Cost crunch
Assuming that 5,000 MW and 20,000 MW are installed through foreign investments in the 8th and 9th Plans respectively, the NWGP notes that:
• Foreign investor-owned projects have rupee funds for 40 per cent to 60 per cent of the project costs raised from Indian savings.
• If indigenous equipment is used, the additional resources required over and above the savings going in for the foreign investor-owned projects will be marginal.
• The resources brought in by the foreign investor is through guarantees by the government of India and can therefore be raised by the government on its own also.
• The additional resources being brought are purely temporary. If a power programme of 25,000 MW for the 8th and the 9th Plans is actually realised, the outflows after the first few years will be much higher than the inflows, engendering a huge negative flow of resources. On an annual basis, the outflows will be of the order of Rs 30,000 crore.
• The cumulative outflows in following the course set out by the ministry of power is about 30 times as against the cumulative outflows in following an indigenous route. The cumulative outflows total an astounding Rs 900,000 crore.
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