Deccan Chronicle 18.02.2010

Online tender has hit biz, say contractors

Feb. 17: Bruhat Bengaluru Mahanagara Palike’s decision to go in for e-procurement even when awarding tenders for many of its projects, has not gone down well with the contractors’ lobby, which has alleged that this will keep them out of business.

But its argument has cut no ice with BBMP officers who contend that the contractors’ cartel is upset because it is is no longer able to monopolise tenders, giving no room for fresh contractors to bid for projects. “When the contractors’ cartel participated in the tender process, it made sure that the contract was bagged by one of its own. The work was later distributed among many contractors who also shared the profit,” say officers.

So far tenders have been issued for 560 projects through e-procurement and work has begun on 230 of them. BBMP administrator K.N. Shivakumar, who was instrumental in implementing it, says it benefits both BBMP and the public.

“E-procurement has helped BBMP save money as work is being completed at the cost quoted with no escalations at a later date. It has been implemented as per the law. As the state government has made it compulsory no contractor can protest,” he said.

Association president R.G. Srinivas claims e-procurement is working against small contractors who have no knowledge of computers and the online process. BBMP must issue manual tenders for low cost projects worth below Rs 50 lakh to keep them in business, he said. In a memorandum to BBMP, he urged it to pay arrears of Rs 1,500 crore due to the contractors.