BL reported that national highways bidding process has come to a virtual standstill because of the conflict of interest clause in the bidding process. The National Highways Authority of India has been forced to shift the due dates for accepting financial bids for several projects in the past few weeks. They are waiting for the matter to be sorted out.
Two bidders Navinya Buildcon and GVK have moved court against the clause. Navinya Buildcon a subsidiary of TATA Realty and Infrastructure Ltd and its partner Atlantia have also decided not to participate in any of the highway projects till the Government’s stand on the issue is clarified.
The conflict of interest clause prohibits competing bidders from having common shareholding of over 5% at both request for qualification and request for proposal levels. This leaves a lot to interpretation say sources involved in the matter.
NHAI had not implemented this clause in the strictest of sense till the bidding process of the Kishangarh-Ajmer-Beawar project started. For this project, the NHAI forfeited the INR 14 crore bid security of Navinya-Atlantia consortium because Abertis had 6.68% stake in Atlantia.
This was despite the fact that IDFC-IJM-Abertis did not submit its financial bid in the RFP stage for the project. In this project, as emerged later, Navinya had the best bid offer for the project. But NHAI awarded the bid to the Soma-Isolux consortium after Navinya was disqualified.
Officials from four different bidders Business Line said that “If this interpretation was to be adopted for all earlier projects awarded by NHAI, the results will be entirely different and many bidders will end up getting disqualified.”
In another project Kishangarh to Udaipur three short-listed consortia of bidders IL&FS Transportation, GVK-Leighton and Oriental Structure Engineers-Gayatri-Continental Engineers have been disqualified under the same clause.
Meanwhile, NHAI officials are waiting for the implementation of the recommendation of committee headed by Planning Commission Member, Mr BK Chaturvedi. The Committee has recommended increasing the common shareholding limit to 25%.
(Sourced from Business Line)
