The Telegraph
Since 1st March, 1999
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Japan recharges power loan initiatives

Calcutta, Sept. 23: Japan Bank for International Co-operation (JBIC) has appointed Tata Consultancy Services (TCS) and Japan Institute for Overseas Investment (JOI) to explore investment opportunities in power and review progress of reforms in the industry.

JBIC, having sunk in 55 per cent of the 62,873 million Japanese Yen it handed out as assistance to India in 2001-02 in power, wants to lend more to the sector this year.

Called OECF earlier, JBIC halted funding to India and Pakistan in May 1998, when the two countries carried out tit-for-tat nuclear tests, but resumed it in December 2001 after the Japanese government lifted sanctions.

JBIC disbursed Japanese Yen 113 billion (equivalent to Rs 4,200 crore) to India under official development assistance (ODA) loans during 2001-02.

The amount is the highest since it began handing ODA loan assistance to India in 1957, and about a fourth of the total external assistance received by the country in 2001-02. The effort is to tap new areas in the power sector.

India grabbed the bulk of JBIC’s ODA loans in 2001, or 17.3 per cent of disbursements that went to 51 countries; China got 16.9 per cent, Thailand 12.8 per cent, Philippines 10.3 per cent and Indonesia 9.2 per cent.

Numbers on state-wise distribution of these loans show Andhra Pradesh, Delhi, Bengal, Karnataka and Uttar Pradesh as the major recipients last year. Reform-inspired Andhra’s won the biggest slice of 37 per cent.

The team from Japan Institute for Overseas Investment — deputy director general Yasuo Wada, researcher Maki Ishikawa, economist Sumiko Taranaka and TCS’ Arjun Narayanan — is now talking to state electricity boards to find out the kind of assistance they would need, apart from evaluating progress in achieving milestones set for power reforms.

The team is assessing just how state power boards are faring on transmission and distribution, sale volumes, revenue, generation cost, profit, cost-cutting initiatives besides efficiency in billing and cash collection.

The team is discussing with SEBs their plans to develop transmission and distribution networks, and the steps they intend to take to improve financial condition.

As part of that effort, it talked to WBSEB chairman G.D. Gautama last week. “JBIC has funded Bakreswar (3 x 210 MW), Teesta Canal Project (67.5 MW), Purulia pumped storage project (900 MW) and the Rs 690-crore Bengal transmission project that envisages 31 sub-stations and transmission lines,” Gautama told The Telegraph.

The parleys centred on transmission and distribution losses, current tariffs for various categories of customers, moves to rationalise tariff structure and ways to make setting of user charges transparent.

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