Ghana government to sue Indian road contractor for not completing work after receiving $29.6m part payment

The Government of Ghana is to take legal action against JMC Projects, an Indian construction company, under Kalpataru Group, for taking $29.6 million, as part payment to construct the 113km Sevelugu-Walewale road but failed to execute the project. 

The Indian contractor also made an attempt to collect an additional $14 million for allegedly mobilising equipment and staff to site but government refused to pay that amount. 

Later, the Indian construction firm issued a notice of termination of contract and attempted to clandestinely transport its construction equipment at the project site in the northern Ghana to another project site in Guinea without the explicit consent of the Ministry of Roads and Highways. 

The Minister disclosed that the former Vice President, Dr Mahamudu Bawumia performed the sod-cutting ceremony on June 17, 2024, for commencement of work on that road without knowing that the contractor had already issued a notice of termination of contract. 

Mr. Kwame Governs Agbodza, the Roads and Highways Minister, made the disclosure while responding to an urgent question posed by Mahama Ayariga, the Majority Leader and Member of Parliament for Bawku Central on the status design-build contract of the Phase 1 Tamale-Savelugu-Walewale (30-113km) stretch on the floor of Parliament on Thursday. 

The Minister said after the Indian construction firm had taken $29.6 million from government, it issued a notice of termination of contract on March 11, 2024. 

The Minister said at the time the contractor issued the notice of termination of contract in March 2024, it had done only one per cent of the work. 

Mr. Agbodza said the Ministry had notified the Attorney-General and Minister of Justice about the matter to provide legal advice on the way forward. 

However, the Minister was of the conviction that the Indian construction firm either execute the road project worth the amount collected or government of Ghana use every legal means to retrieve the money paid to the contractor. 

The Minister expressed surprise that while the previous New Patriotic Party government was owing Ghanaian road contractors to the tune of GH¢21 billion, it could mobilise almost $30 million to pay a foreign road contractor without any work done. 

The contract, worth $158 million, was awarded in 2022 and expected to be completed within 42 months in December 2025 but now the contractor has abandoned the site. 

The IMS Engineers and Vision Consult Limited were consultants for that road project. 

Source: GNA 

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