Explained: The Chinese delay that pushed Piyush Goyal to say: 'We should stop buying German equipment'

Herrenknecht, a German mechanized tunneling company, has reportedly  claimed "extraordinary circumstances" with Chinese customs, delaying deliveries of tunnel-boring machines intended for Indian projects. 

The issue, the company said, has severely impacted their ability to meet obligations to Indian clients.

“For several months now, we have been observing extraordinary circumstances in the customs clearance processes for machines to be delivered from China to India. These are hindering us from fulfilling our delivery obligations as expected and, in some cases, entirely,” a Herrenknecht spokesperson was quoted as saying in an Indian Express report.

The situation gained public attention when Union Commerce Minister Piyush Goyal addressed it directly with Germany's Vice Chancellor and Federal Minister for Economic Affairs, Robert Habeck. 

The exchange occurred during a Delhi Metro ride, part of Habeck’s visit to India for the 7th India-Germany Inter-Governmental Consultations. Goyal expressed his frustration, pointing out that TBMs made by Herrenknecht in China were being blocked from export to India. 

“We should stop buying German equipment now,” Goyal remarked, highlighting the urgency of the situation.

Habeck, initially appearing unfamiliar with the specifics, asked, “They are producing in China?” Goyal confirmed, emphasizing the impact on crucial infrastructure projects. In response, Habeck stood up from his seat and acknowledged, “I think I should listen to you.”

Herrenknecht, which operates globally from over 60 locations, remains a key player in India’s tunneling projects. Through its Chennai-based subsidiary, the company has supplied TBMs for metro networks in Delhi, Mumbai, Chennai, and other major cities. The company declined to specify the number of TBMs affected or the projects impacted, citing confidentiality agreements.

Additionally, Herrenknecht noted that its central production facility in Schwanau, Germany, remains crucial for manufacturing key components, even as large steel structures are fabricated and assembled at its facilities in China and India. 

“This allows our customers to verify the functionality of the machines in their entirety at one location and rely on consistently high-quality standards,” the company explained.

The video of Goyal and Habeck’s exchange, which has since gone viral, underscores the strain these delays are placing on India’s infrastructure ambitions. The ongoing issue highlights the challenges faced in international manufacturing and supply chain logistics, especially in sectors critical to urban development and civil infrastructure.