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Highway developers up in arms against new threshold limit clause

Our Bureau

New Delhi, June 21 The highway developers’ lobby body – National Highways Builders Federation (NHBF) – has written to the National Highways Authority of India (NHAI) and the Road Transport Ministry against a clause on technical threshold capacity in the new request for qualification (RFQ) set for highway projects.

According to the new threshold limit clause, in order to bid for a project of a certain total cost, the bidder should have had the experience of implementing projects at least twice that cost in the preceding five years. In the earlier version of the RFQ, the clause stated that the bidder should have collected an amount equivalent to the project cost in the five-year preceding period.

For instance, in the six-laning 250 km of Udaipur-Ahmedabad national highway section, the estimated project cost is Rs 1,750 crore. For this, the qualifying bidders are now required to have collected Rs 3,500 crore of revenues from build-operate-transfer (BOT) projects in the five preceding years. Earlier, the qualified bidders were required to have collected Rs 1,750 crore of BOT revenues in the five-year period.

Similarly, the RFQ has also laid down more stringent norms for projects that will be taken into consideration while calculating the experience score. For the Udaipur-Ahmedabad NH project, the capital cost of ‘eligible projects’ should be Rs 200 crore against the earlier level of Rs 100 crore.

Opinion, meanwhile, is divided on whether the clause is desirable or not. The clause will sieve the ‘serious’ players from non-serious ones, says a section of Government officials that supports the clause.

But it will also limit the number of qualified firms that can bid for a particular project and in the process, limit competition, says another section. “With these clauses, a number of firms which had qualified in the initial rounds of bidding of the NHAI projects, will not qualify for the same projects,” said Mr M. Murali, Director-General, NHBF.

“The very reason the earlier RFQ was discarded was because it called for short-listing the top 5-6 bidders, thereby limiting competition. The new clauses are indirectly limiting competition,” Mr Murali said.

Related Stories:
NHAI cancels single bid projects; to reinvite tenders
NHAI, Ministry, Plan panel to work on model concession pact
NHAI may spend only two-thirds of target this fiscal

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