Public projects: Tech transfers with Chinese firms on hold

Consequently, in August final 12 months, the DPIIT notified a format for firms from these bordering international locations (China and Pakistan) to register themselves with the division to have the ability to bid for public initiatives. (Consultant picture)

The division for the promotion of business and inner commerce (DPIIT) has placed on maintain the relaxations just lately granted by the finance ministry, which had successfully allowed home firms having know-how switch preparations with Chinese language companies to bid for public initiatives.

Citing representations from business our bodies which have expressed concern over the division of expenditure’s (DoE’s) determination final month, the DPIIT has resisted the “blanket exemption” to companies having switch of know-how (ToT) pacts with Chinese language entities from necessary registration with it and sought a evaluate of the choice.

In a communication to the DoE final week, the DPIIT has argued that any such transfer will “present an oblique path to the bidders having helpful possession in land border sharing international locations to take part in public procurement in violation of the rules stipulated within the DoE order dated July 23, 2020”.

Within the wake of the Galwan conflict, the DoE had in July 2020 amended the final monetary guidelines (GFRs), limiting bidders from international locations with which India shares land border from collaborating in authorities procurement tenders with out approval from competent authorities. Nonetheless, the federal government made an exception for bidders from international locations to which India had prolonged a line of credit score or was engaged in improvement initiatives. This successfully restricted the curbs to solely China and Pakistan.

Consequently, in August final 12 months, the DPIIT notified a format for firms from these bordering international locations (China and Pakistan) to register themselves with the division to have the ability to bid for public initiatives. Nonetheless, on June 8, the DoE stated the amended GFRs received’t apply to bidders having switch of know-how pacts with an entity from the bordering international locations.

Responding to this, the DPIIT wrote to the DoE: “The subject material has additionally been examined on this division. It’s thought-about that entities having helpful possession from involved international locations can have ToT settlement for set up/upkeep/after gross sales service/related such providers with an Indian firm to push its merchandise in public procurement, though not permitted except mandatorily registered….”

It additional stated the scope and mandate of ToT agreements proposed to be exempted from the purview of July 2020 order must be outlined. “Blanket exemption from registration to bidders having ToT association will present an oblique path to the bidders having helpful possession in land border sharing international locations to take part in public procurement in violation of pointers stipulated in DoE order dated July 23, 2020,” DPIIT stated.

Additionally, different associated points raised by business associations like nationwide knowledge safety, notably for the initiatives in delicate areas too must be appropriately addressed, the DPIIT added. The division, due to this fact, has requested the DoE to look at the problems and evaluate the comfort granted. Until the time the difficulty is resolved, the comfort must be placed on maintain, the DPIIT stated.

The division stated stakeholders, together with CII, Ficci, Assocham, Telecom Tools Producers Affiliation and Mobile Operators Affiliation of India, have written to it towards the comfort of guidelines.