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The direction of the Centre’s reforms in the energy sector has been satisfactory, but decision-making timelines are still too long, said Bhaskar Patel, Managing Director of Technip India.
Patel leads the India arm of the French engineering, procurement and construction, and project management company. “The direction is fine but decision-making takes time. For example, in one of the fertiliser projects we have undertaken, we were the L1 (lowest cost) bidder, but have waited for almost a year now for the go-ahead from the public sector company,” Patel told BusinessLine .
Globally, Technip’s revenue in the nine months ended September 2015 stood at €9 billion.
Technip India’s order book currently stands at ₹1,350 crore. The country forms only a small share in Technip’s global revenues from 48 countries where it has operations. Only about 25 per cent of Technip India’s operations is for local projects, the rest being back-office engineering support for the group’s global business.
“My aim over the next 2-3 years is to make sure at least 30-40 per cent of the work we do here is for Indian projects. That would give us a larger share of the revenue in the group,” said Patel.
“We see ONGC undertaking large-scale development in the eastern offshore blocks, which would have several billion dollar projects. If we win those projects that would take us to the top 10-15 countries. We are quite sure that ONGC will develop at least one or two projects over the next 12-24 months,” he added.
While Patel admitted that in the current low crude oil price scenario opportunities in India are exciting, the dominance of public sector units and their L1 bidding norms, however, becomes a hurdle for growth. “We pride ourselves for being technology-driven. But we are not able to fully show our capabilities because at the end of the day, once one is technically qualified, the only thing that matters is the cost. While offering new technology and solutions, market price becomes higher. Therefore, bidding rules in India are not giving the best solutions,” Patel said.
The other issue that Technip faces is that new technologies cannot be tested since their products need to be in operation for a year.
On the manufacturing front, the company is setting up a fabrication unit in Dahej, Gujarat. first phase of the project is expected to be operational soon. Products manufactured here will also be exported, Patel said.
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