Procurement Management Practices in Hydropower sector of Nepal. This includes donor's requirement, bank's requirement , Procurement guidelines of Nepal etc.

1. -Er. Abhushan Neupane (NEC: 3173-Civil “A”)
Date: 18th June,2018 (Monday)
Venue: EIM Maven, Kathmandu

2. 1. Procurement Planning
2. Procurement Terminologies
3. Procurement Standards and Guidelines
4.Procurement Process
5. Bid Evaluation Process
6. Contract Documentation

3. “Failing to plan
is Planning to fail”
- Peter Drucker, Famous Management Guru, USA
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4. There are 4 main principles:
1. Economy: Value for money - Finance Ministry’s
concern
2. Efficiency: quick procurement - Project’s
concern, but against the Fairness
3. Fairness: No discrimination – Bidders’ concern
4. Transparency: Bidders’ concern, Auditor’s
concern
All of these 4 parameters should be met 100%, but in
practice it is not possible.
Attempt should be to be in the nearest of this, while
meeting the project’s objectives.
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5. For large or multi-year projects, both of master &
annual proc. plans are prepared. Annual proc.
plans are prepared as per annual program &
budget, but within the framework of master proc.
Plan.
Slicing & Packaging arrangement
◦ Slicing: Large project is sliced into smaller ones.
Benefits are (1) high competition as small contractors
can participate, (2) chances for small local contractors
to grow, (3) short project duration. Examples – long
road projects, multi-dimensional projects like
Melamchi.
◦ Packaging: Small jobs can be joined in appropriate
package to attract big contractors to achieve economy.
Slicing & Packaging principle seems contradictory, but
it is not so. Why? Take case by case decision.
Note: Market study or knowledge of market is the key
to successful procurement.
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6. Applicable Proc. GLs is stated in the Loan
Agreements. For purely GoN funded projects,
applicable Proc. GLs is of the GoN. 4 main
Proc. GLs are in practice in Nepal:
1. GoN – Public procurement Act, 2063; Public
procurement Regulations, 2064 & SBDs issued
by the PPMO.
2. World Bank (WB) – Procurement Guidelines &
Consultant Guidelines.
3. Asian Development Bank (ADB) – Same
4. JICA: Very different than ADB/WB - rebidding
time = only 15 minutes, 80% evaluation done
during bid opening, total bid price counts not
item rates, item rates are negotiated.
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7. 7

8.  Acceptance
 Compensation
events
 Commencement
date
 Contract Data
 Contractor
 Bid Bond
 Performance
Bond
 Contractor’s Bid
 Contract Price
 Defect
Notification
Period
 Employer
 Initial Contract
Price
 Intended
Completion date

9.  Site
 Site Investigation
report
 Subcontractor
 Possession date
 Insurance
 Variation Orders
 Payment Certificates
 Taking over
certificates
 Claims
 Liquidated
Damage
 Advance
Payment
 Retention Money
 Tax Deduction
at Source (TDS)
 Price adjustment
 Day works
Schedule

10. Procurement Package Selection

11. Procurement Package Selection
Procurement Package Selection
(Norwegian Practice)

12. 12
Procurement Standards
and Guidelines

13. Introduction to FIDIC RAINBOW SUITES
1. General Conditions
2. Particular Conditions
3. Guide for Procurement/ Claims handling
4. Appendix to Tender
•ADB Procurement Guidelines
•WB Procurement Guidelines
• JICA Procurement Guidelines

14. Introduction to Public Procurement in Nepal
• Nepal Procurement Act 2063
• Nepal Procurement Rules 2064
• Standard Bid Documents (Refer to www.ppmo.gov.np)

15. Procurement Process

16. Procurement Cycle

17. Procurement Type Selection

18. Procurement Flowchart

19. Bid Evaluation Process
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20.  Prequalification
 Multiple stage evaluation
◦ Expression of Interest (EoI)
◦ Request for Qualification (RfQ)
◦ Request for Proposal (RfP)
 Single Stage evaluation
◦ Single stage – Double Envelope ( Technical
+Financial)
◦ Single stage- Single Envelope

21. Contract Packaging

22.  Contract Agreement
 Letter of Acceptance
 Letter of Bid
 Addenda/MOUs
 SCC/GCC
 Technical Specification
 Drawings
 Bill of Quantities
 Other documents
 Schedules (if any)