Players in the power equipment manufacturing industry are divided on the issue of imposing higher import duty on power equipment to prevent the influx of Chinese equipment and protect the domestic players  It seems that the government’s stand to levy 14% customs duty on the import of power equipment to safeguard the domestic industry against the influx of Chinese equipment has not satisfied domestic power equipment makers. Giants in this segment such as Larsen & Toubro and Bharat Heavy Electrical Ltd, among others are asking for a higher import duty to save the domestic equipment makers from the Chinese threat. According to these giants, usage of Chinese equipment is impeding their expansion plans and resulting in loss of revenues.Conflicting situation
However, according to another section—comprising private players—in the industry, imposing higher duty on power equipment is not the ultimate solution to create a level playing field for Indian firms. According to Harry Dhaul,director general of Independent Power Producers Association of India, “The conflict is between consumers and stakeholders of the aforementioned companies. Consumers want quality equipment at the lowest possible cost and if the country wants to produce power for everybody, then levying long-term import duty would be difficult to sustain. The interest of consumers should be given priority.”
Notably, the Association of Power Producers (APP), a 12-member body comprising major private sector power players such as Adani Power, Lanco Infratech etc, have shown their dissatisfaction on the levy of import duty on Chinese equipment as these are important for them to undertake capacity addition programmes.
National standard system for power equipment
“The government must look to set up more power equipment firms in India, which will not only help to satisfy the domestic demand, but also ensure that India is not dependent on any other country for procuring power equipment,” comments M Chandrashekhar, manager at Manu Power Equipment Pvt Ltd, a small-sized power equipment dealer in Hyderabad.
Meanwhile, for environmental and energy efficiency, the government has started a process of implementing a national standard system for power equipment.
Arup Choudhury |
