National Highways Logistics Management looks for fresh bids to build a multi-modal logistics park at Bengaluru

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The National Highways Logistics Management Ltd (NHLM), a unit of the National Highways Authority of India (NHAI), is once again looking to build a multi-modal logistics park at Bengaluru with private funds after an earlier attempt collapsed due to the presence of a single bidder.

Planned to be developed on 400 acres at Muddalinganahalli in Bengaluru Rural district, the multi-modal logistics parks grasped interest from Reliance Industries Ltd and Prakash Asphaltings and Toll Highways (India). Prakash Asphaltings and Toll Highways were disqualified from the tender.

The National Highways Logistics Management on 15 December, issued a notice canceling the bid process without assigning reasons.

On the same day, a fresh tender for the multimodal logistics park at Muddalinganahalli was issued.

Explaining why the tender was annulled, Prakash Gaur, Chief Executive Officer, of National Highways Logistics Management Ltd said, We received two bids for the project and one of them could not qualify, resulting in a single bid situation. There was a lot of interest in the market for the project and 4-5 bidders were asking for a time extension. Unfortunately, we could not extend the timeline and many of them could not participate at that time. I am sure all of them will participate this time,” he added.

Public authorities typically refrain from processing a single bid per guidelines issued by the Central Vigilance Commission (CVC). In case, the second round of tendering also fetched a single bid, the authority floating the tender was allowed to take a call on the bid.

However, in October 2021, the Union government scrapped the “practice” followed by public authorities to reject a single bid during open tenders, stating that it should be considered valid subject to some conditions.

“It has become a practice among some procuring entities to routinely assume that open tenders which result in single bids are not acceptable and to go for re-tender as a ‘safe’ course of action. This is not correct,” said the ‘General Instructions on Procurement and Project Management’ issued by the government on October 29, 2021, which applies to Central Government Ministries/Departments, Attached/Subordinate bodies including Autonomous Bodies or Central Public Sector Enterprises (CPSE).

“Lack of competition shall not be determined solely based on the number of bidders. Even when only one bid is submitted, the process should be considered valid provided the procurement was satisfactorily advertised and sufficient time was given for submission of bids, the qualification criteria were not unduly restrictive and prices are reasonable in comparison to market values,” the government said in the new ‘General Instructions on Procurement and Project Management’.

The Development, Operation, and Maintenance of the Multimodal Logistics Park at Muddalinganahalli is being implemented through Public Private Partnership (PPP) on Design, Build, Finance, Operate and Transfer (DBFOT) basis with an investment of some Rs935.90 crores.

The bid will be decided based on the minimum guaranteed revenue share – the entity offering the highest revenue share to the National Highways Logistics Management – gets the contract to develop and run the facility for a concession period of 45 years.

Under the ‘PM GatiShakti National Master Plan (NMP)’, the Ministry of Road Transport and Highways plans to develop 35 multi-modal logistics parks across India, 15 of them in the next three years.

The first such logistics park at Mappedu near Chennai in Tamil Nadu’s Thiruvallur district was awarded to Reliance Industries Ltd through a competitive bid in November.

A multi-modal logistics park is a cargo consolidation and distribution center using multiple modes of transport to achieve scale in shipments and provides various logistics and other value-added services.

It acts as an intermodal freight-handling facility with mechanized material handling provisions that contain warehouses, specialized cold chain facilities, freight/container terminals, and bulk/break-bulk cargo terminals.

Typically, MMLPs include inter-modal connectivity such as dedicated railway line/spur, access from prominent highways/expressways to allow movement of commercial vehicles, and connectivity to an airport or a seaport, or an inland waterway terminal.

The value-added services provided by an MMLP include customs clearance and late-stage processing activities such as sorting/grading, aggregation/ disaggregation, cold storage, etc. to provide flexibility to the users at a single location.