Last week as Punjab CM Parkash Singh Badal gave in to the BJP’s demand to provide power subsidy to the urban sector, it did not bring cheers to anybody except a few BJP leaders.
The state govt has extended power subsidy to the urban sector now
CHANDIGARH: Last week as Punjab chief minister Parkash Singh Badal gave in to the BJP’s demand to provide power subsidy to the urban sector, it did not bring cheers to anybody except a few BJP leaders.
While the BJP leaders celebrated the victory at their party office here, the power officials put their heads down to calculate the financial burden it would put on the Punjab State Electricity Board (PSEB), which is already reeling under a heavy debt of Rs 10,867 crores.
The power subsidy for the urban consumers that the BJP fought for so assiduously would put an added burden of Rs 300 crores. Being given for the first time in the last 60 years, the government’s decision has evoked shock and surprise in official circles.
This has not only put the process of power reforms in Punjab on a back-foot, but has also driven the PSEB to the brink of bankruptcy, say senior officers.
The PSEB’s fiscal loss in the past two years has been to the tune of Rs 4,598 crore. By the end of the 11th five-year plan (March 2012) the accumulated loss of the PSEB will be in the range of Rs 21,000 crore if it continued to be run the same way, say officials.
Power subsidies to farmers, backward classes and the urban sector would mean that the state government is required to pay nearly Rs 3418 crores to the PSEB as a compensation for these political decisions.
Till August, the government could shell out Rs 730 crores only, leaving the officials wondering if the government would be able to bear rest of the burden.
During the current fiscal, the government has committed to pay Rs 1,988 crore as subsidy on agriculture, Rs 130 crore as subsidy to provide free power to SCs and below-poverty-line families, Rs 429 crore as subsidy arrears of the past two years and Rs 579 crore as interest on capital diversion.
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