'Power'ful shock for IT holiday extension
11 June 1998 10:35 IST Goa, which has been declared industrially backward, may not be in a position to take optimum benefit of the extension of income tax holiday granted till 2000 due to lack of enough power supply.
Over 960 industries including around 25 multinationals were set up in Goa, attracting investment of Rs 929.20 crore, after five-year tax holiday was declared for the tiny tourist state by former finance minister Manmohan Singh, since April '93.
However, directionless industrial policy of the local Congress government became the cause of existing power shortage. Over 50 power guzzling industries of ferro alloy and MS ingots have been allotted almost 220 MW of high tension lines, while Goa's power input is hardly 210 MW. The high court has intervened now, banning new connection to any establishment except domestic consumer and public utility services since the actual demand has zoomed up to 303 MW. It has obviously resulted in low voltage, load shedding and unannounced shutdowns .
Goa's power minister Mauvin Godinho is also caught up in a controversy for allotting excess power to the power guzzlers and unauthorisedly paying 25 per cent power subsidy to these units. Due to public pressure, the cabinet has now disapproved Godinho's action.
In the white paper published by Godinho himself, the power requirement is estimated to minimum 324 MW by 2000, showing a deficit of 133 MW, even after state's first private power project of 40 MW is commissioned by August this year.
However, the white paper projection is purely based on its plans to improvise the power situation in the state and not by considering its industrial development. The International Finance Corporation, which has prepared a project report for privatisation of T & D sector, predicts it in a different way.
Considering Goa's present GDP growth at 12 per cent, the study predicts minimum 379 MW of power by 2000, showing a deficit of 131 MW, even if the government did not go ahead with its improvisation plans.
It is however doubtful whether any private firm could meet the deficit in record time of two years, when the tax-holiday period expires. The power subsidy of 25 per cent, another attraction for industries, has also been now discontinued since April this year.
"Industries could come only if they have a captive power generation capacity", admits Sangay Shenga, the industries director. She is presently struggling to get power for several medium and large scale units, who symbolically started production by March this year to avail tax holiday facility but are awaiting for power connections.
The T & D losses are also highest in the country, around 32 per cent, most of which is theft committed in collusion with the high officials and patronised by ruling politicians. Several hotels along the coastline are today offering cheap accommodation to foreigners by stealing power.
Industrial development has presently come to a standstill since the high court has banned new connections. But situation may not change even otherwise since the tourist state has no other source to draw more power. The extension of tax holiday may not thus help the industrially backward tourist state.
