Around 60% of the investment for setting up transmission
infrastructure goes towards equipment with the market size estimated to be
around Rs.14,000 crore. Photo: Indranil Bhoumik/Mint
New Delhi: Attracted by Prime Minister Narendra
Modi’s ‘Make in India’ programme, and, more pertinently, to meet
conditions that make it mandatory for foreign companies wishing to sell
equipment to large Indian government projects to have factories in India,
China’s Baoding
Tianwei Group Ltd (BTW) and South Korea’s Hyosung Corp.
plan to set up electricity transmission equipment manufacturing facilities in
the country.
India and China have been at odds over the supply of cheap Chinese
equipment to Indian firms in sectors such as telecom and power generation over
security and quality concerns.
“Due to the mandatory requirement that one needs to have a
manufacturing base in India and the size of the electricity transmission
equipment market here, firm such as BTW and Hyosung have firmed up plans to
manufacture transformers and reactors here,” said a person aware of the
development requesting anonymity.
High-voltage transformers are used to pump up
voltage or to bring it down for electricity transfer across long distances and
will play an important role in increasing the footprint of the national grid.
Around 60% of the investment for setting up transmission infrastructure goes
towards equipment with the market size estimated to be around Rs.14,000 crore. India has installed power
generation capacity of 258,701.46 MW.
Queries emailed to BTW remained unanswered till press time.
Repeated phone calls to Hyosung’s New Delhi office also remained
unanswered.
State-owned Power Grid Corporation of India Ltd (PGCIL), which
operates around 113,587 circuit km of transmission lines plans to spend Rs.1
trillion to increase India’s inter-regional power transfer capacity of 46,450 MW
to 72,250MW by 2017.
Some other firms that supply equipment in the high-voltage segment
are Siemens AG, ABB Ltd, Areva
SA, Alstom and state owned Bharat
Heavy Electricals Ltd (Bhel). This comes in the backdrop of 300
million Indians lacking access to electricity with per-capita electricity
consumption being one-fourth of the world’s average.
Mint reported on 27 May 2010 that PGCIL was making it
mandatory for overseas equipment suppliers to have factories in India to
participate in its tenders, ruling out imports from China. Another state-run
firm, NTPC Ltd, India’s largest power generator, has also made
domestic manufacturing a pre-qualification criteria for companies to bid for its
equipment tenders.
Subsequently, China’s largest manufacturer of high-voltage
transformers, Tebian Electric Apparatus Stock Co. Ltd (TBEA), which
has been a major supplier of transformers and reactors to the Indian
transmission sector started manufacturing locally.
“PGCIL has been increasingly mandating the supply of power
transmission and distribution (T&D) equipment from facilities in India,
besides specifying a local service setup in India for HV (high voltage) and EHV
(extra high voltage) power T&D equipments, as clause in the PQR (pre
qualification requirment). This has resulted in many global Power T&D majors
(Alstom T&D, ABB, Siemens, etc.) setting up local facilities in India for
manufacturing HV and EHV equipments (viz Transformers, Reactors etc.),” said
Amol
Kotwal director, energy and environment practice (South Asia &
Middle East) at Frost & Sullivan.
The electricity transmission equipment firms’ plans comes at a time
when US-based First Solar Inc. and China’s Trina Solar—the
world’s largest maker of photovoltaic modules—is considering plans to set up
manufacturing facilities in India, drawn by the nation’s ambitious solar power
generation target.
Modi, after leading the National Democratic Alliance to victory in
the April-May general election, launched the Make In India campaign in September
to attract foreign companies to invest and manufacture in India and export to
other countries.
Modi and his Bharatiya Janata Party (BJP) have placed special
emphasis on manufacturing, in which India lags behind Asian economies such as
China, to boost economic growth.
“The Chinese equipment suppliers, not to be left behind, have also
established facilities in an effort to tap the burgeoning demand for Power
T&D equipments in India and meeting PGCIL’s domestic content clause. TBEA
has already set up a huge Green Energy Park at Vadodara,” Frost & Sullivan’s
Kotwal said.
“Given this trend, it is expected that Korean and other Chinese
majors shall soon follow in setting up their manufacturing facilities in
India.”
source:livemint
Comments