| Some
more players want to play the “Power”
game in India |
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In the last few months, many
European and Asian companies have written to the
Power Grid Corporation of India enquiring about
developments in India. Some have even attended
pre-bid meetings organised by Power Grid, the
nodal agency for the $ 15.7 bln national grid
spread over 31,000 circle kilometres. The list
includes Spain`s Isolex Wat and some Russian players,
who attended the pre-bid meetings for the Koldam
joint venture project. There are some Asian players
like China Light, Askone of South Korea and a
few Malaysian companies. A Power Grid executive
was also quoted saying that Germany`s RTE and
EDF of France had also shown interest.
Although none of these players has bid for joint
venture projects, or for the setting up of independent
power transmission companies, Power Grid executives
expect international transmission majors might
form a consortium to participate in joint ventures
with the state utility who will lay a majority
of the 31,000 circle kilometres of transmission
lines planned for the national grid. So far, work
on 8,400 circle kilometres has been completed
and the government is targeting to complete the
remaining by 2007.
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Our Say |
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| The
reluctance of global majors to set up
power transmission companies was largely
attributed to their past experience
in the country. Many projects have,
in the past, encountered unforeseen
delays such as those relating to finalization
of power purchase agreements, guarantees
and counter-guarantees, environmental
clearances, matching transmission networks
and legally enforceable contracts for
fuel supplies, etc.
The
lack of a proper regulatory framework
is also a reason for concern. Although
the Electricity Act, 2003, provides
for wholly owned private transmission
ventures, the Central Electricity Regulatory
Commission is yet to come out with detailed
guidelines.
Despite
this, the initial response of the domestic
and foreign investors to the policy
of private participation in power sector
has been extremely encouraging and will
help pave the way for speedier reforms
in India’s power sector. |
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| Airport
modernisation programme to get off the ground soon! |
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| The process
of modernisation of more airports apart from those
at Delhi and Mumbai, is likely to be set in motion
by early 2005. Chennai and Kolkata are the two amongst
the four other metro airports which are to be modernised
and restructured. Some of the other airports being
considered are Ahmedabad, Nagpur and Pune. The government
is also in the process of developing new airports
at Bangalore and Hyderabad in partnership with the
private sector. This is aimed at bringing existing
airport infrastructure facilities up to global standards.
In the subsequent
phase, the government plans to upgrade city side
terminals of ten non-metro airports by December
2006. In the subsequent stages, other airports such
as those at Jaipur, Udaipur, Lucknow, Bhubaneswar
and Trivandrum will also be upgraded.
Besides this, steps will also be taken to improve
facilities to handle additional traffic as well
as larger aircraft at these airports. In the initial
phase, the government plans to cover international
airports. It is also expected that the government
will encourage greenfield airports at locations
that have potential for air transport. The government
will also take a close look at airstrips in various
parts of the country, which require improvement
to boost tourist traffic.
Expressions of
interest to appoint global technical advisors have
been called for this project. This project is expected
to cost $1.1 bln. The ministry plans to seek loans
from the $ 8.9 bln corpus being created by the inter-institutional
group. The Airports Authority of India would float
bonds for serving the proposed loan.
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Our Say |
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| The
airports sector in India is throwing
up various interesting opportunities
for foreign investors, in the greenfield
airport construction area, foreign investment
can be as much as 74%. Also India’s
airports are in urgent need of modernisation
in equipment and services, terminal
technologies and transport facilities.
Specific investment opportunities include
expansion of import and export wings
at international airports, building
of new, integrated cargo and airfreight
terminals, building of common user domestic
terminals at all international airports,
introduction of elevating transfer vehicles
with stacker systems and introduction
of electronic data interchange at all
airports to enable handling of international
cargo. |
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