Leading private power producers including Tata Power, Reliance Power, Essar Power, Adani, Jindal Power, GMR, GVK and the Lanco Group have come together against the government’s move to impose a uniform customs duty on import of equipment for power projects.
“The proposal under the assumption to create a level playing field for domestic equipment manufacturers is set to derail the capacity addition programme being envisaged from private sector,” said Prasad R. Menon, managing director, Tata Power in his August 11 letter to the Prime Minister.
“The proposal to limit the benefits to power projects under mega power policy and imposition of customs duty will also have serious implications for the tariff which have been determined for the power being sold from these large ultra mega and other mega power projects,” the letter said. Menon is the chairman of the Association of Power Producers, while Reliance Power’s MD J.P. Chalasani is its vice chairman.
The representation follows the decision of the committee of secretaries led by Cabinet Secretary K.M. Chandrasekhar to do away with the import duty benefits on equipment imports for mega power projects. This is being done to safeguard the domestic industry against cheaper equipment imports especially from China.