IPPs face hard times over equipment import issue

Most Independent Power Producers (IPPs) have been put in a quandary due to delay in the implementation of government announced changes in power plant equipment import norms. According to the older norms, the company has to pay an import duty of about 27.5 per cent upfront. On the other hand, the new norm will give the IPPs an option to provide a bank guarantee or corporate guarantee. Lanco Infratech is in a soup for not collecting the equipment they imported for their 1,320 MW Vidharbha power project. The equipment has been lying idle at the Mumbai port for over a month and according to Major Port Trust Act, the Mumbai Port Trust now holds the right to auction it off.