Friday, March 30, 2007

No Time For Governance

“Procrastination: Hard work often pays off after time, but laziness always pays off now” - Larry Kersten (American Sociologist and Author).
I found the above quote very amusing and relevant. Those in the government - ministers and bureaucrats seem to have been immensely inspired by it. Or else how can one gloss over the colossal loss of over Rs25,545 crores ($58 billion) incurred in 476 centrally-funded projects. It just sums up to 8% of cost overun. The irony is that the most serious delays occurred in power, petroleum and railway projects which constitute the backbone of India's infrastructure. The government, without any let or hindrance, would be happy to fantasize about becoming the second largest economy in the world when development of basic infrastructure vital for such dreams to materialise remains neglected.
Who is to blame for such poor performance? Nobody. In the recent history of the government, there is hardly any instance when any head of a minister or bureaucrat has rolled for such failures. Introspection seems to be the right medicine to cure such maladies. The other day, the Prime Minister, while talking on the slippages in power projects, suggested introspection for the officials. For the crucial power sector, the achievement against the target was a meagre 56% for the Tenth Plan. Interestingly, such shortfalls did not happen overnight but was spread over 5 long years and despite a separate ministry of Programme Implementation supposedly monitoring central projects round the year.
BCCI President Sharad Pawar, who is also the Agriculture Minister, also advised introspection after the debacle of Team India in World Cup 2007. Where else his heart should be as BCCI is the richest cricket organisation in the world? It is unfortunate that he cannot devote so much time for the hapless farmers who are committing suicides by dozens.
Similarly, inflation is forcing millions of self-employed, daily wage-earners and senior citizens(who are not getting pension from the government) to tighten their belts to make both ends meet. The ministers and the government officials who should have been alarmed at their own failures are protected automatically with their pay and perquisites linked to consumer price index. And even before any pressure has built up for setting up of the Sixth Pay Commission, the Prime Minister himself took the initiative to announce it to win the hearts of the pampered and organised group of government employees who constitute merely 4% of the total labour force.
My advice to the remaining 96% of the labour force is that they should be patient and introspective.

Monday, March 26, 2007

India's Fuel Basket For Power

Starting from where I had left my last post, India is gearing to use a basket of fuels for meeting its burgeoning power needs. It aims at generating 65.6% (84,400 MW) Thermal, 26.6% (33,942 MW) Hydro, 3% (3,900 MW) Nuclear and 4.8% (6, 191 MW) Renewable power by 2012. Thermal Power: India is endowed with huge coal reserves which provide a ready and economical resource. Obviously, it has been chosen as the main fuel for power generation till 2012. Out of the total thermal generation, coal-based generation has been fixed at 69,616 MW (54.1%), gas-based generation at 13,582 MW (10.6%) and oil-based generation at 1,203 MW (0.9%). Gas-based plants have the advantage that they can be commissioned within 28 months whereas the coal-based plants need at least 40 months. There is a low capital cost and commissioning cost for gas-based plants too. In a study of comparable cost, it was found that Interest during construction (IDC) and financial charges (FC) work out to only Rupees 2.75 crores ($.62 million) per MW for gas-based plants whereas it is Rupees 4.24 crores ($96 million) per MW for coal-based plants. India's preference should be for gas-based plants for their lower cost and less time taken for commissioning. The supply position of gas is also going to improve drastically and will be boosted to 250-270 mmscmd by 2012 from the current level of 90 mmscmd.
Hydro Electricity: India has vast potential of 150,000 MW but it is yet to be tapped. Generation of 33,942 MW by 2012 is envisaged which amounts to an utilisation of only 17% of the potential. Hydel power is clean energy and its generation is independent of fuel supply. It should therefore be given the priority it deserves.
Nuclear Power: Though only 3,900 MW (3%) of power generation by nuclear plants has been envisaged by 2012, there is a lot of scope to increase capacities significantly. India has got good reserves of Thorium. Public sector initiatives along with private sector partnerships will be required to expand capacity of nuclear power.
Non-conventional Energy Sources: A target of 6,191 MW (4.8%) for non-conventional energy sources by 2012 appears to be achievable. Wind, solar, bio-mass energy are showing great promises. Unfortunately, the emphasis has so far been on traditional sources chiefly coal though non-conventional energy sources can be exploited with proper support from the government. India's power position is going to improve as the mix of fuels for generation undergoes rapid changes due to cost, availability and environmental factors. Such prospects are brightening gradually.

Wednesday, March 21, 2007

India's Power Scenario Brightens Up

Power is one of the most critical components of infrastructure required for economic growth and better standard of living. Historically, the growth in the power sector has been always sluggish compared to the economic growth in India where as it should have been the other way. Now that India's GDP is growing at the rate of 8-10% and is projected to grow at 10% during the XIth Plan period (2007-2012), the desirable growth rate for the power sector ought to be at least 12%.
Despite such an apparent deficiency in its infrastructure, the famous financial analyst Golden Sachs stunned the world with their recent conclusion that India's economy would emerge as the second largest in the world - next only to China by 2050 and it would surpass Japan by 2032. It would be safe to presume that such conclusions were made definitely after taking into consideration the strategies and blueprint prepared by the Government and planners which aim to add a whopping 1,00,000 MW additional generation capacity by 2012 to bridge the gap between demand and supply of power.
It involves the capacity addition target of 45,500 MW for central Public Sector Undertakings under the Ministry of Power, 41,800 MW for State Electricity Boards/State Utilities and private sectors. Nuclear and non-conventional energy have been given more importance to augment power. A target of 6,400 MW of nuclear power and 10,700 MW of non-conventional power has been fixed for the period upto 2012.
With such massive capacity addition, the per-capita consumption of electricity would reach 1000 KWH/year from the level of 606 KWH/year (2004 - 2005). This is still much below per-capita consumption of 10,000 KWH/year in some developed countries. The latest provisional figures show a peak demand of 100,423 MW where as the demand being 86,425 - a deficit of 13.9% (April 2006-January 2007). Taking into account the gigantic task as well as the huge potential in growth of power sector, the Government of India has set its goal - Mission 2012: Power for All. In line of its commitment, the annual budget for 2007-08 (which essentially is a statement of accounts) has increased the budgetary support for power reforms and development from Rs650 crores ($148 million) in 2006-07 to Rs800 crores ($180 million). It has also given emphasis on Ultra Mega Power Projects (UMPP). These projects involve huge investment in the region of Rs20,000 crores ($4.5 billion) or more with capacities of 4000 MW. Two units at Sasan and Mundra have been cleared and two more are expected to be cleared out of seven UMPPs by July,2007. For accelerated growth in the power sector, such projects hold out great promise.
So, there I see light at the end of the tunnel. Do you?

Wednesday, March 14, 2007

Children Take The Lead In Fighting Global warming

Today global warming and its apocalyptic effect on the planet Earth is no longer viewed by the scientific world as distant scenarios but is a hard reality facing the entire human race. It is, however, shocking that masses still live in the illusion that it is not going to affect their lives even as clinching evidences like shrinking icebergs in Arctic or Antartic regions as well as other serious climatic changes are regularly reported. A recent report of Reuters said "13% Americans have never heard of global warming, even though their country is the world's top source of greenhouse gases".
If this is the state of affairs with the nation of richest economy and high literacy, the awareness among people in India having poor literacy is obviously very low. There is a ray of hope, however, to the looming crisis. It has been possible to spread the awareness unexpectedly through animated films and movies for kids. Movies produced abroad like Ice Age: The Meltdown for the children dealing with global warming was a big box-office hit.
Children in India can also play a very effective role in spreading the awareness among people. They should learn subjects such as global warming, environment and pollution compulsorily at the high school level. In all interviews and examinations for recruitment, each candidate must satisfy the selectors that he has the minimum required knowledge about global warming. Thus awareness about global warming will go up and that is how a beginning can be made to fight it. How I wish it happened yesterday!