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India Opens Critical Power Tenders to China
4 Jul
Summary
- Four China-linked firms with local factories can bid for contracts.
- Exemption applies to critical power infrastructure for two years.
- Competitor stocks fell amid concerns over increased Chinese competition.
India has permitted four Chinese power transmission equipment manufacturers with established factories in the country to bid for government contracts related to critical power infrastructure. This decision, formalized on June 24, 2026, provides a two-year exemption from existing procurement restrictions for companies from nations sharing a border with India.
The exemption, a result of a power ministry proposal, is intended to ensure the timely availability of specialized equipment crucial for India's extensive transmission network expansion. This expansion is vital for meeting rising electricity demand and integrating renewable energy sources.
Despite the targeted nature of the exemption, shares of major Indian power equipment companies experienced a decline on the Bombay Stock Exchange on Friday, July 4, 2026. Investors expressed concerns about potential heightened competition from these Chinese firms over the next two years.
The government had initially imposed procurement restrictions in 2020, requiring prior approval for companies from neighboring countries to participate in public tenders. Industry experts note that a limited global supplier base for high-voltage direct current (HVDC) components has contributed to delays in transmission infrastructure development over the past decade.
