<p>To nail down contractors engaged in building highways, the Centre intends to make them liable for maintaining the roads for two years after completion of the projects.<br /><br /></p>.<p>In the draft EPC (engineering-procurement-construction) bidding document prepared by the Ministry of Road Transport and Highways, a “defect liability period” clause has been included to make contractors liable for delivery of quality work.<br /><br />While the defect liability period for roads is two years, it is five years for bridges and foot over-bridges. The maintenance will include rebuilding or repair if the project developed structural damage within this period, a senior official in the Ministry told Deccan Herald.<br /><br />Besides, the bidding document also stipulates that contractors must deposit a guarantee money equivalent to 12.5 per cent of the project cost with the government. <br /><br />If the contractor failed to complete the project according to schedule, penalty amount will be deducted from the guarantee money on a day to day basis.<br /><br />For the first two years, tolling work and maintenance of the highway would be the charge of the contractor. After that, the Ministry would float a new operation, maintenance, tolling contract to be given to a separate player, said the official.<br /><br />At present, highways built under EPC system are handed over to the government and subsequently the National Highways Authority of India.<br /><br />Under the new system, contractors will be paid a lump sum to prevent cost overrun. The draft will be sent for Cabinet nod.<br /><br />The road ministry and Planning Commission failed to see eye to eye on the defect liability period, with the former insisting on a five-year liability and the latter opposing it saying it would encourage contractors to inflate project cost.<br /><br />As the ministry plans to award around 9,000 km of highways in this fiscal, early finalisation of the EPC document was crucial for the Government to meet the deadline.<br /></p>
<p>To nail down contractors engaged in building highways, the Centre intends to make them liable for maintaining the roads for two years after completion of the projects.<br /><br /></p>.<p>In the draft EPC (engineering-procurement-construction) bidding document prepared by the Ministry of Road Transport and Highways, a “defect liability period” clause has been included to make contractors liable for delivery of quality work.<br /><br />While the defect liability period for roads is two years, it is five years for bridges and foot over-bridges. The maintenance will include rebuilding or repair if the project developed structural damage within this period, a senior official in the Ministry told Deccan Herald.<br /><br />Besides, the bidding document also stipulates that contractors must deposit a guarantee money equivalent to 12.5 per cent of the project cost with the government. <br /><br />If the contractor failed to complete the project according to schedule, penalty amount will be deducted from the guarantee money on a day to day basis.<br /><br />For the first two years, tolling work and maintenance of the highway would be the charge of the contractor. After that, the Ministry would float a new operation, maintenance, tolling contract to be given to a separate player, said the official.<br /><br />At present, highways built under EPC system are handed over to the government and subsequently the National Highways Authority of India.<br /><br />Under the new system, contractors will be paid a lump sum to prevent cost overrun. The draft will be sent for Cabinet nod.<br /><br />The road ministry and Planning Commission failed to see eye to eye on the defect liability period, with the former insisting on a five-year liability and the latter opposing it saying it would encourage contractors to inflate project cost.<br /><br />As the ministry plans to award around 9,000 km of highways in this fiscal, early finalisation of the EPC document was crucial for the Government to meet the deadline.<br /></p>
