Pappu Construction beset by a series of setbacks after its owner was suspended as a lawmakerThe company has been denied at least one almost sure contract while some of the contracts it had won were terminated after Rauniyar’s suspension.
The suspension of Hari Narayan Rauniyar, founder of Pappu Construction, from the position of lawmaker last year over corruption charges, has appeared to be a turning point for his waning influence in getting contracts and saving the contracts won by his firm.
In October last year, the Commission for Investigation of Abuse of Authority filed a corruption case at the Special Court against Rauniyar and his son Sumit along with ten other government officials over the construction of a sub-standard bridge over Babai River at Jabbighat in Bardiya.
As per the Corruption Prevention Act-2002, it led to automatic suspension of Rauniyar from the lawmaker’s post.
Pappu Construction has been denied at least one almost sure contract while some of the contracts it had won were terminated after Rauniyar’s suspension.
The government officials who dealt with Pappu Construction point out a number of factors that led to the company losing its influence lately.
“Waning political influence is one factor,” said Rabindra Nath Shrestha, secretary (Irrigation) at the Ministry of Energy, Water Resources and Irrigation.
“Other factors such as the new provision of setting a certain milestone to accomplish even before the contract deadline expires, concerns about its performance raised by the media and the strong instruction from Prime Minister KP Sharma Oli for decisive action on under-performance also broke Pappu’s dominance in the construction sector.”
Shrestha had served as director-general of the Department of Roads last year.
A former secretary of the Ministry of Physical Infrastructure and Transport recollected recently to the Post about the influence of Pappu when he was the director-general of the Department of Roads some years ago.
“Our project office requested the Public Procurement Monitoring Office to blacklist the Pappu. But under the influence of Rauniyar, the immediate secretary of the procurement monitoring office continued to delay the blacklisting process. Only after that secretary left the procurement monitoring office, the company was blacklisted.”
Given the political influence he had, Rauniyar got a ticket from erstwhile Sanghiya Samajbadi Party (now Samajbadi Party Nepal) for the parliamentary seats and also won the elections in 2017. He used to secure interim orders from court whenever his company ran into trouble, according to the road department officials. But now the situation has changed.
After Kathmandu Valley Road Expansion Project terminated Pappu’s contract for a Bagmati river bridge project in Tinkune last week, the latter sought an interim order from the Supreme Court. Instead of issuing an interim order, the court has asked both parties to be present at the court this time.
According to Bishow Bijaya Lal Shrestha, spokesperson for Kathmandu Valley Road Expansion Project, the contract was
terminated after Pappu failed to complete even the foundation of the bridge in five years since the signing of the contract.
Besides, Pappu had also rejected the project office’s instruction to correct the mistake and build the bridge as per the approved design. Now, the project office has asked the procurement monitoring office to blacklist the firm.
Rauniyar claimed that despite his firm’s willingness to work as per new design, it was not allowed to work.
“It is due to the prejudice of former Physical Infrastructure Minister Raghubir Mahaseth, who didn’t like me joining the Samajbadi Party Nepal,” Rauniyar told the Post on Sunday.
On Sunday, Pappu’s other contract regarding building two bridges in the Mid-Hill Highway was also terminated.
The Mid-Hill Highway project said that contractor had failed to give a convincing clarification on why the contract should not be terminated. The project has also instructed the contractor to pay a fine of
Rs 66 million after its performance guarantee could not cover the increased cost for the project implementation. The project was awarded to Pappu/Nepal Pragati JV in July 2011, and its extended deadline was until January 2014.
Earlier in March, Coastal/Pappu JV was blacklisted by procurement monitoring office for poor progress in the construction of the main and link canals and rehabilitation of headworks of the Dunduwa Irrigation System—of Sikta Irrigation Project.
Amid ongoing bad publicity and strong reservation from the Nepal Rastra Bank, SRBC Pappu JV was also denied the contract of building central bank’s building in Baluwatar, Kathmandu.
After passing the technical qualification and coming first in financial evaluation, it was almost sure to get the contract of the central bank.
Rauniyar admitted that he has become an easy target of the government agencies after his suspension from lawmaker’s post. He also claimed that his firm was facing action against the procurement laws.
“If I were in Parliament, I would not allow the government agencies to take
action against my company by going against existing laws and regulations,” Rauniyar said.
He said that he would now go to the court for his reinstatement as a lawmaker, as parliamentary regulation and anti-corruption law have a contradictory provision regarding suspension.