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Minister asks SBI to hike funds for power sector

Union Power Minister P R Kumaramangalam held a close-door discussion on Wednesday evening with State Bank of India chairman M S Verma to review the emerging scenario in financing the power sector projects. He also made an attempt to sort out certain problems related to Power Finance Corporation.

According to sources, the minister asked the SBI chief to enlarge the bank's commitments towards various infrastructure projects. Reportedly, Verma assured the minister that his bank would deploy additional funds to the power sector provided the projects are viable and get on ground for implementation.

SBI has so far sanctioned Rs 15 billion towards various power projects and the amount would be raised as and when required.

Recently, SBI has acquired foreign currency resources worth of $ 4.16 billion through the Resurgent India Bonds and parked these funds for funding various infrastructure projects including power.

Later, addressing the 42nd annual general meeting of the Indo-German Chamber of Commerce, Kumaramangalam said that India needs about $ 10 billion investments in various infrastructure projects in the next ten years to increase its gross domestic product growth rate to 7.5 per cent from the current five per cent.

In power sector alone, his ministry has plans to make investment proposals worth $ 35 billion in the next four years to create an additional 40,000 megawatts of power in the country.

The minister who defined the swadeshi concept of the coalition Bharatiya Janata Party government at the Centre, said that the country's reforms policy was getting matured over the years and whatever decisions taken by his government in the last few months were the results of hardwork done in the last 18 years by the previous successive governments at the Centre.

There are imbalances in the availability of power across the country and this could only be rectified by a disciplined central distributory system. He projected that the country needs $ 118 billion investment in transmission and distribution of power in the coming years.

Appreciating the gesture of the German power company KFW towards funding of power projects, he said that the German firm had offered German mark 6.4 billion during the post Pokhran nuclear test towards power sector which was on-lent to national hydro and national thermal power corporation for setting up additional power capacity of 4,500 MW in the public sector.

Besides, NTPC and NHPC were asked to invite tenders based on proposed tariff rates to set up projects of 10,000 MW in the country. For independent power projects, the power ministry would sign agreements by March 1999 with private power producers for constructing 15,000 MW power projects in the country.

UNI

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