Categories: Business

Ban on government procurement from China and other neighboring countries, Modi government takes big step

Photo: BLOOMBERGQUINT

Govt imposes restriction on public procurement from China, other neighbors

new Delhi. The government has imposed controls on public procurement from countries including China, which have borders with India. Companies from these countries can fill the tender only after security clearance and registration with a special committee. The move comes amidst a border dispute with China. An official statement on Thursday said that the Government of India has amended the General Financial Rules, 2017 to control the bidding of countries that are bordered by India.

This step has been taken keeping in view the matters related to defense and security of the country. The Department of Expenditure issued a detailed order on public procurement under the rule intended to strengthen the defense and national security of the country. Under the order, any supplier of countries bordering India can bid for the supply of goods, services (including consultancy and non-consultancy) or project works (including turn-key projects) for public projects in India. , When it is registered with the appropriate authority.

It states that the appropriate authority for registration will be the Registration Committee constituted by the Department of Industry Promotion and Internal Trade (DPIIT). For this, political and security clearance from the Ministry of External Affairs and Home Affairs will be mandatory. The scope of the order also includes public sector banks and financial institutions, autonomous bodies, central public sector undertakings, public-private partnership projects, which seek financial support from the government or the entities under it.

It states that state governments have an important role in protecting and protecting the country. In view of this, the Government of India has written a letter to the Chief Secretaries of the State Governments using Article 257 (1) of the Constitution regarding the implementation of this order in the matter of procurement by the State Governments and State Undertakings etc. States will constitute appropriate authorities in case of procurement of state governments but political and security clearance will remain mandatory. Exemptions have been granted in some cases. This includes procurement of supplies of medical goods by 31 December for the prevention of the Kovid-19 global epidemic.

The government has, in a separate order, exempted those countries from pre-registration, which have been provided with credit facilities or development assistance by the Government of India. As per the order, the new provision will be applicable to all tenders. Tenders that have already been invited or have not completed the first phase of eligibility evaluation, bidders who are not registered, will not be considered eligible. If this stage is completed, the tender will be canceled and the process will be started afresh. This provision does not apply to purchases by the private sector.

This post was published on July 24, 2020 9:07 am

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