Top guns bid for DJB project

Tatas, Mahindra Water, Manila Water, Saur in race for 24x7 water plan

A host of companies including the Tatas, Mahindra Water and foreign players like Manila Water and a French company Saur have participated in the bidding process of the first phase of the Delhi Jal Board's (DJB) ambitious 24x7 water supply programme.

The project, to be implemented over a period of six years across two zones in South Delhi, would have an estimated project cost of Rs 500 crore, with the annual cost per zone estimated at around Rs 35-40 crore. The project cost includes both capital expenditure and the annual contract fee of the private partner.

Two private partners, one for each zone would be appointed on a management contract basis for a period of six years and would have defined performance targets on the basis of a number of parameters.

The companies winning the contract, would be rewarded with bonus for better performance, whereas there is also provision of an exit clause in case of poor performance.

While the Tatas, Mahindra Water and Manila Water are part of the three consortiums that have participated in the bidding process, the French company Saur is the only stand alone bidder. The management contractor is expected to be appointed by December this year.

The areas which would be part of this first phase performance improvement programme (PIP) of the DJB included Lajpat Nagar, Defence Colony, Govindpuri, NDSE Part 1 and 2, Greater Kailash, Saket, Okhla, IIT, Hauz Khas, AIIMS, Chittaranjan Park, Panchsheel and other adjoining areas.

DJB officials said these areas were expected to have 24 hour water supply by the end of 2007.

These two zones would cover 1.6 lakh connections, about 12 per cent of DJB's total connections.

DJB's Chief Executive Officer Rakesh Mohan said awarding the contract for water supply in private hands would not drive the water tariff upward and all issues related to tariff would remain in the public domain.

"The management contractor would only manage the system with a fixed fee, whereas the owenership of infrastructure, assets and revenue would remain with DJB," Mohan said.

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Water, water everywhere

• The project will have an estimated project cost of Rs 500 crore, with the annual cost per zone at Rs 35-40 crore
• The project cost will include both capital expenditure and the annual contract fee of the private partner
• The private partner will be appointed on a management contract basis for six years with defined performance targets
• The management contractor is expected to be appointed by December this year