EESL ‘admits’ LED bulbs were ‘assembled’ in India

Firing another salvo after alleging on Monday a ₹20,000 crore scam in importing LED bulbs from China, Congress spokesman Shaktisinh Gohil on Tuesday posed a few more questions to the Power Ministry.

• Why did India, the world’s third largest economy, require to borrow foreign funds for a small LED programme?
• Isn’t it true that EESL made the cost higher by not allowing state utilities and Indian manufacturers to manufacture the bulbs in India?
• How was an Indian Revenue Service Officer appointed MD of EESL after he was made to leave the service?

Reacting to Gohil’s earlier allegations in the procurement of LED bulbs, the state-owned Energy Efficiency Services Limited (EESL) on Tuesday refuted the claims in a Press Information Bureau (PIB) press release. EESL—a company under the administrative control of Ministry of Power—said the claims were false, misleading and devoid of any facts.

However, EESL refrained from saying that the bulbs were manufactured in India. Gohil pointed out that his allegation that the bulbs were not manufactured in India has actually been borne out by the rejoinder issued by the company.

“There is no specific reply in the EESL press statement to the charges I made yesterday. In fact, the statement only reiterates my point that the LED bulbs were not manufactured in India, but only assembled here,” said Gohil.

EESL was given the contract on ‘nomination’ not allowed by CVC guidelines, he claimed.

There clearly was some ambiguity in EESL’s Tuesday press release.

It said that the procurement norms for the LED programmes allow only those bidders who have “manufacturing facilities” in India. As a result, almost all LED bulbs are “being assembled” in India and the manufacturing capacity has risen to about 3-4 crore LED bulbs every month now from about 1-2 lakh three years ago.

So, does this mean that though there were manufacturing facilities, the LED bulb components were imported and then assembled in these facilities? “That is exactly what it means,” says Gohil, adding that almost all diodes of the LED bulbs have been manufactured in China, and EESL is admitting in the statement that the companies only assembled the components in India.

The next sentence in the statement says: “EESL would like to state that ‘no Chinese’ or any other manufacturer who is ‘yet’ to set up manufacturing facilities in India has participated in the tenders.”

This sentence also just reiterates that only those manufacturers who had manufacturing facilities in India “participated” in tenders. It does not clarify on whether after winning the tender, these companies or some of them only assembled the parts which may have been imported.

Gohil said there were many more faultlines in the EESL statement. For instance, it starts by saying that the LED bulb e-procurement is conducted in the most transparent manner, adhering to prescribed guidelines. “That’s incorrect. Being a central Public Sector Undertaking, EESL does not procure from the central procurement portal. This is not adhering to the Central Vigilance Commission guidelines,” he alleged.

He goes on to claim about a dozen more flaws in the statement, such as EESL claiming that the LED street light project in the Navsari Nagarpalika project in Gujarat had a verified electricity bill saving from October 2016 to January 2017, which was at ₹2,24,891 and 61,932 units, as per the Chief Officer of the Urban Local Body. “I have received an RTI (Right to Information) reply on this. No actual bill is reduced,” he said. Clearly, the issue doesn’t seem like fading away soon.