PPRA refuses to accept request of Ministry of Aviation for Islamabad Airport outsourcing
The Public Procurement Regulatory Authority (PPRA) has declined a special
exemption request from the Ministry of Aviation to bypass PPRA rules for the
outsourcing of operations and maintenance at Islamabad Airport under the Public
Private Partnership Act 2017 (P3A Act), sources informed Business Recorder.
Managing Director of PPRA, Hasnat Ahmed Qureshi, presented the Ministry's
proposal to the Board chaired by Secretary Finance, Imdadullah Bosal, on June
26, 2024. The Ministry sought exemption from Rule-36 of the Public Procurement
Rules 2004 to conduct a second round of financial bidding for the PPP project.
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The Secretary of Aviation clarified that the decision to outsource
operations at Islamabad, Karachi, and Lahore airports was made under the P3A
Act following directives from the Prime Minister in December 2022.
International Finance Corporation (IFC) was appointed as the Transaction
Advisor, and a Steering Committee was formed to oversee the process.
Despite following a Single Stage-Two Envelope procedure as per Rule-36, the
Steering Committee proposed a second round of financial bidding to maximize the
transaction's value and minimize the need for re-bidding.
During deliberations, the PPRA Board noted that the P3A Act supersedes the
PPRA Ordinance 2002 and its rules under Section 29, thereby obviating the need
for a special exemption.
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The Ministry of Aviation justified its request on the grounds of procedural
clarity, as specific procurement mechanisms under the P3A Act are yet to be
established. However, the Board asserted that the Ministry, as the implementing
agency, should adhere to the P3A Act's provisions.
After extensive discussion, the PPRA Board unanimously concluded that the
Ministry's request for exemption under Section 21 of the PPRA Ordinance 2002
was untenable. They recommended that the Ministry pursue appropriate channels
in accordance with the relevant legal framework.
Source: Business Recorder