Meltdown hits Rs 5,500cr solar power project in Bengal

The global financial crisis has come as a roadblock to the Rs 5,500-crore integrated solar power complex, possibly the world's largest and the country's first polysilicon project, in Haldia in West Bengal.

"The project would be executed in phases. The financial closure for the first phase is yet to be achieved due to the global financial crisis," lead promoter of the project Bhaskar Silicon Ltd Managing Director Jyoti Poddar said. The proposed investment for the first phase was estimated at Rs 3,100 crore.

"The project would be funded in a mix of debt and equity. We are looking at foreign debt to meet our import component for the project's plant and machinery which would be around 250 million euros," he said.

The company and the West Bengal government had announced that the first phase would be completed by 2009.

This, however, seems unlikely as only the land development work has begun. Srei Infrastructure, also a major partner in the project, said the company would bring in equity and arrange debt once financial closure was achieved. "We have not finalised the equity and debt participation as the project is yet to reach that stage," Srei Infrastructure Chairman and Managing Director Hemant Kanoria said.Poddar, however, expressed confidence in maintaining the target in execution of the project.

He said the Centrotherm Photovoltaics AG has been awarded execution of the project on a turn-key basis. The German company was also expected to pick up minority stake of 10-15 per cent in the project.

US-based Perseus may also partner with the solar energy project. The project has acquired 200 acre for its current phase and is in talks with the government for another 600 acres for the other phases. The plant proposes to produce 2,500 tonne of polysilicon at an investment of Rs 2,500 crores. The plant would also produce wafers in the subsequent phases. The project aimed to make all stages of production of solar panels. It was expected to play a significant role in contributing to the central government's target of having 5,000 MW of solar power by 2012. The plant would also help to manufacture semi-conductor chips and benefit information technology industries.

The project would not only help in developing green energy, but also hardware and electronics for the IT sector of the state, according to West Bengal Industry Minister Nirupam Sen.