India may ban Chinese firms from ISA' solar home power system tender3 min read . Updated: 06 Aug 2020, 04:47 PM IST
- India’ stand on Chinese imports may impact multilateral engagements such as the ISA, that is increasingly being viewed as a foreign policy tool, as China attempts to co-opt countries into its One Belt One Road initiative
NEW DELHI : Tightening its economic squeeze, India plans to disqualify Chinese firms from participating in the largest global solar home system’ price discovery tender, for the International Solar Alliance' (ISA) member nations, said two people aware of the development.
State run Energy Efficiency Services Ltd (EESL) is conducting the exercise for a potential order of 47 million home power systems, valued at around $28 billion. The first phase will be for 9.3 million home power system—each comprising of a solar panel, battery, LED bulbs, fan and charging port for radio, TV and USB—with the bids to be submitted by 31 October.
The price discovered will then be offered to all ISA member countries for acceptance and will serve as the reference point for such large global order. A pre-bid conference on the tender was called on Thursday.
India’ stand on Chinese imports may impact multilateral engagements such as the ISA, that is increasingly being viewed as a foreign policy tool, as China attempts to co-opt countries into its One Belt One Road initiative.
The tender document reviewed by Mint stated, “To provide energy access to 1 billion populations without electricity, ISA plans to facilitate the provision of Solar Home System with different configurations."
“To facilitate this, ISA shall explore the price of the Solar Home System for ISA member Countries. EESL shall help ISA in exploring the price band in different ISA member countries," the tender stated.
The solar home system tender also comes in the backdrop of India’ plan to become an integral part of global supply chains as firms look to move production lines out of China, following the coronavirus pandemic that originated in Wuhan. Prime Minister Narendra Modi announced his vision for a self reliant India on 12 May.
In response to Mint’ queries, an ISA spokesperson said, “EESL has been selected through Swiss Channel basis for tendering 47 million solar home system."
An EESL spokesperson said, “EESL is a bid management agency hired by ISA," and added, “The tender is being done as per guidelines of ISA, which is an International Inter-Governmental treaty based organization."
Queries emailed to India’s new and renewable energy ministry spokesperson remained unanswered.
This comes at the time of EESL cancelling a 2 million units smart meter contract awarded to Indonesia-based PT Hexing following concerns about its Chinese ownership and manufacturing plans in India. The state run firm will now call snap bids shortly for awarding the cancelled contract for around 3 million smart meters, Mint reported on Wednesday.
“Being a government owned firm, EESL can’t allow Chinese firms to participate in this tender after the DPIIT (Department for Promotion of Industry and Internal Trade) order, that restricts companies from countries with a shared land border from participating for government procurement without approval from competent authorities," said an Indian government official requesting anonymity.
EESL, is a joint venture set up by NTPC Ltd, Rural Electrification Corp. Ltd, Power Finance Corp. Ltd and Power Grid Corp. of India Ltd and conducted similar price discovery exercise for ISA, by aggregating the demand from ISA member nations for solar-powered agricultural pumps. The tender achieved global disruption by bringing down the cost of such pumps by half.
“EESL can only allow Chinese firms’ participation, if they secure a clearance," said the government official cited above.
ISA’ strategy is to leverage the demand from the member countries to reduce costs by aggregating the demand from member nations and then call for tenders. It has aggregated demand for solar pumps, rooftops, mini-grids, parks and home systems.
“The Chinese firms will have to meet the specifications as listed by EESL. Most of the Chinese firms won’t fit the criteria," said the second person cited above who also did not want to be named.
Under the aegis of the ISA, India is also leveraging its solar power expertise to get state run NTPC to develop solar power parks in Sudan, Mozambique, Egypt, Uganda, Rwanda, Niger and Sri Lanka. As part of this strategy, India’s largest power generation utility has also been helping Gambia and Malawi develop solar power parks as project management consultants.
As part of its economic response against China, India last week imposed restrictions on imports of colour television sets after barring Chinese apps and cancelling railway and road tenders secured by Chinese firms. Also, the Chinese smartphone handset maker Vivo has pulled out as the title sponsor for this year’ Indian Premier League. Chinese language has also been removed from the curriculum of Indian schools and the government is set to review the status of Confucious Institutes aimed at popularizing Chinese in India.