Monday, June 24, 2013

India planning wind-farm tax break revival, subsidy hike

Tax breaks may be revived after the market size fell by almost half following expiry of the programme



















Investment in the wind industry sputtered after the two incentives expired on 31 March last year, stalling turbine orders for manufacturers such as Suzlon Energy Ltd. Photo: Mint
Mumbai: India plans to revive tax breaks for wind farms after the size of the market fell by almost half following the expiry of the programme, two government officials with direct knowledge of the matter said.
The ministry of new and renewable energy has proposed to reintroduce tax depreciation benefits for wind-farm owners and increase an alternate generation-based subsidy, the officials said, asking not to be identified because the proposal is awaiting Cabinet approval.
Investment in the wind industry sputtered after the two incentives expired on 31 March last year, stalling turbine orders for manufacturers such as Suzlon Energy Ltd. Installations plunged 47% in the last fiscal year, toppling India from its place as the world’s third-biggest market.
Wind project investors could claim the benefits retroactively from 1 April 2012 should the tax breaks be revived, the officials said.