Tata Power criticises PGC over Bhutan electricity

Vol 6, PW 20 (04 Dec 02) Midstream & Downstream

TATA POWER Company must be cursing the day it decided to have state-owned Power Grid Corporation as partner for the Tala Transmission Project, its biggest overseas venture.

This Rs1,100cr ($229m) project proposes to buy hydroelectricity from Bhutan and transmit it along a distance of 1,200-km to Delhi. But Tata Power reports no progress even though it signed up a joint venture agreement with PGC in February 2002.

All this talk about private-public sector working together never works at a practical level," a top Tata Power official tells PETROWATCH. "The reason we chose PGC to be our partner was so they could facilitate the project by helping us with the clearances and the bureaucracy.

But now R. P Singh (PGC chairman) is telling us we should not expect any help from them.

Blame PGC's reluctance on a legacy of mistrust towards the private sector, despite more than a decade of mantras about liberalisation and market reforms. Says Singh: "The private sector is not serious about infrastructure projects.

Ultimately public sector companies have to carry all the burden." The Tala project is the first PSU-private power transmission joint venture in India. The project has yet to get the all-important approval from India's federal cabinet and only after this happens can Tata Power organise the other approvals.

Despite PGC's unhelpful attitude, Tata Power is not giving up. We have to do all the running around in the corridors of the power ministry.

PGC alsorefuses to help us get right of way and forest department clearances in West Bengal and Bihar. Tata Power tells us it has invested Rs400cr ($83m) in this project to evacuate power from electricity-surplus Bhutan to electricity-starved India.

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