Power Ministry to seek 19% duty on imported power gear, again

The Power Ministry is likely to move its proposal to levy 19 per cent duty on imported electricity equipment for large projects to the Cabinet. Earlier, the ministry had withdrawn a proposal in this regard.

"We may not make any changes in the proposal and send it to the Cabinet again as the earlier one (proposal) was withdrawn because it was (sent) too close to the Budget," a official said.

The proposal is aimed at safeguarding the interests of the domestic power equipment makers like BHEL and L&T.

At present, equipment for projects with less than 1,000 MW generation capacity attract 5 per cent import duty while the rest enjoy duty-free import of equipment.

Power gear makers have been demanding the duty as they are facing stiff competition from the Chinese companies.

Meanwhile, private power producers have opposed imposition of duty stating that this would lead to an increase in electricity tariffs.

While the power ministry is proposing 5 per cent basic customs duty on the equipment, the Commerce Ministry is pitching for 15 per cent, an official said.

Meanwhile, the Budget 2012-13 has also proposed to increase the excise duty from 10 per cent to 12 per cent.