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Bengaluru: Only a single firm has thrown its hat in the ring to build the 73-km Peripheral Ring Road (PRR) by investing Rs 27,000 crore.
The Bangalore Development Authority (BDA), responsible for building the semicircular road along the city’s peripheries, is happy with the response since its two previous attempts to secure a contractor for the project had failed.
Top BDA sources told DH that a Chennai-based company participated in the tender, with the deadline for the submission looming on Friday. Officials expected a better response since three firms, including an Adani offshoot, took part in the pre-bid meeting held towards the end of February.
Going by the tender specifications, the participating company must deposit Rs 300 crore in the BDA’s account. The authority intends to conduct both technical and financial evaluations of the company, since it sees the project as in line with the election code of conduct.
"The project is such that the company is required to fund both land acquisition and construction cost. Such tenders do not generally get very good responses from the bidders. We estimate the land acquisition cost to be around Rs 21,000 crore. This is not very attractive to the private firms,” a senior BDA official told DH.
According to the tender document, the company must deposit the land acquisition amount in two tranches over a period of 90 months from the date of signing the contract. Lack of clarity in land acquisition structure could be a reason for the poor response to the tender call. The BDA is not clear if it would follow its own act for land compensation or the 2013 Act of the Union government, which is nearly two to four times the guidance value.
BDA officials told DH that they have devised a combination of different compensation structures, although they made it clear that the state cabinet would take the final call. The matter was slated for a decision last week, but was deferred.
The BDA had dropped service roads from the scope of work to make the contract attractive and ensure better toll collection. The authority heaped pressure on the government to slash the guidance value along the 73-km alignment.
The move, exclusively reported by DH on March 7, was aimed at reducing compensation to the land losers.