MoRTH’s Stricter Rules Expected to Ease Road Project Pressure: Icra

20 May 2025 CW Team

Rating agency Icra anticipates that the Ministry of Road Transport & Highways (MoRTH) will tighten bidding norms by introducing a requirement for additional performance security (APS), aiming to reduce competitive pressure in Central Government road projects.

Earlier, the relaxed bidding guidelines had led to fierce competition in central government road tenders, with many contracts awarded at steep discounts—around a median of 25 per cent between January 2024 and March 2025. However, the new policy could place financial stress on small and mid-sized contractors, especially those with limited bank guarantee (BG) capacities.

Back in August 2022, the Ministry had mandated APS for projects awarded at significantly lower than the base price, but this was capped at 3 per cent of the total project cost. According to the latest circular, this 3 per cent cap has now been removed.

Ashish Modani, Group Head, Corporate Ratings, Icra, said, “The hike in performance security requirement is a positive step towards execution discipline, which will deter speculative bidding and promote realistic pricing. The policy, though, in the near term, is expected to put some strain on the credit profiles of small and mid-sized contractors, particularly those with limited-sized BG limits."

Modani further explained that the need for cash margins to secure additional BGs will increase working capital demands, which may affect bidding capacity, revenue growth, and coverage ratios due to higher financing costs. However, he noted that in the medium term, the policy will encourage participation from serious, well-capitalised bidders, leading to improved performance and better quality in road construction.

News source: Business World

Infrastructure Energy

17 Dec 2025

Vedanta Aluminium Uses 1.57 bn Units of Green Energy in FY25

Vedanta Aluminium, India’s largest aluminium producer, recently reported consumption of 1.57 billion units of renewable energy in FY25, marking a significant milestone in its 2030 decarbonisation roadmap. The company also achieved an 8.96 per cent reduction in greenhouse gas (GHG) emissions intensity compared to FY21, reinforcing its leadership in India’s low-carbon manufacturing transition. During FY25, Vedanta Aluminium expanded its renewable energy portfolio through long-term power purchase agreements, strengthening its strategy to source nearly 1,500 MW of renewable power over the lon..

Oberoi Group to Develop Luxury Resort at Makaibari Tea Estate

EIH Limited, the flagship company of The Oberoi Group, has announced the signing of a management agreement to develop an Oberoi luxury resort at the iconic Makaibari Tea Estate in Darjeeling. The project marks a key milestone in the Group’s long-term strategy of creating distinctive hospitality experiences in rare and environmentally significant locations. Established in 1859, Makaibari is one of the world’s oldest tea estates and is globally recognised for its Himalayan landscape, primary forests and exceptional biodiversity. Spread across 1,236 acres, the estate houses one of the world�..

GHV Infra Secures Rs 1.09 Bn EPC Order in Jamshedpur

GHV Infra Projects Ltd, a fast-growing EPC company in India’s infrastructure and construction sector, has recently secured a Rs 1.09 billion work order in Jamshedpur, Jharkhand. Awarded by a reputed group entity, the contract covers end-to-end civil construction, mechanical, electrical and plumbing (MEP) systems, along with high-quality finishing works for a large building development. The project will be executed over a 30-month period, with defined benchmarks for quality, safety and timely delivery. The order strengthens GHV Infra’s footprint in Jamshedpur, a key industrial hub known fo..