The MoP has issued an order mandating that tenders for 110 equipment and works for power plants can be awarded only to local companies with high localisation.
The central government will bar non-local suppliers, i.e. the manufacturers with less than 20 per cent local content in bidding contracts for power plants. These tenders, in respect of which there is sufficient local capacity, will be open to only class–I local suppliers or those vendors who have more than 50 per cent local content. The ministry’s order is based on an order of the Department for Promotion of Industry and Internal Trade (DPIIT) that provides for compulsory purchase preference to local suppliers. The order will apply to procurements made by central and state government companies and on projects funded by Power Finance Corporation (PFC) and REC Limited. The order has identified another 69 products and services that are being manufactured under license from foreign manufacturers holding intellectual property rights. These can be sourced from class-II local suppliers with localisation content between 20 per cent and 50 per cent.