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Why a clean drinking water project in Punjab is going nowhere

Updated Apr 09, 2018 11:30am

Water sparkles at a luxury golf club and water resort just off Multan Road. The environment inside its premises is rarefied — meticulously manicured lawns, well-maintained golf greens and artificial sandpits are lined by diligently designed tree plantations. Water sport facilities are interspersed over a large area. The clear blue sky above the resort and the crystal clear water raining down from what its management calls a “splash zone” belie its surroundings. It is located amid one of the most heavily industrialised – and also highly polluted – tracts of land near Lahore. Factories and plants of all types emit poisonous smoke and spew dangerous waste right around the bucolic atmosphere of the resort. Groundwater in the area is poisonous, the land is singed with chemicals and the air noxious with hazardous fumes.

Located about 36 kilometres south of Lahore’s Thokar Niaz Beg flyover, this area was agricultural country before industry arrived here in the 1990s. Rice, vegetable, wheat, sugarcane and many other crops grew here in abundance. Soon after industrial units started draining their waste water into these fertile lands, they started losing their virility and vigour. The worse was yet to come.

Lahore-based Urdu daily Khabrain reported in 1998 that a large number of children studying in Kulalanwala village in this area were developing bone deformities. Most people were initially incredulous due to the sensational way the newspaper had covered the story but everyone was shocked when similar stories appeared in other and better reputed newspapers.

Basharat Ali, a young man in his late twenties, lives in Kot Asadullah, a village adjoining Kulalanwala. He was one of the hundreds of children whose cases were reported in the 1990s. All of them had developed limp legs, rotten teeth and skewed arms. Even after growing up, their ailments did not go away. Ali lurches both forward and sideways as he walks. “Whether old or young, we all have pain in our joints,” he says. “We experience difficulties in getting up and sitting down. A lot of people have problems with their teeth,” he adds.

Immediately after the discovery of widespread bone and joint diseases in the area, many government teams, non-government agencies and journalists descended on Kulalanwala and Kot Asadullah. Some started taking soil and water samples for testing, others began collecting personal narratives of misery and suffering, and a third group set up camps to provide whatever medical services they could offer through their makeshift facilities. The Punjab government – headed by incumbent Chief Minister Shehbaz Sharif back then too – transported scores of children to various government hospitals in Lahore for corrective surgeries and other treatments. Ali considers himself lucky for being one of those children.


####How long must the residents of Kulalanwala and Kot Asadullah wait for this departmental musical chairs to end?

Water and soil tests later revealed that levels of arsenic, fluoride and various other metals and minerals, which are injurious to human health, were much higher than is medically permissible in the drinking water available to residents of Kulalanwala, Kot Asadullah and other villages in the area. The revelation prompted the provincial administration to promise that water filtration plants will be set up in the two villages without any delay.

A young girl outside the Human Necessity Foundation’s water filtration plant in Kulalanwala village
A young girl outside the Human Necessity Foundation’s water filtration plant in Kulalanwala village

Instead, the issue soon shifted to the inside pages of newspapers. The provincial government’s attention was also diverted towards the myriad other problems it was facing, including threats to its own existence, which came to an end in October 1999 when Pervez Musharraf’s military regime took over. Approximately twenty years have passed since the problem of poisonous water first surfaced in the twin villages and they still do not have a functional water filtration plant. “The situation has not really improved,” says Ali.

Weak, hobbling figures emerge from a thick blanket of smog – a toxic mixture of early winter fog, industrial and agricultural smoke and general environmental pollution – in Kulalanwala. They limp to their destinations on a recent November morning. Most of them work in nearby factories. Others have office jobs or small shops and businesses to run. Agriculture has all but died in and around the village. Some local residents have sold their farms to the water and golf resort, others have given it to factories in exchange for money even when they blame industrialisation for poisoning their water and environment.

“People have to live with their pain,” says Ali. This, in spite of the fact that stories of their medical problems have been resurfacing — though not as prominently as they did when their plight was first discovered by newspapers. In 2000, many cases of bone and joint deformities were found among residents of Shamke Bhattian, a village just 15 kilometres outside Lahore on the road leading to Multan. Ali’s father decided that he needed to attract the media’s attention to his village again. He contacted a local reporter who filed a small news report that appeared in an Urdu newspaper along with a picture of Ali. It is the only picture he has of himself from those days. He looks shrivelled and crumpled in it.

After the issue made headlines again, Lieutenant General (retd) Muhammad Safdar, then governor of Punjab, visited the area and promised setting up a water filtration plant in Kot Asadullah. The plant was set up in less than a year but it stopped working soon afterwards. Its sad remains now lie all shattered. Another plant was built in Kulalanwala months before the 2013 general elections. It was inaugurated by Rana Muhammad Iqbal, speaker of the Punjab Assembly. It remained functional for a brief period before starting to fall apart due to oversight and lack of maintenance. It now stands abandoned and deserted in the middle of the village.

Earlier this year, Nasir Iqbal, a senior officer of the Punjab Housing, Urban Development and Public Health Engineering Department in Kasur district – to which Kulalanwala and Kot Asadullah belong – visited the two villages and told locals that the provincial government’s Khadim-e-Punjab Saaf Pani (clean water) Programme would soon set up a water filtration plant for them, using the most advanced technology. He promised to a local politician that the plant will be capable of separating all the dangerous minerals, metals, bacteria and pathogens from the water that would be pumped from the ground and supplied to people at a central location. That promise is yet to materialise. “If you look around, nothing has really improved after 2000,” says Ali. If anything, the problem of industrial effluents and residential sewage stagnating around the villages has become more pronounced than ever before.

Some change has lately arrived though — and from an entirely unexpected source. A charity, Human Necessity Foundation, opened a solar-powered, state-of-the-art water filtration plant in Kulalanwala, to honour the deceased singer-turned-preacher Junaid Jamshed, in February 2017. Yet, many local residents have not given up their earlier routine. They still place large plastic jerrycans on the street in front of their doors, waiting for the delivery of drinkable water to arrive on motorcycle rickshaws from the nearby town of Manga Mandi. Sometimes their water supply arrives from as far as Lahore.

Before Shehbaz Sharif resumed his job as Punjab’s chief minister in 2008, the province was receiving funds under a drinking water supply project financed by the federal government through money provided by the World Bank. Its executing agency was the Punjab Housing, Urban Development and Public Health Engineering Department. For the next five years, a large number of filtration plants were set up across the province by the department — covering 10 to 12 per cent of Punjab’s population. Most, if not all, of these plants started becoming dysfunctional due to lack of an efficient mechanism to maintain them regularly and keep them operational in a cost-effective way. Many of them went out of service because the government could not pay for the import of replacement filter membranes as regularly as the plants needed. In other cases, the electricity bill to keep them running ran too high to be affordable by a provincial administration that badly needed money for other projects such as a metro bus service for Lahore. Bad engineering, faulty construction and low-quality construction material also contributed to reducing their lifespan.

Muhammad Naveed and Basharat Ali of Kot Asadullah show their deformed legs
Muhammad Naveed and Basharat Ali of Kot Asadullah show their deformed legs

When Shehbaz Sharif started his third stint as chief minister in 2013, he was already thinking of something else. Addressing a conference on water issues that year, he announced that he would introduce corporate-type structures to deliver civic services – including clean drinking water – in a manner more efficient and more cost-effective than what the government departments could manage with their tedious, archaic rules and insufficiently trained human resources. He also promised that the entire province, under his charge, would get access to clean drinking water by the end of June 2015.

Within a year, Punjab Saaf Pani Company came into existence — like dozens of other companies in other sectors. Registered under Section 42 of the 1984 Companies Ordinance as a non-profit corporate entity wholly owned by the government of Punjab, it is to be run – at least in theory – by a chief executive officer (CEO) selected from the private sector by the chief minister on the basis of his or her management experience in the water sector. It is also to be overseen by an independent board of directors, mostly chosen from the private sector — again by the chief minister.

The company is not required to follow lengthy government rules and regulations to have its projects approved and executed — at least that is what its foundational rationale is. All it needs is a project proposal, vetted and endorsed by its board of directors and approved directly by the chief minister without having to go through the usual departmental route. The funds for execution too come from what in official terminology is called “block” allocation — vast amounts of money at the discretion of the provincial chief executive. Centralisation of power in the hands of the chief minister has been built into the company’s very structure. Its ostensible objective has been to save the working of the company from official red tape and allow for quick decisions.

Yet, this power has not always functioned the way it was supposed to. Its first manifestation has been seen in the appointment of the company’s CEOs. Four of them have come and gone in about three years and all of them belonged to the same provincial bureaucracy blamed for being inefficient and laggard, rather than from the private sector. Its second manifestation has been even more problematic: the design, scope, timelines and financial parameters of a project envisioned by the company have changed so frequently that its ultimate shape is way off its original conception. In its third, and perhaps most worrying manifestation, the differences between the chief minister’s own thinking and that of the various CEOs of the company have often led to leakage of funds and massive delays in getting things done.

Back to square one.

Shehbaz Sharif was chairing a meeting on July 2, 2015 at his Model Town office in Lahore. Major figures in the Punjab government were among the participants. These included provincial finance minister Dr Aisha Ghaus Pasha, who was also the chairperson of Punjab Saaf Pani Company, Hamza Shahbaz, the chief minister’s own son who is a member of the National Assembly besides being the head of the Public Affairs Unit tasked with being the Punjab government’s internal watchdog, and a large number of advisers and department secretaries.

The outgoing CEO of Punjab Saaf Pani Company, Farasat Iqbal, informed participants of the meeting that 135 schemes for the provision of clean drinking water – as a pilot project – had been shortlisted for “rehabilitation in Bahawalpur region” at a cost of 896 million rupees. The contract for these schemes was already awarded to KSB, a Lahore-based firm that makes water pumps, after competitive local bidding. The main objective of the project was to revive water filtration and supply schemes in four tehsils – Hasilpur, Minchinabad, Khanpur and Lodhran – of Bahawalpur division. They were set up during the Musharraf era but had become defunct.

The chief minister, as per the official minutes of the meeting, “desired that high-quality third-party international consultancy should be hired to validate” that all the payments made to the project contractor are done on the basis of completed work. He also “desired” that no “contract would be awarded” without first showing him the bid evaluation process for the finalisation of the contractor and seeking his approval for the same.

Shehbaz Sharif’s desire to appoint third-party validation consultants was his intervention in the design of the project. His desire to have the final say on the bidding process and the award of the contract was his interference with its execution. The impact of his desires was twofold: what Punjab Saaf Pani Company had envisioned as a simple project of setting up water filtration plants (based on imported membranes) soon changed into a complex design requiring larger amounts of money and an even greater amount of time.


####Every single CEO of the company left it in ignominy — starting from Waseem Mukhtar, who headed it when it was still in the process of being corporatised.

The chief minister also insisted that the project be carried out in, what in government jargon is called, EPC mode. The contractors operating in this mode do not need to adhere to a preconceived standard design. They can devise their own engineering, planning and construction strategies for each part of the project, depending on the terrain, weather and other social and physical circumstances of the project sites. These variations more often than not result in variations in expenditure too and could easily lead to escalation in the cost of the project.

It was around the time of the same meeting that Farasat Iqbal was replaced by Waseem Ajmal as the CEO of Punjab Saaf Pani Company. The new boss was also present at the meeting.

After he took over, he changed the design of the project. Instead of rehabilitating the old schemes, he proposed that the company set up a tube well and a filtration plant along the bank of a canal at a location central to a cluster of 12-15 villages; filtered water would be piped to a designated point in each village where all the local residents could access it easily. The villagers would pay minimal delivery charges while the government would bear the cost of running the tube well and maintaining the filtration plant, which was to use local technology since one of the most cited reasons for the failure of earlier filtration plants was the use of expensive imported filtration membranes in them. The company also envisaged that all water supply schemes would follow a standard design and there would be no major variations for each scheme. The chief minister was not in favour of any of this.

Mai Bibi has been bedridden for ten years since she lost the ability to walk due to water poisoning
Mai Bibi has been bedridden for ten years since she lost the ability to walk due to water poisoning

By the time KSB started working on the project, its entire technical and financial design had changed. The company was required to set up solar-powered reverse osmosis and ultrafiltration plants for the treatment of brackish water in four tehsils of Bahawalpur division. Rather than catering to a cluster, each plant was to be based in a specific village. The estimate of the total cost of the project had escalated to 1.13 billion rupees by the time KSB began working on it.

Punjab Saaf Pani Company issued an advertisement on April 1, 2015 to invite foreign and local companies to bid for the next phase of the project to be carried out in 17 tehsils across Punjab. The process started by the advert resulted in the shortlisting of five companies that were to work on more than 35 separate schemes. This progress, however, soon fell apart. “There was a strong apprehension that these companies could have captured the bidding process through pooling,” read the minutes of a meeting held on February 19, 2016 with Shehbaz Sharif in the chair. In one evidence of this pooling, bids for all three contracts for Pattoki tehsil quoted engineering estimates exceeding one billion rupees, notwithstanding the fact that none of the bidding firms was qualified under government rules to carry out works worth that much money.

In order to address the problem, Punjab Saaf Pani Company embarked upon what it called a “post-qualification” process. It “was adopted to save time, ensure more transparency by inviting more firms, and [change] criteria” so that firms capable of carrying out larger projects could take part in it. The CEO of the company told the meeting that these steps were in line with the “usual practice” in many engineering departments and donor agencies and were also in accordance with the rules of the Punjab Public Procurement Regulatory Authority, a public sector watchdog for government-awarded contracts.

The chief minister agreed that no procurement rules were violated but he added that a better option was to take a “pre-qualification route” for the inclusion of more firms “because that was the hallmark of all mega projects happening in Punjab”. He also “expressed his concern over lack of interest from international companies in” the contracts “despite foreign visits” by the minister and the secretary of the Punjab Housing, Urban Development and Public Health Engineering Department and “other officers associated with” Punjab Saaf Pani Company. He “observed” that the company needed to club “small contracts into big contracts” to “attract” international firms of “reputed brands” in the water sector. Punjab Saaf Pani Company “should have devised a strategy to bring those companies” into the bidding process, he said, and suggested the “holding [of] international road shows in different countries” to reach “out to those companies”.

Amir Mir Ali shows his deformed knees
Amir Mir Ali shows his deformed knees

Waseem Ajmal, the CEO of Punjab Saaf Pani Company at the time, told another meeting, convened on February 27, 2016 and chaired by Shehbaz Sharif, that a committee set up previously to look into the award of contracts found “no adverse substance” in the “experience and credentials of the recommended contractors”. The process adopted for awarding the contracts was “legal, transparent, bona fide and in accordance” with procurement rules, Ajmal said. He also repeated what the chief minister had earlier suggested – that “larger projects” involving international firms should be devised “in the future” – but this sounded more like a concession he was willing to make only after the project being discussed was approved.

Shehbaz Sharif changed tack and this time criticised the escalation of the project cost. It had increased from the original estimate of 121 billion rupees to 190.34 billion rupees. Shehbaz Sharif ordered Ajmal to “submit a detailed report to explain” the increase within three days. He, however, approved the award of the contracts “with a heavy heart” and as “a stand-alone” case, subject to the condition that he himself “will thoroughly monitor the project execution” and that a third-party validation “will be vigorously conducted” of all works.

Before his conditional approval could become formal, the chief minister made another move.

He chaired a high-level meeting through a video link on March 1, 2016. The chairman of the Planning and Development Department informed the meeting that Sinohydro Corporation Limited, a Chinese company working on a number of water sector projects in Pakistan, has been “briefed” on the Punjab Saaf Pani Company “and the contracts being offered” for setting up clean drinking water supply schemes in Pattoki tehsil. He said, “Sinohydro has shown willingness to participate even for smaller contracts”. Shehbaz Sharif directed the chairman to “constitute a committee to visit China in order to interact with Sinohydro”.


####Punjab Saaf Pani Company’s records show its total expenditure so far to be at slightly less than three billion rupees. And yet the company has nothing to show for it all.

He also “agreed to the suggestion” of holding road shows in China as well as in “Dubai where all major international companies can participate”.

All these meetings essentially ended up taking the entire project back to the drawing table. The ongoing bidding process was all but scrapped even though it had the chief minister’s conditional approval and renewed efforts were launched to attract foreign companies.

The road shows held in China were extremely successful — that is, if the minutes of a meeting held on April 29, 2016 are to be believed. The participants of the meeting were told that “48 companies in Shanghai and 22 in Beijing attended” the road shows “and showed interest in working with” Punjab Saaf Pani Company. In his briefing, Ajmal said that the size of each contract had been “worked out” to 10 billion rupees “to attract well-reputed international companies”.

The defunct water filtration plant inaugurated by Lieutenant General (retd) Muhammad Safdar in Kot Asadullah in 2000
The defunct water filtration plant inaugurated by Lieutenant General (retd) Muhammad Safdar in Kot Asadullah in 2000

Shehbaz Sharif had developed other concerns by that time. He said he was told at the beginning of the project that making clean drinking water accessible for the whole of Punjab would require 70 billion rupees “but now it is [increased to 118 billion rupees] for 35 selected tehsils of 12 districts”. He directed Punjab Saaf Pani Company to “revisit estimates and come up with valid justifications for this escalation in cost”.

Ajmal explained there were two major reasons for cost escalation: addition of solar panels to provide electricity to water filtration plants and operations and maintenance expenditure for five years after they start functioning. The chief minister said “the solar component itself needed to be reviewed considering the expected increase in energy supply in coming years [and its] high-maintenance cost”. A few months later, he would reject the solar option for a different reason.

In a meeting held on May 7, 2016, Ajmal stated that the project would be divided into three phases. According to him, 33 tehsils in high priority districts would be covered in the first phase that would cost 117 billion rupees. The second phase would cost 50 billion rupees and the third 133 billion rupees, he said. “All costs of the project may reach 300 billion [rupees],” he pointed out.

It was obvious from the different numbers being bandied about that the confusion – and consequently the concerns – over the scope and cost of the project were becoming quite pronounced.

Shehbaz Sharif made another move that further exacerbated the confusion. He raised questions about the studies being carried out by the engineering management consultants working with Punjab Saaf Pani Company to find out the financial, social and environmental costs of the project. He suggested their work “should be validated by an independent, internationally recognised consultant firm”. At the same time, he was pushing for very strict timelines: he wanted work on the first phase to begin in May 2016 and be completed by December 2017. The second and the third phase, he said, must be completed by February and April 2018, respectively. Ajmal’s argument was that these timelines could only be met if work started immediately and all the required money was made available instantly.

The two men were clearly not seeing eye to eye.

The meeting was followed by another advertisement in international and national newspapers – published on May 17, 2016 – to invite local and foreign firms to bid for the contracts. The last date for submitting bids was set to be June 17, 2016. The chief minister directed that Pakistan’s embassies in China, Turkey, the United States and European countries “should be approached to attract good and renowned companies working in [the] water sector”.

The deadline for submitting the tender came and went. A meeting held on the day of the deadline was told that 33 companies had purchased bidding documents. The chief minister was not entirely satisfied. He directed Punjab Saaf Pani Company to “ensure that no substandard company” is shortlisted for the bidding process. He also directed other senior officials to “ensure that only top-class and worldwide recognised companies” are shortlisted.

Some inside sources claim that the bidding process was stalled because a French company, Vinci Construction, had approached the chief minister through his former aide Dr Tauqir Shah, expressing its willingness to take part in the bidding process and seeking an extension in the deadline. The firm has experience of working in Pakistan, having helped Faisalabad city modernise its water supply and sanitation systems. A 20-day extension was given. The company, however, failed to fulfil all the documentary requirements within the new deadline, submitting only a financial proposal without a technical one. The entire bidding process was held back — one more time.

The process of shortlisting the firms that qualified for bidding was not complete even by July 23, 2016 when the provincial chief secretary told the participants that 64 international companies had submitted the bids. Vinci Construction was conspicuous by its absence.

By August 23, 2016, Shehbaz Sharif was having second thoughts about the entire operation of Punjab Saaf Pani Company. He ordered its large-scale restructuring. As a first step, it was divided into two — along the geographical lines of north and south Punjab. Its board of directors was also reconstituted and the government hired a German firm, Fichtner Water and Transportation, to review its working.

Children carry empty containers on their way to collect drinking water | shutterstock
Children carry empty containers on their way to collect drinking water | shutterstock

That the chief minister was about to reinvent the wheel became apparent when he directed the chairman of the Planning and Development Department to come up with “formal” medium and long-term plans within 30 days with help from Fichtner Water and Transportation for the water sector, “keeping in view the challenges of groundwater availability and sanitation issues of Punjab”. This was a recourse to the old bureaucratic approach that worked through different departments starting with the one responsible for planning and development. Shehbaz Sharif once saw it as a stumbling block for quick progress on development projects.

He told a representative of the German consultancy firm that his government expected it to carry out “an independent review” of all “components and stages” of the project being carried out by Punjab Saaf Pani Company. He also ordered the firm to evaluate the shortlisting of “contractors and consultants and assess whether they have been appointed as per the approved terms and conditions/parameters”. It was a complete vote of no-confidence in the performance of an entity he had himself envisioned and put in place. Something somewhere did not seem to be working the way he wanted.


####Approximately twenty years have passed since the problem of poisonous water first surfaced in the twin villages and still they do not have a functional water filtration plant.

In a subsequent meeting on September 30, 2016 he was even more categorical. He told Fichtner Water and Transportation to “evaluate/review the hiring process” of engineering management consultants by Punjab Saaf Pani Company. The consultancy was requited to find out whether these consultants included foreign experts as team leaders and whether locally-based consultancies engaged by Punjab Saaf Pani Company had ‘lead’ foreign partners. The next logical step was to probe if these consultants had shortlisted contractors with the right kind of financial and technical resources to bid for the contracts. The entire project was now up in smoke unless Fichtner Water and Transportation found that there was nothing wrong with it.

It did just that. It reported that engineering management consultants were local firms working in partnership with international firms as joint ventures and are led by international team leaders. It pointed out that the condition to engage foreign/international firms as lead partners was “not available” in the minutes of any meetings chaired by the chief minister. It further said that feasibility studies done by the engineering management consultants “have been elaborate with sufficient thoroughness … they are generally comprehensive and very detailed” and that “the contractor has the possibility to adopt the best technical solution” for water treatment and renewable energy “on the basis of the outcome of these feasibility studies”. It, similarly, rejected concerns about the shortlisted contractors. “These 19 firms are well renowned in the water treatment sector” and they have “worldwide experience to design, execute and operate the drinking water supply projects”.

Nobody could read the chief minister’s mind. He probably was not going to accept any of this.

In a meeting he chaired on November 6, 2016 he asked what kind of energy solutions were being proposed for the project. Ajmal responded that some companies were suggesting hybrid solutions — solar power along with grid electricity or solar power complemented by generators. Shehbaz Sharif observed that solar panels might be too expensive for use in the project so the money to be spent on them must be saved and used for some other project by Punjab Saaf Pani Company.

In plain words, all the companies that had solar power as an energy component in their technical proposals needed to revise and rewrite their proposal — further delaying the awarding of contracts. The German consultancy he had himself engaged warned that the entire first phase of the project would take 15 months to complete. If it started in December 2016, it would only be completed by February 2018.

The chief minister inexplicably let the process linger. While chairing a meeting on November 25, 2016, he stated that the processes being followed in the project might be legal but his concern was with “the quality rather than legality”. His preference was on full display in the meeting. He would not brook any argument otherwise.

Kashif Padhiar, who at the time was working as the chairman of Punjab Saaf Pani Company’s board of directors, argued in favour of awarding the contracts as per the bids submitted by 19 companies earlier. He argued that engaging new contractors from abroad “would take time” at a juncture when the government was under massive social pressure to “provide water at the earliest”. Managing director of the Punjab Public Procurement Regulatory Authority argued that the firms that had submitted the bids “do not have [an] innovative or modern approach” but the award of the contracts must be approved. The chairman of the Planning and Development Department, too, voted for approving the contracts — though he said this should be done only “if time is a constraint”.

Punjab Chief Minister Shehbaz Sharif (right) with his brother, former prime minister Nawaz Sharif | AFP
Punjab Chief Minister Shehbaz Sharif (right) with his brother, former prime minister Nawaz Sharif | AFP

Ajmal meekly tried to save the project by saying that the contractors were bringing in contamination-free water treatment plants and deploying solar energy. The chief minister dismissed his contention by saying that the whole project had the same old approach that was once adopted by the Public Health Engineering Department – the one he wanted to overturn through Punjab Saaf Pani Company. He ordered Ajmal to restart everything and “embark upon [an] innovative and modern approach through [the] best water companies in the world”.

If only he had named some of them, all his subordinates would have rushed and brought them onboard, no matter how much it cost the exchequer and the taxpayer.

Ajmal was already on his way out by then. On December 31, 2016, the Punjab Housing, Urban Development and Public Health Engineering Department sent a letter to the director general of Punjab’s Anti-Corruption Establishment, stating that the top management of Punjab Saaf Pani Company had spiked up the cost of project contracts from 121 billion rupees to 194 billion rupees without informing its own board of directors about the increase in a proper and timely manner. The letter mentioned a news report published in daily *Business Recorder* and alleged that “doubts/issues were raised by certain quarters on the bidding process” carried out on May 13, 2016 to select companies for the execution of the project. Anti-corruption authorities were asked to conduct an investigation with “special reference to the appointment of officers/officials of the company related to the execution of the project [and] Engineering Management Consultants (EMCs) and possible wrongdoing/corrupt practices in estimates” and increase therein.

The Anti-Corruption Establishment immediately ordered an inquiry and set up a probe team that found out that Punjab Saaf Pani Company made “illegal/excess payment amounting to 10,069,144 [rupees] on account of weather shield [paint]” to KSB; that an “attempt was made to deprive the public at large” of scarce financial resources through unjustified and non-uniform application of risk/cost factors to increase the project estimates; that engineering management consultants were selected through favouritism and were paid even when they had not completed their required tasks; that the company made an illegal payment of 58.995 million rupees to its third party validation consultant, Alpha Consult, as salary for its international staff “without verification of their arrival, stay [and] departure status”; and that “excess payment” was made to KSB “without applying reduced rate as per contract agreement”.

The inquiry report was finalised on October 5, 2017 and it recommended the filing of a case against 22 people including Ajmal and other senior officers of Punjab Saaf Pani Company. A first information report (FIR) was subsequently registered at the Anti-Corruption Establishment’s directorate on October 25, 2017 under legal provisions that cover such crimes as fraud, deception, forgery, criminal breach of trust and misappropriation of funds among others.

The second water filtration plant opened in Kulalanwala; it is now defunct
The second water filtration plant opened in Kulalanwala; it is now defunct

The matter is pending further investigation and trial.

Apart from these allegations, government officers interviewed for this report allege that some foreign companies were the reason why the project has never gone ahead. These firms could not legally become a part of the bidding process but are being backed by influential personalities in the ruling Pakistan Muslim League-Nawaz as well as by some serving and former senior government officials. At least one Turkish company is said to have submitted an unsolicited proposal for clean drinking water schemes in Sahiwal district. It is alleged to have the backing of Hamza Shahbaz. It did not get any contracts though.

The impact of all this internal wrangling has been devastating for the people in Punjab thirsting for clean drinking water. Slightly more than three years have passed since Punjab Saaf Pani Company was set up. More than 30 months have passed since the process began for inviting and shortlisting companies to take part in the construction of clean drinking water supply schemes. Hundreds of thousands, if not millions, of dollars have been paid as consultant fees. Millions of rupees have been spent on foreign tours and road shows. Hundreds of millions of rupees have been expended on staff salaries as well as office and administrative costs. Punjab Saaf Pani Company’s records show its total expenditure so far to be at slightly less than three billion rupees. And yet the company has nothing to show for it all.

Many sources in the Punjab government blame it on the whimsical way the chief minister has handled the company and its working. He has constantly shifted the goalposts and added layer after layer of reviews and monitoring by outside consultants even before the project moved beyond its documentation and preparatory stages. And, at the same time, he successfully blamed the top management of Punjab Saaf Pani Company for the delays and bottlenecks in its execution. Every single CEO of the company left it in ignominy — starting from Waseem Mukhtar, who headed it when it was still in the process of being corporatised, to Farasat Iqbal to Waseem Ajmal to Khalid Sherdil. Before each one of them was kicked out of the post, a probe into their conduct as the head of the company had already been ordered, though an FIR has been registered only against Ajmal and his associates.

The Punjab government’s spokesperson Malik Muhammad Ahmad Khan acknowledges that there have been multiple problems with the functioning of the project but he first wants its success stories mentioned. “Pilot project in south Punjab has produced good results.” Issues arose when the government tried to take the project to a larger level, he says.

Khan claims the project designed by Punjab Saaf Pani Company envisioned laying down pipelines to carry water from filtration plants to homes. It was soon realised that this was not a feasible option in already settled areas, he says. The other problem, he points out, concerned extraordinary increases in project costs. “[The chief minister] had doubts over the pricing due to his past experience with projects of this nature.”

Shehbaz Sharif, according to Khan, did not micromanage the project but he was only ensuring that the public’s money was not misused. One reason why multiple CEOs were appointed and replaced at Punjab Saaf Pani Company was that they had all failed to address design problems in the project, Khan says. The other reason was that they abused their power, he adds.

It was for these reasons that the chief minister initiated an inquiry which revealed that “Ajmal had over-invoiced the project cost by 62 billion rupees and had hired consultants at higher than market rates”. He and his associates in the management were also found to have been involved in the overbilling of 20 to 40 million rupees, Khan alleges.

How long must the residents of Kulalanwala and Kot Asadullah wait for this departmental musical chairs to end and all the turf wars between the powerful to conclude before they can have easy and ready access to clean drinking water? The answer is obvious: as long as Shehbaz Sharif is unwilling to stop micromanaging the affairs of Punjab Saaf Pani Company.


Additional reporting by Nasir Jamal


This article was published in the Herald's December 2017 issue. To read more subscribe to the Herald in print.