Funding agency Japan International Cooperation Agency has prevented non-Indian firms from participating in new metro rail projects

French metro car manufacturer’s India operation, Alstom India, has expressed unhappiness over the restrictions placed by Japanese funding agency preventing non-Indian firms from participating in new metro rail projects including a Chennai Metro Rail Limited (CMRL) project.

“We are unhappy as we are being restricted from participating in certain tenders, based on conditions put forth by Japan International Cooperation Agency (JICA),” said Alain Spohr, managing director - India & South Asia, Alstom.

According to Mr. Spohr, JICA had laid down certain clauses, such as around 30-35% of purchases have to be from Japanese or Indian companies that are owned by Indians, he said.

“One of the things which I am not happy at all about is that after doing all these investments, including in factories and people etc., I am not allowed to be considered an Indian company and bid on those tenders. We cannot bid as we do not have that much percentage of Japanese content,” he said.

Mr. Spohr said that every year, Alstom was unable to participate in two to three tenders due to such restrictive clauses. The value of each tender was about €250 million. In a way, it was a loss of €250 million for Alstom India, he said.

“Though, we are in India, we are not considered an Indian company. We have made representations to the concerned persons. But nothing has happened,” said another official.

Accepting the need for State governments to seek overseas funding, he said, “But still I think the government should ensure that for future jobs, fair play is respected.

However, officials of CMRL claim these fears are unfounded. Alstom has already provided trains for phase I and the phase I extension project and may well be able to participate in the phase II project as well, sources said.

“In the 118.9 km project of phase II, the restrictions [that a certain percent of components should be Japanese] are only for 52 km. For the remaining, we will call for tenders and they can certainly participate in it,” an official said.