The WDB is awarding contract for the project to Japanese company Ebara Corporation that outlines a cost of Tk 132 crore. But the government will have to spend Tk 180 crore, including tax, VAT and consultancy fees, for the project that should cost between Tk 60 crore and Tk 80 crore, the sources pointed out.

The awarding of contract was stalled for two years due to two writ petitions, one filed by Ebara claiming it should get the contract as the 'lowest bidder' and the other opposing it, saying there is a cheaper offer.

Ebara, backed by a powerful minister's son, is the second lowest bidder.

The High Court disposed of both the petitions about three months ago, saying since the project cost is more than Tk 100 crore, the Cabinet Purchase Committee's decision on it is final.

According to a separate proposal from the Rural Development Academy (RDA) of the Ministry of Local Government and Rural Development (LGRD), the project can be implemented at an expenditure of Tk 80 crore.

LGRD Minister Abdul Mannan Bhuiyan strongly recommended this proposal noting that the RDA successfully implemented 70 projects for supply of water at low cost using its own technology. But the WDB brushed it aside.

Moreover, during the evaluation of the bid for this project, the WDB had cancelled a bid by a German company -- KSB-- that offered Tk 60 crore, Tk 72 crore less than Ebara's offer.

The German company lacked one document but was not given a chance to rectify the shortcoming although Ebara and another Japanese companyKanematsu -- were allowed to clarify over a dozen questions, sources said.

Industry insiders also say installation of three pumps under this project should not take more than Tk 50 - 60 crore.

The project is being implemented mainly by using a Japanese Debt Relief Grant Aid of $17.99 million.

The WDB had floated the tender for it in 2003 and selected Ebara. But conflict erupted soon when very influential ruling BNP lobbies wanted the WDB to award the contract to Kanematsu that had offered Tk 180 crore. The water resources ministry backed this move.

The ministry had been unsuccessfully pushing a Tk202-crore unsolicited deal with Kanematsu from 2001 through a tender evaluation committee that objected to awarding the contract to Ebara, saying there had been irregularities in the tender process and the WDB did not ensure wider participation. It however did not refer to the KSB bid.

The ministry on April 25 last year decided on its own to re-tender the scheme. But the move failed as a High Court order in June said there was no need to re-tender. Further legal tangles slowed down this project, which the ministry marked as 'very urgent'.

The installation of the new pumps will increase the irrigation coverage to 142,000 hectares from 100,000 hectares now.

The GK Project was implemented in the sixties by installing three pumps to increase crop production in the southwestern region. During 1981-93, the project was rehabilitated in two phases under Asian Development Bank loan but the original pumps were not replaced.