To keep Chinese at bay, Patel seeks bids for sourcing power equipment

  • 23/01/2012

  • Indian Express (New Delhi)

The Heavy Industries Ministry is pushing hard to ensure that the award of equipment contracts by developers of large power projects is done mandatorily through a bidding process, rather than the current practice of developers placing orders directly on the vendors of their choice. Speaking to reporters here, Heavy Industries Minister Praful Patel said the equipment bids for large power projects should be “rejigged” to allow domestic gear makers to participate in the procedure. Patel said he would raise the issue in a scheduled meeting with Prime Minister Manmohan Singh later in the day. Patel had also met Power Minister Sushilkumar Shinde to discuss the possibility of levying an import duty on power equipment coming in from Chinese, Russian, Korean and other overseas vendors. Currently, equipment imports are exempt from duty under the Centre’s Mega Power Policy that is applicable for thermal projects of 1,000 MW and above. Earlier, a panel headed by the Planning Commission Member Arun Maira had proposed the imposition of a 14 per cent levy to bridge the duty differential faced by domestic firms in comparison to gear manufacturers from abroad while bidding for mega and ultra mega power projects. “In the Eleventh Plan period, imports were freely allowed; but we feel that now in the Twelfth Plan, imports need to be regulated by some way of a duty structure. What we are pursuing is the Arun Maira committee’s recommendations. The Power Ministry has some views based on the committee of secretaries recommendation,” Patel said.