Department of Heavy Industry will pursue a 14 per cent duty on power equipment imports, says Mr Vilasrao Deshmukh

The Department of Heavy Industry will pursue a 14 per cent duty on power equipment imports, said Mr Vilasrao Deshmukh, Union Minister for Heavy Industries and Public Enterprises.

“We'll pursue the matter till it is imposed. We'll refer the matter to the Cabinet for a decision,” he said, speaking at the sidelines of the National Conference on ‘Indian Capital Goods Industry – Prospects and Issues: Enabling Framework for Sustainable Development', organised by FICCI.

Support offeredThe Finance Ministry has agreed to provide Rs 300 crore to create clusters and other facilities required for capital goods sector and it may reach up to Rs 1,000 crore next year, said Mr Deshmukh.

To enhance competitiveness of the domestic capital goods industry, a scheme has been envisaged for consideration of the Expenditure Finance Committee in the Ministry of Finance.It includes setting up of four common facility centres for machine tools, textile machinery, heavy electrical equipment, and two capital goods specific industrial clusters.Currently, capital goods sector suffers from a number of difficulties such as non-availability of advanced technologies, benchmarking, inadequate infrastructure and absence of level playing field.

Competitiveness

This could adversely affect the competitiveness of the user manufacturing and infrastructure industries, forcing them to resort to imports of machinery, services and components for repair, said Mr Deshmukh.“We need to upgrade our technology, develop skills and increase cost competitiveness vis-à-vis developed countries who have already registered a strong presence in the field,” he said.At present, India imports almost 50 per cent of its capital goods requirements.