The Ministry of Finance is considering plans to do away with five-year old restrictions on Chinese firms bidding for government contracts, sources told news agency Reuters on Thursday.
The plans come amid India's efforts towards reviving commercial relations with Beijing after border and diplomatic tensions have eased recently. Restrictions on China had been in place since 2020 following a deadly border clash between the nations' troops.
Chinese firms were barred from competing for Indian contracts with an estimated value range of $700 billion to $750 billion because of the curbs, until they registered with an Indian government committee and obtained political and security clearances.
These measures had reportedly weighed down on Indian government departments and ministries and delayed development of projects, specifically in the power sector.
Curbs imposed on Chinese imports for the power sector have disrupted New Delhi's plans to expand its thermal power capacity to about 307 GW over the next decade.
"Several ministries have requested exemptions to overcome the constraints that could derail projects in their sectors," the government source told Reuters.
The sources, who chose to remain anonymous, added that officials are making efforts towards removal of the registration requirement for bidders from bordering nations.
A high-level committee led by a former cabinet secretary, Rajiv Gauba, has also reportedly recommended easing the restrictions. Gauba is now a member of a top government think tank.
Value of new projects awarded to Chinese bidders fell 27% year-on-year to $1.67 billion in 2021, Reuters cited a 2024 report from the Observer Research Foundation.
The final decision regarding these restrictions, however, lies with Prime Minister Narendra Modi, the sources specified.
Efforts towards India's reset of ties with China picked up pace after US President Donald Trump imposed 50% punitive tariffs on India in August 2025, citing its purchase of Russian oil.
Following the sanctions, Modi visited China for the first time in seven years and agreed to culminate deeper commercial ties with Beijing.
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