Viper0011.
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Why does pakistan award the contract to chinese companies without competitive bidding..?
Is it because that the chinese companies will inves in the project also..? but what do they get in return...as investment profit? This profit can be very costly to public---without compitive bidding...
Read the bold above, these are investment based projects where the costs and profits are to be recovered b the investor like you said. The investors aren't stupid or born yesterday who'd just throw a few billions down the drain. There are significant feasibility studies which are conducted before hand.
No investor would spend a dollar without understand a minimal return he'll take for sure. Typically, Pakistani project's have been returning around 25-30% ROI. That's actually really good.
Also, the cost doesn't mean squeezing public's already small pocket. The cost is subsidized by the gov't, so there is guaranteed return for the investment. But the beauty is, everyone wins.
The gov't who doesn't have a lot of extra money, ends up generating a ton of new revenue, creates thousands of more jobs, which kick start the economy and taxation, and then pays partial project cost from its pocket, the rest is recovered from people who use this transportation and the investors make good profit. Can't beat this model !!
I read an audit report two years ago by the Transparency International about the Metro bus. It said (back then), that every day, they were counting 5000-10000 new customer taking the bus. I am sure that would've stopped and saturated at some point, but if 500,000 people take the buses every week, that's helping a HUGE population, and obviously generating revenue, taxes and stuff, which will result in more of such projects get done for people's welfare!
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