Chinese manufacturer companies that have invested in India to set up foreign direct investment route will now need a fresh security protocol to be eligible for government contracts. This move will impact phone and computer manufacturer as well drug manufacturers.
This is fresh guidelines issued by the finance ministry on Thursday evening, requiring bidders from any country sharing a land border with India to register with a “competent authority” to be eligible for government contracts. With an exception made for bidders from countries where India has extended a line of credit or is engaged in development projects, Nepal, Bhutan and Bangladesh would be exempted, officials told TOI.
According to Times Of India, by this the order is maily targeting companies from China since those based in Pakistan hardly participate in Indian contracts. Even smartphone-makers such as Xiaomi and Oppo will need to go through a fresh protocol. As part of the registration process through a team comprising officials from both ministries of home and external affairs. Also department which promotes industry and internal trade, should be eligible to sell on the Government e-Marketplace (GeM), that is online public procurement platform.
Even telecom equipment suppliers Huawei and ZTE as well as power gear players Dongfang and China Light and Power is also uncertain. But still there is lack of clarity on companies like Lenovo, as Legend Holdings, the company that owns the brand, started out in China but are registered in Hong Kong.
“This will hit their business. They first need a clearance for additional investments in India and then seek fresh registration to participate in government contracts,” explained an official.
