DECEMBER 20238TOP STORIESGOVERNMENT TO INCENTIVISE DOMESTIC MINING EQUIPMENT MANUFACTURINGCG POWER & MURUGAPPA GROUP TO SETUP OSAT FACILITYAn inter-disciplinary committee comprised of officials from Coal India Ltd, the railway ministry, the heavy industries ministry, NLC India Ltd, and NTPC Ltd, among others, has recommended encouraging domestic mining equipment manufacturing through incentive schemes, standardisation, and specific tendering clauses. This gains importance because coal is expected to remain the dominant energy source beyond 2030. The committee anticipates a significant demand for equipment over the next ten years.According to a government release, the committee also included representatives from Singareni Collieries Company Ltd, West Bengal Power Development Corporation Ltd, Bharat Earth Movers Ltd, Caterpillar India Pvt Ltd, Tata Hitachi, Gainwell India, and industry associations.The committee has suggested the standardisation of equipment in line with Coal India's existing equipment standardisation effort, the government said.It has also stated that tender clauses should encourage the use of domestic equipment. A proposal was made to incentivize manufacturers to design, develop, and manufacture equipment in India for five years as part of the Make in India initiative.Coal India currently imports high-capacity equipment worth 3,500 crore, including electric rope shovels, hydraulic shovels, dumpers, crawler dozers, and others, with an additional 1,000 crore in customs duty. CG Power and Industrial Solutions from Murugappa Group are setting up an Outsourced Semiconductor Assembly and Test (OSAT) facility in India with an application signed off by the Ministry of Electronics & Information Technology (MeitY).Both companies are believed to have poured in about Rs 6,592 crore ($791 million) in the course of five years, and the same is expected to be invested by subsidy, JV partners' equity contribution and debt, as required.Likewise, the company has already sought a subsidy and is awaiting approval.With regards to the subsidy and the project, the company revealed plans for a joint venture partnership involving technology providers or anchor customers. Currently, the development around it is already under discussion.Last month, CG Power and Industrial Solutions agreed on an investment of Rs 347 crore, which also meant for its ongoing project, eventually hoping for a capacity expansion of its various units.CG Power plans to expand its manufacturing capacity located at its Switchgears Division complex in Nashik for instrument transformers and condenser bushings, medium voltage switchgear, and GIS units by investing about Rs 155 crore.Additionally, it plans to expand its manufacturing capacity of large industrial machine (LIM) units at Mandideep, Bhopal. With the expansion, the company aims to increase the capacity of LIM up to 1,728 units per annum from 1,002 units per annum now.
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