Signal Desk · Economy

Finmin sets rule for abnormally low bids in govt contracts

2026-11-11 · 1 source · BusinessLine Economy

In short

The Finance Ministry has set a new rule for government contracts. Bids that are more than 30% below the estimated cost must now explain why.

If the explanation is not good enough, the bid can be rejected. This matters for contractors bidding on government work.

What the reporting says

The Finance Ministry has defined an abnormally low bid for government contracts, saying bids more than 30% below the estimated cost will require a detailed rationale. If the explanation is unsatisfactory, the bid may be rejected, but not automatically disqualified. The move adds a formal review step to procurement decisions and could affect how contractors price future bids.

Why it matters

The Finance Ministry has introduced a rule for government procurement that treats bids more than 30% below estimated cost as abnormally low. Such bids must now carry a detailed rationale, and an unsatisfactory response may lead to rejection rather than automatic disqualification. The measure affects contractors and procurement officials handling government contracts.

Touches: Government, Economy

Sources