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Project Tendering registers quantum jump in Q2 & Q3/FY21Project tendering activities took a quantum jump in terms of both tenders and tender value in the second half of the fiscal 2020-21. As against 15,651 project tenders worth Rs 3,44,222.66 crore announced in Q1 & Q2, the country saw announcement of 25,004 tenders worth Rs 4,47,401.49 crore in Q3 & Q4 put together. The special incentive package worth Rs 20 lakh crore announced under the Atmanirbhar Bharat Abhiyaan induced the Indian companies to step up their project execution pace in the second half of the fiscal 2020-21.

In Q1/FY21, the country saw floatation of 5,891 project tenders. In the succeeding quarters, the numbers jumped up to 9,760 tenders in Q2 and further to 12,086 tenders in Q3. In the last quarter of FY21, the tendering activities stabilized at Q3 levels with the issuance of 12,918 project-related tenders across the country.

In terms of tender value, the first quarter saw issuance of project tenders worth Rs 1,72,804 crore. Despite of sizeable increase in number of tenders in Q2/FY21, the aggregate job value the tenders at Rs 1,71,418 crore remained at the preceding quarter’s level. Missing of large value tenders in Q2 was the main reason for the stagnation in the total value.

Following the unlocking of the economy, tendering activities gained momentum in the second half of the fiscal FY21. As a result, not only the number of project tenders issued in Q3/FY21 increased by 2,326 but the job value of such tenders at Rs 2,11,126 crore registered an increase of 23.16 percent. In Q4/FY21, the buoyancy was maintained and the country saw floatation of 12,918 project tenders carrying job work value of Rs 2,36,275 crore.

As many as 113 mega-value tenders (Rs 1,000 crore and above) with an aggregate value of Rs 2,27,585.37 crore were issued in FY21. These mega tenders accounted for around 29 percent of the total value of Rs 7,91,624.15 crore project tenders issued in FY21.

An uptick in high-value tenders was seen in both Q3 as well as Q4 in FY21 as compared to the preceding two quarters. As many as 36 high-ticket tenders worth Rs 73,525.08 crore were issued in Q4/FY21, as against 33 tenders worth Rs 58,792.94 crore issued in Q3/FY21.

Supply Tenders 

The strong growth seen in project tendering was echoed in the supply tendering segment too in FY21. The country witnessed floatation of 70,686 supply tenders worth Rs 1,76,010.3 crore between July 2020 and April 2021. (Projects Todays started monitoring high value project related supply tenders from July 2020).

Three agencies – the National Highways Authority of India (NHAI), the Food Corporation of India (FCI) and the Department of Irrigation, Assam – accounted for over 60 percent of the supply tenders issued in July 2020 – March 2021 period. NHAI issued 1,105 tenders worth Rs 35,947.8 crore, while FCI floated 83 tenders worth Rs 25,122.03 crore.

Ownership

In India, only a tiny portion (0.22 percent) of the total tendering value floated in FY21 is owned by the private sector and the balance is by the Central government and state government owned agencies. During FY21, the tendering activities increased both at the state and Central level on a Y-o-Y basis.

The state government agencies issued 11,757 tenders worth Rs 1,80,293 crore in the first two quarters of FY21, while 20,133 project-related tenders worth Rs2,61,892 crore were invited in the last two quarters of  FY21. On the other hand, the Central government agencies floated 4,523 project tenders worth Rs 1,84,525 crore in Q3-Q4/FY21 as compared to 3,685 project tenders with a contract value of Rs 1,63,097 crore issued during Q1-Q2/FY21.

Major Sectors

The Services & Utilities (Infrastructure) and Irrigation sectors remained frontrunners in tendering activities during the period.

The Infrastructure sector registered the highest growth on Q-o-Q basis. On an average, the sector grabbed over 70 percent in each quarter of FY21. The sector saw 11,554 project tenders worth Rs 1,95,931crore being floated in Q4/FY21 as against 10,735 tenders worth Rs 1,81,445 crore in the previous quarter. The first and second quarter witnessed Rs 1,27,033 crore and Rs 1,37,420 crore project- related tenders being issued. In all, the Infrastructure sector issued 36,216 tenders related to various works worth Rs 6,41,829 crore in FY21.

Among the major sectors, where tendering is done by the implementing authorities, Roadways, Other Community Services and Water Pipelines & Distribution remained  frontrunners.

Of the entire tendering activity in the Infrastructure sector, the Roadways accounted for almost half of the tender issuance during the financial year. In all, the Roadways sector grabbed the first spot with 12,120 tenders worth Rs 3,14,469.6 crore in FY21. On Q-o-Q basis, the sector issued 5,135 tenders worth Rs 1,07,063 crore in Q4/FY21, as against 3,139 tenders worth Rs 98,135.9 crore in Q3/FY21 and 2,076 tenders worth Rs 49,902.5 crore in Q2/FY21.

Three nodal agencies — the National Highways Authority of India (NHAI), the National Highways & Infrastructure Development Corporation (NHIDCL), the Ministry of Road Transport & Highways (MoRTH), and the Uttar Pradesh Expressways Industrial Development Authority — were leading in tender floatation.

NHAI floated 77 tenders for various works worth Rs 40,670.77 crore during Q4/FY21, while 86 tenders worth Rs 55,898.11 crore were issued in Q3 and 57 tenders worth Rs 20,239.78 crore were issued in Q2/FY21.

NHAI issued 12 notable tenders for construction of four-lane greenfield Delhi-Amritsar-Katra Expressway from 0.00 km to 3497.70 km in Haryana and Punjab under Bharatmala Pariyojana valued at Rs 12,915.23 crore.

Apart from this, the Uttar Pradesh Expressways Industrial Development Authority issued four notable tenders for development of the Ganga Expressway, an access-controlled six-lane (expandable to eight-lane) greenfield expressway from Meerut to Prayagraj from 7.900 km to 601.847 km (Group-I to IV) in the state of Uttar Pradesh on DBFOT (Toll) basis worth Rs 22,125.01 crore.

Moreover, of the mega-value tenders issued during FY21, 62 tenders were published in the Roadways sector for an aggregate value of Rs 1,04,775.13 crore.

As many as 2,074 tenders with a total value of Rs 18,668 crore were issued in the Other Community Services in Q4/FY21, as against 2,604 tenders worth Rs 17,030.25 crore floated in Q3/FY21. Whereas Q1 and Q2 together saw issuance of Rs 21,992.55 crore project-related tenders.

On one hand the Central Public Works Department floated 385 tenders worth Rs 6,430.41 crore in the financial year, and on the other the  Public Works Department, Uttar Pradesh, issued 246 tenders with a value totalling Rs 26,38.21 crore.

The Central Public Works Department issued two tenders for construction of new Parliament Building and redevelopment of Central Vista Avenue in New Delhi with an aggregate value of Rs 1,352.10 crore.

Project tendering activities in the Water & Sewerage Pipeline & Distribution sector remained stable in all four quarters of FY21. The sector which issued 1,677 tenders worth Rs 22,726 crore in Q4/FY21 floated 1,883 tenders worth Rs 24,770.7 crore in Q3/FY21. During the preceding quarter (Q2/FY21), 1,212 tenders with an aggregate value of Rs 22,063 crore were published.

The Rural Water Supply & Sanitation Department, Odisha, invited 223 bids from various firms for work orders worth Rs 4,523.51 crore, while the Public Health Engineering Department, Manipur, floated 13 tenders for works Rs 1,895.09 crore in Q4/FY21.

The Healthcare sector saw issuance of 1,292 tenders with a total value of Rs 21,117.31 crore in FY21. The sector issued 308 tenders worth Rs 7,722.51 crore in Q4/FY21, while in the preceding quarter it had seen issuance of 299 tenders worth Rs 6,008.49 crore.

In this sector, Uttar Pradesh remained at the top spot in Q3 as well as Q4/FY21. The state witnessed 20 tenders for works related to medical infrastructure worth Rs 1,689.72 crore in Q3, while 18 tenders worth Rs 1,849.77 crore were issued in Q4/FY21.

The Public Works Department, Uttar Pradesh, issued seven tenders for establishment of new medical colleges attached with the existing district/referral hospitals at Kaushambi, Gonda, Pilibhit, Bijnor, Chandauli, Bulandshahar and Bareilly districts. The aggregate value of these tenders was Rs 1,717.70 crore.

The Irrigation sector, which accounted for 11.66 percent of the total tender value, saw floatation of 943 tenders worth Rs 27,556 crore in Q4/FY21. Even though the share of tenders in terms of value dipped in Q2/FY21 as compared to the preceding quarter, bounce-back signs were visible in the next two quarters. A total of 476 tenders worth Rs 13,285.69 crore were floated in Q2/FY21 against 324 tenders worth Rs 29,761 crore floated in Q1/FY2. In Q3/FY21 the tendering activity rebounded with 865 tenders worth Rs 22,461 crore.

Overall, 19 mega-value tenders with aggregate work orders worth Rs 56,228.53 crore were issued in this sector during FY21. During the year, two government agencies –the Irrigation & CAD Department, Telangana and the Irrigation & CAD Department, Andhra Pradesh – were at the forefront in issuing tenders.

While on one hand, the Irrigation & CAD Department, Telangana, issued 122 project-related tenders worth Rs 28,471.41 crore in FY21, on the other, the Irrigation & CAD Department, Andhra Pradesh, floated 113 tenders for Rs 25,815.76 crore works.

In Q4/FY21, the Narmada Valley Development Authority came ahead and issued two high-value tenders for works of Chinki Boras Barrage Combined Multipurpose Project and Sanwer Micro Lift Irrigation Scheme with an aggregate value of Rs 8,394.08 crore.

The tendering activity in the Mining sector remained high in the first two quarters of FY21 on the back of coal mining activity. In all, 155 tenders worth Rs 30,589 crore were issued in the sector during Q1-Q2/FY21. The Q3 saw 91 tenders worth Rs 4,283.57 crore and Q4 registered 59 mining-related tenders worth Rs 9,857.36 crore.

In May 2020, the Union government opened coal mining to private players. Under this scheme, 41 coal blocks were earmarked for auctioning. The move was part of the Centre’s Aatmanirbhar Bharat Abhiyaan. As many as 90 tenders with a value totalling Rs 30,373.87 crore were issued in the Coal & Lignite sector.

However, this trend declined in the third quarter. In all, 32 coal mining tenders with an aggregate value of Rs 3,859.62 crore were issued during Q3/FY21. The Q4/FY21 period witnessed 12 tenders with an aggregate value of Rs 9,765.25 crore.

The Electricity sector saw issuance of 221 tenders worth Rs 1,724.26 crore in Q4/FY21 as against 246 tenders worth Rs 2,305.84 crore in Q3/FY21. In Q1/FY21 171 tenders totalling Rs 1,325.9 crore were published while Q2/FY21 saw 263 tenders worth Rs 2,771.18 crore.

In terms of number, 372 tenders worth Rs 3,284.79 crore were issued under solar-based power sector in FY21. The state of Gujarat remained frontrunner in Q3 and Q4/FY21. The state witnessed nine solar power project tenders worth Rs 491.06 crore in Q4/FY21, while seven tenders worth Rs 572.98 crore were issued in Q3/FY21.

In the latest quarter, Coal India issued tender for acquisition of land, design, engineering and construction of solar photovoltaic grid-connected power plant of capacity 100 MW(AC) in Gujarat worth Rs 450 crore.

States

Maharashtra replaced Uttar Pradesh as the top state in terms of number of project tenders issued in Q4/FY21. The state issued 1,792 project tenders valued at Rs 21,879 crore. The second ranked Uttar Pradesh issued 1,648 project tenders worth Rs 40,578 crore. In the preceding quarter, Uttar Pradesh was the highest project tender issuer with 1,073 project tenders being issued in the state.

The top 10 states — Maharashtra, Uttar Pradesh, Karnataka, Odisha, Tamil Nadu, West Bengal, Madhya Pradesh, Assam, Gujarat, Rajasthan – together accounted for 71.57 percent of the total number of tenders issued during Q4/FY21. Of the 12,918 tenders published, 9,246 tenders were issued by these states. In terms of value, of the Rs 2,36,275 crore tenders, Rs 1,49,790 crore were published by these 10 states in Q4/FY21.

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