1. Procurement Manual – An Overview National Hydrology Project
, New Delhi
Procurement Manual – An Overview National Hydrology Project
Ministry of Water Resources, River Development and Ganga Rejuvenation

2. 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, 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.

3. Procurement Cycle

4. 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.

5. Procurement Methods (Goods/Works/NCS)
International Competitive Bidding (ICB)
Limited International Bidding (LIB)
National Competitive Bidding (NCB)
Shopping
Direct Contracting
Framework Agreement
Force Account

6. Thresholds for Goods, Information technology and non-consultancy services
International Competitive Bidding (ICB)
> US Dollars 3 million(INR 195 million)
Limited Competitive Bidding (LIB)
Must meet the requirements as per Para 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
Up to USD 100,000 (INR 6.5 million)
Direct Contracting
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

7. 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

8. Procurement Guidelines Para 3.7 Direct Contracting (Single Source)
Appropriate method under the following circumstances.
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.
Standardization of equipment or spare parts, to be compatible with existing equipment, may justify additional purchases from the original Supplier.
the required equipment is proprietary and obtainable only from one source;
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;
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

9. 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.

10. Thresholds for Works Method of Procurement Thresholds for Methods
International Competitive Bidding (ICB)
> US Dollars 40 million (INR 2,600 million)
National Competitive Bidding (NCB)
> USD 100,000 and up to USD 40 million
(INR 6.5 million – INR 2,600 million)
Shopping
Up to USD 100,000 (INR 6.5 million)
Force Account
Must meet the requirements as per Para 3.9 of the Procurement Guidelines, and with prior agreement in PP with the Bank

11. 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;

12. 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

13. Flow chart for procurement of Works and Goods

14. CONSULTANCY SERVICES

15. 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)

16. 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.

17. 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

18. Cost Estimate for consultancy

19. Flow chart for procurement of Consultancy

20. Negotiations with the highest ranked bidder

21. QBS system QBS is appropriate for the following types :
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.

22. 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,

23. 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.

24. 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.

25. CQS system EOI shall also contain TOR.
May be used for small assignments or emergency situations declared by the Borrower and recognized by the Bank
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.

26. 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

27. Consultant Selection Process under Various Methods- A Comparison
Aspect
QCBS
FBS
LCS
QBS
CQS
SSS
Prepare ToR √
Prepare Cost Estimate
Advertise for EOIs (2 weeks) X
Prepare Shortlist of top 6 firms
Best Firm Shortlisted
Prepare and Issue RFP to 6 firms ( 4 weeks)
Issued to 1 firm
Issued to SS
Technical evaluation and rejection below pass mark
Commercial Evaluation and combined scores
T1 if within budget
L1 of tech qualified selected
Cost & Units Negotiated for Award
Contract Negotiations (Tech & Tax)
Award of Contract

28. Engagement of Individual Consultants
To be adopted when:
a team of experts is not required,
no additional outside (home office) professional support is required,
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.

29. 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

30. 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

31. 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:
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

32. Thanks