It should have been done years ago. It's Also the BJP-led Government's first real political test on a hard economic issue.What Union Power Minister R. Kumaramangalam proposes to do with the regulatory commissions on power is, in one stroke, cut back inefficiency, debt, and the key reason for the power sector being in such a mess and private power years behind schedule: why should any private power producer link up with loss-making state electricity boards (SEBs) without guarantees of payment? The reason why chief ministers like Kerala's E.K. Nayanar and Tamil Nadu's M. Karunanidhi are screaming murder over it is because they fear a loss of votes.The ordinance authorises these commissions to charge realistic rates for electricity; now, first the states subsidise consumers and then prompt the Centre to pay for it. Objections have been voiced by coalition partner J. Jayalalitha and will surely be echoed by Punjab Chief Minister Parkash Singh Badal who made electricity free for his farmers in 1997, then got the Centre to pay for it. This has to stop. If not, it should at least be modified so that each state can determine its politically viable level of subsidy to whomsoever it wishes, without further burdening SEBs and the Centre. Obviously, this will have to come from higher rates from users. Even farmers will not mind paying a little more, provided there's better service - ready availability at the proper frequency. This argument can be extended to practically every area of subsidy, totalling Rs 95,000 crore by one estimate, and actually forms a key plank of the Government's agenda to, if not cut totally, then focus subsidies better. For instance, give fertiliser subsidies directly to farmers instead of fertiliser producers. The over-arching message of the power ordinance must be applied elsewhere: if you want to play politics with power, go ahead. But you must pay for it.Published By: AtMigration Published On: May 18, 1998--- ENDS ---
