Lok Sabha Question No. 3338 (UNSTARRED), answered on 2026-03-12
Subject: Low Bids by Road Contractors
Ministry: ROAD TRANSPORT AND HIGHWAYS
Asked by: Ms. Mahua Moitra

## GOVERNMENT OF INDIA MINISTRY OF ROAD TRANSPORT AND HIGHWAYS

LOK SABHA UNSTARRED QUESTION NO. 3338

ANSWERED ON 12 TH  MARCH, 2026

## LOW BIDS BY ROAD CONTRACTORS

3338.   MS. MAHUA MOITRA:

Will the Minister of ROAD TRANSPORT AND HIGHWAYS

सड़क परिवहन औि िाजमार्ग मंत्री

be pleased to state:

- (a)  whether it is true that road contractors have been quoting low bids that are significantly lower than the tender cost of Government road projects, if so, the reasons therefor;
- (b) the details of projects awarded by the Government including the tender  cost,  the  bids  quoted  by  contractors  since  2014  and  the difference  between  tender  cost  and  bid  quoted  (in  percentage) since 2014, year-wise and project-wise;
- (c) whether the quality and timely completion of road projects have suffered due to the extremely low bids quoted by contractors and if so, the details thereof;
- (d) whether the qualification criteria have been relaxed for bidding for Government road projects including the old and new criteria, if so, the details thereof; and
- (e)  whether the Government has cancelled any tenders announced due to the extremely low tender bid, if so, the details thereof since
- 2014, project-wise and year-wise?

## ANSWER

THE MINISTER OF ROAD TRANSPORT AND HIGHWAYS (SHRI NITIN JAIRAM GADKARI)

- (a) and (b) Government engages contractors for project works implementation  through  a  transparent  and  competitive  bidding process in accordance with the prescribed procurement guidelines. In certain cases, bids have been received at rates far lower than the estimated project cost put to tender, primarily due to competitive market conditions and aggressive bidding strategies adopted by the bidders.

To  safeguard  the  interests  of  the  Government  and  to  ensure  that quality  standards  are  not  compromised,  suitable  provisions  have been incorporated in the bidding documents including requirement of Additional Performance Security. Further, all works are executed strictly in accordance with the relevant codes/manuals prescribed. Independent Engineers/Authority Engineers and regular field inspections ensure supervision and adherence to quality standards at  every  stage  of  construction.  Independent  Quality  Audit  is  also taken up in certain projects where required.

Accordingly,  necessary  safeguards  are  in  place  to  ensure  that competitive  bidding does  not  adversely  impact  the  quality of National Highway works.

The average tender discount of ongoing works varies from 11% to 34%  across States. Project-wise and year-wise data on the difference  between  tender  cost  and  bid  cost  being  voluminous  in nature is being compiled and will be laid on the table of the House.

- (c) It may not be possible to infer that the quality of works have suffered on  account  of  low  bids.  Generally,  works  are  being implemented  as  per  laid  down  specifications  and  standards.  The instances of poor quality have been observed even in bids without discount.  It  may  be  mentioned  that  the  quality  of  work  primarily gets affected based on quality of raw materials, quality of equipment,  level  of  supervision,  Quality  Control  measures  and experience of workers/ engineers at the site.
- (d) In  2019,  relaxations  in  qualification  criteria  for  Contractors  / Concessionaires  were  given  to  promote  competition.   However,  in

2025, the Government tightened the qualification criteria for bidding  for  NHs  works  under  Hybrid  Annuity  Model  (HAM)  and Engineering, Procurement and Construction (EPC) modes, to prevent potential issues related to construction timelines and quality due to aggressive bidding. The modifications inter-alia include raising the minimum financial and technical requirement for bidders, introducing  greater  checks  on  sub-contracting  experience  and modification  of  the  highways  and  core  sector  definitions.  Further, provision of Additional Performance Bank Guarantee has been made stringent. (e) Tenders are generally accepted or rejected based on qualification  criteria  as  specified  in  Request  for  Proposal  (RFP)  in accordance with the guidelines and General Financial Rules GFR as per the recommendation of the tender evaluation Committee.

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