Engineering major Larsen & Toubro (L&T) on Wednesday said it will be "conscious" of government's directives while getting into future partnerships with Chinese firms for fresh orders, even as it would continue with the existing tie-ups for contracts as most of them are for critical projects.

"...it's something that we need to work through because as you know the orders from supply from China are contractual orders and we cannot, based on political stance, immediately turn turtle. So we have to make sure that all the obligations are understood in whatever contracts we have signed," L&T Group Chief Financial Officer R Shankar Raman said during a media call.

Amid rising tensions between India and China following violent clashes at the border, the government had banned 59 Chinese mobile apps. Some of the major establishments such as Indian Railways decided to cancel a contract awarded to a Chinese firm, while MMRDA scrapped the tender process which had attracted bids from only Chinese firms.

Raman said that Chinese firms, which it had contracted, are providing critical equipment for some of the projects and helping in implementing and operating them.

"So we are not trying to turn them off and send them away. They are much part of the deals, but fresh deals we will be very conscious of what the government is saying...at the same time we have to develop an alternate ecosystem and it is not going to be an on-off kind of situation where you find a next equally compelling vendor or supplier available," he added.

Raman further said the company will need to do some more searching and surfing for future projects. "We constantly anyway do the searching in the sense that there is no mandate in the company that we should be only sourcing from one source. We will continue to do that, just that we will be conscious of the External Affairs Ministry and the government directives towards all of this. These are must watch for us," Raman added.

He noted that the anti-China sentiments have "fortunately" coincided with relatively dull ordering period, due to the COVID-19 pandemic. "If it had been a very busy season for order wins then it would have become much of a challenge," he added.

Raman said the current environment has provided opportunities, and people are putting their hands up knowing the geopolitical developments. "The world is talking about a consortium of alliance partners against the Chinese partners so this is not an India specific issue, so lot of vendors and supply chain partners are putting up their hands and looking at India as a potential, if not this year then may be next. We are also getting inward enquiry so we are evaluating that," he added.

First Published:Jul 23, 2020 7:58 AM IST