Vol. 4 Num 61 Sat. July 26, 2003  
Front Page

Controversy clouds BTTB cellphone scheme

A public sector cellphone bid evaluation report reveals flaws in methodology that exposes the exchequer to a high financial risk.

Such revelations give weight to the controversy of the mobile phone venture of Bangladesh Telegraph and Telephone Board (BTTB), designed for 250,000 customers.

The concern came to a head when the BTTB asked a nine-member committee to finish within 15 days the evaluation of the bids by six telecoms vendors and the committee declined to comply with the deadline.

Swedish Ericsson, German Siemens, Canadian Nortel and American Motorola along with four Chinese vendors -- Huawei, CMEC, ZTE and China Putian -- submitted bids on December 18, 2002 after the BTTB invited bids for its mobile phone system on August 17, 2002.

Motorola and China Putian were instantly disqualified for lacking necessary documents and the remaining six bids were sent to the committee for technical evaluation on December 26, 2002.

The committee said the BTTB relaxed evaluation criteria in an apparent move to favour some inexperienced vendors and scrapped the committee's authority to disqualify a bid with false information.

Despite detecting "deemed fabricated" documents in Huawei's bid, the committee had to technically qualify the Chinese vendor because of loopholes in evaluation criteria.

CMEC, another Chinese vendor, admitted in its bid to having "no experience of completion of similar project", but its bid was technically qualified as the penalty provision is negligible compared to such a major discrepancy.

But the committee divided over evaluation of the third Chinese bidder ZTE: five out of the nine members challenged ZTE's credibility as a GSM equipment supplier, while the rest supported the state-owned Chinese company.

The BTTB's hierarchy reportedly persuaded the committee, headed by BTTB Director (Planning) Absar Alam, to give a unanimous go-ahead to ZTE. But the dissenting five ignored the pressure, sparking an internal feud for nearly two months.

On June 5, 2003, BTTB Chairman SATM Badrul Haque officially accused Alam of 'repeatedly delaying' the submission of the bid evaluation report.

He referred to the pledges by the prime minister and the telecoms minister of launching BTTB mobile phones without delay and made the June 2004 deadline essential.

The BTTB chief blamed Alam for missing deadlines for submission of the evaluation report.

The chairman called the delay "suspected connivance (of Alam) with the conspiracy against the BTTB mobile project" and said such a "serious allegation" would be put in Alam's annual confidential report (ACR). Copies of the letter (No. S,BTTB/confidential-1/2002-27) were sent to the telecoms minister and the secretary.

Such a unilateral harsh step of the BTTB chairman outraged the technical evaluation committee members. Four days after issuance of the letter, the committee submitted split decisions to the authorities on June 9, 2003.

Five out of the nine members disqualified ZTE. Three out of the remaining four members disqualified telecoms vendors Siemens and Nortel. But Alam, convenor of the committee, made all the six bidders technically qualified.

But the committee members were unanimous in levelling allegations against their superiors. The page 44 of the evaluation report says, "From the 3rd week of February 2003, the higher authority of BTTB, through the convenor, interrupted the committee's work several times by verbal instruction for many reasons."

The committee members again blamed their superiors for poorly drafting the bid documents. The page 77 of the report says most commercial requirements are "very peculiar and against the national interest".

But the committee censored the accusations made in the draft and kept pages 77 and 78 blank in its 80-page final report. Sources said such a gap in the evaluation report is unprecedented.

Contacted, the BTTB chairman said, "I have never, directly or indirectly, approached or influenced this GSM bid evaluation." He declined to comment on other points.

The BTTB proposed GSM mobile system likely to serve one million subscribers in the end will also offer affordable Internet in mobility.

More than Tk 600 crore has been earmarked in the concept paper of the project. Funds will be mobilised through selling telecoms bonds to the local money market. The capital cost of the project will be finalised upon complete evaluation of the financial bids of the technically qualified vendors.