In what could be seen as the first casualty of the economic slowdown coupled with stringent regulatory mechanism, bidding for 23 mega road projects worth around Rs 30,000 crore under phase III of National Highways Development Programme has been deferred.
?The last date for submission of financial bids for the short-listed companies for these projects was November 21. However, National Highways Authority of India (NHAI) has not got a single bid for any of these projects,? said a source close to the development.
With the private players shying away from submission of bids for these build operate and transfer (BoT) projects, NHAI?s target to award 53 projects worth Rs 60,000 crore is likely to go for a toss.
NHAI feels the current economic scenario is taking a toll on tendering process of road projects. ?The private players are not coming forward to take up the projects due to the current economic scenario, wherein the participants are not sure what will be the future like. Owing to this, we have deferred the bidding date by almost two weeks in the case of all the projects. This is certainly going to delay the awarding of the projects,? said an NHAI official on conditions of anonymity.
Agrees a construction company official, ?We all have our fingers burnt. The sector is likely to see a slump as almost all the companies are shelving their investment plans.?
These projects comprise Lot I of NHDP, phase III. The second lot comprises 21 more projects. These projects were kept on the block for bidding by the NHAI in September this year.
The projects in Lot I have already seen large scale withdrawals by the shortlisted bidders from the projects owing to the additional clause introduced by the ministry of road transport and highways in August this year. The clause capped the number of projects a company can implement, standalone or as a part of a consortium, at four. Seven projects of Lot I were rendered bidderless owing to the clause.
NHAI, however, had a Plan B ready to deal with this situation. It planned to invite the companies, which were next in line, during the technical evaluation stage. But now, with no company coming forward to take up the projects, NHAI is left groping for a solution.
Incidentally, in order to break the ice, the ministry of road transport and highways held a meeting with the highway construction companies last week in presence of the Planning Commission representative. ?The government proposed to make the projects more viable by reducing the number of service roads. How can a project, which has been calculated on 9% rate of interest be made feasible in a scenario when the rates are at 14% by just reducing the number of service roads,? said the construction company official.
Slowdown fears
•The last date for submission of financial bids for the short-listed companies for these projects was November 21
•National Highways Authority of India has not got a single bid for any of these projects
•Private players are not coming forward to take up the projects due to the current economic scenario
•The sector is likely to see a slump as almost all the companies are shelving their investment plans
•Owing economic slowdown, NHAI has deferred the bidding date by almost two weeks
•These projects comprise Lot I of NHDP, phase III. The second lot comprises 21 more projects. In order to break the ice, the ministry of road transport and highways held a meeting with the highway construction companies last week in presence of the Planning Commission representative
