Qualification standards for highway tasks must be tightened, says IRB Infrastructure Builders’ MD

The federal government must tighten its qualification standards within the awarding of tenders for highway tasks as corporations who put in bids usually complain of price overruns, which ends up in the tasks getting delayed, in accordance with Virendra Mhaiskar, Managing Director of IRB Infrastructure Developers.

With an order guide dimension of about ₹20,000 crore and round ₹6,000 crore value of tasks to be executed over the following 5-6 months, IRB Infrastructure Builders is a number one participant within the highway mission section.

Highway tasks, most delayed

Speaking to businessline, Mhaiskar mentioned that the bid worth for among the projects on hybrid annuity model (HAM) have been ‘intriguing’.

“We’re unable to obviously establish how any individual is ready to bid so aggressively,” he mentioned. Corporations normally put in a bid for a mission at a sure worth “after which in a while that mission will get delayed on account of price overruns.” This phenomenon has been gathering tempo in latest months, he added. At an analyst name final month the administration of the corporate had indicated that it will be cautious whereas bidding for tasks awarded by the Nationwide Highways Authority of India.

Lately a report quoting knowledge from the Ministry of Statistics and Programme Implementation mentioned that of the full infrastructure tasks within the nation, roads and highways had the best variety of delayed tasks at 460 of the 750 tasks underneath execution. These are tasks costing ₹150 crore and above. In comparison with the unique sanctioned price of ₹4.1 lakh crore, there was price escalation of 4.5 per cent.

“It might be attention-grabbing to dig extra and discover out the precise causes for the delay and the way a lot price escalation has been skilled,” with respect to every mission, Mhaiskar mentioned. He added that since this was constantly occurring there was a necessity for all stakeholders to come back collectively and talk about it. “It is a actual drawback and so possibly there’s a must tighten the qualification standards,” he mentioned.

Bharatmala mission

For instance he pointed to section one among Bharatmala mission which was to be accomplished by 2022 at a price of ₹5 lakh crore. The completion date has now been shifted to 2027 and the price has doubled. “That could be a very thoughts boggling quantity,” Mhaiskar mentioned.

Whereas a part of the rationale was the delay on account of COVID-19, Mhaiskar mentioned there was a necessity to have a look at different elements too and verify whether or not the bidders provided ‘very, very competing costs’ and if that was one of many causes for the price overrun.

Tightening the qualification standards would make sure that high quality gamers have been within the enterprise. “I perceive and agree that we have to broaden the contractor base ..however on the similar time the general business sense additionally has to prevail.”

IRB Infrastructure additionally just lately obtained the appointed date for the Ganga Expressway mission which is being constructed at a price of ₹6,660 crore on a construct, function, switch foundation. It additionally received an order value over ₹2,100 crore for a highway mission in Gujarat.

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