IBM, HP opt out of 2,000-crore UIDAI bid

NEW DELHI: Two of the world's largest technology companies - IBM and HP - on Monday opted out from bidding for the 2,000-crore outsourcing contract to manage the world's biggest citizen identity database, people familiar with the development said.

The Unique Identity Development Authority of India, or UIDAI, headed by Infosys founder Nandan Nilekani , had asked vendors to submit their proposals for the contract by Monday evening. After IBM and HP dropped out from the race, the remaining five - Accenture , Wipro, TCS , HCL Infosystems and Mahindra Satyam - will go to the next stage and begin their negotiations with the UID officials.

"They (IBM and HP) are not interested," confirmed an official familiar with the bidding.

In one of the biggest outsourcing contracts to be awarded this year by any Indian government department, the selected vendor will manage all IT and the national repository which will contain data of all Indian citizens.

Executives at vendors who decided not to bid said it was a decision by Global HQs not to participate in bidding.

"As far as I know, we have not submitted any bids, the conditions did not match our processes," said another person who requested anonymity because he is not authorised to speak with media.

The tech majors had earlier complained to Unique ID Authority of being biased towards products of certain vendors (EMC Corp and Cisco). The authority postponed the bidding last month and made changes to the tender specifications after ET reported about a fiery meeting in the capital with the bidders.

The final five vendors submitted bids on Monday at UIDAI headquarters at Jeevan Bharti Building at Connaught Place in huge cartons. The timely selection of the IT vendor is critical to the success and implementation of the UIDAI project, which aims at giving 600 million Unique ID numbers by 2014.

"We decided to quit the bidding process on the request of our global headquarters. Things had become pretty hostile between us and the authority over the weeks," said an official at one the US-based tech majors which opted out. "Things had become pretty bad for us after we complained," said another top level official declining further comment.

Spokespersons of both IBM and HP declined to offer reasons why the companies opted out from participating in one of the most prestigious and large projects in India, even after submitting expressions of interest. Both companies got selected and participated in all pre-bids as well.

Another executive said his company decided to opt out because the chances to win the project were not as bright.

"It costs us over a million dollars to put in such a large bid as teams fly down from across the globe over many months. It's best we concentrate on projects where chances of winning are higher," he added.

UIDAI officials say it's up to the companies to bid. "Some who opted out have earlier participated as equipment vendors. We will take about three months to decide on the winner from the bidders," said a UIDAI spokesperson. The selected vendor will manage all IT infrastructure for the project. Only large firms with at least 4,000 people and sales of 6,000 crore in the last three years were allowed to bid.