KARACHI, Jan 1: The process for handing over — or what observers describe as the privatisation of the city’s solid-waste management — to a Chinese firm has been delayed considerably due to the fact that a draft agreement in this regard has not be finalised and signed between the firm and the city government.

On Nov 11, 2007 a letter of intent (LoI) was signed between the city government and the Chinese firm, Shanghai Shen Gong Environmental Protection Company, giving responsibility to the firm to manage the city’s solid waste for 20 years. At the ceremony, the managing director of the company promised to start work in January with an investment of $250 million.

Under the LoI, the Chinese company will be responsible for upgrading the existing landfill sites and to build eight garbage transfer stations (GTS) and another landfill site in various parts of the city. The company will lift solid waste from city areas during daytime and shift it to the GTS. At night, the waste will be shifted to a landfill site by covered vehicles. The company will ensure improvement in the environmental conditions in and around the garbage transfer stations. The city government will pay $20 to the company for lifting and disposal of each tonne of waste.

At present, over 8,000 tonnes of solid waste is being generated in the metropolis out of which 4,000 tonnes are being lifted and transferred to the landfill site for disposal.

Sources in the city government told Dawn that it had been decided that the Chinese company would sign a final agreement within 10 days of signing of the LoI after accepting the terms to implement the Integrated Municipal Solid Waste and Hospital Hazardous Waste Management project.

The sources said that before starting the project, the Chinese firm would have to set up a company and get it registered here to utilise the resources, including vehicles and employees, of the solid-waste management department.

They said the agreement should have been signed in December but both parties were still busy in negotiations and representatives of the Chinese company had visited the metropolis thrice to settle certain financial and land issues before signing a final agreement.

“We are in the process of finalising the draft agreement and I am hopeful that it will be signed before the current month ends,” Municipal Services EDO Masood Alam told Dawn.

He said the Chinese company’s representatives were due to arrive in the city on Tuesday to shape up the draft agreement but they had delayed their arrival due to security concerns following the assassination of former prime minister Benazir Bhutto.

Mr Alam maintained that the draft agreement was an over 80-page document and deliberations on its each and every point was necessary because the company would manage the city’s solid waste for 20 long years.

“We have given them details of our employees, number of vehicles, etc. They have to build eight garbage-transfer stations in different areas and some of them fall in the jurisdictions of other land-controlling agencies,” he said.

Besides, the city government will give nine places to the company to build field offices for monitoring the process in 18 towns of the city, he said, adding that these places had already been identified and the civil work would begin shortly after the signing of a final agreement.

Referring to the future plan of generating electricity from a waste energy plant to be established by the company, he said the city government would get 15 per cent of the revenue of the waste energy project and trading of carbon credits. “We are also in the process of finalising such matters through which the city government will increase its revenue,” he added.

The city government will also get 15 per cent of the total revenue to be generated by the company through recycling of the solid waste.

The sources said the Chinese company would take at least three more months from the date of official handing over of the solid-waste management to it, as the construction of GTS and landfill sites was a gigantic task.

Till then, the chances of any improvement in the state of cleanliness in the metropolis are very thin as the city government appears in no mood to spend money in the transitional period.