Polavaram reverse tender helps Andhra Pradesh save Rs 58.53 crore

The same company—Max Infra (I) Ltd.—which quoted Rs 290 crore when the previous TDP government had called tenders in March, 2019, bagged the contract by quoting Rs 231.46 crore. 

Published: 21st September 2019 05:23 AM  |   Last Updated: 21st September 2019 05:23 AM   |  A+A-

Polavaram Project (File Photo |EPS)

By Express News Service

VIJAYAWADA: In what could be a shot in the arm for the State government, the Water Resources department saved about Rs 58.53 crore through reverse tendering for Package 65 (connectivities) of Polavaram Irrigation Project. The same company—Max Infra (I) Ltd.—which quoted Rs 290 crore when the previous TDP government had called tenders in March, 2019, bagged the contract by quoting Rs 231.46 crore. 

A day after six firms -- Patel Engineering Limited, Megha Engineering and Infrastructure Ltd., Max Infra (I) Limited, Afcons Infrastructure Ltd, MRKR-SLR (JV) and RRCIIPL-WCPL Consortium —filed bids for the package, the Water Resources officials opened the bids at 11 am on Friday. After examining the initial offers made by the firms, they identified the lowest as Rs 260.26 crore against the estimated contract value of Rs 274.25 crore. The details of the firm which quoted Rs 260.26 crore, however, have not been divulged in accordance with the reverse tendering norms.

The department held reverse bidding from 2 pm to 5 pm, by keeping Rs 260.26 crore as the benchmark value. “After completion of reverse auction process, Max Infra (I) Limited, Hyderabad, emerged the L1 Bidder by quoting the lowest— Rs 231,46,91,679, which is 15.600253% less than the estimated contractual value of Rs 274,25,33,909,” the officials explained. In January 2019, the department, at the behest of the then government, had decided to terminate the contract for executing Package 65 and go for fresh tenders.

In the tendering process held subsequently in March, Max Infra (I) Ltd bagged the package for Rs 290 crore, which is 4.77 per cent higher than the then estimated contract value of Rs 276.8 crore. After Jagan Mohan Reddy came to power, the Water Resources department, in August, had terminated the contract awarded to Max Infra, following the recommendations of the expert committee. The government decided to go for reverse tendering aiming to save 10-20 per cent of exchequer’s money and invited fresh tenders in on August 20. 

While there was criticism that the new tendering process by the YSRC government did away with pre-qualification process, especially technical, for the agencies to participate in the bidding, a top-ranking official told TNIE, “It is a first of its kind that we have followed self-declaration for qualifying agencies. The fact that the agency which had earlier quoted Rs 290 crore participated and quoted much lower shows that agencies too have faith in the government.”

The Package 65 includes the construction of 919 m long irrigation tunnel, left flank head regulator, navigation lock.

Bidding for balance work

The bidding process under the fresh tenders invited for the balance work of irrigation headworks and spillway and 960 MW hydel power plant will end at 5 pm on Saturday. The water resources department will know the firms which have participated to execute the Polavaram project through reverse tendering. The works worth Rs 4987.55 crore would be awarded after the department holds a reverse auction with the lowest bid as the benchmark. The officials will open the bids on Monday and subsequently, the reverse auction would be held.


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