CDA Auction Is Restricted AgainFriday, September 14, 2012
Weeks ago, prime minister blocked the auction of CDA commercial plots to the pre-qualified bidders but the authority’s heads have decided to continue with the proceedings. Capital Development Authority has agreed to auction eight sites for petrol stations of the estimated value of Rs 7 billion through the same process. These sites are on the extension of Blue Area in F-10, along Shahrah-e-Iqbal skirting E-9, E-10 and F-11 while two sites are located in G sectors.
Bear in mind that on 31st August, Prime Minister Pervez Ashraf had communicated to CDA that government will not compromise on transparency so the sale of 12 high value commercial plots to 11 pre-qualified bidders was blocked. People objected that the pre-qualification system only works for powerful investors who can get lower prices through their connections in the right places.
These sites can be auctioned at better prices through open auction. It is because the “pre-qualification” system is designed to help the mighty tycoons and established entrepreneurs who manipulate the bidding process.
However, CDA Chairman Farkhand Iqbal has his reasons to justify the pre-qualification process. He says, pre-qualification is an approved method, allowed by government and practiced to get strong leads. However, the final decision regarding petrol station sites is yet to be taken.
Though he has no issues regarding open auctions but pre-qualification brings serious buyers. Back in 1980, a successful bidder failed to pay the promised amount for a commercial pilot and he took CDA to the court for refusing to honour the auction deal. The court granted him relief and the plot is in a limbo to this day.
Pre-qualification bidding is always helpful as this process promises bid money to be paid as per the payment schedule. However, CDA Chairman promises to make the bidding process transparent.