In his Independence Day address on 15th August, 2008, Prime Minister Manmohan Singh told the nation that to eliminate poverty in India, an annual economic growth rate of 10% had to be achieved and sustained. In the early 1990s, this would have seemed a difficult and perhaps downright fanciful vision, but India has been witnessing an economic boom in recent years. GDP growth for the last 4 years has averaged 9%, peaking at 9.6% in 2006-07, just shy of the visionary mark of 10%.
While fiscal policy and economic reforms continue to be hotly debated, the biggest threat to rapid industrialization and development in India is a lack of power. Power cuts, blackouts and load shedding have been a constant problem in the day to day functioning of business and enterprise. The Maharashtra government this year announced load shedding of up to 16 hours a day in the small scale industrial areas of the state during the peak summer months. India faces a perennial electricity shortage of 7% and a peak time shortage of 11%.
The facts portray a discomforting picture. While economic liberalization and private enterprise have brought us to the threshold of achieving 10% growth, we cannot cross this economic Rubicon if industry is to be starved of power supply.
Similarly, electricity consumption is, no longer a requisite of industrialization alone, it has attracted developmental and aspirational virtues as India has modernized over the decades. It is hard to address to an urban audience how ‘electricity’ could be something to aspire to, but in rural India, electrification is a privilege. Almost 1/3rd of rural India continues to subsist without connections to the national grid. With electricity lies the key to a more comfortable lifestyle with televisions, refrigerators and even air conditioning- that most of the urban conglomerations take for granted. Lack of electrical supply inhibits development by forcing farmers to use expensive diesel fuel to power irrigation pumps and provide lighting.
Due to its developmental and aspirational connections, electricity has become a political tool. Governments at state and centre boast of their achievements in connecting villages to the national grid. This pseudo-electrification, like many other gimmicks utilized in election rallies, is a developmental red-herring. Laying electrical cables to a village without planning for a commensurate increase in power production is a waste of time and copper. How do you distribute electricity if you have none to distribute in the first place?
Politics, however, does not require logical consistencies. Political schemes to provide farmers with ‘free’ electricity during election times is another favoured practice. True to the saying, anything that is free has no value, ‘free’ power leads to rampant wastage and stretches the national grid literally to the ‘tripping’ point. Farmers in turn get the ultimate in free power, no power at all.
Similarly, political compulsions cause urban politicians to turn a blind eye to rampant pilferage of electricity in urban shanties and unauthorized and unplanned colonies. Almost 40% of electricity in the capital New Delhi is lost due to pilferage. This results in increased bills for those who do pay for their share, which has doubtful moral legacies.
Just like the beauty of the Vedas is often lost in translation, so the beauty of economic growth in India is being lost in transmission.
Shoddy and unplanned electricity theft not only strains the electricity mains, but provides a hazard to life and property. Any layman walking down city alleys amidst the mass of convoluted, dangling, exposed wires amongst rickety wooden housing, past oil drums and gas cylinders can only look to the heavens to answer why more short circuit fires, indeed explosions, do not happen. As a child I recall nightly fireworks at the local electricity transformer with a fondness only a child unaware of the dangers can have.
Electricity, in essence, is a key fuel to power economic growth. In addition, as I have pointed out, it has important developmental virtues and aspirational overtones. Then it seems absurdly shocking why electric power generation has been so woefully neglected for decades.
Once more we shall blame our pet peeve, politicians. While politics has compounded problems in electricity supply, it has sought no solution in electricity production. When faced with a shortage of electricity, the government of Uttar Pradesh will simply draw more from the national grid. Haryana will do the same, blame it on Punjab which will blame it on poor rainfall and therefore fall in hydropower generation. Delhi, having hardly any power generation capacity of its own will blame all of the above and twiddle its thumbs while proclaiming great success at achieving nothing. Passing the buck as a survival tactic is fine, but we shall soon play this passing-the-parcel game in darkness, with a flute as musical accompaniment.
What then, is the solution?
Firstly, you need a grand vision of power production in India. It must plan for added power generation for the next 20-30 years, not quick fixes that are readily falling behind the curve. Happily, while the National Electricity Policy of 2005 does contain the usual bombast of ‘power for all by 2012’, it goes into further detail of adding 1 lakh megawatts of power production in less than one decade. This should almost double India’s electricity production to a grand total of over 2.25 lakh megawatts. Even this might not be enough, but it’s a good start.
Secondly, large scale re-vamping of the national grid must be done to upgrade infrastructure and harmonize load distribution. By improving efficiency alone, end-user electricity supply could be improved by as much as 10%.
Thirdly, electric loss due to pilferage must be tackled with a political backbone hitherto missing in Indian politicians since the heroism of the independence struggle. Reducing pilferage not only makes electricity consumption safer, but reduces the cost to all the users which is a long-term political advantage.
Fourthly, environmental and social considerations should be included in the policy process from the beginning, not as cobbled together after-thoughts. India has one of the world’s largest coal reserves and producing thermal electricity is nominally cheaper, almost half the cost per unit when compared to nuclear and wind generation. The cost would, however, attain parity if environmental impacts were computed into project costs. Similarly, displacement of people which has stalled many hydro-power projects such as the expansion of the Narmada dam, must be taken into consideration before, and not after, the project is commissioned. Social campaigners and environmentalists, must therefore be included at the policy making stage to help reduce the societal displacement, instead of dragging them away belatedly from dharna’s on Parliament Street.
Lastly, while private enterprise has been recently instituted in both power generation and distribution, the government’s responsibility is to generate competition to lower prices and not hold private companies to ransom for political compulsions to neithers benefit.
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The author is Assistant Editor, Development Channel
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