Finally, Procurement Shifts from L1!

Prime Minister Modi has retreated and withdrawn the proposed farm laws. A step back for progressive reforms for the farm sector, but a step forward for democracy. Meanwhile, critical reforms are underway, although silently, that can have a cascading impact on our national assets on which we have proposed to spend ₹ 110 trillion over the next five years under the National Infrastructure Pipeline (NIP).

Public procurement policy norms have been tweaked to allow for quality-oriented procurement. The guidelines issued by the Department of Expenditure’s Public Procurement Division have now allowed the selection of bidders for works and non-consultancy services through alternative procurement methods like quality-cum-cost-based selection (QCBS) thereby fulfilling a long felt need for the industry for which FIRST Construction Council and Construction World have raised concerns. In times of early infrastructure development during UPA 1 and UPA 2, the L1 method has driven several private companies to make ridiculous bids endangering their sustainability. In the L1 system, a bidder is selected only on the basis of the lowest cost. But now things are set for a change.

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