Negotiations begin with Germany and France for setting up security printing pressWith less than 700,000 copies of passports in stock, the government is in a hurry to reach a deal at the earliest.
As the stock of passports is depleting fast, the Ministry of Communication and Information Technology has started fresh negotiations with German and French firms to set up a dedicated printing facility.
A technical team headed by Joint-secretary at the ministry Radhika Dhakal—which includes representatives of various government agencies—tasked with assessing the proposals and recommending a government-to-government deal has already submitted its report to Minister for Communication and Information Technology Gokul Prasad Baskota, according to officials.
Both Germany and France resubmitted their financial and technical proposals to the ministry on Friday, a member of the technical team told the Post on condition of anonymity.
Both the proposals were forwarded after the team found both German and French firms qualified for setting up the security printing press.
But given the global outreach, company’s financial condition, technical capability, experience, and other requirements, the German firm has bagged more points than the French one, a joint-secretary, who is also a member of the task force, told the Post.
“So we have made a fair recommendation to the government about our evaluation,” said the joint-secretary.
However, there should have been a global competition, which has been already violated by the government, according to the official. “After we could not call a global competition, we have to make a fair deal based on whatever we found in the two proposals. And we have made a fair recommendation,” he said.
Establishing a security printing press through a government-to-government deal is the biggest procurement process initiated by the KP Sharma Oli government and has generated huge interest among political leaders and officials.
Though its initial budget for the press, including the banknote printing facility, was estimated to be Rs32 billion, now the government has dropped the plan of printing banknotes at home and downsized the budget.
Veridos, a special purpose vehicle of the German government-owned Bundesdruckerei, Giesecke and Devrient, have submitted their proposals backed by the federal finance ministry of Germany. Another proposal was submitted by the French foreign ministry on behalf of IN Gropue, a French government undertaking.
Earlier, Germany’s Bundesdruckerei had offered a soft loan of 260 million euros to set up a security printing in Nepal, which would have paper, card and banknote printing facilities.
France’s Groupe Imprimerie Nationale had offered 200 million euros in a soft loan for only paper and card printing facilities.
The interest rate of both these soft loans is around 2.5 to 3 percent, according to Finance Ministry officials.
After reservations from the Finance Ministry, the plan to include banknote printing facilities has been shelved, according to Finance Ministry officials.
Though officials in the evaluation team refused to share details, government sources said that Germans have offered a soft loan of 175 million euros.
The French soft loan offer is a little higher at 185 million Euros, said a source who also requested anonymity.
The source refused to disclose the interest. But in technical terms, the German proposal looks better, he said.
But the Finance Ministry has expressed reservations about the interest rates of both the firms and urged the Ministry of Communication and Information Technology to negotiate for bringing it down before signing the deal with any of the countries.
The Germans have a century-long history in printing facilities so there is no doubt their technical proposal is stronger than the French, at least two other officials familiar with the process since the beginning told the Post.
“The German company has the world’s largest paper mill called Luisenthal while the French company needs to buy paper,” said one official. “That’s why Germans have assured Nepali officials that they could deliver passports fast and, in case of emergency, they can provide one million interim passports free of cost.”
After the plan to set up the banknote printing facility was dropped, both countries have revised the budget and technical strength.
The government is in a hurry to sign a deal for establishing secure printing after cancelling the global bidding for e-passports.
The Department of Passports says its stock is depleting fast with less than 700,000 copies remaining.