Srinagar: The Mumbai-based Hindustan Construction Company (HCC) has sought yet another extension before signing the contract to build the New Ganderbal Power Project. Sources in Jammu and Kashmir State Power Development Corporation (JKSPDC) revealed to Kashmir Reader that they have received another letter from HCC seeking extension of the deadline till January 31, 2018.
“The time has been granted,” the sources said.
“The bank has sought more time from HCC,” sources in the know of the contract said. “For signing the contract, the HCC is supposed to submit its (bank) ‘performance certificate’ to the JKSPDC, which is a necessity.”
The HCC bagged the Rs 820-crore contract after almost half a century of the project first being mooted.
The 93-MW power project will be built on the river Sindh in central Kashmir’s Ganderbal district, for which the approach road is almost ready. The Sindh is a tributary of the river Jhelum.
“After it won the contract among six bidders, the HCC was supposed to sign the contract in September but it did not, citing implications of the new Goods and Services Tax (GST) on the contract,” an official of JKSPDC said. “Later, the HCC agreed to all provisions of the Letter of Intent (LoI) issued by JKSPDC.”
The officer, however, added, “HCC is facing a tough time with its banker as it has failed to produce the ‘performance certificate’ of at least Rs 80 crore to be produced before signing of the agreement.”
The sources said that it was the third extension granted to HCC since September for signing the agreement. “After it failed to sign the contract within 28 days since August 8, 2017, the HCC officials held several meetings with JKSPDC officials in Srinagar. They were finally satisfied that the contract had all the provisions that cater to any change in taxation, but then the HCC faced problems from its banker and they sought time till November 31 to sign the contract, which was extended to December 31, 2017. Now the final date has been set on January 31, 2018,” the sources said.
New Ganderbal will be the fourth biggest state-owned hydropower project after Upper Jhelum, Lower Sindh, and Baglihar power projects. It will have three turbines with a capacity to produce 31 MW of electricity each. Construction is to be completed in 48 months.
The New Ganderbal Power Project is possibly the first contract bagged by the HCC which is facing crisis at its initial stage. The HCC has been operating in J&K for over five decades and has built one-third of the state’s hydropower capacity.
It completed two hydropower projects at Chutak and Nimbazo in the Ladakh region, funded by the National Hydro Power Corporation (NHPC). It is currently constructing a 1.5 km excess tunnel at the Sawlakote hydroelectric project. It is also involved in road construction in the state.
The New Ganderbal power project will be HCC’s fourth such venture in J&K.