Only 22% increase in STP cost in two years, BMC clarifies

Refuting reports of 42% increase, civic authority appeals all stakeholders to join hands for the supreme court-monitored project

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Geetanjali Minhas | May 7, 2022 | Mumbai


#BMC   #Mumbai   #Maharashtra   #urban governance   #environment   #I.S. Chahal  


After reports of cost escalation of its sewerage treatment plants (STPs) by 42% over its estimated cost of Rs 16,412 Cr in 2020, BrihanMumbai Municipal Corporation (BMC) has come out with project-by-project cost, clarifying that the cost has gone up by only 22% during the two years of Covid-19.

Putting out figures of the six STP projects, the civic body has said that estimated cost of the Worli STP project in 2020 stood at Rs 4,044.17 crore for which in April 2022 it received the lowest bid of Rs 5,811.70 crore.

For the Bandra project, the estimated cost in 2020 was Rs 3,232.28 crore and the lowest bid received in April 2022 is for Rs 4,293.34 crore.

The Dharavi project cost of Rs 3,274.22 crore in 2020 has escalated to Rs 4,636.00 crore in April 2022. The Ghatkopar project cost has gone up from Rs 2,463.05 crore in 2020 to Rs 2,551.00 crore.

In the case of Bhandup and Versova, the costs have actually come down. The Bhandup project, which earlier was estimated to cost Rs 1,758.64 crore, will now cost Rs 1,170.00 crore. The Versova project was estimated to cost Rs 1,639.81 crore, but will now cost 1,603.81 crore.
 
The total amount has increased from Rs 16,412.17 crore in 2020 to Rs 20,065.85 crore in April 2022 – which is a 22% increase and 11% hike per annum as per the lowest bids received by the BMC.

The seventh STP project of Malad which had land reclamation issues in 2020 and now been resolved has received the lowest bid which is 0.5% below the estimated value as per the BMC.

The BMC’s plan to upgrade and rebuild completely the STPs is part of the Mumbai Sewerage disposal project II (MSDP). Once functional, the STPs will recycle 2,464 million liters per day (MLD) for use and also address the critical issue of environmental degradation. Considering the fact that the present consumption of water under BMC is 3,850 MLD, nearly 64% of the total water consumed as on today will get recycled.

The BMC has said that considering last two years of the pandemic coupled with a sharp increase in cement and steel prices in the last six months and the uncertainty caused by the Ukraine-Russia war this annual increase of 11% per annum is highly justified and far away from the alleged hike of 42% as reported by certain sections of media.

“Even though the present estimated costs (approved by Peer Review Committee of IIT, Mumbai and VJTI experts) were on higher side these estimates have now become irrelevant in view of the project wise lowest quotes received through competitive bidding,” BMC said in its statement.  

The Supreme Court in Civil Appeal No. 5036 of 2019 of Municipal Corporation of Greater Mumbai Vs. Nitin Shankar Deshpande and others is monitoring and supervising the present tendering process.

On February 24, the court had passed the order to float and process the tenders and to apprise it of the steps taken and report to it on May 4, 2022. In its hearing on May 4, the BMC commissioner I.S. Chahal had apprised the court that since February 2022, during the current bidding process of seven STPs, a total number of 24 bidders participated in the bidding process and during the technical evaluation, all 24 bidders have been found to be technically eligible. None of the prospective or actual bidders who have participated in the bidding process have raised any objections regarding terms and conditions of these bids. The civic body also submitted project wise names of the lowest bidders and costs quoted by them.

“Considering the constraints of availability of lands, multi-storey construction of STPs in some projects, challenges of constructing some of these projects on existing functional sites of sewerage treatment facilities, land reclamation issues in Malad and uncertainties thereof, construction of these STPs will be a major milestone in our country,” the BMC said.

Requesting all the stakeholders to join hands in making STPs a reality and set up a new milestone in the country, municipal commissioner Chahal said, “The tendering process has been carried out in the most transparent manner. This is for the first time ever that STPs of the monstrous size of 400 MLD-500 MLD are being constructed in India. Till now most of the STPs in India which have been constructed are in the range of 50 MLD-100MLD.”

“The BrihanMumbai Municipal Corporation is extremely thankful and indebted to the Hon’ble Supreme Court of India for the directions and timely guidance because of which the tendering process could be completed in a very short time period,” added Chahal.

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