Exemption from procurement guidelines granted to four Chinese electrical equipment manufacturers
- July 3, 2026
The Union finance ministry, through its Department of Expenditure, has granted exemptions to four Indian subsidiaries of Chinese electrical equipment manufacturers, with respect to public procurement policies.
This exemption was granted in response to a request from the Union power ministry seeking exemption from the provisions of Public Procurement Order No.4 dated February 23, 2023 regarding restrictions under Rule 144(xi) of GFRs, 2017 in respect of certain entities having manufacturing units in India, for critical power projects.
In this context, based on the deliberations of the Committee of Secretaries and the recommendations of the Registration Committee, the Union finance ministry decided to grant exemption for the following four entities for a period of two years, effective June 24, 2026:
- TBEA Energy India Pvt Ltd
- Nanjing Electric India Pvt Ltd
- New Northeast Electric India Pvt Ltd
- Taikai Electric (India) Pvt Ltd
All the above-mentioned companies are Indian subsidiaries of Chinese entities, and are collectively engaged in the manufacture and supply of specialized electric equipment, including EHV power transformers, gas-insulated switchgear, glass insulators, etc. Each of the four entities has a manufacturing unit in India.
Implication
Following this exemption, the aforementioned companies can participate in the bidding process of procurement of goods/services of Central government agencies for a period of two years, without having to undergo the registration process.
The practical implication, as industry experts suggest, is that Central utilities, mainly Power Grid Corporation of India Ltd (PGCIL), can procure EHV transformers and other specialized electrical equipment from the four entities listed, provided, of course, that they participate in the bidding process.
Background
The aforementioned Public Procurement Order No.4 dated February 23, 2023, issued by the Department of Expenditure under the Union finance ministry, relates to restrictions under Rule 144(xi) of the General Financial Rules (GFRs), 2017.
It states that any bidder which shares land border with India will be eligible to bid in any procurement whether of goods, services (including consultancy services and non-consultancy services) or works (including turnkey projects) only if the bidder is registered with the “Competent Authority,” which in this case is the Registration Committee constituted by the Department for Promotion of Industry & Internal Trade (DPIIT).
This Registration Committee is applicable for procurement by Central government agencies. For procurement by a state government, all functions assigned to DPIIT shall be carried out by the state government concerned through a specific department or authority designated by that particular state government.
The subject Procurement Order has also specified “sensitive sectors” under two categories – Category I and Category II.
Category I includes the most sensitive sectors such as space, defence, atomic energy, etc. Category II covers relatively lesser sensitive sectors like power & energy, banking and finance, civil aviation, agriculture, etc.
The order also features a list of sensitive technologies that cover 3D printing, SCADA systems, data streaming, satellite communication, chemical technologies, information & communication technologies, software, etc.
The order states that for Category-I sensitive sectors, bidders with transfer of technology (ToT) arrangement in any technology with an entity from a country which shares land border with India shall require registration.
For Category-II sensitive sectors, bidders with ToT arrangement in the sensitive technologies list, with an entity from a country which shares land border with India shall require registration.
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