India Reserves 110 Power Plant Equipment, Local Business Services, Energy News, ET EnergyWorld


New Delhi: India will ban non-local suppliers from bidding on contracts to supply around 110 goods and services to power plants. Non-local suppliers are manufacturers with less than 20% local content. These tenders, for which there is sufficient local capacity, will be open only to “local Class I suppliers” or to suppliers who have more than 50% local content.

The Department of Energy has issued a government procurement order with separate lists of products with adequate manufacturing capacity in India and those manufactured locally under technology licenses from foreign countries. The latest ministerial decree dated July 28 provides that calls for tenders for these 110 items of equipment and works can only be awarded to local companies with a strong location. The equipment includes transformers, switchgears, cables and insulators, which are imported into India in large numbers despite the available local capacity.

The ministerial decree is based on a June 4 decree of the Department for the Promotion of Industry and Internal Trade (DPIIT) which provides for compulsory purchase preference for local suppliers.

The order will apply to procurement by state and central government enterprises and projects funded by Power Finance Corp and REC Ltd. The order identified 69 other products and services licensed by foreign manufacturers with intellectual property rights. These can come from local Class II providers with localization content between 20% and 50%.

“Only local class I suppliers and local class II suppliers may tender under a contract awarded by contracting entities, except when a request for a global offer has been published. In global bidding requests, non-local suppliers will also be eligible to bid with local Class I suppliers and local Class II suppliers, ”the order states.

The ordinance advised state-run entities to revise their tender documents. He also advised PSUs to only allow participation from foreign companies that have established a manufacturing base in India. In the event of a technological partnership, the PSUs must insist on the transfer of technology.

The Energy Ministry order of July 2 established an effective ban on imports from benchmark countries like China and Pakistan, which require authorization. All other imports will be tested in government approved laboratories. Last Thursday, the expenditure department amended its general financial rules, 2017, requiring bidders from a country that shares land borders with India to register in order to bid on PSU contracts.

In 2018-19, India imported 71,000 crore rupees of electrical equipment, including 21,000 crore Chinese rupees. The Energy Ministry order of July 2 mentioned the possibilities of cyberattacks against the power system through “Trojans” embedded in imported equipment, which can have catastrophic effects and potentially cripple the entire system. country.


Leon E. Hill

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