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Home News Power Sector News Industry Seeks 14% Duty On Power Equipment, NTPC objects

Industry Seeks 14% Duty On Power Equipment, NTPC objects

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NTPCIn a move that may spell trouble for private sector utilities and Chinese makers of power generation equipment, heavy industries minister Praful Patel has called a meeting today to discuss and push for the imposition of customs duties on imports of such equipment.

The meeting will be attended by officials from the ministries of heavy industries, commerce and power, and follows demands by local manufacturers to restrict Chinese power equipment importsm which grabbed market share over the years due to 20 per cent cheaper prices.

If the duty, to be levied on power equipment import in form of Basic Custom duty, is agreed upon in the meeting, it will turn out to be helpful for Indian players like L&T, BHEL, BGR, Thermax among others.

Power equipment cost will then increase by 15-21 per cent, especially for players like Adani Power, Reliance Power, Lanco who have ordered Chinese equipment.

NDTV broke a story last week on a Cabinet note regarding the same with the Prime Minister's Office (PMO) asking to prepare a list of current and future mega power plants, with capacity of 1000 MW and above, that do not pay any duties on import of equipment. Currently, non-mega plants have to pay a duty of 5 per cent on equipment imports.

PMO has asked to remove this disparity and implement the Arun Maira committee panel recommendation of 19 per cent duty.

Meanwhile Arup Roy Choudhury, CMD of state-run power generator NTPC said that one of the important components is fixed cost which goes by cost of imported equipments or equipments. There is already a 15% purchase preference which is being enjoyed by domestic suppliers. Any increase beyond this is only going to load price of electricity.


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