NSEFI Seeks Government Intervention to Issue Directions to NTPC to Comply With MSME Act Provisions

The National Solar Energy Federation of India (NSEFI) an umbrella organisation representing solar energy companies has written 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 for “not seeking tender fee from MSMEs” as well as “exempting them from payment of earnest money deposit.”

NTPC refuses to exempt MSMEs from payment of tender fees and Earnest Money for bidding for its engineering, procurement and construction (EPC) tender for 923 MW solar projects, costing an estimated ₹5,000 crore.

According to provisions under the Micro, Small and Medium Enterprises Development Act brought into effect by the Modi Government in June 2016, states MSME tenders to be free of cost and also exempts them from payment of EMD. This is intended to provide the much-needed boost to the Make in India initiative encouraging participation of MSMEs in building public infrastructure. 

In a tender dated December 3, 2019, for development of grid connected solar PV project, the Federation said that, NTPC did not comply with the provisions of the MSME Act and has not allowed for exemption of EMD in this tender. Besides Gadkari, the letter from NSEFI seeks clarifications and issuing of directions to NTPC. It was also marked to the Prime Minister of India, Narendra Modi and Power Minister, R K Singh.