KUKL annuls contract with Chinese company

KATHMANDU, SEPTEMBER 9 : Kathmandu Upatyaka Khanepani Limited (KUKL) has cancelled a contract agreement with China-based SafBon Water Service (Holding) Inc. According to the Project Implementation Directorial (PID) under the KUKL, the very deal made to establish three different water treatment plants-one at Sallaghari in the Bhaktapur district and two at Kodku and Dhobighar respectively in the Lalitpur district- is annulled. As per it (contract agreement) signed on January 26 2027,  the three plants-  each having the treatment capacity of 68.7 million liter of water- were supposed to be established within 2 years and come into operations within 5 years.   

“The Chinese company continued to ignore the repeated request on the part of the KUKL to complete the construction of the plants in a timely manner. As this was clearly a violation of the contract agreement, we decided to severe ties with SafBon Water Service (Holding) Inc,” read a press release issued by the KUKL.   It is said that the company completed just 27.1 percent during the period of 5.3 years.  

Of the total of Rs 3.92 billion proposed for building the plant, as per the contract agreement the amount of Rs 490 million deposited by the company as a bank guarantee has also been confiscated.