Country's largest private power producer Tata Power today said that more financial incentives as well as speedy clearances for projects are needed to ensure double-digit growth for the domestic sector.

"The power sector has been in need of urgent attention and a number of issues need to be addressed in the Union Budget 2013-14 to let the power sector grow at 12 per cent every fiscal –- which is required to support a GDP growth of 7-8 per cent," Tata Power Managing Director Anil Sardana said.

Noting that high capital investments are required for power projects, he 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".

In a statement, Sardana said exempting power projects from service tax net and removal of import duty on equipment would help in bringing down costs.

"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," he added.

Since power projects have long gestation periods, Sardana said that existing provision of a 10-year tax holiday could be extended to at least 15 years.

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