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| Edited By: Sreejiraj Eluvangal |Source: DNA |Updated: Mar 17, 2018, 05:01 AM IST
The Lok Sabha standing committee on energy has expressed anguish and alarm at the lack of progress in providing funds for government power projects.
Criticising both the power and finance ministries, the 17-member committee headed by Mulayam Singh Yadav, warned that India is destined to miss its target for adding electricity infrastructure by a wide margin unless the government acts quickly.
India had a target of adding nearly 78,000 megawatt (mw) of power generation capacity over the five years ending March 2012.
However, it has added only around 30,000 megawatts by June 2010, taking the total to 162,000 mw.
The committee pointed out nearly Rs 10.5 lakh crore would be required for implementing all the projects from 2007 to 2012, but with just two years to go, nobody seemed to know where nearly Rs 4 lakh crore would come from.
“There is a yawning deficit of more than Rs 4 lakh crore.. As of now, the situation is so intricate that even if the resources are arranged, it would be impossible to achieve the physical targets of the [eleventh five-year] plan as there is considerable gestation period in completing power projects,” the committee warned.
Under the current system, the addition of power generation units is split equally between the government and private players, while nearly all of the Rs 4.5 lakh crore to be spent on setting up transmission and distribution networks had to be borne mostly by the state governments.
However, most of the state government agencies have been unable to find funds for overhauling the transmission and distribution networks. Without the overhauling, the committee warned, India will continue to hold on to its record of losing nearly 30-40% of its power during transmission from the generating station to the end consumer.
Out of the Rs 4 lakh crore shortfall, Rs 2.5 lakh crore is in the area of distribution and transmission. The remaining shortfall is on the power generation side, including nearly Rs 1 lakh crore by private companies.
The committee put most of the blame for the lack of funds at the doors of the finance ministry, which, in its opinion, failed to create the suitable conditions for fund-raising by states and the private sector.
“The committee are anguished to not the response of the ministry of finance towards the power sector of the country. Instead of becoming a facilitator for resource mobilisation, it has been consciously attempting to take the garb of various provisions of financial rules, imaginary situations, diversionary tactics and even misinterpretation of the possible and logical outcome of various fiscal measures to deflect the issue and divert attention,” the report said, pointing especially to the ministry blocking various fund-raising attempts by the Power Finance Corporation and Rural Electrification Corporation.
It was also scathing on India’s largest and sole power equipment manufacturer, the government-owned Bharat Heavy Electricals Ltd.
The power ministry had reported to the Committee that the firm 30% more time than others to fullfill orders and charged more.
“Penal provisions should be enforced on the defaulting organisation” if it fails to stick to its time table, the committee said.
The power ministry also told the committee that the deportation of 2,500-3,000 Chinese technical workers deployed on various power projects in the country since September had also impacted the pace of development.
