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Sri Lanka to run new digital ID tender after Madras disqualified

Sri Lanka to run new digital ID tender after Madras disqualified

After much controversy, the multi-million dollar tender for Sri Lanka’s digital identity project will be refloated. The news comes after the country’s government procurement agency disqualified the two Indian companies that had submitted bids, reported to be Madras Security Printers (MSP) and Protean Technologies.

The bidding process for Sri Lanka’s Unique Digital Identity program, known as SL-UDI, has been marred by problems since the launch of the tender in May. The Cabinet Appointed Procurement Committee (CAPC) introduced several abrupt changes to the bid submission deadline.

Prospective bidders were not only left confused and frustrated by the changes but were also denied clarifications on bid document clauses, according to sources cited by Sri Lankan newspaper The Sunday Times.

In August, the contract was finally awarded to Madras Security Printers, a digital document printing company headquartered in Chennai, India. Allegations have arisen, however, that the tender was manipulated to favor the company.

Last Saturday, Sri Lankan Technology State Minister Kanaka Herath confirmed the disqualification of both MSP and its competitor. Protean (referred to as “Protein” by the Sunday Times) was disqualified prior to the awarding of the contract to MSP.

“We hope to refloat the tender at the earliest, given the urgency of the matter,” he told the Sunday Times.

This week, the Indo-Sri Lanka Joint Project Monitoring Committee (JPMC), tasked with overseeing the unique digital ID project, is expected to meet and discuss the next steps. Aside from corruption allegations, the project is also facing scrutiny over personal data privacy with concerns raised over giving the tender to Indian companies.

Sri Lanka’s digital ID project is overseen by the Indian government and is expected to resemble India’s Aadhaar digital ID program and to run on MOSIP. In 2022, Indian officials signed a memorandum of understanding (MoU) which included a 300 million Sri Lankan rupee (US$3.8 million) grant. According to the MoU, only Indian companies are eligible to bid for the tender.

The total cost of the project is estimated at 41.05 billion Sri Lankan rupees (US$126 million). In August, the Indian Government provided an advance payment of 450 million Indian rupees ($5.4 million) to the Sri Lankan Government for the project.

Madras Security Printers, which provides digital liquor stickers for the Sri Lankan government, has also been involved in a separate controversy. Sri Lankan parliament members have recently started an investigation after finding nearly 44,000 liquor bottles with fake Madras Security Printers security stickers in raids. Parliament’s Ways and Means Committee, which is investigating the scam, recommended launching a new tender for the digital stickers.

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