NHAI takes steps to curb 'unathorised' subcontracting

NEW DELHI: In a move to ensure quality project execution and reduce delays, National Highways Authority of India ( NHAI ) has tightened norms to check "unathorised" subcontracting of works by main highway builders . It has said that any "unauthorised subcontracting and subcontracting beyond permissible limits will be classified as 'undesirable practice', thereby attracting penalties on par with fraudulent practices".

The changes in the bid document have been made months after the issue of subcontracting at multiple levels was raised at a meeting chaired by PM Narendra Modi. TOI on June 9 had reported about the PM's direction to the road transport and highways ministry to formulate "clear norms and standards" for subcontractors.

NHAI said instances had been observed where concessionaires or selected bidders had engaged contractors without the required prior approval of the authority or exceeded the permissible subcontracting limits. It added that such practices not only violated contractual norms but also posed risks to quality assurance , project timelines and regulatory oversight.

The parliamentary PAC in its recent report had raised concerns over the practice of subcontracting in highway projects while flagging that "unchecked layering" of contractors and subcontractors had led to diffusion of accountability.

NHAI said the provision of "similar work" criteria in bid qualification had been clarified considering how it had been often misrepresented by contractors seeking to become eligible for large-scale projects despite having experience only in minor or peripheral works.