DDA set to adopt Swiss Challenge bidding system

In a major policy shift to overcome persistent hurdles in government tendering, the Delhi Development Authority (DDA) is set to adopt the Swiss Challenge Method for disposal and licencing of land and other high-value public assets. The new mechanism, recently approved by Delhi Lieutenant Governor VK Saxena, is aimed at addressing a chronic problem faced by public bodies which include repeated cancellation of tenders due to single bids, which often results in delays, escalating costs and in some cases, stalled projects that never reach execution. Officials said the step would ensure that even in a single-bid scenario, the tender process would move forward while guaranteeing that DDA secured a price higher than the initial reserve value, whether through sale of land or licence fee mode.

The Swiss Challenge Method places a single bid in the public domain and invites competing counter-bids, essentially treating the original bid as the new reserve price. The original bidder is allowed to participate in the re-auction, and the mechanism ensures competitive price discovery while safeguarding the public authority from accusations of arbitrary allotment or undervaluation.

The new bidding model complements the model request for proposal (RFP) structure that DDA has approved for high-value projects proposed on long-term licences of up to 55 years. The dual framework is expected to enhance market participation while also protecting the government’s revenue interests. As these projects involve long-term annual licence fees and large public assets, DDA believes that the competitive framework will help the authority avoid under-pricing, financial loss and procedural logjams that have historically slowed development initiatives.

Officials further described the method as a tool for faster decision-making. Rather than repeated re-tendering, the Swiss Challenge method allows a time-bound challenge to the initial bidder, expediting both price discovery and finalisation. It provides a safety net in cases where the first bid appears low by exposing it to market competition.