The River Princess saga may seem to be over on the surfacejust as the vessel has gone but the financial stakes that the much hypedremoval raised, will surface again and again.
The project has a history of shady deals. The days after thevessel was beached in June 2000, ship's charterers Salgaocar Mining IndustriesLtd mooted the proposal to break ship at site with bank guarantee. Seeing redover the spoiling of its’ most popular beach the government said no. It wasonly in January 24, 2005 Crosschem International Ltd’s tender bid of Rs. 85.41lakhs for refloating and towing away of the vessel was accepted by thegovernment. The work was to be completed within 110 days (May 21, 2005). The formal agreement to be signed withinfifteen days of commencement of the work as stipulated in the work order neededa bank guarantee for Rs 1 crore towards security deposit was to be furnishedwithin 21 days of signing of the agreement.
In spite of follow-up by the department, the contractor didnot furnish the bank guarantee. 80 to 85per cent of the work was completed within the stipulated date yet thecontractor was asked to stop the work from May 2005 and the contract terminatedin September 2005 on the ground of non-furnishing of the security deposit andnon-completion of the work within the stipulated period. Question then is whywas an ‘under a crore’ deal for moving away the entire vessel intact notallowed. CAG Report 2005-06 observes “failure in timely obtaining the bankguarantee coupled with termination of contract without contingency plan andadequate assessment of possible options including consideration of extension toCrosschem International Ltd as sought by them, resulted in subsequent award ofcontract for removal of the ship at a cost of Rs 5.5 crore which could have beensaved”.
For another four years, the government floated six globaltenders with not much luck till 2008. It was Kandla based Jaisu Shippingbidding for the fifth time which got the contract to tow away in 90 days for Rs5.5 crore. Jaisu too failed and the government tried to encash the bankguarantee of Rs 5.5 crore terminating the contract. As Jaisu dragged thegovernment to court. The matter still awaits decision at Supreme Court.
But it was in February 2010 that the government decided togive up trying to re-float and tow away the ship, but cut it into pieces andclose the vexed issue. While Singapore-based Titan Salvage got the contract itwithdrew.
It was in 2011 that government inked the deal withMumbai-based Arihant Ship Breakers for cutting it up in a Rs 99 crore deal.What however is interesting and stands out is the fact that the government thatwas alarmed at the prospect of cutting the vessel on one of Goa’s most popularbeaches free of cost in 2000 ended up doing the same a decade later dishing outalmost 115 times the amount that it would have to float the same vessel away.And that too with no guarantee that the vessel was completely removed away.
