Tata Power, one of the country’s largest private power producer, said that more financial incentives as well as speedy clearances for projects are needed to ensure double-digit growth in the domestic sector.

“The power sector is in need of urgent attention and number of issues need to be addressed in the Union Budget 2013-14, if the power sector have to grow at 12 per cent every fiscal. The 12 per cent increase is required to attain the GDP growth of 7-8 per cent,” Tata Power Managing Director Anil Sardana said on Monday.

Noting that high capital investments are required for power projects, Mr. Sardana said the scope for financial incentives to the power sector needs to be widened “given the sectoral caps that Indian regulations impose on domestic lenders, so as to attract larger private sector investment. Policies pertaining to imported fuel-based mega projects need to be suitably modified given the unprecedented rise in imported coal prices and the shortage of domestic coal.”

Since power projects have long gestation periods, Mr. Sardana said that the existing provision of 10-year tax holiday could be extended to at least 15 years. Exempting power projects from service tax net and removal of import duty on equipment would also help in bringing down costs, he added.

Tata Power has an installed generation capacity of about 7,700 MW.

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