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India

India

HIGH COURT INJUNCTION

German wind firm Tacke Windtechnik (TW) has been restrained by a High Court injunction from doing business in India. The injunction, issued in Delhi, applies to the manufacturing, sale, design, marketing, erection and commissioning of wind turbines.

Tacke's former partner in India, Flovel Tacke Private Limited (FTPL), applied for the injuction. FTPL was founded on the basis of a joint venture agreement with TW, signed two years ago on January 7, 1994. TW, however, claims it was dissatisfied with the input from its Indian partner and took the initiative to dissolve the partnership. A furious FTPL demanded DEM 4 million in compensation for lost business, according to Tacke. The claim is described as excessive by Jürgen Beigel, head of exports in Germany.

"We would rather withdraw from the Indian market altogether than comply with such an unreasonable demand. In any case, that route would be cheaper," says Beigel. "We wanted an active partner with contacts and experience of the Indian market. But over the last two year, just ten Tacke turbines have been installed in India. This is not enough compared with our competitors."

FTPL says the success of the joint venture was entirely dependent on input from TW, input the German company failed to deliver. "Necessary technical information (know-how) was withheld as a result of which proper marketing of the product could not be carried out," states FTPL. It also says its wind turbines were not competitive in India because local manufacture was not made possible by Tacke. The units sold by FTPL were six 600 kW units -- the first large scale turbines in India -- and four 250 kW units. Of the 600 kW, FTPL says the Indian market was not ready for such large and costly turbines which "involved logistical problems due their large size and weight."

FTPL applied for the High Court injunction because it claims TW flouted the agreement that FTPL should have exclusive rights to sell the Tacke turbines in India and was attempting to woo customers and employees away from FTPL. The two companies are attempting a negotiated settlement of their differences. Both intend to continue in the Indian wind market with new partners.

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