Govt looks into Chinese equipment's performance at power plant.

NEW DELHI: The Power Ministry is looking into a report on performance of Chinese equipment being used in domestic power plants, amid concerns over cheaper imports hurting the struggling domestic industry.

The Central Electricity Authority, the apex planning body for the power sector, has prepared the report after getting inputs from various project developers.

According to a source, the report on the performance of Chinese power equipment being used in domestic power plants was recently submitted to the Power Ministry.

"The Ministry is looking into the report. It is yet to be made public," the source told PTI.

This is the second time the CEA has prepared a report on the performance of Chinese power gear. A similar study was done way back in 2008.

While preparing the report, the CEA had sought information from various power project developers. Since some of them did not provide the requisite details, the apex body had also served notices under relevant provisions of the Electricity Act, the source said.

Findings of the CEA could not be immediately ascertained. The latest report comes at a time when there are rising concerns that cheaper imports, especially from China, are hurting domestic majors including state-run Bharat Heavy Electricals Ltd (BHEL).

Besides, there is clamour for further hiking the import duty on imported power equipment which would provide a cushion for the struggling domestic industry.

Chinese equipment suppliers competing in India include Dongfang, Harbin Power, Shanghai Electric and SEPCO.

Many domestic players including Adani Power, Reliance Power and Lanco Infratech have placed orders with Chinese equipment makers.

Going by official estimates, Chinese equipment accounted for about 34 per cent or nearly 18,500 MW of the total installed power generation capacity of 54,964 MW in the 11th Five Year Plan (2007-12).

Last month, Heavy Industries and Public Enterprises Minister Praful Patel said that his Ministry has demanded an additional levy of five per cent on imported power equipment.

Patel has written to Finance Minister P Chidambaram seeking higher import duty on power gear, which currently attracts 21 per cent levy.

The demand comes against the backdrop of local power gear makers such as BHEL and Larsen & Toubro grappling with tough market conditions due to cheaper imports, mainly from China, and overall economic sluggishness.

In July last year, the government had slapped 21 per cent import duty on power equipment.

The Cabinet, last year, had approved 5 per cent basic customs duty, 12 per cent counter-veiling duty and 4 per cent special additional duty on import of power gear.

Source : economictimes.indiatimes.com