Patel to seek deterrent for Chinese power equipment imports

Sources close to Patel said the ministry of heavy industries and public enterprises would soon move a proposal to stop unbridled imports from China.

Surely,the proposal will find favour with the Plan panel that had last year recommended import duties of 14 per cent. But this was resisted by independent power producers. At present,imports of power equipment are duty free.

Planning Commission sources said the primary reason it was pushing for import duties on power equipment last year was to promote domestic manufacturing capacities. In fact,in its manufacturing plan for the Twelfth Plan (2012-13 to 2016-17),it has sought careful application of fiscal policies to boost Indian manufacturing.

In the last 2-3 years,private power producers have imported Chinese equipment that will help generate almost 35,000 mw of power.

India has consistently failed to meet its power capacity addition targets during the last two Plan periods (2002-03 and 2006-07 and 2007-08 to 2011-12). In the current or Eleventh Plan that ends March,2012,the government had originally set the target at 78,577 mw. Subsequently,the Plan panel pared it by 20 per cent to 62,374 mw.

Till the end of 2010-11 or the first four years of the Eleventh Plan,the power ministry could add only 34,615 mw.

In the current financial year that is also the last year of the Eleventh Plan,the power ministry may end adding at best another 15,000 mw or so taking the total capacity addition in five years to about 50,000 mw.

In the previous Plan (2002-03 to 2006-07),inadequate equipment capacity had failed the power sector and India could add just 20,950 mw or less than 50 per cent of its target of 41,110 mw. The country’s total installed capacity is about 1,50,000 mw.