and added that they were completing the project to show that the country had the expertise to construct the motorway.

He said it was the first contract of its kind which had no escalation clause.

When asked as to how many projects his company had fetched in the period of military government, he avoided giving straight answer, and said that whatever his company had got was on merit. He admitted that he had purchased about a dozen sick industrial units.

The NHA chief stressed the need to develop the Western part of the country along River Indus and close to Afghanistan.

He said Pakistan had got the contract for construction of road from Chaman to Kandahar. Negotiations for Torkhum to Kabul road were under way, he added.

 

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