Power gear companies raise alarm over surging Chinese imports

Indian power equipment makers say that the rapidly rising Chinese imports is a big security risk as Beijing can disrupt the Indian economy by withdrawing technical support to plants built with cheap imports.

 

Indian import of power equipment from China climbed to 45% in 2012-13 from 15% in 2005-06, according to the Indian Electrical and Electronics Manufacturers' Association (IEEMA), whose members have a combined annual turnover of over Rs 1,25,000 crore.

 

IEEMA plans to take up the issue with the Central government as it feels that the Indian power sector is leaning too heavily on China.

 

Slowdown in Indian power sector and import of aggressively priced Chinese equipment have compelled Indian manufacturers to operate at well below 70% of capacity utilisation, it estimated.

 

"We need to be cautious about banking on a single nation to such an extent. Intrusion at border is watched by Indian forces and intelligences, which are well equipped and trained to deal with it. But it has gone unnoticed in Indian power generation, transmission and distribution.

 

Chinese electrical equipment and their service centres may function in fair weather, but we want to draw attention of the policy makers what happens to this critical machinery in turbulent times when they withdraw support of spares and engineers and technology," the association's directorgeneral Sunil Misra told ET.

 

He said Chinese firms are in process of setting up service centres in India after some of the power producers have started experiencing hiccups in functioning of imported equipment. The Central Electricity Authority said in a recent report that operation of Chinese equipment needs more human intervention and is not as efficient as the gear supplied by BHEL. Adani Power, Reliance Power Lanco and Power Grid Corporation are some of the largest importers of  Chinese equipment in India.

Misra said he is not against foreign direct investments from China. "But we should not pay high cost for cheap equipment. China won't buy any critical product from India in such a huge quantity," said Misra, who spent three years in China during his stint with the Confederation of Indian Industries. "With the introduction of modern technologies such as smart grid, many things will be controlled by computers. This poses new set of challenges for security of critical systems. So should we not think how much we buy from where," he asked.

 

Misra said that hidden subsidies and cheap inputs have helped Chinese manufacturers dominate markets. "Like many other products, Chinese manufacturers have beaten even advanced countries in power equipment making. They are largely controlled by the government and they have a very different notion of cost and pricing strategies for their products. Indian players would have succeeded if they were given level playing field against the Chinese players, who are backed by hidden subsidies and cheap inputs," said Misra.