NHAI tightens RFP norms to boost quality, accountability in highway projects

In a bid to improve execution quality, reduce delays, and cut lifecycle costs of national highway projects, the National Highways Authority of India (NHAI) has tightened provisions in its Request for Proposal (RFP) documents. The new clarifications aim to strengthen contractor qualification norms, enforce compliance during project execution, and enhance financial transparency.

One of the key changes involves a sharper definition of the “Similar Work” criteria used in bid qualification. NHAI noted that contractors often misrepresented minor or peripheral works to gain eligibility for large-scale highway projects. Going forward, only completed highway projects that include all major components comparable to those required under the bid will be considered as “Similar Work.” This move is expected to ensure that only technically competent and experienced contractors qualify for execution.

The Authority has also cracked down on the unauthorized engagement of EPC contractors in Hybrid Annuity Model (HAM) and Build-Operate-Transfer (BOT-Toll) projects, as well as subcontracting in EPC projects. Any subcontracting beyond permissible limits or without prior approval of the Authority will now be classified as an “Undesirable Practice” — attracting penalties at par with fraudulent practices. According to officials, this measure will reinforce discipline in contract execution, mitigate risks to project timelines, and strengthen regulatory oversight.

Another significant clarification prohibits the use of third-party sourced “Bid and Performance Securities.” NHAI observed that some bidders had submitted guarantees issued by external entities, raising concerns over accountability and enforceability. Under the revised provisions, only securities backed by the bidder or its approved entities will be accepted, thereby improving financial transparency and ensuring contractual obligations are met.