A Review of Contract Awards to Lowest Bidder in Indian Construction Projects via Case Based Approach

Abstract

Indian construction especially public sector organisations and government department mostly depends on lowest financial bidder for award of contracts. At some point time of these projects, it has become a common scenario that there is a schedule delay resulting in extension of time. So it can be mentioned that modern contract handling procedures require an overhauling. The study presents a case-based approach, in which authors have studied different projects that have been awarded on basis of financial criterion. Ultimately conclusions have been drawn by comparing efficiency of contractor with progress, ratio of bid and project cost and other factors.

An Analytical Study of Critical Factors Affecting Contractor Efficiency in Construction Projects in Indian Scenario

“…The reason is as follows: although a contractor is awarded project on the basis of its low bid, it tends to meet out its finances through time value on money, i.e. by delaying the project (Hatush and Skitmore, 1997;Kumaraswamy, 2000, 2001;Elyamany and Abdelrahman, 2010;Sarker et al, 2012;Leśniak, 2015;Deep et al, 2017e;Asim et al, 2017aAsim et al, , 2017b. The real purpose behind quality imperfections, i.e.…”

“…in the case of equipment and material, has been due to the inclination of contractors to meet out their cost since they have won the tender with low bids. It is found in the research that the advance according to the timetable of most projects awarded on the responsive lowest bidder award system was weak (Deep et al, 2017e). Competitive lowest bid method has been exceptionally scrutinized for its adverse effect on contractor's profit, disputes/claims, coordination, quality control and project span.…”

“…Strife and question can hence exist at all levels in the contractual hierarchy amongst client and consultant, client and contractor and contractor and subcontractor. Amongst many reasons for contradictions in the construction project, the project delivery framework chose one of the significant components (Deep et al, 2017e). Henceforth, numerous researchers have stated that construction organizations have learned from their past experiences and made various advancements.…”

“…The framework is entirely focused towards client's requirement which is not a bad idea; since it is more popular with government and its subsidiaries, it tends to increase malpractices and poor quality due to the contractors being sceptical about their profit margins (Deep et al, 2017b, 2017e, Mathivathanan et al, 2017Mishra et al, 2017;Sanderson et al, 2017 the potential bidder is the bid that is reasonably below the client's estimate and serves client's interest well (Deep et al, 2017e). Thus, there is a clear research gap, in the case of developing countries, that the contract awarding framework fails to answer mutual interests of client and contractor relationship resulting in unavoidable risks (Asim et al, 2017a(Asim et al, , 2017bDeep et al, 2017aDeep et al, , 2017bKhan et al, 2017b;Singh et al, 2017a;Wahaj et al, 2017b).…”

Identification of Delay Causing Actor in the Indian Real Estate Project: an AHP-Based Approach

“…Evidently from government records, the construction domain is valued over $126 billion and accounts for more than 60 percent of total investment in infrastructure. The primary cause of growth catalyst in this sector is technological advancement (Deep et al, 2016;Deep et al, 2017a;Deep et al, 2017b;Deep et al, 2017c;Deep et al, 2017e;Wahaj et al, 2017). Among such factors, innovative technologies and international players lead to enhanced employment across an infinite array of varying skills.…”