Core sectors show good growth

NEW DELHI, May 28: The infrastructure sector fared better during 1997-98 than the previous year. But while the growth was marginally higher, demand continued to outstrip supply in almost all the sectors including power, ports and telecom. In fact shortfall in power generation could prove to be the greatest bottleneck for future economic growth.

The Economic Survey recognises the need for investment of a much larger order in the infrastructure sector as higher economic growth would lead to an accelerated demand for infrastructural facilities. The Survey also makes a pointer towards need for greater reforms in individual infrastructure sectors for attracting larger private investments in specific sectors. The six infrastructure sectors including power, coal, crude oil, refinery throughput, steel and cement which together account for a combined weight of 28.8 per cent in the Index of Industrial Production (IIP) recorded an average growth of 4.6 per cent in April-Feb 1997-98 as compared with 3.5 per cent forthe corresponding period in 1996-97.

POWER: Even though total generation of power during April to February 1997-98 grew by 6.7 per cent over the previous year, heavy transmission and distribution (T&D) losses, low plant load factor (PLF) of the thermal plants and other operational and technical ineffeiciencies continued to depress utilisation of existing capacities. The T&D losses though showed a marginal drop from 21.8 to 21.1 per cent are still very high.The survey highlights that hidden subsidies on account of free power given to the agriculture and domestic sectors touched Rs 23,010 crore in 1997-98.