Uttarakhand govt says no to Jaypee's offer

Says it will not be able to generate the Rs 2,000-3,000 cr needed for the project

The Uttarakhand government has formally ruled out the possibility of buying the 440-Mw Vishnuprayag hydel project on Alaknanda river, saying it will be not be able to generate the Rs 2,000 crore-Rs 3,000 crore needed for the project.

S S Sandhu, principal secretary to Uttarakhand Chief Minister Harish Rawat, said: "Where is the money? We can't generate Rs 2,000 crore- Rs 3,000 crore which is needed for buying such big projects." Similar views were also expressed by power secretary Umakant Panwar. Sandhu also said the government was also not interested in buying private projects. "This is an era of privatisation and not nationalisation," quipped Sandhu.

Amid reports that the Jaypee group wants to sell its entire hydropower business, a section of top government officials had mooted the idea of buying the Vishnuprayag hydel project in Chamoli district in view of the acute power shortage in the state.

With most of the hydel projects facing legal hurdles owing to environmental concerns, the business proposition of buying Jaypee's assets in Chamoli district looked attractive at the moment, the officials had opined.

The Bharatiya Janata Party was also not averse to the idea of buying the project. "Since the state is facing power crisis, the government can buy the power project of Jaypee group," said leader of opposition Ajay Bhatt.

The state, facing acute power shortage, is currently relying on power purchase from outside at steep rates, which in turn puts tremendous financial burden on the state-run Uttarakhand Power Corporation Limited (UPCL), the sole power distribution company in the state. UPCL is running into heavy losses, a big worry for the state government, as it spends more than Rs 1,000-1,500 crore every year on buying power from outside the state.

Another official of the energy department said the government should also try to take a legal opinion whether it had the first right to purchase such assets which are located in the state only.

The government on the other hand is yet to take a view on GVK's power purchase agreement with Uttar Pradesh on the 330 Mw Alaknanda hydel project which was not seen in the interest of the state.

After failing to make a headway in the hydropower sector despite its tremendous potential, the government is exploring various new options to increase power in the state.

The government has moved to the Supreme Court for the transfer of 25 per cent shares of the joint venture mini ratna company THDC (India) which are held by Uttar Pradesh.