RAA’s final report confirms irregularities and illegalities in Younphula and Bathpalathang airports

The RAA’s final report on the domestic airways reconfirms several of the earlier findings in its draft report on the Younphula and Bathpalathang airports.

In both the airports the report confirmed overpayments, substandard works, flawed tendering processes, ineligible bidders chosen, wasteful expenditure and etc.


Younphula airport

Millions in Overpayments

Around Nu 10 mn were made in overpayments to contractors. As part of the construction the contractor was overpaid paid Nu 8.03 mn for removing soil. The RAA has asked for the recovery of the money.

In another case the contractor Sonam Ugyen and hiring unit had claimed and was paid Nu 1.84 mn as hiring charges for a fictitious excavator that never existed.

Other overpayments were for CGI roofs, timber flooring, taxiway, compressor works, and shoulder works and fencing works.

The direct accountability is on Deputy Executive Engineer Gyem Dorji.


Ineligible contractors chosen

Three firms which are Sonam Ugyen and Hiring Unit, CDCL and Peldang Hiring Unit had bid for earthmoving works for the Younphula domestic airport.

Sonam Ugyen and Hiring Unit was selected as the lowest evaluated bid at Nu 18.78 mn.

However, the RAA on the review of the Tender evaluation report found that Sonam Ugyen and Hiring Unit has failed to fulfill several minimum qualifications which should have rendered the company ineligible.

In fact a disqualified bidder Peldang had fulfilled several conditions which according to the technical committee were non-complying.

The report says the ministry should investigate the evaluation process to rule out collusive practices.

The RAA also found that the bid of CDCL had been unfairly rejected though they fulfilled all requirements with the resultant financial impact of Nu 6 mn as CDCL was the lowest bidder.

The direct accountability is on Gyem Dorji, assistant finance officer Tshering Denkar and Ranman Pradhan.

In another case the RAA found that a lone bidder Kuenleg Construction who was selected for Nu 13.49 mn to carry out site development works was actually not eligible as the bidder had failed to fulfill several requirements.

The MoIC in its response quoted the Minister’s remarks on a note sheet which said, “We do not want any more delays; please proceed with work after the 10 percent rebate on the financial bid.”

The RAA report said that the Ministry and the government has to review the review the overriding of procurement norms which ultimately led to poor quality works and delayed completion.

The direct accountability has been placed on Lyonpo Nandalal Rai.


Nu 9 mn in additional costs due to irregular bidding process


The MoIC had called for tenders in 2009 for construction of the Domestic Airport and received six bids but had cancelled the tenders on grounds of budgetary constraints and called for a retender later.

The RAA says that this irregular bidding process resulted in additional cost to government of Nu 9 mn. This is because the lowest bidder in the first tender was 9 mn lower than the accepted bid.

The report also says that Nu 4 mn worth of additional works were awarded to Kuenleg construction without proper tendering process.

The report also says that the cancellation of the initial tender was not justifiable particularly when the financial bids of the six bids were lower than the prepared estimates.

It also says the delay of the construction of the airport by nearly one year failed to achieve the objective of ensuring timely completion, economy, efficiency and effectiveness.

The direct accountability has been placed on the MoIC minister on whose instructions the above were done.


Important surveys not done


The RAA despite repeated requests were not given the feasibility study report, topographic survey report, detailed measurements for demolition of three hills and extent of work executed against measurement made.

The RAA was told that such studies had not been conducted based on shortage of time and directions from the cabinet and Prime Minister to expedite airfield construction.

The RAA said that the Ministry and the government may investigate the circumstances leading to non maintenance of requisite records to rule out possible conflict of interest and take appropriate actions accordingly.

The direct accountability was placed on Lyonpo Nandalal Rai and Gyem Dorji.


Doubtful BOQs and deployment of different equipment than specified


The RAA has also pointed out the use of unauthenticated Bill of Quantities or BOQ (list of construction items and their costs) by the MoIC tender committee for tendering and awarding contract for infrastructure works and demolition of three hills.

The report said that there were many estimates for the same work, none of which were found authenticated and considered final.

The RAA found that the type or specifications of vehicles like excavators and trippers used at the site were entirely different from those committed in the tender documents. The RAA said that this pointed to possible conflict of interest in the evaluation, selection, awarding and implementation process.

The direct accountability was placed on Gyem Dorji.


Substandard and poor quality works

A joint physical inspection of the runway on 13 September 2012 revealed several defects with the airport. The runway was found to have multiple cracks.

It also said that the runway not only had cracks, seepage of water and growth of vegetation but also necessitated urgent resurfacing of the pavement to reinstate the operation of the air services.

The RAA report said that rather than spending Nu 8.77 mn in redoing the runway in patches it would have been better to redo the entire runway in a uniform manner to ensure quality works.

Direct accountability was placed on Gyem Dorji.


Bathpalathang Airport

Nu 3 mn in Illegal overpayments

Nu 2.74 mn was overpaid to a contractor for paving the runway of the airport as the required thickness of 120 mm was not achieved. The RAA also found that the density of the completed pavement was only 1.95 g/cc as opposed to the required density of 2.12b/cc.

The report has asked the Department of Civil aviation to either get the works redone or recover the amount and has asked the Ministry to investigate if there was a conflict of interest.

In another instance the department found that Nu 426,347 had been overpaid in the execution of the gabion wall. Direct accountability is on the engineer Pelden Lhamo.


Nu 31 mn worth of substandard gabion walls 

As per the report Nu 31.66 mn was spent on the river protection works by building gabion walls on the border of the airport and the river.

However, on joint physical verification of the construction site of Bathpalathang Domestic Airport, it was found that the river protection works were not executed properly and defects were observed. The report says, “It was apparent that the total expenditure of Nu.31.66 mn incurred on the river protection works had resulted into wasteful expenditure in terms of failure to meet the required technical specification.”

The report has asked for the contractor to reconstruct all the structures and fix responsibility on the engineer Pelden Lhamo for taking over substandard works.


Nu 33.3 mn in additional costs to repair sub-standard runway

The RAA report said that the airport runway was rendered non operational soon after the launching of air services apparently due to defective run-way pavement entailing need for resurfacing works involving substantial addition of Nu 33.3 mn.

Direct Accountability is on Phala Dorji with supervisory accountability on the MoIC Minister


Flawed Tendering process

The RAA report has pointed out that that the MoIC ministerial tendering committee has awarded a tender of Nu 42.46 mn to a non eligible construction company called Tshering Construction who failed to fulfill several criteria in violation of tender rules.

The MoIC in its response said that they were aware that the contractor did not meet several specifications but the tender was awarded on the basis of the cabinets instructions.

The RAA says in the absence of these criteria the contractor not only executed substandard works but also failed to complete within the stipulated time.

The direct accountability is on the MoIC minister.


Poor planning and Design 

The report says that the construction of the Bathpalathang Airport at Bumthang was carried out without proper feasibility study, topography survey, geotechnical study and adequate planning with consequential adverse impact on the quality and cost of works.

The report says that the Department of Civil had omitted important items of work from the tender even after it was pointed out by the Ministry of Works and Human Settlement and instead directly gave the tender to Tshering Construction.

Later additional works of Nu 15 mn were given without any tender just after the work order was issued.

Direct Accountability is on former Director Phala Dorji with supervisory accountability on the MoIC Minister


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  1. The Bhutanese may have done good piece of work by publishing Audit reports on Construction project of three airports in Bumtha, Youngphula and Gelephu in four different editions. However, therte is no news of audit report being made public by the RAA in any of the media except in the Bhutanese. The Bhutanese has reported all the qualifications ranging from illegal and overpayment payments, substandard works,flawed tendering processes,doubtful Boqs, illegal selection of contractors,additional cost etc.etc. This information may have very critical impact on the readers! Therefore, the concern agency should clarify the issues or they should also make the audit report public in order for the people to read the facts and figures from the report. If whatever this paoer reported are true and facts, it is a well done job and if on the other hand, it is again going to be critical

  2. Though Bhutanese made great effort to inform people but have they really made proper study regarding the facts and figures published to avoid peolpe misguide.
    Is it possible to maintain standard quality to of work in short tender period to avoid cracks in airstrip due to natural settlement of soil hope politics and technical works doesn’t conflict.

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