DMK to buy 4 mn colour TVs worth Rs 922cr

Fourth phase of distribution scheduled from Jan 1.

The Tamil Nadu government is set to begin its fourth phase of distribution of free colour television sets to all households that do not possess one.

For this, the ruling DMK is planning to procure 4 million colour TV sets with an investment of Rs 922 crore. The government through its agency Elcot has identified 15 companies including Videocon and LG Electronics. The fourth phase is scheduled to start from January 1 till December 31, 2009.

A senior state government representative told Business Standard so far over 5.3 million TV sets had been distributed in the state in three phases since 2006, when the scheme was launched.

It may be mentioned that the Supreme Court recently said it would examine whether the Constitution mandated expenditure of public money for private purposes. A Bench comprising Chief Justice KG Balakrishnan, Justice RV Raveendran and Justice JM Panchal had sought response from the Union and DMK governments.

In the last two state budgets, the state government had allocated Rs 750 crore and promised that the distribution would go on till every household in the state was covered under the scheme.

Meanwhile, the highly populist and expensive scheme has resulted in a drop of CTV sales in the state and also increased the power consumption, according to industry representatives.

Local retail dealers have reported a 30 per cent drop in CTV sales ever since the government started distributing the TV sets. Retailers said the impact was on the 14 inch segment, which is targeted at lower middle-class and people below poverty line, especially in the rural markets.

Manikam Ramaswami, chairman, CII – Tamil Nadu, said the state government’s free television distribution initiative alone had increased the power consumption by 200 Mw in the state.