Reverse tendering: A Grand Success Govt. saves Rs. 58 crores

Reverse tendering: A Grand Success Govt. saves Rs. 58 crores
Reverse tendering: A Grand Success Govt. saves Rs. 58 crores

The reverse tendering undertaken by the Government of Andhra Pradesh has unexpectedly yielded very positive results. For the first time, the 65 package work in the Polavaram Project has been called tenders for 15.6 per cent less than the estimated cost of the total work.  I have bid a company bid for Rs 58 crores less if we compare with previous government’s pricing as L-1. If we consider the present goverment’s pricing it is less by Rs. 42. 8 crores. The same package in the previous TDP government was awarded to the contractors for 274 crores, which was cancelled by the YS Jagan Mohan Reddy Government. In the reverse tendering process, a company has filed bidding for 231 crores for the same work. It is likely to be officially known tonight that the company’s name and the rest of the companies who have taken part in the reverse tendering process. If there is so much saving in reverse tendering in the work of just Rs 3000 crores, one can imagine how much amount will be saved in the works of hydel and headworks, which to be finalized in the future.

The government will deal with the company that generally comes at L-1 and allocate the works. However, the company’s price in reverse tender will be declared as a basic benchmark price. The companies have to submit tenders for further low prices. A company filed a bid for 15.6 per cent less for the work of the package 65. There is a higher probability to award the work to this company as it is less than the rest of the companies.

The E-auction (reverse tendering) held from 11 am on Friday morning. Six companies competing in the reverse tendering process. The E-auction held for almost three hours. After a careful consideration of company qualifications, the government will award the works. 

This is the first time that the state government has undertaken a transparent reverse tendering process in the country.  As six big companies took part in the tendering, the water resources department officials believe that tenders are likely to be at a lower price than the contract value.