Electrical Monitor

Mission Plan for Electrical Equipment Industry launched

EM News BureauTuesday, August 27, 2013, 16:53 Hrs  [IST]

mission planThe Indian Electrical Equipment Industry Mission Plan 2012-2022 was launched at the hands of Praful Patel, Union Minister of Heavy Industries & Public Enterprises, on July 24, 2013. The Mission Plan seeks to steer, coordinate and synergise the efforts of all stakeholders to accelerate and sustain the growth of the domestic electrical equipment industry.

Vision 2022 for the Indian electrical equipment industry as articulated in the Mission Plan is to make India the country of choice for the production of electrical equipment and reach an output of $100 billion by balancing exports and imports. The Mission Plan has been evolved by the Department of Heavy Industry (DHI) through an elaborate exercise involving all stakeholders and with the support of the Indian Electrical & Electronics Manufacturers’ Association (IEEMA).

Praful Patel said “while India’s electrical exports currently stood at a rather modest $5 billion, it is a matter of no small satisfaction that the country’s products are now being increasingly accepted and in demand in the global marketplace”.

Plan allocation should aim at the production of more power; the cost of producing power was on the increase, as a result of which realization suffered, with the utilities being unable to pay the IPPs, he noted. It is regrettable that despite our ample potential in solar power, the country doesn’t manufacture a single chip of silicon, preferring to import them from overseas. China, on the other hand produces about 60 per cent of the world’s silicon.

Detailed recommendations have been formulated for strategic and policy interventions in five critical areas that need to be addressed by the industry, with support from the government. These are industry competitiveness, technology up gradation, skills development, exports and conversion of latent demand. To carry forward the recommendations arising out of the Mission Plan, Inter-Ministerial Groups, comprising of representatives of the DHI and other ministries concerned, IEEMA, industry and other stakeholders will be constituted for monitoring the implementation of the recommendations and for periodic follow-up of its status.

Considering that the government plans to increase power generation capacity from 200 GW in 2012 to about 400 GW by 2022 with commensurate transmission & distribution capacity enhancement, Indian electrical equipment manufacturers not only have to meet demand of such huge capacity addition, but also that of metros, airports, railways, other infrastructure projects and increase in domestic consumer demand too.

Mission Plan
  • Level-playing field for domestic players
  • PPP model for new technology development
  • Sector Skill Council proposed
  • Policy support to manufacturers to improve global competitiveness
  • Timely completion of power generation and transmission projects

Presently, the domestic electrical equipment industry size exceeds Rs.1.20 lakh crore ($25 billion) with the share of generation equipment being about one-fourth and that of T&D being three-fourth of the total. The domestic electrical equipment industry contributed 1.4 per cent to the nation’s GDP in 2011-12 and 10 per cent to the manufacturing GDP. The industry provides direct employment to about 5 lakh persons and indirectly to about 10 lakh persons.

To enhance industry competitiveness, the Mission Plan calls for providing a level playing field in the country to domestic electrical equipment manufacturers vis-à-vis foreign manufacturers, replacing the L1 criteria of procurement by power utilities in India with two part bidding, augmenting domestic testing facilities to cover the type testing of all equipment, mandating type testing of imported small equipment in Indian labs, etc.

For technology upgrade, the Mission Plan recommends a coordinated and collaborative effort by industries and utilities. It also recommends public-private partnership (PPP) for fast development of new technology and systems.

Under skills development, it is suggested to set up a Sector Skill Council (SSC), which will undertake skill mapping and interact with the industry to provide training to the workers and also train the trainers and teachers, propose changes in curriculum, etc.

To boost exports of electrical equipment, the Mission Plan recommends providing policy support to domestic manufacturers to enhance their competitiveness in the global market and address issues of quality of the products, high transaction costs, non-recognition of test certificates of CPRI by some countries, high cost of production, high cost of finance, etc.

To convert the latent demand for power in the country, the Mission Plan calls for timely completion of power generation projects and the downstream transmission projects for evacuation of power and improvement in the health of power distribution companies.