Govt pushes ahead with reforms to address power shortage

Majid Jahangir

Tribune News Service

Srinagar, May 30

With emphasis on Central power schemes, the PDP-BJP government has brought reforms aimed at addressing power shortage in the state.

While presenting the state power Budget separately in the Assembly today, Finance Minister Haseeb Drabu said the government was committed to taking the process of unbundling of the Power Department forward for efficient distribution and transmission of electricity to consumers.

“Without prejudicing the service conditions of any of the employees, the reforms will ensure transparency and efficiency in operation and reduce the costs with concomitant gains to the consumers,” Drabu said in the Assembly. He said many schemes were underway at various stages for bringing reforms in the power distribution system.

The minister said, “The total restricted energy availability of power...remains to be 13,701 million units (MUs) against the requirement of about 18,000 MUs.”

The government has not been able to give a comprehensive answer as to how it would tackle this deficit. However, there are bits and pieces but precise figures and a roadmap are missing.

“The average cost of supply is Rs 7.72 per unit. This includes the approved losses of 42.26 per cent. The average sale per unit is Rs 3.64. At the approved tariff, the average gap comes to Rs 4.18 per unit. This Rs 4.18 loss per unit, or 54 per cent of the cost price per unit comprises operational inefficiencies and a component of implicit subsidy which is neither directed nor targeted,” Drabu said.

The minister said power sector holds the key to the fiscal autonomy of the state.

“The core idea is to be able to address the issues of the sector with a greater clarity and focus, develop a framework and take steps to contain our fiscal deficit,” Drabu said.

He said that the government had ordered unbundling of J&K Power Development Department (JKPDD) and setting up of one transmission company, two distribution firms (one each for Kashmir and Jammu divisions) and one trading company with the function of a holding company.

Accordingly, four companies — Jammu and Kashmir State Power Transmission Company Limited, JK State Power Trading Company Limited, Jammu Power Distribution Company Limited and Kashmir Power Distribution Company Limited have been set up, Drabu said

The government, Drabu said, had approved Rs 11,400 crore under the Prime Minister’s Relief and Reconstruction Programme (PMRRP) for the power sector in the state. The PMRRP aims to strengthen generation, transmission and distribution network with advanced technology interventions including construction of smart grids at Gulmarg, Pahalgam, Rangreth, Katra and Bari-Brahamana.

“Rs 2,000 crore has been provided under the PMRRP for preparation of detailed project reports (DPRs) and implementation/execution of small hydel projects. Similarly, Rs 4,153 crore has been provided as the state equity towards Pakal Dul and other hydro-electric projects. Under augmentation of distribution system, Rs 3,790 crore has been earmarked for capital cities, four industrial estates at Khonmoh, Lassipora, Samba and Kathua, tourist destinations, heritage sites and important places of pilgrimage. An action plan has been submitted to the Government of India and the projects will kick-start soon,” he said

“The government is taking steps to move towards tariff rationalisation, identify the barriers in moving towards it and suitable ways to achieve it. Key measures in achieving these would be, by introducing efficient tariff design, by including ‘time of day rate structure’ and other measures,” he said.

The government has also enhanced the benefits of Power Amnesty Scheme for domestic consumers up to December 31, 2016. Under the scheme announced last year, the government had provided waiver of 100 per cent surcharge on electricity charges with the stipulation that the domestic consumers make the outstanding payment by or before March 31, 2016.

What the minister said 

• While presenting the state power Budget separately in the state Assembly on Monday, Finance Minister Haseeb Drabu said the government was committed to taking the process of unbundling of the Power Department forward for efficient distribution and transmission of electricity to consumers
• The minister said many schemes were underway at various stages for bringing reforms in the power distribution system
• The government, Drabu said, had approved Rs 11,400 crore under the Prime Minister’s Relief and Reconstruction Programme for the power sector in the state

108 villages unelectrified 

• State government faces a challenging task of providing each household round-the-clock access to electricity
• Out of the 6,337 villages in the state, 98.3 per cent have been electrified
• 108 villages still without power 
• JKPDD has planned 100 per cent metering for reduction in commercial losses and investment plans

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 Reactions to Budget

"The Budget seems a great initiative to encourage women of our state. Women here get a lesser chance to emerge as entrepreneurs so the 10 per cent industrial estate reservation for women entrepreneurs is a great step by the government. This will help women who want to be entrepreneurs. 

— Ahra Sayed, entrepreneur

It’s good that new women-specific schemes have been proposed. I hope they are implemented on the ground so that women feel empowered in Kashmir. And, it’s a welcome step that women entrepreneurship has been encouraged. More girls want to come up with their innovations. All they need is a push and support from the government. 

— Mehak Wajahat, mba student 

The Budget has a few good points for women but I think more could have been done. The waiving off the fee till higher secondary is a good initiative but girls should also be given assistance in college and universities. Financial assistance and single-window clearing systems for start-ups would have been nice. Even the Central government has put aside funds for entrepreneurs. 

— Insha S Qazi, fashion institute owner

Overall it was a routine Budget. All major demands of the traders such as rationalisation of taxes, emanation of tax recovery and simplification of VAT to discourage inspector raj has not been addressed. The Budget was Kashmir-centric and the credit goes to the Chamber of Kashmir and the Kashmiri leadership. The Jammu leadership needs self-introspection as it failed to get our issues addressed. 

 Rakesh Gupta, president, chamber of commerce and industries,Jammu

I will call it a Budget for women. Our first lady Chief Minister has taken care of women issues and the Finance Minister has separately mentioned women-related policies in the Budget. It is a welcome step of the government. 

Deepti Kawatra, tax consultant

I don’t find anything interesting in the Budget except women issues and release of installment of dearness allowance. There was no clarity on regularisation of daily wagers. The taxes on essentials have been increased. 

Arvind Sen, government employee

“For the first time, the Budget was focused on women security. Fee waiver and setting up women police stations are welcome steps of the government. It is good that the lady Chief Minister is doing something for women. 

Joginder Kaur, housewife

The government should have given clarity on the industrial policy. On the pattern of ‘Make in India’, the state government should have started ‘Make in Jammu and Kashmir’ and invited industrialists to establish industries in the state to boost its economy and tackle the problem of unemployment in the state. 

Vinayak Puri, Private firm employee