Lights off

The government has to wake up the fact that the power situation cannot be redeemed unless some drastic steps are taken. The power situation in the state is grim for so many reasons: power losses due to theft are still beyond acceptable limits, the state does not have the generation capacity, the transmission structure makes it difficult to buy power from elsewhere, and after the Enron disaster, the climate for investment in the power sector has not been propitious. We can endlessly debate whether the terms of the Dabhol power project were a good deal. But there is no doubt that the failure of that project to take off has had dire consequences for the state. This is not because that project alone would have cured Maharashtra8217;s capacity woes. It is rather because that project has become such an emblem of everything that is wrong with the power sector: too much politics, too little economic rationality, non-existent enforcement, too many bureaucratic delays, too much false populism and no manifest attempt to break out of the logjam. Voters should send a strong signal that they would rather vote for those can speak the plain truth than those politicians who promise things they cannot deliver with money they do not have. There is great evidence that consumers, even poor ones, are willing to share the burden of creating a reliable power supply. The state would do better in ensuring that investment comes into this sector, rather than make false promises, and the opposition would do well to learn the right lesson. The state has cleared four new MSEB projects, but these will barely make a dent in Maharashtra8217;s power needs.

In the short run there is little the state can do, except better manage the distribution of power and better utilise already existing captive power generation capacity. But its long run policies have to be based on the sound common sense that voters cannot be fooled indefinitely.