Govt. tenders to include ‘life-cycle cost’ soon; financial rules to be amended

The decision is expected to be taken by the Centre soon.
There had been no life-cycle analysis earlier in the tendering process, but now the government is mulling a change in the rules for better costing of the projects.
Aruna Sharma, Secretary of State, Ministry of Steel, said the life-cycle cost would be included after an amendment in the General Financial Rules.

She said the life-cycle cost would have to be considered and it would be included in the government tenders for government projects. She said the decisions regarding the tenders would be taken after the life-cycle cost analysis.

She said there were several projects in which the initial cost might be slightly higher, but in the long run, the overall cost for the project would come down — depending on the factors such as material, quality, repairs needed, the time for setting up the projects, etc.

She said steel might turn out to be more viable in the long run for the infrastructure projects such as bridges, housing projects, doors, etc. Even the time span for construction and installation would be much lesser, she added.

A government official said, “A bridge, for instance, may have an average life of around 30 to 40 years, but a steel bridge —with higher investment requirement in the beginning — can last more than 100 years. Its repair requirements will be lesser and cheaper.”

Upkar Singh, General Secretary, Chamber of Industrial and Commercial Undertakings, said it was a good step as it would save resources in the long run, and would lead to sustainable projects. “It is a good sign for the steel industry. Steel is likely to get preference as it can help in building more durable infrastructure than other materials,” he said.

Source – Tribune News Service