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ongc: Home pipe makers restricted to twenty% of $500 million ONGC mission – Instances of India

NEW DELHI: Home pipe makers have been restricted to solely 20% of a $500-million ONGC mission after the state-run explorer superior the date of awarding contract to 5 days earlier than the necessary home buy coverage for iron and metal merchandise was to kick in for the mission.
ONGC had floated the tender for a mission, recognized as PRP-VII, to interchange 317 km inter-platform offshore pipeline on September 22 with February 3, 2022 because the mission award date. However on October 22, the corporate superior the award date to January 20, 2022.
Trade sources stated the profitable bidder might have sourced all of the pipes domestically underneath the unique schedule because the two-year exemption from the domestically manufactured iron & metal merchandise (DMISP) coverage granted to ONGC would have ended on January 29, 2022.
After the metal ministry introduced the coverage on Could 29, 2019, ONGC had in 2020 sought an exemption for the PRP-VII mission citing “engineering necessity and interface hardships delaying projects”. Underneath the DMISP coverage, iron and metal pipelines have “to be exclusively domestically manufactured and cannot be imported without the approval of the steel ministry.”
The ministry on January 29, 2020, granted exemption till January 29, 2022 for 80% of the required pipes with the caveat that ONGC take a look at home producers by inserting a growth order by March 31, 2020 for the remaining 20% of pipes. Import of this amount was allowed if the event order failed. ONGC was additionally suggested to delink the event order from the tender and submit the take a look at outcomes for the ministry’s evaluate by June 2020.
ONGC, nevertheless, didn’t place the event order and amended the tender to advance the date of award with a view to avoiding falling foul of the metal ministry and potential authorized problem as soon as the exemption ended on January 2022. Underneath the circumstance, 80% of the pipelines are prone to be imported.

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