GCC Cancels Rs 284 Crore Footpath Tenders Over Inflated Costs and Collusion

The Greater Chennai Corporation (GCC) on Wednesday cancelled tenders worth ₹284 crore for footpath construction across key Chennai localities, including Mylapore, Adyar, Besant Nagar, and Kilpauk, after uncovering irregularities and inflated project costs. No work orders had been issued, preventing a significant loss to the public exchequer.

The funding for the massive project was initially announced in the civic budget by Mayor R Priya on February 19, with the special projects department floating the tenders on February 20. The project was split into 35 packages to lay footpaths on major stretches, including Dr P S Siasamy Salai in Mylapore, Shastri Nagar in Adyar, Fourth Avenue in Besant Nagar, Barnaby Road in Kilpauk, and Raja Muthiah Salai near the Jawaharlal Nehru Stadium.

Each of the 35 packages carried a tender value of ₹8 crore to ₹9 crore, covering footpaths across two to three roads. However, GCC officials revealed that the budgeting was grossly inflated. Typical masonry and concrete flattening for similar stretches usually costs between ₹1.5 crore and ₹2 crore.

To illustrate the inflation, officials pointed to Package 6 in Anna Nagar West Extension, where a ₹8.2 crore tender was floated to lay just one kilometer of footpaths on Park Road and North Avenue Road. This worked out to nearly four times the standard rate.

The tendering process also showed signs of collusion and restricted competition. Under Package 9 in Mogappair, valued at ₹8.3 crore, only two firms—P and CE Projects and Sri Sivaram and Co.—participated. P and CE Projects won the contract despite bidding nine percent above the estimated cost.

A similar pattern occurred in Package 2 for works on Erikarai Salai, Pillaiyar Kovil Salai, and Bazaar Street worth ₹7.9 crore, where the same two firms and Adithya Infrastructure were the sole bidders, quoting up to 15 percent above the estimate.

Rama Rao, president of the Greater Chennai Contractors Association, noted that normal competitive tenders attract at least 20 contractors, often bidding below the project cost. He questioned why the GCC had not yet punished the officials involved in restricting the tenders.

According to a top civic official, the project has not been shelved since it has state approval. The GCC plans to review the Detailed Project Report (DPR) and re-tender the work with revised estimates.