MoRTH to rate DPR consultants, review subcontracting norms for highway projects: Nitin Gadkari

The Ministry of Road Transport and Highways (MoRTH) is set to tighten its oversight of highway project consultants, with Union Minister Nitin Gadkari saying that the ministry will rate firms preparing Detailed Project Reports (DPRs) and may link their performance to eligibility for future tenders.

Gadkari also said the ministry would review provisions governing the subcontracting of highway works, amid concerns that projects awarded at substantially low bids are subsequently passed through multiple layers of contractors, potentially affecting quality and accountability.

Addressing the fourth edition of FICCI's Tunnels and Bridges Conference on Wednesday, Gadkari said the ministry was already evaluating contractors on the basis of their performance and had extended the exercise to DPR consultants. The move is aimed at making the quality of project planning a more important factor in the award of future consultancy contracts.

"Quality is the first priority, and cost comes after quality," Gadkari said.

GST records may help track subcontracting chains

Gadkari said he had come across instances where contracts were awarded significantly below estimated costs and were subsequently subcontracted through several layers, with each intermediary retaining a margin. He said GST records could potentially be used to trace such subcontracting chains and determine whether contractual conditions had been violated.

The minister said the principal contractor must remain accountable for both quality and timely completion, adding that the ministry would examine whether existing restrictions on subcontracting need to be strengthened or modified.

MoRTH is also preparing tunnel tenders worth an estimated ₹2 lakh crore-₹2.5 lakh crore, Gadkari said, underscoring the scale of the upcoming infrastructure pipeline.

Industry flags risks from lowest-bid tenders

S Paramasivan, Chair, FICCI Committee on Roads & Highways and Managing Director of Afcons Infrastructure, said the widespread use of L1, or lowest-bid, selection was resulting in tenders being quoted 20% or more below estimated project costs.

He called for quality-cum-cost based selection to become the preferred approach for complex projects and those exceeding ₹1,000 crore, with technical parameters accounting for 70-80% of the evaluation.

Paramasivan also urged project authorities to take responsibility for land acquisition and clearances in EPC contracts and sought mechanisms to compensate contractors for verified geological variations in Himalayan tunnelling projects.

He further called for a rethink of the June 2024 procurement guidelines on disputes above ₹10 crore, arguing that institutional arbitration with time-bound procedures would be more effective than prolonged court proceedings.

The road ministry's move to formally assess DPR consultants comes against a broader push to improve project planning. MoRTH has already introduced performance-based assessment mechanisms for contractors and DPR consultants, with the ministry's website listing separate frameworks for rating both categories.