Our Bureau

Mumbai, Feb. 14

Electrical and electronics manufacturers want the Government to categorise power generation and distribution business under "infrastructure facility" in the forthcoming Budget, in order to extend the benefits available only to owners of the projects to developers and operators, too.

At present, benefits under Section 80 IA are available to undertakings engaged in generation, transmission or distribution of power, but in a restricted manner, as turnkey contractors, who supply and operate the equipment, are not allowed such benefits.

The country's electrical and electronics industry has a gross annual turnover of over Rs 50,000 crore, with exports contributing Rs 5,000 crore in the last fiscal. The manufacturers are concerned over the recent free trade agreements with neighbouring countries like Singapore, Bangladesh and Thailand. "FTAs are essential in a globalised environment, but the recent ones with Thailand, Singapore and Bangladesh have thrown up new challenges for the domestic electrical industry. These countries reportedly do not have the manufacturing capability and could act as conduits for re-exports from China, Korea, Japan and Malaysia. The domestic industry apprehends dumping of finished goods, as the FTA partner countries have comparatively lower tariffs," a representative of the Indian Electrical and Electronics Manufacturers Association said.

(This article was published in the Business Line print edition dated February 15, 2006)
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