Project Management Units: A Parallel Delivery System

A parallel delivery system is gaining momentum in India which is an inadequately documented and largely ignored. With considerable encouragement from the policymakers, the Project Management Units (PMUs) have crept into each ministry and departments in India. It is evident that their nature is varied and layered. It’s interesting to see how such entities are thriving and why the governments increasingly rely upon a parallel delivery system?

The governments set up the PMUs within their organisational structure. Several union ministries and bodies are front-runners to engage the PMUs. One of them is the NSDC. They frequently release the Request for Proposals (RFPs) for professional services through the PMUs. Under the typical RFPs, they spell out and outline a set of provisions regarding the project. It starts with a note from the head of organisation which is followed by Disclaimer. In the RFP, the Disclaimer part is very interesting which sheds light on the organisation’s approach. A typical RFP states, the RFP is not an agreement and is neither an offer or invitation by the organisation to the prospective bidders or any other person. It mentions that the purpose of this RFP is to provide interested parties with information that may be useful to them in making Bids pursuant to this RFP.
The RFP adds that the information given is not intended to be an exhaustive account of the statutory requirements and should not be regarded as a complete and authoritative statement of law. The organisation accepts no responsibility for the accuracy or otherwise of any interpretation or opinion on law expressed herein.

The RFP articulates on the financial aspects. It clearly mentions that the bidders shall bear all costs associated or with or relating to the preparation and submission of the Bids. All cost and expenses will remain with the bidders.  The orgainsation reserves the right to reject all or any of the bidders or bids without assigning any reason whatsoever.

After this section, the RFP talks about the background of the Project and Scope of the Project. It briefly discusses the payment (Payment to the Project Management Unit) on a monthly or quarterly basis for retianership cost of resources deployed.

Instruction to bidders, evaluation process and other conditions follows it.  Under this section, the RFP briefs about the format for submission of proposals, important dates for the submission of the proposal and a schedule for the bidding process.
Then the RFP lists a set of reasons which will be responsible for termination of bids such as corrupt or fraudulent practices of bidders and late submission of a proposal by the bidder.
After this section, the RFP enters in a very important section – Evaluation of Proposal. As parent organisation evaluates the proposal, the RFP lists a set of criteria and requirement of documents:

• A registered company with a certificate of incorporation
• A fair and impressive track record. It must not be blacklisted by any government entities
• Sound financial performance along with documentary evidence like a copy of balance sheet, annual report
• Expertise and experience in managing the government projects a copy of contract or work order must attach
• Staffs and employees to handle the projects(Proof from HR Head and Company Secretary)
• Office near the headquarters of the parent organisation for close coordination

After this section, the RFP talks about the technical evaluation criteria like relevant past experiences, understanding the project, project management/execution unit, format for technical proposal etc.

In order to understand this new trend, there is a need to explore the government documents, the RFPs, the Expression of Interests, the official communiqué and press releases. A press release from the Ministry of Railways stated that16 Firms Participated in Project Management Consultancy Services Contract for 2^nd Phase of Eastern Dedicated Freight Corridor in 2013.  According to the press release, “The Project Management Consultant will assist DFCCIL for review of preliminary, definitive design, Contract Management, Construction Supervision, review of contractors’ documents, review of Quality Assurance Plan, Contractor Safety Plan, Environmental Management Plan, RAM Plan and assist in coordination with different agencies, management of interface, coordination with utility authorities etc with Services respect to Civil, Structures, Track Works for Bhaupur–Khurja Section of Eastern Dedicated Freight Corridor.”

The above-mentioned piece of information indicates that how the private players as the project management consultants are engaging in the infrastructure projects. These freight corridors were funded by the World Bank and Japan International Cooperation Agency (JICA). According to the government sources, the Dedicated Freight Corridor Corporation of India (DFCCIL) is a Special Purpose Vehicle set up under the administrative control of Ministry of Railways to undertake planning & development, mobilization of financial resources and construction, maintenance and operation of the Dedicated Freight Corridors. DFCCIL was incorporated in October 2006 under Indian Companies Act 1956.

How multiple players are involved in an infrastructure project in India