Bankrupt electricity boards run up $5.5bn debt
During his budget speech on 28th February, finance minister Yashwant Sinha devoted much time talking about the crisis in India's power sector, and released some alarming figures about the country's bankrupt electricity boards to illustrate the scale of the problem.
He said India's SEBs (State Electricity Boards) owe a staggering Rs25,000cr ($5.5bn) in outstanding payments to state-owned utilities like National Thermal Power Corporation. "If these resources were available, the country would have no difficulty in investing adequately in power sector expansion to the benefit of all," said Sinha.
"Theft of electricity must be stopped and economic tariffs levied." It gets worse: "The total cost to the state electricity boards of implicit subsidies amounts to about Rs 36,000cr ($7.92bn)." Sinha said reform of the country's electricity boards is "the most vital element of the reform process" and that the Ministry of Power would be introducing the 'Electricity Bill 2001' in this session of parliament to"unify all existing central legislations in the sector." State governments that support reform of their electricity boards, added Sinha, would receive money from the 'Accelerated Power Development Programme', whose budget allocation is to increase from Rs1,000cr ($220m) last year to Rs1,500cr ($330m) this year.