India has allowed Chinese companies to participate in the country’s government projects. According to the decision of the government, now domestic companies will be able to bid for government projects together with Chinese companies through technology transfer agreement. This is in contrast to the government’s stand that last year, amid the ongoing dispute with China, steps were taken to prevent Chinese companies from doing business in India in every possible way. According to industry sources, the relief given by the government has made it possible for Chinese companies to operate in the Indian market.
Since the beginning of last year, India has been taking a tough stand against Chinese companies. Huawei and ZTE were not allowed to build networks for state-owned BSNL or other private telecom operators. Imported consignments were also banned, but when domestic companies pleaded for production to be affected, the customs authorities started clearing the consignments.
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The rules were amended last year amid the border dispute
In July 2020, amid the border dispute, the Central Government amended the General Financial Rules. Under this provision was made that if any country bordering India wants to bid for any government project in India, then it must first register itself with the Competent Authority. However, this provision gave relief to those countries with which India has extended the line of credit or is associated in development projects. This brought relief to Nepal, Bhutan and Bangladesh. China was affected by this provision because Pakistan is not already a part of any government projects of India.
However, an office memorandum issued by the Procurement Policy Division of the Department of Expenditure under the Ministry of Finance earlier this month states that there is a need for TOT (Technology Transfer) arrangement for auctions for companies from countries bordering India. is not. In such a situation, they do not even need to be registered with the Competent Authority.
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Indian companies pay for technology transfer
According to official sources, Indian companies needed this relief to bid for government projects as these companies have pacts of technology transfer with many Chinese companies, especially companies in the infrastructure sector. Due to this, the administrative ministries had sought clarification from the Finance Ministry on whether such companies should be allowed or disqualified from participating in the auction. Sources said that Indian companies do technology transfer by paying to Chinese companies and if the executing firms are Indian then this relief has been given.
(Article: Kiran Rathee)