Pakistan Airports Authority’s Rs20 billion e-gate project faces scrutiny over alleged PPRA breaches

Transparency International Pakistan has approached the Prime Minister’s Office over alleged violations of procurement rules in the award of a Rs20 billion e-gate project by the Pakistan Airports Authority, Business Recorder reported. 

In a letter addressed to Advisor to the Prime Minister Dr Tauqeer Shah and other officials, TIP said the complaint alleges that the contract was awarded without open competitive bidding and was instead processed under Rule 42(f) of the Public Procurement Regulatory Authority Rules 2004.

The rule allows procurement through state-owned entities under specific conditions. However, the complaint states that the executing entity lacked the required in-house technology, expertise and capacity to independently deliver the e-gate system, raising questions over the applicability of the rule.

Under Rule 42(f), procurement through state-owned entities is permitted only if the project is executed entirely using their own resources, without involvement of private partners, joint ventures or subcontractors. The complaint alleges that this condition was not met, making the process potentially non-compliant.

It further states that where multiple eligible state-owned entities exist, the rules require limited competition through transparent processes and price checks, which were not followed in this case.

TIP also noted that key disclosures required under Rules 35 and 47, including the evaluation report and contract agreement, were not available on the PPRA website, raising concerns about transparency.

Additional issues highlighted in the complaint include non-disclosure of beneficial ownership details, absence of a performance bond estimated at around Rs2 billion, and the contract reportedly being awarded at nearly double prevailing market rates. It also pointed to non-compliance with integrity pact provisions, which could carry penalties linked to the alleged loss.

The complaint questioned the cancellation of earlier tenders for the project before the final award.

In its preliminary assessment, TIP said the allegations appear to have merit and may indicate violations of procurement rules, potentially qualifying as mis-procurement under Rule 50.

The organisation also raised concerns over reliance on Rule 42(f), citing the reported lack of in-house capability of the executing firm, which could indicate circumvention of procurement safeguards.

TIP has recommended that the PAA Director General initiate a formal inquiry and consider retendering the project through open competitive bidding in line with PPRA rules.