Being an international EPC company, we feel our strength lies in procuring highly competitive quality products from global vendors.Punj Lloyd provides integrated design, engineering, procurement, construction and project management services in the energy and infrastructure sectors. Rajendra Khandalkar talks about the current procurement sector and challenges it is facing.
Where does India standInfrastructure is fundamental to economic development and plays a crucial role in determining the quality of growth of the country. Mr Khandalkar mentions some points in this regard. He says, “There have been positive moves after the economic crisis of 2008-09 by inducing fiscal stimuli towards development of infrastructure.”
He also observes that EPC developers need to establish strategic partnerships and at present India is in a nascent stage compared to the global scenario.
“Punj Lloyd has been able to establish strategic partnerships for bulk material and the same needs to be extended to technology,” he feels.
Challenges“Being an international EPC company, we feel our strength lies in procuring highly competitive quality products from global vendors,” says Mr Khandalkar.
However, most of Punj Lloyd clients have their approved vendor list which does not allow it to optimally utilise its global sourcing expertise. “We try to get vendors offering competitive quality products, approved by the client to bring value to the client; however this is a challenge as it needs to be done during the project execution,” says Mr Khandalkar. “Ever rising cost of input materials, change of specification, getting correct engineering estimates and fluctuating exchange rate also pose as challenges to keep cost under control.”
In addition, considering the existing infrastructure available in the country, logistic facility is also considered as a key challenge though there has been a significant improvement over the years. Most of the project sites are in remote locations with poor infrastructure and ensuring proper delivery of cargo is a challenge.
China along with Eastern Europe and other low-cost countries are emerging as cost-effective equipment suppliers and if one can ensure quality control, the products are of a standard comparable to any reputed manufacturer globally.
IT helpWith project completion time being shortened, Punj Lloyd uses reverse auction for online negotiations with vendors. This has helped it in making the transactions transparent and building vendor confidence.
Punj Lloyd is in the process of establishing complete supply chain activities through e-Platform to ensure timely completion of procurement cycle as well as provide visibility of events to all our customers and vendors.
It is also important to get visibility and control over all the expenditure happens in company. The company is using various modules of Oracle for the purpose.
– Rajendra Khandalkar, President and Chief Procurement Officer, Punj Llyod Group