Business Standard

Punjab small cycle producers miffed by strict tender rules

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Komal Amit Gera New Delhi/ Chandigarh
Punjab-based small and medium manufacturers of bicycles are set to take on large players to bag the tender floated by the Karnataka government for the supply of 470,000 bicycles for school students.
 
The Indian Bicycle Manufacturers Association (IBMA), the Ludhiana-based apex body of bicycle manufacturers, is contemplating moving court to seek a level playing field.
 
"Stringent terms, like only a company with a turnover of Rs 100 crore or more can qualify to participate and that the manufacturers should have earlier supplied 300 per cent of the proposed quantity to establish satisfactory past performance are in violation of the Central Vigilance Commission (CVC) guidelines, which state that the 30 per cent of turnover of the estimated contract cost and 40 per cent past supplies are sufficient for calling tenders. Even the world bank norms do not require turn over more than 30 per cent of the approximate purchase value:" said the secretary of the association, RD Sharma.
 
About 35 companies in Punjab were exporting bicycles across globe but had a turnover of less than Rs 100 crore.
 
According to of IBMA Vice-President KK Seth, "Also the Karnataka standard tender documents for procurement of goods and equipment, under the Karnataka Transparency Act, have also been grossly violated."
 
Seth said the supplies of small players were more cost effective as they were offering one bicycle for Rs 1,900 as compared to the same sold by the large houses at Rs 2,150. He explained that their product samples were passed in the laboratory and were as good as those of the large manufacturers.
 
On the other hand the president of Atlas Cycles, Vikram Kapoor told Business Standard that public money should be spent with utmost care and this might be the reason to restrict the small players.
 
He said that small manufacturers did not have the adequate dealer network and could not provide after-sales services. He said large players had better R&D facilities and can deliver better quality products.
 
Reacting to this another spokesperson of IBMA said they were registered with National Small Industries Corporation and were also ISO 9001 and therefore adhere to all quality norms.
 
The association moved the court in Jharkhand two weeks back as they alleged the same kind of discrimination there. The Jharkhand government floated a tender 80,000 bicycles for which again these players did not qualify. About two years back we secured our pie in the business in Chhattisgarh by taking recourse to legal action, Seth added.

 
 

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First Published: Jul 18 2007 | 12:00 AM IST

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