Delhi Enforces Stricter Bidding Rules To Improve Road Quality And Speed
In a bid to rein in project delays and ensure durable road infrastructure, Delhi has introduced tighter bidding norms for highway development under hybrid annuity and EPC models. The move raises financial eligibility thresholds and aims to reduce contractor defaults that have long plagued India’s road sector. With over Rs 3.5 lakh crore in upcoming allocations for 2025–26, the new rules are set to prioritise quality, timely execution, and large-scale participation from financially sound infrastructure players.
Delhi has moved to tighten the financial and technical eligibility norms for contractors bidding on highway infrastructure projects, following persistent delays and quality concerns in ongoing developments. The Ministry of Road Transport and Highways has rolled out revised guidelines under both the Hybrid Annuity Model (HAM) and the Engineering, Procurement and Construction (EPC) model to stem bottlenecks and bring in more competent players. As part of the new norms, financial thresholds have been revised significantly. For HAM projects, the required financial capacity has been raised to 20% of the project’s estimated cost, up from the previous 15%. Additionally, consortium members must now maintain a net worth of at least 10%, compared to the earlier 7.5%.
The EPC model has also been restructured, with minimum net worth criteria doubling to 10% and turnover thresholds elevated to 20%. These adjustments come in the wake of concerning data that shows nearly half of ongoing highway projects are behind schedule. According to industry analysts, around 44% of India’s highway projects were delayed as of March 2024. The relaxed thresholds introduced in earlier years, meant to encourage smaller contractors, inadvertently resulted in underqualified firms winning contracts they struggled to execute. Officials say the revised bidding framework will improve both accountability and efficiency. By encouraging participation from financially robust firms with deeper sectoral experience, the ministry hopes to reduce overruns in cost and time while upholding construction standards.
In the revised framework, projects like metro rails, ports, and railways are now excluded from the definition of highway works, and instead categorised under broader core sector development. As the government prepares to allocate 124 road projects worth Rs 3.5 lakh crore for the upcoming fiscal year, these reforms are positioned as a turning point in the nation’s highway planning strategy. The success of these measures will be closely monitored by both industry stakeholders and the public, as India continues its push towards sustainable, reliable, and world-class infrastructure.
