Bengal Firms Up Rs 8,000cr Loans To Develop Power Sector

The West Bengal government has signed agreements with foreign and domestic agencies for loans amounting to Rs 8,000 crore to develop its power sector. Of the amount, the Overseas Economic Cooperation Fund (OECF) of Japan will alone provide more than Rs 7,000 crore in loans to the state.

Power minister Sankar Sen, speaking on the governments plan to borrow funds to augument power generation, transmission and supply, said that Siemens Limited of Germany would provide a large chunk of the funds required to revamp the five old units of Durgapur Projects Limited (DPL).

Among the domestic financing agencies, the Power Finance Corporation (PFC) has agreed to provide a loan of Rs 64 crore for the implementation of a project by the West Bengal State Electricity Board (WBSEB) which will aim at developing communication systems across the state using V-Sat technology.

The power minister said the government had accepted loans from the Industrial Development Bank of India, Life Insurance Corporation of India, the PFC and the Rural Electrification Corporation for meeting the capital expenditure of the WBSEB, the DPL and the West Bengal Power Development Corporation (WBPDCL). Sen said that the Overseas Economic Cooperation Fund has sanctioned Rs 3,189 crore to the WBSEB for the Purulia Pump Storage scheme till 1998-99, and Rs 2,428.5 crore for the first and second units of the Bakreswar Thermal Power project. An agreement has also been signed between the Overseas Economic Cooperation Fund and the WBPDCL for a loan of Rs 814.7 crore for the construction of the third unit.

While the OECF has sanctioned a loan of around Rs 453.72 crore for the Teesta Canal Fall Hydro-electric Project, it has agreed to loan another Rs 862 crore for the development of power transmission, construction of new sub-stations, augmentation of the capacity of existing sub-stations, and the establishment of new lines and micro-wave communication links in the state.

In the first phase of the Rs 862 crore project, Rs 353 crore would be available from the Overseas Economic Cooperation Fund and efforts were on to get financial assistance from the organisation for revamping and modernising the units of the Bandel and Santaldih thermal power stations.

He said that for the modernisation and revamp of the five old units of Durgapur Projects Limited (DPL), the government had taken up the project in collaboration with Siemens of Germany. A large portion of the funds for the estimated Rs 330 crore project would be gathered by Siemens.

The government, he said, had further plans to take loans from different financial institutions to augument power generation and for the development of the distribution system.