Punjab has emerged as India’s top State in terms of electricity coverage as about 97 per cent of households in the State have power facility, says a study by Associated Chambers of Commerce and Industry of India (ASSOCHAM). The study titled ‘State-wise Analysis of Power Sector: Consumption, Demand and Investment’, conducted by the industry body also pointed that Punjab has registered an impro-vement in terms of electricity coverage during 2001-2011.
“Electricity coverage in Punjab registered an improvement of about five per cent — that is from 91.1 per cent in 2001 to 96.6 per cent in 2011,” it stated. On the other hand, the study added that electricity coverage across India during the same period increased by about 11.5 per cent, that is from 55.8 per cent in 2001 to 67.3 per cent in 2011.
However, Punjab had a meager 1.2 per cent share in terms of new investments worth over Rs31 lakh crore attracted by the power sector from various public and private sources across India during the course of financial year 2004-05 and 2012-13, the study said. Private sector accounted for over 75 per cent share in the total amount of new investments worth about Rs38,000 crore attracted by Punjab during 2004-05 and 2012-13.
About 76 per cent of investment projects in the power sector attracted by Punjab were under implementation as of financial year of 2012-13, while about 57 per cent projects were under implementation as of financial year of 2004-05. Though, Punjab has a small share in investments attracted by the power sector, condition of power supply in the State has improved considerably over the years as power deficit in Punjab improved by about 3.5 per cent during the course of 2004-05 and 2012-13.
While on an average, power deficit in the country increased by about 1.4 per cent during the period mainly due to high growth in power demand as compared to that in power availability, the study said. Considering that agriculture is the mainstay of Punjab’s economy, the State is ranked third in terms of power consumption growth in agriculture sector thereby showcasing that Punjab is ahead in terms of agriculture infrastructure development, it further pointed out.
“Flow of private investments in any State is determined by attractiveness of investment opportunities as they are mostly driven by profitability considerations,” said ASSOCHAM national secretary general DS Rawat. “Bureaucratic efficiency, infrastructure facilities, and ease of land acquisition influence the flow of private investments…. Tax concessions, product market conditions and exit policies are effective tools of private investment attraction,” he said.
The study suggested that to garner additional funds in the power sector, the Punjab Government should lure private sector investment through a tax incentive scheme and facilitate quicker implementation of pending power projects. “Private sector players should also be encouraged to invest in untapped regions having large potential for setting up power plants,” it said, adding that efforts should also be made to promote power generation by tapping new and renewable energy sources like wind, hydro, bio-mass and solar.