Surety Bond State Wise India: Which Bodies Accept Them and How to Submit
TL;DR
The DFS September 2024 directive covers central government only. State bodies run on their own financial rules and no blanket state mandate exists yet. Acceptance is per-tender, not automatic.
69 state bodies across 17 states accept insurance surety bonds today. Andhra Pradesh and Maharashtra lead with 11 each, followed by Rajasthan (10) and Karnataka (8).
Power utilities make up 38% of state acceptance. The Ministry of Power’s April 2026 directive is pushing DISCOMs and TRANSCOs to update bidding documents. The power sector is where state acceptance is moving fastest right now.
One step before you bid: check the bid security clause. If it says “insurance surety bond,” you are clear. If it does not, there is a process for that too.
Most contractors bidding on state tenders still assume they need a bank guarantee. Some are right. Many are leaving working capital locked up for no reason.
As of October 2026, 69 state government bodies across 17 Indian states accept insurance surety bonds. The list spans power utilities, municipal corporations, housing boards, metro rail authorities, and public works departments. It is growing, and it is not evenly distributed. Four states account for more than half of all documented acceptance.
This article maps every verified body by state and sector, explains what the clause looks like in state tenders, and tells you exactly how to submit. For how each state’s procurement framework treats surety bonds, see our guide to surety bonds by state in India.
The State Picture at a Glance
State | Bodies Accepting ISBs | Dominant Sector |
Andhra Pradesh | 11 | Power (generation, transmission, distribution) |
Maharashtra | 11 | Power + urban bodies (municipal corporations) |
Rajasthan | 10 | Power + renewable energy |
Karnataka | 8 | Power + metro rail, urban development and water supply |
Odisha | 5 | Power (all five are power sector bodies) |
Telangana | 3 | Roads, mining, power |
West Bengal | 3 | Urban infrastructure and bridges |
Uttar Pradesh | 3 | Water, renewable energy, bridges |
Madhya Pradesh | 2 | Power distribution + solar |
Chhattisgarh | 2 | Health and state supply |
Gujarat | 2 | Municipal + port |
Assam | 1 | Power distribution |
Bihar | 1 | Urban infrastructure |
Haryana | 1 | Agricultural supply |
Tamil Nadu | 1 | Water supply and drainage |
Manipur | 1 | Rural roads |
Meghalaya | 1 | Infrastructure finance |
Two things stand out in this table. First, power utilities dominate: 38% of all 69 state bodies are in the power sector. The Ministry of Power’s April 2026 directive, which asked state DISCOMs, TRANSCOs, and procuring utilities to update their bidding documents to accept ISBs, is the biggest driver of state-level acceptance right now. If you work in power sector EPC, this is the most important development in state procurement this year.
Second, urban development and municipal bodies make up 28% of acceptance. Maharashtra alone added four municipal corporations to the verified list in August 2026. This trend is accelerating as urban infrastructure spending under smart city programmes and AMRUT 2.0 continues to grow.
The Top Four States in Detail
Andhra Pradesh: 11 Bodies
AP leads the country in documented state-level ISB acceptance. Its acceptance spans the entire power value chain: generation, transmission, and all three distribution companies, plus renewable energy, housing, urban development, warehousing, and public health civil works.
Body | Sector | Accepts |
APGENCO | Power generation | Bid + performance |
Transmission Corporation of AP | Power transmission | Bid + performance |
AP Central Power Distribution Company | Power distribution | Bid + performance |
Eastern Power Distribution Company of AP | Power distribution | Bid + performance |
Southern Power Distribution Company of AP | Power distribution | Bid + performance |
NREDCAP | Renewable energy | Bid + performance |
AP State Housing / Infrastructure Department | Housing and civil works | Bid + performance |
AP State Warehousing Corporation | Warehousing | Bid |
AP Technology Services Limited | IT | Bid |
Amaravati Development Corporation | Urban development | Bid + performance |
Superintending Engineer, Public Health Circle, Nellore | Public health civil works | Bid + performance |
AP power bodies updated their standard bidding documents following the April 2026 Ministry of Power directive. The ISB clause sits in the bid security and performance security sections of the Instructions to Bidders. NREDCAP aligns with SECI bidding formats, so the ISB clause and format requirements will be familiar if you have worked on SECI renewable energy tenders. Bond validity across AP power tenders is typically the contract period plus 60 days.
Maharashtra: 11 Bodies
Maharashtra’s 11 bodies span power, urban infrastructure, transport, housing, ports, and four recently added municipal corporations.
Body | Sector | Accepts |
Maharashtra State Power Generation Co. Ltd (Mahagenco) | Power generation | Bid + performance |
Maharashtra State Electricity Distribution Co. Ltd (MSEDCL) | Power distribution | Bid + performance |
Mumbai Metropolitan Region Development Authority (MMRDA) | Urban infrastructure | Bid + performance |
MHADA | Housing | Bid + performance |
BEST | Urban transport and power | Bid + performance |
Maharashtra Maritime Board | Ports | Bid + performance |
Maharashtra State Road Transport Corporation | Road transport | Bid |
Nashik Municipal Corporation | Urban civil works | Bid + performance |
Ahilyanagar Municipal Corporation | Urban civil works | Bid + performance |
Akola Municipal Corporation | Urban civil works | Bid + performance |
Amravati Municipal Corporation | Urban civil works | Bid + performance |
MSEDCL requires the ISB to be unconditional, from an IRDAI-licensed insurer, valid through the contract period plus 60 days. The four municipal corporations added ISB acceptance in August 2026 under the Maharashtra Municipal Corporations Act framework. Coverage includes civil works, road, water supply, and drainage contracts.
Rajasthan: 10 Bodies
Rajasthan’s acceptance sits almost entirely in power and renewable energy, with three state discoms, a renewable energy corporation, and a solar park developer in the verified list.
Body | Sector | Accepts |
RVUNL | Power generation | Bid + performance |
Ajmer Vidyut Vitran Nigam (AVVNL) | Power distribution | Bid + performance |
Jaipur Vidyut Vitran Nigam (JVVNL) | Power distribution | Bid + performance |
Rajasthan Renewable Energy Corporation (RRECL) | Renewable energy | Bid + performance |
Rajasthan Solarpark Development Company | Solar parks | Bid + performance |
Rajasthan Electronics and Instruments Ltd (REIL) | Electronics | Bid |
Indira Gandhi Nahar Project | Irrigation | Bid + performance |
General state procurement | Bid + performance | |
Rajasthan State Health Society | Health | Bid |
Rajasthan State Mines and Minerals Limited | Mining | Bid + performance |
RRECL and Rajasthan Solarpark follow MNRE and SECI-standard bidding documents. Contractors who have submitted ISBs on SECI tenders will find the clause structure and format requirements identical. Bond validity in Rajasthan power tenders: contract completion plus 90 days.
Karnataka: 8 Bodies
Karnataka covers power transmission, two electricity supply companies, metro rail, urban development, industrial infrastructure, and water supply.
Body | Sector | Accepts |
Karnataka Power Transmission Corporation (KPTCL) | Power transmission | Bid + performance |
Gulbarga Electricity Supply Company (GESCOM) | Power distribution | Bid + performance |
Hubli Electricity Supply Company (HESCOM) | Power distribution | Bid + performance |
Bangalore Metro Rail Corporation (BMRCL) | Metro rail | Bid + performance |
Bengaluru Development Authority (BDA) | Urban development | Bid + performance |
Karnataka Industrial Areas Development Board (KIADB) | Industrial infrastructure | Bid + performance |
Bangalore Water Supply and Sewerage Board (BWSSB) | Water supply and sewerage | Bid + performance |
Karnataka Building Workers Welfare Board | Labour welfare | Bid |
One important detail for Karnataka power tenders: KPTCL, GESCOM, and HESCOM require the ISB to be unconditional and irrevocable, payable on demand, the same standard as a bank guarantee. A conditional ISB will be returned. BMRCL follows the Karnataka Transparency in Public Procurement Act; bond validity is project completion plus six months. BMRCL accepts the CPWD standard ISB format.
Remaining States: Verified Bodies
State | Body | Sector | Accepts |
Odisha | Grid Corporation of Odisha (GRIDCO) | Power bulk supply | Bid + performance |
Odisha | Odisha Power Generation Corporation (OPGCL) | Power generation | Bid + performance |
Odisha | Orissa Power Generation Corporation (OPGC) | Power generation | Bid + performance |
Odisha | Orissa Power Transmission Corporation (OPTCL) | Power transmission | Bid + performance |
Odisha | Orissa Bridge and Construction Corporation (OBCC) | Civil infrastructure | Bid + performance |
Telangana | Roads and Buildings Department | Roads and civil works | Bid + performance |
Telangana | Singareni Collieries Company Limited | Coal mining | Bid + performance |
Telangana | Telangana Power Generation Corporation (TSGENCO) | Power generation | Bid + performance |
West Bengal | Kolkata Metropolitan Development Authority (KMDA) | Urban infrastructure | Bid + performance |
West Bengal | Hooghly River Bridge Commissioners | Bridge infrastructure | Bid + performance |
West Bengal | Bengal Gas Company Limited | Gas distribution | Bid |
Uttar Pradesh | UP Jal Nigam | Water supply | Bid + performance |
Uttar Pradesh | UP New and Renewable Energy Development Agency (UPNEDA) | Renewable energy | Bid + performance |
Uttar Pradesh | UP State Bridge Corporation | Bridge construction | Bid + performance |
Madhya Pradesh | MP Madhya Kshetra Vidyut Vitaran Co. Ltd | Power distribution | Bid + performance |
Madhya Pradesh | Rewa Ultra Mega Solar Limited | Solar power | Bid + performance |
Chhattisgarh | Chhattisgarh Medical Services Corporation | Health procurement | Bid |
Chhattisgarh | Chhattisgarh State Marketing Corporation | State supply | Bid |
Gujarat | Ahmedabad Municipal Corporation | Urban civil works | Bid + performance |
Gujarat | Gujarat Chemical Port | Port infrastructure | Bid + performance |
Assam | Assam Power Distribution Company (APDCL) | Power distribution | Bid + performance |
Bihar | Bihar Urban Infrastructure Dev Corporation (BUIDCO) | Urban infrastructure | Bid + performance |
Haryana | Haryana State Cooperative Supply Federation (HAFED) | Agricultural supply | Bid |
Tamil Nadu | Tamil Nadu Water Supply and Drainage Board (TWAD) | Water and sewerage | Bid + performance |
Manipur | Manipur State Rural Roads Development Agency | Rural roads | Bid + performance |
Meghalaya | Meghalaya Infrastructure Dev Finance Corporation | Infrastructure finance | Bid + performance |
Rewa Ultra Mega Solar is a SECI and MPUVNL joint venture. Its SBD and ISB format requirements are identical to SECI tenders. UPNEDA aligns with MNRE and SECI formats as well. Singareni Collieries is a Navratna PSU jointly owned by Telangana government and the central government, and follows its own procurement framework. All other bodies in this table follow their respective state procurement rules and Ministry of Power guidelines where applicable.
States Where ISBs Are Not Yet Accepted
No documented acceptance as of October 2026: Kerala, Jharkhand, Himachal Pradesh, Punjab, Goa, Uttarakhand, Sikkim, Arunachal Pradesh, Nagaland, Mizoram, Tripura.
The cause is consistent: no state financial rule amendment, no government resolution, and no ISB language in state SBDs.
If you are bidding in one of these states, read the NIT first. Some individual bodies include ISB language even without a state-level policy in place. If the clause is not there, raise a pre-bid clarification requesting ISBs be added. For power sector tenders, cite the Ministry of Power April 2026 office memorandum. For other contracts, cite the IRDAI Master Circular June 2024. Most field-level rejections are a knowledge gap. A one-page written representation to the right officer resolves the majority within 48 hours.
How to Submit an Insurance Surety Bond in a State Tender
The process is the same across all 17 states:
Step 1: Check the clause. Open the Instructions to Bidders or Bid Data Sheet. Search for “insurance surety bond.” If it is listed alongside bank guarantee, proceed. If not, submit a pre-bid clarification before the NIT closes.
Step 2: Confirm the format. Some bodies have their own format (KPTCL Karnataka, Ministry of Power-aligned bodies). Others accept the CPWD standard. Confirm before the insurer issues the bond. A format mismatch is the most common reason ISBs are returned.
Step 3: Get the bond issued. Ten general insurers are active surety underwriters in India as of 2026. The bond must carry the insurer’s authorised signatory details, IRDAI licence number, power of attorney reference, and head office contact information. Stamp paper must be in the insurer’s name, not the contractor’s. For a breakdown of what ISB premiums typically look like, see insurance surety bond cost in India.
Step 4: Submit through the insurer. The insurer dispatches the original bond directly to the employer by registered post with acknowledgement due. You upload a scanned copy on the relevant state e-procurement portal at the time of bid submission. Do not submit the original yourself without an insurer covering letter. Most state bodies will not accept it that way.
Step 5: Keep proof. Registered post receipt and AD acknowledgement. Portal upload confirmation with timestamp. These are your evidence if a dispute arises at bid opening.
If a tender officer at a state body refuses your ISB despite the acceptance clause being in the SBD, respond in writing citing the clause and the relevant state or Ministry of Power circular. Copy the next-level officer. Rejections at this stage are almost always resolved within 24 to 48 hours.
Conclusion
69 bodies today. More are coming. The Ministry of Power directive is still working through state electricity boards and DISCOMs.
The process is not complicated: check the clause, confirm the format, let the insurer dispatch the original. One step before the bid saves a rejection at the desk.
The axiTrust team verifies ISB acceptance for specific state tenders before your deadline, confirms which bond type applies at each contract stage, and supports the application from issuance through submission.
FAQ
Does the DFS September 2024 directive apply to state bodies?
No. The GFR 2022 amendment established ISB acceptance for central procurement only. State acceptance depends on each state’s own financial rules, government resolutions, or individual tender documents.
Which state has the most bodies accepting ISBs?
Andhra Pradesh and Maharashtra are tied at 11 each. Rajasthan is third with 10.
Can I submit an ISB when the tender only lists bank guarantee?
Raise a pre-bid clarification requesting ISBs be added to the bid security clause. For power tenders, cite the Ministry of Power April 2026 office memorandum. For others, cite the IRDAI Master Circular June 2024.
Which bond type applies at which stage of a state contract?
Bid security bond at tender submission. Performance security bond after award. Advance payment bond when a mobilisation advance is taken. Retention money bond to release withheld retention. Bid and performance bonds have the widest acceptance. Verify advance payment and retention money bonds per-tender.
