Why can't China's new energy industry enter the Middle East without Indian company L&T?

JinkoSolar secured a major photovoltaic module contract for Saudi Arabia’s NEOM project, enabling Chinese new energy equipment suppliers to enter the Middle Eastern market via Indian engineering and construction giant Larsen & Toubro (L&T). As the global clean energy transition accelerates, the Middle East is emerging as a hotspot for new energy infrastructure development. This article is the 63rd installment of the “Business Insights on the Middle East” series by the China-Arab Industrial Research Institute, offering in-depth analysis of industrial policies, laws and regulations, industry trends, market demand, competitive landscape, and potential transaction opportunities in China–Arab investment, trade, and engineering construction. Recently, JinkoSolar, a leading Chinese solar PV manufacturer, announced it has signed a supply agreement with Indian engineering and construction leader Larsen & Toubro (L&T) to provide solar panels for L&T’s photovoltaic project in NEOM, Saudi Arabia’s futuristic city. This collaboration not only marks deeper penetration of Chinese new energy equipment suppliers into the Middle Eastern market but also highlights L&T’s pivotal role as a key partner for Chinese enterprises entering the region. The NEOM Green Hydrogen Project is one of the most pioneering clean energy initiatives currently underway in the Middle East. Under construction at the Oxagon industrial zone in NEOM, the project aims to produce 600 tons of carbon-free hydrogen per day by the end of 2026, converting it into green ammonia—a vital clean fuel anticipated for future transportation and industrial applications. In its statement, JinkoSolar emphasized that participating in this world’s largest green hydrogen project represents a critical step toward a sustainable future in the region—and strongly aligns with Saudi Arabia’s Vision 2030. Behind this landmark order, L&T’s role is indispensable.

Who will replace Chinese contractors in the next decade?

Then came the South Koreans. In 1973, Korea’s Samhwan Construction won its first Middle Eastern contract—the construction of a 164-kilometer highway in Saudi Arabia—with the lowest bid of approximately $25 million. Despite tight deadlines and high risks, Samhwan completed the project successfully and to high standards—earning Korean contractors a reputation in the Middle East of exceptional value: 'hardworking, high-quality execution, and low pricing.' Following Samhwan, Korean construction firms flooded into the region. Korea’s Middle Eastern contracting revenue surged from $25 million in 1973 to nearly $8 billion by 1978. In 1976, Hyundai Engineering & Construction outcompeted nine European and American contractors to win the Jubail Industrial Port project in Saudi Arabia—valued at $940 million, with a bid $300 million lower than the runner-up’s, equivalent to nearly one-third of Korea’s national budget that year. Then came the Chinese. In the 1980s, over 80% of China’s overseas business consisted of labor export, and most projects it undertook were low-end civil construction works. During the construction of Beijing’s China World Trade Center Phase I in 1985, the general contractor was French firm SAE, while China State Construction Engineering Corporation’s First Bureau served only as the main subcontractor. By contrast, during the construction of Phase III in 2006, the same First Bureau had become the EPC (Engineering, Procurement, and Construction) contractor. Over two decades—from subcontractor to EPC contractor, from supporting player to lead actor—this transformation epitomizes the dramatic leap in China’s international engineering capabilities. Each successive wave of change follows an eerily similar script in its early phase: newcomers displace prior leaders by offering lower prices, larger scale, and greater resilience. A German retiree with 35 years’ experience in Europe’s international contracting industry once summarized this competitive logic in two English words: 'Cheap & Easy'—low cost and high volume. He did not intend this as criticism. Rather, he described a harsh industry reality: Japan and Korea rose to dominance over Western firms through 'Cheap & Easy'; later, China proved even *cheaper* and *easier*, overtaking Japan and Korea. So what if someone emerges who is *even cheaper* and *even easier*? The challengers are no longer hypothetical. Flip open the 2025 ENR Top 250 International Contractors list—and the challengers are no longer theoretical; they are factual. Turkey: 45 Turkish firms made the list—the second-highest national count globally—with eight ranking among the top 100. Since 1972, Turkish contractors have secured 12,641 projects across 137 countries, totaling over $540 billion. In traditional Chinese markets such as Libya, Iraq, and Saudi Arabia, Turkish firms—leveraging geographic proximity and inherent trust within the Islamic cultural sphere—are becoming increasingly formidable competitors. India: The pace of internationalization by India’s largest contractor, L&T, is striking. In FY2025, L&T’s international revenue accounted for 50% of its total revenue; internationally sourced orders represented 39% of its infrastructure division’s backlog, and overseas revenue constituted 66% of its energy division’s income. Alone, the Saudi and UAE markets contributed over 60% of L&T’s newly signed international contracts. Even more critically, L&T’s overseas order volume more than doubled within just two years. Another Indian firm, Afcons Infrastructure, is also rapidly expanding overseas: in early 2026, it secured a road project in Uganda valued at over €100 million.

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L&T Technology Services reported a 19.6% rise in net profit and anticipates a strong second half driven by large deals and sustainability segment growth.

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L&T Technology Services Expects Robust Second Half as Deals Ramp Up; Quarterly Revenue Rises

L&T Technology Services Expects Robust Second Half as Deals Ramp Up; Quarterly Revenue Rises

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