Cabinet approves modifications to the Mega Power project Policy
merisarkar news service.
New Delhi, October 02, 2009
To simplify the procedure for setting up ultra mega power projects in the country the union cabinet on Thursday approved the modifications in the existing 'mega power project policy'. Namely it simplified the grant of mega power project certificate and extended the reduced custom duty rates for equipments imported for expansion of existing power plants.
The government is of the view that in order for Indian economy to grow at a faster pace the country would require massive capacity addition in power sector which is only possible by utilizing economies of scale.
The union cabinet's decision makes easier to get the certification for mega power plant. It will also encourage technology transfer and indigenous manufacturing in the field of super critical power equipments.
In the modified policy the conditions requiring inter-state sale of power for getting mega power status is removed.
The existing condition of privatization of distribution by power purchasing states would be replaced by the condition that power purchasing states shall undertake to carry out distribution reforms as laid down by the union power ministry.
The benefits of mega power policy will also be extended to supercritical projects to be awarded through international competitive bidding with the mandatory condition of setting up indigenous manufacturing facility.
A basic custom duty of 2.5% only would be applicable on brown field expansion of existing mega projects.
