The Telegraph
Since 1st March, 1999
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Contract lost, Reliance cries foul

Mumbai, Jan. 31: The knives are out: bidders who lost out to GMR-Fraport and GVK-South Africa Airport in the race for the Delhi and Mumbai airport modernisation contracts have accused the civil aviation ministry of changing the bid terms at the last minute in a display of favouritism.

In a statement issued soon after the bidding process ended, the Anil Ambani-owned Reliance Airport Developers expressed outrage at the “substantial changes to the published tender conditions” that were communicated over the phone barely two hours before the bids were due to be opened.

Reliance saw in this a conspiracy to slam the door on its face, though the consortium formed by Reliance Airport Developers and Mexican airport operator ASA had emerged the highest bidder for the Delhi airport. Reliance had promised to share 45.99 per cent of the revenue from the airport with the government against GMR’s offer of 43.64 per cent.

“These changes also reverse the fundamental philosophy of the tender to favour select bidders and to deny Reliance either of the airports,” the statement said.

Reliance is already mounting pressure on the government to nix the award of the contracts to GMR and GVK. Sources said the company has written a strongly worded letter to Prime Minister Manmohan Singh protesting against the way the bidding terms were changed at the last minute.

It is hoping that the objections will weigh on the mind of the cabinet when it meets tomorrow to discuss the award of the contracts. If that fails, sources said, the company will approach Delhi High Court in a day or two and file a petition challenging the award.

“There was no provision in the RFP (request for proposal) or tender conditions to give any bidder an option to match the highest bid, that too selectively for only one airport,” Reliance said, slamming the decision to give GMR the right to match its financial offer.

The losing bidders said just before the bids were opened, GMR ' the only one that had qualified as a technical bidder with 80 per cent marks in the technical evaluation ' had demanded that it be placed in a separate class with special rights, industry sources said.

GMR had insisted on three special rights before the bids were opened at 3:30 pm. First, it wanted to be allowed to select any airport of its choice even if it was not the highest bidder. Second, it wanted to be allowed to select another airport even if it was the highest bidder in one airport. Third, it wanted to be awarded any airport of its choice by matching the highest financial bid.

It was the third condition that saw GMR through after being outbid by the Reliance-led consortium, which, however, did not qualify as a technical bidder.

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