India bans the import of power equipment from China: Is India striving to overpower China through this retaliation step?

India bans the import of power equipment from China: Is India striving to overpower China through this retaliation step?

 In the last 10 years, 22,420 MW of supercritical power plants have been chosen and of these 12,540 MW were made on Chinese stuff, including CLP India’s Jhajjar plant, Adani’s Mundra and Tirora units,  Vedanta’s Talwandi Sabo project and Reliance Sasan. Other state-run power projects where Chinese accessories have been placed are DVC’s 600 MW Raghunathpur plant in West Bengal, Tamil Nadu’s 600 MW Mettur project, and the 600 MW Kalisindh plant in Rajasthan.

In what could the greatest economic retaliation action against China among a slew of such moves practiced by New Delhi recently, including severe Customs scrutiny and the banning of different Chinese apps in the wake of a short, bloody border stand-off, power minister RK Singh on Friday announced a complete prohibition will be in place immediately on import of power equipment from the bordering country.

The minister announced all equipment imported for application in the power supply system would be examined in the country to block Trojans, installed malware, or other cyber threats. Any import of materials from “prior reference” countries will need the prior approval of the government, the minister stated, even as he repeated that such permission won’t be possible for either China or Pakistan, a perennially hostile neighbour.

China has over the last few years remained a dominant source of power equipment for India, with a portion of approximately a third of the entire imported machines in terms of value. Imports of these capital-intensive instruments have been soaring at a fast pace despite adequate, if not excess, domestic capacity and India being a serious exporter of such materials.

Chinese banks and economic organizations have liberally provided long-term loan facilities to India’s power companies to improve the business of the country’s machinery producers and this has surely served for that country. Imports from China were worth over Rs 21,000 crore in FY19 and surplus of Rs 16,000 crore in April-December FY20.

It is not instantly apparent if the Indian power producers who have previously joined up with Chinese machinery suppliers will receive a refusal or a carve-out from the latest declaration. As much as 9,570 MW of the currently under-construction power plants — all from the private sector — have contracted with Chinese firms for providing turbines, boilers, and generators. The entire under-construction volume is 15,861 MW, of which 12,245 MW is in the private sector.