Coal India bets big on electronic procurement to boost efficiency
May, 28th 2008
Public sector Coal India (CIL) plans to procure about one-third of its equipment, consumables, spare parts and other stores, electronically to cut delays and boost efficiencies.
Coal India aims to purchase Rs 3,400 crore worth of equipment and consumables in FY09 through this platform, helping to integrate buyers and suppliers.
This is the first time that the public sector behemoth is offering 4-models of e-procurement and even its 8 subsidiaries might opt for this electronic platform, which till now was restricted to the holding company alone.
Another public sector company, MSTC, has been selected as the service provider. The whole process has been undertaken as per the Information Technology Act of 2000 and the bidders have been asked to conform to the guidelines. MSTC was instrumental in procuring Rs 1,000 crore of explosives for CIL through reverse e-auction in FY08.
CIL has also engaged certification agency CERT-IN so that the bidders are satisfied on security requirements while entering the e-procurement system. The whole exercise has been carried out for developing a secure and encrypted platform both for the bidders and also for Coal India.
CIL has already signed an integrity pact with Transparency International and is therefore committed to provide proper and secured services to its customers.
The certifying agency will look into the security aspects of the system as well as audit of the entire process. The 4-models offered under e-procurement are e-tendering, e-tendering with multiple bids, reverse e-auction with price bid and reverse e-auction with quantity and price bidding.
Under e-tendering, the physical system will be converted into an electronic tender, whereby buyers will be able to decide the eligibility of the vendor.
Eligible vendors can quote from any place on the internet and the buyer will have the option of obtaining the techno-commercial bid manually or over the internet.
In such a format, price bids can only be seen at the appointed hour.
E-tendering with multiple bids is almost similar to e-tendering. Here the vendors will have the option of revising their price bids any number of times before the closing time of the bids.
Reverse e-auction with price bid is a system adopted for the first time by CIL and its service provider. This is basically a reverse of forward e-auction. Here buyers can decide the eligibility criteria of the vendors.