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24.05.2017, New Delhi
Procurement Manual – An Overview
National Hydrology Project
Ministry of Water Resources, River Development and Ganga Rejuvenation
Procurement Manual - NHP
Procurement Manual is only a guideline document
Procurement under National Hydrology Project will be carried out in accordance
with the :
a)
the World Bank’s Procurement Guidelines: Procurement of Goods,
Works, and Non-Consulting Services under IBRD Loans and IDA
Credits and Grants by World Bank Borrowers (January 2011,
revised
July 2014);
b)
Consultant Guidelines: Selection and Employment of Consultants under
IBRD Loans and IDA Credits and Grants by World Bank Borrowers
(January 2011, revised July 2014); and
(c)
the provisions stipulated in the Legal Agreement. The project will be
subject to the World Bank’s Anticorruption Guidelines (October
15, 2006 and revised January 2011) and the agreed procedures
described in the Legal Agreements.
In event of any discrepancies between the Manual and the World Bank guidelines, the World Bank
Guidelines as stated above will supersede the Procurement Manual.
Procurement Cycle
Procurement Planning
•Ensure that specific budget provision is available to meet
expenditure in the financial year in which it is to be incurred.
•Assess bulk requirement of goods, works and services for
procurement at the beginning of the financial year and initiate
action for procurement in accordance with the procedure
applicable.
•Procurement is made to the best advantage of the annual
plan implementation after comparison of competitive prices.
Procurement Methods (Goods/Works/NCS)
International Competitive Bidding (ICB)
Limited International Bidding (LIB)
National Competitive Bidding (NCB)
Shopping
Direct Contracting
Framework Agreement
Force Account
Thresholds for Goods, Information technology and non-consultancy services
International
Bidding (ICB)
Competitive
> US Dollars 3 million(INR 195 million)
Limited Competitive Bidding
(LIB)
Must meet the requirements as per Para
3.2 of the Procurement Guidelines, and
with prior agreement in PP with the Bank
National Competitive Bidding
(NCB)
> USD 100,000 and up to USD 3 million
(INR 6.5 million – INR 195 million)
Shopping
Direct Contracting
Up to USD 100,000 (INR 6.5 million)
Must meet the requirements as per Para
3.7 of the Procurement Guidelines, and
with prior agreement in PP with the Bank
Framework Agreement
Must meet the requirements as per Para
3.6 of the Procurement Guidelines, and
with prior agreement in PP with the Bank
Procurement Guidelines (Para 3.2)
Limited International Bidding
Essentially ICB by direct invitation without open advertisement.
Appropriate method of procurement where:
(a) there is only a limited number of suppliers, or
(b) other exceptional reasons may justify departure from full ICB
procedures. Under LIB, Borrowers shall seek bids from a list of
potential suppliers broad enough to assure competitive prices, such list
to include all suppliers when there are only a limited number.
Domestic preferences are not applicable in the evaluation of bids
under LIB.
In all respects other than advertisement and preferences, ICB
procedures shall apply, including the publication of the award of
contract
Procurement Guidelines Para 3.7
Direct Contracting (Single Source)
Appropriate method under the following circumstances.
(a) An existing contract for goods, works, and non-consulting services, awarded
in accordance with procedures acceptable to the Bank, may be extended for
additional goods, works, and non-consulting services of a similar nature.
(b) Standardization of equipment or spare parts, to be compatible with existing
equipment, may justify additional purchases from the original Supplier.
(c) the required equipment is proprietary and obtainable only from one source;
(d) the procurement of certain goods from a particular supplier is essential to
achieve the required performance or functional guarantee of an equipment
or plant or facility;
(e) in exceptional cases, such as, but not limited to, in response to natural
disasters and emergency situations declared by the Borrower and recognized
by the Bank;
NOL from bank required , except for contracts below a threshold, however in
such case agreement of WB towards Procurement plan required
Procurement Guidelines Para 3.6
Framework Agreement
A Framework Agreement (FA) is a long-term agreement with suppliers, contractors
and providers of non-consulting services which sets out terms and conditions under
which specific procurements (call-offs) can be made throughout the term of the
agreement.
FAs may be permitted as an alternative to the Shopping and NCB methods for:
(a) goods that can be procured off-the-shelf, or are of common use with standard
specifications;
(b) non-consulting services that are of a simple and non-complex nature and may be
required from time to time by the same agency (or multiple agencies) of the
Borrower; or
(c) small value contracts for works under emergency operations.
NOL form WB required.
•
FAs shall not restrict foreign competition, and
•
should be limited to a maximum duration of 3 (three) years. FA procedures
applicable to the project are those of the Borrowers that have been deemed
acceptable by the Bank, and shall be described in the Loan Agreement.
•
Maximum aggregate amounts cannot exceed NCB maximum aggregate amounts.
Thresholds for Works
Method of Procurement
Thresholds for Methods
International Competitive Bidding
(ICB)
> US Dollars 40 million (INR 2,600
million)
National
(NCB)
> USD 100,000 and up to USD 40
million
Competitive
Bidding
(INR 6.5 million – INR 2,600 million)
Shopping
Force Account
Up to USD 100,000 (INR 6.5 million)
Must meet the requirements as per
Para 3.9 of the Procurement Guidelines,
and with prior agreement in PP with
the Bank
Procurement Guidelines Para 3.9
Force Account
Force Account, which are works such as construction and installation of
equipment and non-consulting services carried out by a government
department of the Borrower’s country using its own personnel and
equipment.
Force Account shall be justified and may only be used, after Bank no
objection, under any of the following circumstances:
(a) quantities of construction and installation works that are involved cannot
be defined in advance;
(b) construction and installation works are small and scattered or in remote
locations for which qualified construction firms are unlikely to bid at
reasonable prices;
(c) construction and installation works are required to be carried out without
disrupting ongoing operations;
(d) risks of unavoidable work interruption are better borne by the Borrower
than by a contractor;
Important aspects for consideration in Procurement of Goods
Bidding documents issued by the Bank
Specifications:
Warranty
Qualification Criteria
Training
On-site Service
Consumer Certificates
Bid Evaluation Committees
Applicability of Indian Laws
 Payment Schedule
Flow chart for procurement of Works and Goods
CONSULTANCY SERVICES
Methods for procurement of consultancy
QCBS (Quality cum cost based Selection)
QBS ( Quality based selection)
FBS (Fixed budget selection)
LCS (Least cost selection)
CQS (Consultant’s Qualification Selection)
SS (Single source)
IC (Individual consultant)
Quality and Cost based Selection (QCBS)
A competitive process among shortlisted firms that takes into account the
quality of the proposals and the cost of the services in the selection of the
successful firm.
In general relative weight to be given to the quality is 80%
The selection process shall include the following steps:
• preparation of Terms of Reference (TOR);
• preparation of cost estimate and the budget;
• advertising;
• preparation of the short list of consultants (through EoI);
• preparation and issuance of the Request for Proposals (RFP)
• evaluation of technical proposals:
• public opening of financial proposals;
• evaluation of financial proposal;
• final evaluation of quality and cost; and
• negotiations, and award of the contract to the selected firm.
Preparation of TOR
The ToR shall include:
• A precise statement of objectives
• An outline of the tasks to be carried out
• A schedule for completion of tasks
• The support/inputs provided by the client
• The final outputs that will be required from the Consultant
• Composition of Review Committee (not more than three members) to
monitor the Consultant’s works
• Review of the Progress Reports required from Consultant
• Review of the final draft report
• List of key positions whose CV and experience would be evaluated
Cost Estimate for consultancy
Flow chart for procurement of Consultancy
Negotiations with the highest ranked bidder
QBS system
QBS is appropriate for the following types :
(a) complex or highly specialized assignments for which it is difficult
to define precise TOR and the required input from the
consultants
(b)assignments that have a high downstream impact and in which
the objective is to have the best experts
(c) assignments that can be carried out in substantially different
ways, such that proposals will not be comparable
In QBS, the RFP may request submission of a technical proposal
only, or request submission of both technical and financial
proposals at the same time, but in separate envelopes.
QBS system –contd..
The RFP shall provide either the estimated budget or the estimated
time of key experts, specifying that this information is given as an
indication only and that consultants shall be free to propose their
own estimates.
The Borrower shall ask the consultant with the highest ranked
technical proposal to submit a detailed financial proposal. The
Borrower and the consultant shall then negotiate the financial
proposal and the contract.
All other aspects of the selection process shall be identical to those
of QCBS,
FBS system
• Appropriate only when the assignment is simple and can be
precisely defined and when the budget is fixed.
• RFP shall indicate the available budget.
• The evaluation of all technical proposals shall be carried out first
as in the QCBS method.
•
Financial proposals shall be opened and Proposals that exceed
the indicated budget shall be rejected.
•
The consultant who has submitted the highest ranked technical
proposal among the rest shall be selected and invited to
negotiate a contract.
LCS system
• Appropriate for selecting consultants for assignments of a standard
or routine nature.
• A “minimum” qualifying mark for the “quality” is established. The
minimum qualifying mark shall be stated in the RFP
• Proposals, to be submitted in two envelopes, are invited from a
short list.
• Technical proposals are opened first. Those securing less than the
minimum qualifying mark are rejected, and the financial proposals
of the rest shall be opened.
•
The firm with the lowest price shall then be selected.
CQS system
•
May be used for small
•
EOI shall also contain TOR.
•
Firms having the required experience and competence relevant to
the assignment shall be assessed and compared, and the best
qualified and experienced firm shall be selected.
•
Only the selected firm shall be asked to submit a combined
technical and financial proposal and, if such proposal is responsive
and acceptable, be invited to negotiate a contract.
assignments or emergency situations
declared by the Borrower and recognized by the Bank
SSS system
May be appropriate in the following cases:
• for tasks that represent a natural continuation of previous work
carried out by the firm
• In exceptional cases, such as, but not limited to, in response to
natural disasters and for emergency situations
• for very small assignments
• when only one firm is qualified or has experience of exceptional
worth for the assignment.
NoL of WB required
Consultant Selection Process under Various Methods- A Comparison
Aspect
Prepare ToR
QCBS
FBS
LCS
QBS
CQS
SSS
√
√
√
√
√
√
Prepare Cost Estimate
√
√
√
√
√
√
Advertise for EOIs (2
weeks)
Prepare Shortlist of top
6 firms
Prepare and Issue RFP
to 6 firms ( 4 weeks)
Technical
evaluation
and rejection below
pass mark
Commercial Evaluation
and combined scores
√
√
√
√
√
X
√
√
√
√
√
√
√
√
√
√
√
√
Best Firm
X
Shortlisted
Issued to 1
Issued to
firm
SS
X
X
X
X
Cost
&
Units
Negotiated for Award
Contract Negotiations
(Tech & Tax)
Award of Contract
X
T1 if within L1 of tech
qualified
budget
selected
X
X
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
√
X
Engagement of Individual Consultants
To be adopted when:
(a) a team of experts is not required,
(b)no additional outside (home office) professional support is
required,
(c) the experience and qualifications of the individual are the
paramount requirement.
Other considerations:
EoI May not be required for small value consultancy (Below
USD 50000)
All invitations for EoIs should specify selection criteria that
are solely based on experience and qualifications.
Engagement of Individual Consultants
contd…
•
Individual consultants are selected on the basis of their relevant
experience, qualifications, and capability to carry out the assignment.
•
The selection shall be carried out through the comparison of the relevant
overall capacity of at least three qualified candidates.
•
The Borrower shall negotiate a contract with the selected individual
consultant, or the firm as the case may be, after reaching agreement on
satisfactory terms and conditions of the contract, including reasonable
fees and other expenses.
The selection of individual consultants is normally not subject to prior
review.
However, NOL reqd in following conditions
(a) In the absence of at least three qualified candidates
(b) it intends to invite firms to offer the services of individual consultants
(c)in case negotiations with the selected individual fail before proceeding to
negotiate with the next best individual,
(d) in case of single-source selection
Engagement of Individual Consultants
contd…
Individual consultants may be selected on a single-source basis
in following cases:
(a) tasks that are a continuation of previous work that the
consultant has carried out and for which the consultant was
selected competitively;
(b) assignments with a total expected duration of less than 6
(six) months;
c) urgent situations;
(d) when the individual is the only consultant qualified for the
assignment.
NOL from World Bank required
Prior Reviews
Works:
First procurement under the project irrespective of value and
all procurements estimated to cost more than USD 10 million (INR 650
million)
Goods:
First procurement under the project irrespective of value and
all procurements estimated to cost more than USD 2 million (INR 130
million)
Consulting Firm:
First procurement under the project irrespective of value and all
procurements estimated to cost more than USD 1 million (INR 65
million)
Individual Consultant: all procurements estimated to cost more than
USD 300,000(INR 19.5 million)
All hydro-met bids
Terms of Reference (ToR) for all consultant contracts shall be furnished to the Bank for its
prior review and No Objection
All Single source procurements even below threshold must have agreement of WB at
Procurement Plan stage
Thanks