Indian Power Ministry to seek 19 percent duty on imported power equipment

• 12 years ago (2012-03-21)
• David Flin

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India’s Power Ministry has said that it is likely to place its proposal to levy 19 percent duty on imported electricity equipment for large power projects before the Cabinet. Earlier, the Ministry had withdrawn a similar proposal. An official said: “We may not make any changes in the proposal and send it to the Cabinet again, as the earlier proposal was withdrawn because it was sent too close to the Budget.”

The proposal is intended to safeguard the interests of domestic power equipment manufacturers such as BHEL and L&T. At present, equipment for projects with less than 1000MW generation capacity attract 5 percent import duty, while large projects enjoy duty-free import of equipment. Domestic power equipment manufacturers said that they needed this protection as they are facing stiff competition from Chinese companies. However, private power producers have opposed the imposition of import duty, claiming that this would lead to an increase in electricity tariffs.