Govt imposes restrictions on public procurement from China, neighbours

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The Centre, late on Thursday, amended its General Financial Rules to restrict public procurement from countries which share a land border with India on grounds of national security, a move squarely aimed at China.


However, it provided relaxation in case of medical supplies in light of Covid-19. And keeping in mind some other neighbouring countries, nations with which India has a line of credit or provides development assistance were also exempted.


“The Government of India today amended the General Financial Rules 2017 to enable imposition of restrictions on bidders from countries which share a land border with India on grounds of defence of India, or matters directly or indirectly related thereto including national security,” said an official statement.




According to the new order, any bidder from countries sharing a land border with India will be eligible to bid in any procurement whether of goods, services or works only if the bidder is registered with the ‘Competent Authority.’


The Competent Authority, in this case, is the Registration Committee constituted by the Department for Promotion of Industry and Internal Trade (DPIIT). “Political and security clearance from the Ministries of External and Home Affairs respectively will be mandatory,” the statement said.


The order is applicable for central and state governments, public sector banks and financial institutions, autonomous bodies, state-owned companies and public private partnership projects, receiving financial support from the Government.


“For state government procurement, the Competent Authority will be constituted by the states, but political and security clearance will remain necessary,” the release stated, adding that the new provisions will apply to all new tenders.


“In case of tenders already invited, if the first stage of evaluation of qualification has not been completed, bidders, who are not registered under the new order, will be barred. If this stage has been crossed, ordinarily the tenders will be cancelled and the process started de novo. The Order will also apply to other forms of public procurement,” it said.

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