The Kathmandu Upatyaka Khanepani Limited (KUKL) has annulled a contract with Safbon Water Service (Holding) Inc (SWSHS), Shanghai, after the Chinese construction company failed to accomplish its task according to the contract.

The KUKL had awarded SWSHS with a contract to construct water purification plants in Sallaghari of Bhaktapur and Balkumari and Dhobighat of Lalitpur in January, 2017. The Chinese company had agreed to construct processing plants to purify 68.70 million liters of contaminated water every day.

Although SWSHS was supposed to complete the projects in the two and a half years of signing the contract, it failed to complete its task despite undergoing a number of extended deadlines. As of the latest revision, the company was supposed to complete construction of the structures by last July.

The SWSHS has completed only 27.1 percent of the assigned work in five years and three months’ period. This apart, the Chinese company has been accused of not deploying adequate numbers of workers at the site, failing to renew the insurance policy and ignoring the guidelines given by the Nepali authority, according to Project Implementation Directorate of KUKL.

The Chinese company was awarded the contracts for an estimated cost of Rs 3.92 billion. Over the period, the company has received payment of Rs 772.70 million. According to KUKL, it scrapped the deposit amount of Rs 490 million maintained by SWSHS after the company failed to work according to the signed agreement.