In a strategic move to bolster domestic manufacturing, India has decided to restrict foreign participation in government contracts related to industrial boiler or steam generators. Under the new directive, only Indian firms will be allowed to supply these critical components for upcoming thermal power projects and industrial applications.
Mandatory Local Sourcing of Key Boiler Components
The mandate covers a wide range of boiler-related equipment. Indian suppliers will now be the exclusive source for:
- Certain variants of seamless steel pipes and tubes
- Carbon steel pipes
- Steel plates
- Refractory materials
- Insulation
- Soot blowers
A senior government official stated, “We have assessed that the country has sufficient local capacity and competition for these categories.”
Domestic Vendors to Handle All Services
Alongside materials, a broad set of services must also be locally sourced. These include:
- All surveys and site studies
- Engineering, Procurement and Construction (EPC) contracts
- Fabrication
- Civil construction
In fact, all services related to industrial boiler projects must now be awarded to Indian firms. However, companies seeking exceptions can appeal on a case-by-case basis to a designated grievance committee.
Aligned with ‘Make in India’ Vision
The move aligns with the Public Procurement (Preference to Make in India) Order, 2017. It reflects the government’s commitment to supporting domestic industry, particularly as India prepares to add 80 Gigawatts (GW) of new thermal power generation capacity—where Industrial boiler will be pivotal.
Expanding Boiler Demand Across Sectors
Industrial boilers are not just critical to power generation. They are extensively used in other manufacturing sectors such as:
- Textiles
- Chemicals
- Food processing
- Oil and gas
- Steel
- Cement
As India continues to industrialize, boiler demand is set to grow significantly. The India Brand Equity Foundation (IBEF) projects the domestic industrial boiler market will rise from ₹5,859 crore ($704.6 million) in FY2019 to ₹8,831 crore ($1.1 billion) by FY2030.
Power Sector to Drive Major Growth
While various sectors will contribute to rising demand, power generation remains the biggest driver. The Central Electricity Authority (CEA) estimates a massive investment of ₹6.67 lakh crore in the sector by 2031-32. As reported by the economictimes.indiatimes.com, moreover, India is contemplating additional capacity beyond the planned 80 GW to ensure long-term grid stability.
