Mumbai: VP Mahendru, chairman and managing director of Indo Asian Fusegear Ltd has outlined the expectations of the Indian electrical and lighting sector from Budget 2008.
Key highlights are as under:
Excise Duty cut for CFL and correction of the inverted duty structure
- The government should reduce excise duty on compact fluorescent lamps (CFLs) to 4 per cent, from the existing 8 per cent, with a view to promote the usage of this energy efficient equipment.
- The excise duty on all raw materials for CFL should be reduced from the existing 16 per cent to at least 8 per cent, as was done for complete CFLs in 2006 Budget. This would make domestic manufacturing cheaper than imported products, and correct the inverted duty structure between raw materials and finished CFL
- A uniform VAT across the country should be implemented, as a differential rate of VAT makes it difficult for many producers to operate on a fair or level playing field.
- The government should also take steps to reduce the import of cheap and inferior quality of CFL.
Making BIS mandatory with star ratings for all electrical devices
- The government should make Bureau of Indian Standards (BIS) Star ratings mandatory for all electrical devices across India, which will further extend the benefits of safe and energy efficient products to the end-consumers.
- Imported CFL should pass through BIS rating tests, and should also levy an import duty of 100 per cent on these inferior quality CFLs as anti dumping duty measures.
Import Duty Cut on Power Distribution equipments and components
- Power distribution system is a critical link between power generation and its consumption.
- To make a world class, safe and efficient distribution system available in an expedited manner, the import of power distribution equipments at a reduced Import Duty of maximum of 5 per cent should be allowed.
- Besides import of components that goes into the manufacturing of the power distribution equipments should also be levied import duty at the same rate as of equipments.
- In a stage where the electrical equipment industry is in a nascent stage to become a world class Indian industry, it is important for the government to ensure that the industry receives all the support in the form of low/zero duty import of raw materials and components
More Public - Private Partnership in Power Distribution System
- It is welcome initiatives by some of the State's Electricity Boards' going for public-private partnership process, though in a small way to improve the efficiency of the power system as a whole.
- The successful execution of incorporating the private players into the distribution of the power should be encouraged by introducing well designed Franchisee system for private players.