New Delhi: The proposal to set up a $200 million sugar factory in Ethiopia with line of credit from India’s Exim Bank has hit a road block with one of the bidders moving the court over dispute among contractors.
The bank has informed the Mumbai High Court that it would not disburse any money at this stage.
The Court in an interim order on a petition filed by a Delhi-based contractor Uttam Sucrotech International pointed out that Exim Bank has agreed to maintain ‘status quo’ and would not disburse the amount.
The dispute over construction of Tendaho Sugar Factory arose when the Ethiopian company appointed another bidder Overseas Infrastructure Alliance (OIA) and single Engineering, Procurement and Construction (EPC) contractor to oversee the entire project which was awarded to different parties.
Exim Bank will be providing a line of credit for construction of the sugar factor to be set up under an agreement signed between the governments of India and Ethiopia in 2007.
One of the Exim Bank official was of the viewpoint that since the Tendaho project has not yet achieved requisite milestones the question of disbursing loans does not arise.
“Once the project achieves certain milestones. We are convinced that all guidelines have been followed and then we will disburse the loan”, he added.
The official further pointed out that Exim Bank has already disbursed money for another transmission line construction project in Ethiopia and Africa would continue to be a priority area for the bank in tandem with the policy of the government.
Source: livemint.com