HAM roads: Govt caps excess bids at 5% in contracts

Hyderabad: Amid allegations of contractors forming a syndicate and quoting up to 23% excess bids, govt has reportedly taken a decision to ensure that the contract is given at a maximum of 5% excess only.The over Rs 13,000-crore project for development of roads in the state under hybrid annuity model (HAM) was delayed by almost a year. When the roads and buildings department invited tenders last year, not many contractors came forward. Tenders were floated again after a meeting with contractors. Later, many companies participated, but the bid amount was quoted up to 23% excess.While opposition BRS alleged a huge scam in HAM roads contract, the contractors claimed there was neither a syndicate nor any irregularity or scam, as the contract was not finalised. Many contractors, including Megha Engineering, Raghava Constructions, KNR and Bhrunda Infra, participated and submitted their bids.A contractors’ association representative told TOI that the excess amount was quoted because they would have to take a loan for 60% of the project cost, which would be paid by govt over 15 years. “We calculated the interest on the 60% loan and GST on it, which came to over 9% and 18%, respectively. The issue was explained to officials,” association representative leader DVN Reddy said.After evaluation by a committee of HAM roads in other states, the report was placed before chief minister A Revanth Reddy, who reportedly told the officials to concede to some of the genuine demands of the contractors like payment of GST at the time of construction of roads and excluding them from the mandatory patrolling and ambulance vehicle clause.Subsequently, changes were made to the HAM roads project conditions and placed before the cabinet on Saturday. “The cabinet gave, in principle, green signal to the HAM roads project with a rider that the bid amount should not exceed 5%, which is permissible as per rules. Now, the ball is in the contractors’ court. If all goes well, the HAM roads project will be launched on June 2,” a govt source said.On their part, the contractors said they would meet in a day or two and take a final call.