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Mamuni Das

New Delhi, Sept. 23 Even as the highway developers welcomed the Government move to delete the competition-limiting clause for public private partnership (PPP) projects, they have decided to continue their legal battle (against this clause) seeking its deletion for the ongoing 60 projects.

“The National Highways Builders Federation (NHBF) has decided to continue its legal battle for deletion of competition-limiting clause from the request for qualification (RFQ) document with retrospective effect.

“The very fact that Government decided to delete 3.5.2 clause (prospectively) shows that it is flawed,” said Mr M. Murali, Director-General, NHBF, when contacted.

The contentious 3.5.2 clause — stating that only the top five or six technically qualified applicants can be invited for participation in the financial bid stage for PPP projects — was a part of the model request for qualification (RFQ) document, issued by Finance Ministry with guidance from Planning Commission.

The Planning Commission is keen to implement this clause, as it felt that that this would weed out non-serious players. However, the clause — which impacts all PPP projects — has been legally contested by companies in the port and road sector.

The Finance Ministry issued an order on Monday deleting this clause prospectively for all National Highways Authority of India (NHAI) projects.

It said that the 60 projects which the NHAI is already processing should be dispensed with as per the RFQ with 3.5.2 clause. As for the rest, the NHAI should undertake the process after deleting the clause.

“We had approached the Delhi High Court in January 2008. The RFQs for a significant number of projects were invited after that period. So, we would continue our legal battle,” Mr Murali said.

NHBF would also continue to challenge the subsequent clause (added a few weeks ago by NHAI at the direction of Road Ministry and Planning Commission for the ongoing projects only) that limits the number of projects for which a company can bid to eight (independently or as a part of consortium) within a two month period preceding a bid due date. Moreover, a bidder is also barred if he has won four projects within the period.

The industry body has been saying that by changing the rules midway, the Road Ministry is further complicating the issue.

Players have bid for different projects by forming consortia in various permutations and combinations. This clause will lead to a tussle between companies depending on their respective selection levels.

Moreover, the clause is open to manipulation. “The bid due dates can be set up in a particular manner to suit a player(s),” said a source.

More Stories on : Roadways | Policy | Courts/Legal Issues

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