The duty cuts announced in the Budget for power transmission equipment makers will help domestic companies such as Bharat Heavy Electricals (BHEL) andAreva T&D India compete better with foreign players .
Finance Minister Pranab Mukherjee has proposed that import of components for manufacture of specified high-voltage transmission equipment be allowed at a concessional rate of 5% basic customs duty and 5% countervailing duty. Such components have also been exempted from special additional duty. “The duties were linked to generation projects and were as high as 7.5% in some cases. We have been asking for such a move by the government . This makes us competitive against many global companies,” BHEL chairman and managing director BP Rao said.
Areva T&D India did not offer any comment. “The idea is to make local equipment players more competitive against Chinese and Korean players. The concessional duties would give the domestic equipment makers a level playing field,” Deloitte India senior director Kalpana Jain said. The power ministry is working on upgrading 765 kV and 1200 kV transmission lines to reduce losses.
A transmission capacity of 90,000 circuit km lines is likely to be added in next Five-Year Plan period, beginning April 1, 2012. An inter-regional transmission capacity of 5,470 mw is expected to be added each year. State-owned monopoly Power Grid Corporation is executing nine highcapacity transmission corridors at an estimated cost of . 58,000 crore. The government has also extended the 10-year income tax holiday to power generation and transmission projects that are commissioned by March 31, 2012.
The exemption was earlier available to projects commissioned before March 31 this year. Besides, power equipment used for expansion of mega power projects has also been exempted from customs and excise duties. The excise and customs duty exemption available to ultra mega power projects has been extended for development of facilities such as ash disposal system , water treatment, storage and coal transportation facilities.
Finance Minister Pranab Mukherjee has proposed that import of components for manufacture of specified high-voltage transmission equipment be allowed at a concessional rate of 5% basic customs duty and 5% countervailing duty. Such components have also been exempted from special additional duty. “The duties were linked to generation projects and were as high as 7.5% in some cases. We have been asking for such a move by the government . This makes us competitive against many global companies,” BHEL chairman and managing director BP Rao said.
Areva T&D India did not offer any comment. “The idea is to make local equipment players more competitive against Chinese and Korean players. The concessional duties would give the domestic equipment makers a level playing field,” Deloitte India senior director Kalpana Jain said. The power ministry is working on upgrading 765 kV and 1200 kV transmission lines to reduce losses.
A transmission capacity of 90,000 circuit km lines is likely to be added in next Five-Year Plan period, beginning April 1, 2012. An inter-regional transmission capacity of 5,470 mw is expected to be added each year. State-owned monopoly Power Grid Corporation is executing nine highcapacity transmission corridors at an estimated cost of . 58,000 crore. The government has also extended the 10-year income tax holiday to power generation and transmission projects that are commissioned by March 31, 2012.
The exemption was earlier available to projects commissioned before March 31 this year. Besides, power equipment used for expansion of mega power projects has also been exempted from customs and excise duties. The excise and customs duty exemption available to ultra mega power projects has been extended for development of facilities such as ash disposal system , water treatment, storage and coal transportation facilities.
Thank you for the info. It sounds pretty user friendly. I guess I’ll pick one up for fun. thank u
ReplyDeleteL&t Switch Gear