Abstract
Analysis of Claims in Public Works Construction Contracts in India
Highlights
The construction industry in India is the second largest industry after agriculture (Indianconstructionindustry.com, 2007)
An objective of this paper was to determine if types of claims can be analysed in relation to contract conditions with an aim to affect claim prevention through proposed improvements in general conditions of contract
Twenty-two disputes in arbitration of public works, which are governed by General Conditions of Contract (GCC) of Central Public Works Department (CPWD) were taken up for study and claims therein were studied and analysed
Summary
The construction industry in India is the second largest industry after agriculture (Indianconstructionindustry.com, 2007). Given the fact that strong infrastructure facilities form the backbone of a nation's economy, the performance of project execution has not been commensurate with increased focus on infrastructure development in India. As per a study conducted by McKinsey and Company (Gupta, Gupta and Netzer, 2009), on an average, projects in India across sectors suffer from time and cost over-runs to the tune of 20% to 25%, with some sectors affected by more than 50%. In India, as per the report, of the USD80 billion Gross Domestic Product (GDP) loss due to inefficient execution, USD50 billion is attributable to these time and cost over-runs, many of which are a result of disputes at some stage of the process. Disputes are common and unavoidable in most construction projects due to a number of uncertainties that may occur.
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