No plans for new import duty on power equipment: govt

No new duty will be imposed on imports of Chinese power equipment, the government informed Parliament today.

"During the pre-budget 2010 exercise, the proposal to impose import duty on power equipment was examined and it was decided not to make any changes in the present duty structure," Minister of State for Heavy Industries and Public Enterprises Arun Yadav said in a written reply to a Lok Sabha question.

Yadav said that discussions were held with different stakeholders on the issue before it was decided to maintain the current level of duty on power equipment imports. According to sources, cheap Chinese power equipment imports are posing a threat to domestic manufacturers like Bhel.

State-run Bharat Heavy Electricals Limited (Bhel) was demanding a 10 per cent customs duty on import of equipment for projects awarded through the international competitive bidding route and mega power plants.

At present, 5 per cent customs duty is imposed on equipment imported for projects awarded through the ICB process, while there is no duty on power equipment sourced for mega projects with a capacity of 1,000 MW and above.

Bhel is the country's largest public sector power equipment player and manufactures units that can generate 10,000 MW of power annually. The company plans to take this capacity upward to 15,000 MW by the end of the current financial year.