Mumbai scam: Rs 2600 crore for services that are free

Mumbai scam: Rs 2600 crore for services that are free

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Mumbai India's largest dumping ground, Deonar, in the heart of Mumbai's eastern suburbs spread across 132 hectares. Every day, it receives close to 4,000 tonnes of garbage that cloaks a Rs 2,600-crore scam.

The mountains of garbage at the site are worth crores of rupees if turned into compost and sold. And most companies take this raw material free. Yet, the Mumbai municipality, Brihanmumbai Municipal Corporation or BMC, is set to pay a company Rs 2,600 crore for a job that should have not cost it anything at all.

Documents with NDTV show that in July 2009, the municipality awarded Deonar's waste processing contract to a consortium of firms led by United Phosphorous Limited. It will process 2,000 tonnes of garbage every day for 25 years. The municipality will pay the firm Rs 550 per metric tonne of garbage. Over 25 years, this works out to Rs 2,600 crore.

''We arrived at this tipping fee after following a set process of tendering, where companies across the country were free to participate," Ashish Kumar Singh, the Additional Commissioner of the BMC.

Yet how can the municipality explain these glaring contradictions:

In a letter to the municipality, the National Building Construction Corporation offered to get Deonar's garbage processed free of cost. But the municipality did not take up this offer.

The consultants IL & FS had informed the municipality that United Phosphorous' proposal to manage Deonar's waste does not qualify on technical grounds. But the municipality ignored this advice too.

While RTI documents show the contract is yet to be cleared by the state government, the municipality has already paid United Phosphorous Rs 18 crore, even though the contract did not require it.

''We decided that until the documents are processed, we will pay them an amount for maintaining the site to the maximum of Rs 30 crore," said Ashish Kumar Singh.
United Phosphorous has refused to respond to questions about the project. But Mumbai's corporators need to answer why India's richest municipality is squandering public money in Mumbai.
Story First Published: August 04, 2010 10:43 IST

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