Mass Communication and Journalism 2015 Solved Paper
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Till date, there is less than 1000 MW of generation capacity under active implementation in the private sector, mainly by those companies which are already involved in power generation and distribution. There are very few actors entering the business. According to power ministry sources, there are proposals to put up more than 8000 MW of generation capacity in the private sector, out of which about 50% will be with foreign investment, but how many of these proposals will materialise?
Many of them are merely undergoing viability studies or are restricted to the signing of memorandum of understanding with respective government agencies. As regard foreign investment in this sector the less said the better. The 2000 MW projects in Odisha, which was announced with great fanfare by the State Government is now in the dumps because Southern Power Corporation, USA decided to back out of it.
It has also been the experience that white foreign companies are willing to extend credit, supply equipment and set-up the generation facilities, they are not so forth coming when it comes to equity participation and running the plants. At this rate, it is unlikely that there will be any substantial addition to generation capacity in the private sector in the 9th Plan, leave alone the 8th Plan.
PASSAGE-II
There appears to be a relative lull on the power front. After the initial euphoria with regard to allowing the entry of private and foreign capital into the power sector, the promised guaranteed 16% return on net worth, liberal financing facilities, a higher than usual debt and equity norm, the government is now waiting for the flood to arrive. How realistic are the expectations of the government can be made out by the response of the private sector. Till date, there is less than 1000 MW of generation capacity under active implementation in the private sector, mainly by those companies which are already involved in power generation and distribution. There are very few actors entering the business. According to power ministry sources, there are proposals to put up more than 8000 MW of generation capacity in the private sector, out of which about 50% will be with foreign investment, but how many of these proposals will materialise?
Many of them are merely undergoing viability studies or are restricted to the signing of memorandum of understanding with respective government agencies. As regard foreign investment in this sector the less said the better. The 2000 MW projects in Odisha, which was announced with great fanfare by the State Government is now in the dumps because Southern Power Corporation, USA decided to back out of it.
It has also been the experience that white foreign companies are willing to extend credit, supply equipment and set-up the generation facilities, they are not so forth coming when it comes to equity participation and running the plants. At this rate, it is unlikely that there will be any substantial addition to generation capacity in the private sector in the 9th Plan, leave alone the 8th Plan.
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