Oil and Natural Gas Corporation (ONGC) will hold a pre-bid meeting on Wednesday with prospective shipyards for the construction of four Platform Supply Vessels (PSVs) under a global tender, estimated to be worth over ₹1,000 crore.
However, the move to float a global tender has drawn strong objections from Indian shipbuilders, who say the project falls well within the capability of domestic yards and that giving foreign players an equal footing undermines the government’s ‘Make in India’ and Atmanirbhar Bharat initiatives.
In a representation to Pankaj Jain, Secretary, Ministry of Petroleum and Natural Gas, the Shipyards Association of India (SAI) — representing 19 member yards — urged ONGC to amend tender terms and give “priority” to Indian shipyards. The association cited the 2019 office memorandum issued by the Ministry of Ports, Shipping and Waterways (MoPSW), which lays out eligibility criteria for awarding shipbuilding contracts by government agencies and PSUs.
SAI argued that ONGC’s justification of cost savings through global tendering is “misleading”, adding that any minor increase in upfront capital cost would be outweighed by the long-term benefits of domestic production. “Global tendering is therefore not aligned with the government’s Atmanirbhar policy and should be restricted to Indian yards,” it said.
The association has also advocated the inclusion of a Right of First Refusal (RoFR) clause for domestic shipyards, a measure it says would provide a level playing field and encourage fresh investment in local shipbuilding.
SAI has sought several relaxations in tender conditions to make them more inclusive for micro, small, and medium shipyards. Among the key demands:
Reduction of the ₹8 crore earnest money deposit (EMD), which it said places a heavy financial burden on MSMEs.
Lowering the performance bank guarantee from 10% to 3%, to ease cash flow constraints.
Relaxation of the turnover requirement of ₹175 crore for the last two financial years, which SAI described as “too high”.
Permission for consortium bids and technical collaborations to facilitate technology transfer and capability enhancement.
Interestingly, domestic shipyards have also requested the government to ease restrictions on sourcing critical components from countries sharing land borders with India — a reference to China. They proposed that limited exemptions be allowed for essential items such as propulsion and auxiliary equipment, cranes, deck machinery, and lifeboats, provided these are clearly declared in technical bids.
SAI further requested an extension of the qualifying vessel delivery period for bidders from 10 to 15 years, to allow restructured and revived yards to participate competitively.
“By addressing these concerns, the tender can be made more inclusive and conducive to the growth of Indian shipyards,” SAI Chief Executive Officer Sanjiv Walia said in a letter dated November 7 to the Petroleum Ministry.
Around ten potential bidders are expected to participate in the pre-bid conference, during which ONGC will respond to queries related to technical and commercial criteria.
The deadline for submission of qualification documents is currently set for November 18, though officials indicated the date may be extended depending on the outcome of the meeting.
