Swiss Challenge system for Core Capital

swiss challenge system in core capital

Andhra Pradesh government is mulling on using Swiss Challenge System for the construction of the Core Capital which will help it complete the project early and low cost. Under this system, a private sector company/organisation with exclusive intellectual property can bid with for a public infrastructure project and then government will all others to submit their proposals. If any proposal is better in terms of cost and technology, the original company is asked to match it or better it to get the project. If he fails, then it would be awarded to the best bidder.

However there are chances of lack of transparency in this system and so this system is not rated well by the Central Vigilance Commission. However the state governments can always exercise this system in exceptional cases. After weighing pros and cons, Andhra Pradesh Cabinet voted for the Swiss Challenge method which is aimed reducing costs significantly.

The government will also now have to amend the AP Infrastructure Development Enabling Act, 2001 to bring in this system for the Core Capital construction. The state government will introduce various guidelines issued by the CVC, Planning and Finance departments of Government of India to make the process more transparent.