New Delhi, Aug 20 (KNN)  Power equipment makers and generators have expressed unhappiness with the government’s plan of making domestic equipment sourcing mandatory for mega projects. 

The move will increase the cost of building showcase power plants and would also further increase electricity tariffs.

There has been a rapid fall in orders placed by power developers with government owned-Bharat Heavy Electricals and other domestic manufacturers of equipment in the sector.

The Association of Power Producers, a body representing the private power generation companies, considers mandating only domestically manufactured power equipment for all future ultra-mega power projects, anti-competitive and believe that this will benefit a select domestic power gear makers. 

The Association has also said that mandatory domestic equipment sourcing is impractical and not in the interest of the country’s power consumers. 

The power generators have written to the finance minister, asking the government not to make it mandatory for them to buy local equipment, citing such a policy would be "retrograde" and "anti-competitive", as reported by media.

At present there are some companies like L&Toubro, Thermax, BGR Energy and JSW Energy, who are into power generation and equipment manufacturing but do not have much demand.

The ministry of heavy industries has been proposing the setting up of ultra-mega power projects that are to have a capacity of 4,000 mw. 

According to a media report, experts estimate that private power equipment makers may make losses of over Rs 1,000 crore a year due to lack of orders. 

Power equipment makers have also argued the association's claim that they have a 33 per cent protection and say the government has only imposed an import duty of 21 per cent on power equipment. 

India has boiler manufacturing capacity of 36,000 MW and turbine making capacity of 35,000 MW and the private sector accounts for over 40 per cent of it.  (KNN/SD)