BackBhel and L&T seek 10% duty on foreign power equipment
Bhel and L&T seek 10% duty on foreign power equipment
Mumbai: Indian power equipment makers, which include Bharat Heavy Electricals Ltd (Bhel) and Larsen and Toubro Ltd, have asked the power ministry to impose a 10% import duty on such machinery to offset an unfair cost advantage that they claimed Chinese firms enjoyed.
The companies said this will help protect the interests of Indian firms by providing a level playing field against Chinese rivals such Shanghai Electric Group Co. Ltd and Dongfang Electric Corp. Ltd.
A copy of the letter was reviewed by CNBC-TV18.
Bhel has lost about Rs36,000 crore in business to its Chinese counterparts in fiscal year ended 31 March, said a person familiar with the situation, who declined to be named.
Indian companies have alleged that Chinese suppliers get a benefit from their respective companies as export incentives.
Also, the large gap in interest rates is hurting them as it allows Chinese firms to place lower bids, they said. Indian suppliers have an interest burden of almost 11-12%, while these overseas firms pay only 1% or 2%, and even no interest in some cases, they claimed.
Currently, equipment imported for 4,000MW power projects attracts no duty, while machinery for smaller projects carry a 4% levy.
cnbctv18@livemint.com
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