GOVT TO EVALUATE BPCL BIDDERS FOR LINKS WITH CHINA BEFORE STAKE SALE

NEW DELHI: The government has decided to evaluate security risks associated with prospective buyers of state-run Bharat Petroleum Corp. Ltd (BPCL) , including indirect Chinese links before declaring the name of the highest bidder in a move aimed at avoiding delays, people familiar with the matter said.

The bidding process will be jeopardised if security clearance is denied to the winning bidder as the valuation of the company would be in the public domain by then, they added requesting anonymity. Hence security clearance prior to opening of the financial bid is a must, the people said.

“In the changed geopolitical scenario, it is necessary to be cautious. The sale of BPCL in the current finance year is crucial for the government to achieve its disinvestment target of ₹2.10 lakh crore,” one of the persons said. Officials said BPCL is of strategic importance and hence all precautions need to be taken to ensure no entity from hostile countries such as China and Pakistan have even indirect connections with prospective buyers.

India and China are locked in an impasse along the line of actual control in eastern Ladakh, where China has repeatedly try to transgress into Indian territory. One such transgression resulted in a bloody clash in June, resulting in the death of 20 Indian soldiers and an unknown number of Chinese ones. The defence ministers of the two countries met recently in Moscow and the foreign ministers are to meet later this week.

Divakar Vijayasarathy, founder and managing partner at consulting firm DVS Advisors LLP, said that because BPCL is an asset critical to India’s energy requirements, the security clearance is expected to be much more stringent. Vijayasarathy added that mandating security clearances for all interested parties is a step in the right direction instead of doing so in case of only the highest bidder. “In the recent past, many contracts/ tenders, in which Chinese companies were participating, have been cancelled at the last moment. Such jeopardy could well be avoided [now]...”