Impose 14 pc duty on capital goods import: minister

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SME Times News Bureau | 17 Dec, 2010
Minister for Heavy Industries and Public Enterprises Vilasrao Deshmukh Thursday urged the finance ministry to impose 14 percent customs duty on capital goods import in a bid to provide a level-playing field to the domestic industry.

"We have requested the finance ministry to impose 14 percent customs duty on capital goods import. I will refer the matter to the cabinet for a decision," Deshmukh told reporters on the sidelines of a conference organised by the Federation of Indian Chambers of Commerce and Industry (FICCI) and the department of heavy industries in New Delhi.

He said the department had chalked out a plan for setting up four common facility centres - for machine tools, textile machinery, heavy electrical equipment and process plant equipment.

Establishment of two industrial cluster parks for machine tools and textile machinery to enhance the competitiveness of the Indian capital goods industry has also been planned, he said.

"The finance ministry has agreed to make a provision of Rs.300 crore for the development of common facility centres and industrial cluster parks for giving a boost to the domestic capital goods industry," said Deshmukh.

"The benefits envisaged from common facility centres and industrial cluster parks are abolition of capital investment programmes by individual units, provision of value added services like accredited testing centres at affordable prices, quality upgradation, optimum utilization of equipments, better supply chain management and employment growth," Deshmukh said in his inaugural address at the conference.

Secretary of Department of Heavy Industries B.S. Meena expressed concern over the continued dependence on imports for meeting the requirements of the capital goods sector.

"Half of the requirements of the sector are met through imports and this is bound to rise with the growth in the economy and the growing needs of the nuclear power and defence sectors," Meena said.