State-owned NTPC Ltd’s refusal to exempt small and medium enterprises from earnest money deposits for its solar power tenders has riled an association of solar energy industry which has now petitioned the government seeking its intervention.
The National Solar Energy Federation of India — an umbrella organisation representing solar energy companies — on January 7 wrote to Nitin Gadkari, minister for micro, small and medium enterprises, seeking his intervention in issuing a direction to NTPC to abide with the government policy of not seeking tender fee from MSMEs as well as exempting them from payment of earnest money deposit.
It said NTPC is not exempting MSMEs from payment of earnest money for bidding for its engineering, procurement and construction (EPC) tender for 923 MW solar projects, costing an estimated Rs 5,000 crore.
In the letter, the association said the Narendra Modi government had in June 2016 brought Micro, Small and Medium Enterprises Development Act with an aim to facilitate the promotion, development and enhancing the competitiveness of MSMEs.
The present provisions provide for providing MSMEs “tenders sets free of cost” as well as exempting them “from payment of earnest money”, it said.
“With the various preferential business-conducive provisions of the Act, it is bound to give the Make in India concept a much needed stimulus by promoting participation of MSMEs in building public infrastructure,” it said.
The Federation said NPTC in the tender dated December 3, 2019 for development of grid connected solar PV project has “not yet allowed this incentive of exemption in furnishing earnest money deposit (EMD) for the tender.”
This despite the provision of the MSME Act being brought to NTPC’s notice, it said.
“We request your kind intervention and request your office to kindly issue suitable clarifications to NTPC, enabling MSME registered companies to submit their bid with exemption of EMD,” it said in the letter which was also marked to the Prime Minister and Power Minister R K Singh.