Indian power equipment supply chain to be revamped

India has the potential to become a major hub for power equipment manufacturing, but the country will need to work on improving its supply chain.

Domestic power equipment manufacturers such as Bhel suffer a price disadvantage compared to Chinese suppliers in India because the supply chain for the power equipment industry in China much more well-developed than its Indian counterpart, which has forced domestic manufacturers to seek a customs duty imposition on imported power equipment in order to remain viable. Although the Indian government turned down a proposed 14 percent import duty, a more modest 4 percent increase in the import duty is under consideration, the Financial Express reports.

The government is also working to create improved domestic manufacturing capacity.

"This is exactly the opportunity for India to develop supply chain for the power equipment manufacturing industry," Guy Chardon, senior vice president for Alstom's thermal product business, told the paper.

India has one of the fastest-growing economies in the world. It has the third-largest economy in Asia and the 12th largest in the world.