Finance panel may reject $12 bn package to utilities Chinese bike maker CFMoto enters India
Sops were proposed to help power firms cut emissions
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India’s Finance Commission has told the power ministry that its proposal to award utilities Rs 83,500 crore ($11.6 billion) in incentives to install equipment to curb emissions is “unviable,” a senior official at the ministry told Reuters on Tuesday.
The ministry submitted its proposal to the Finance Commission, which reviews government spending, in February.
The proposal was intended to help plants comply with new sulphur dioxide emissions standards originally set by the environment ministry in 2015.
The standards mandate installation of pollution cutting equipment. Some plants must comply by the end of this year, while others have up to the end of 2022 to do so.
More than half of India’s coal-fired power plant units ordered to retrofit equipment to curb air pollution are already set to miss the deadline, Reuters reported on Friday.
The Finance Commission was likely to reject the power ministry’s spending proposal, according to the ministry official, who is not authorised to speak to media and so did not wish to be identified.
A spokeswoman for the Commission said the government body has not finalised its recommendations, but declined to comment further. If the Finance Commission rejects the proposal, the plans are unlikely to be approved by the government.
A power ministry spokesman declined to comment.
Emissions from power plants are one of the biggest causes of the chronic smog now seen in New Delhi and some other Indian cities.
The Association of Power Producers (APP), a lobby group for private utilities in India, estimates it will cost private companies roughly $38 billion to retfrofit their plants to cut emissions.
It contends that debt-laden power producers, which are still owed over $11 billion in dues by government-owned distribution companies, cannot afford to invest such vast sums at this time.
India has identified 34 economically stressed power plants with a combined capacity of 40 gigawatt (GW). They are owned by companies, including Adani Power, Essar Power, the GMR group, the Lanco Group and Jaiprakash Power Ventures Ltd.
The Ministry of Power wants to extend deadlines for some economically stressed power plants that have been ordered to retrofit equipment to curb air pollution, the official and two other power ministry officials familiar with the matter said.
Among the 34 plants, the debt of 28 plants are in various stages of resolution and some of those plants may be able to meet the emission deadlines, one of the officials said. The ministry wants to grant an extension for the other six plants, the official said, but did not name the plants.
The Supreme Court, which is hearing a petition on air pollution, will make the final call on the issue.
“We will finalise a list of plants which need extension and then submit to the Supreme Court, which will take a call,” the official said.
CFMoto, the Chinese motorcycle manufacturer, is the latest to enter the lucrative 21.18 million Indian motorcycles market by opening its first showroom in India at Thane, near Mumbai on Wednesday and it introduced four motorcycle models to lure buyers.
The Chinese firm has partnered with the Indian Anvita Autotech Works company to form a joint venture to sell the Chinese motorcycles. At present CFMoto sells a range of its bikes in about 100 countries.
India is the world’s largest motorcycles market where over 14 international and Indian bike brands such as American Harley-Davidson, Japanese Kawasaki, Italian Ducati, British Triumph Motorcycles, American Indian, Italian Benelli, Japanese Honda, Italian
MV Augusta, Japanese Yamaha and Suzuki, among others, compete for market share.
CFMoto, which has tied up with the Indian auto firm AMW which later changed its name to Anvita Autotech Works, has introduced four bikes called 300NK, 650NK, 650MT and 650GT priced at Rs 2.29 lakh, Rs 3.99 lakh, Rs 4.99 lakh and Rs 5.49 lakh respectively at pan India showroom.
Some of these bikes are cheaper by 12,000 to Rs 1.7 lakh compared with rivals such as Kawasaki, BMW and Honda bikes, officials disclosed.
“We as an Indian partner have invested Rs 80 crore in setting up an assembly plant near Bangalore and marketing the range of bikes in India,” Vamsi Krishna Jagini, CEO at Anvita AutoTech Works told Financial Chronicle. He said the present four new models called 300NK, 650NK, 650MT and 650GT would be upgraded to BS-VI norm compliant and start selling them in the Indian market from April 2020.