Energy Minister explains to IIM A PGPX how Gujarat became a power surplus state

Saurabh Patel  said that in 2002, Gujarat was losing close to Rs 2300 crores per annum in the power sector

State Minister for industry and power, Saurabh Patel on Saturday addressed students of PGPX, the one-year MBA programme, at the Indian Institute of Management, Ahmedabad on how Gujarat became ‘power surplus’. Speaking about key strategic initiatives undertaken by the Gujarat Government over the past decade Patel said that in 2002, it was losing close to Rs 2300 crores per annum in the power sector and the ministry sought to address this by executing a series of reforms.

Beginning from renegotiating power purchase agreements and in the process earned the distinction of being the first state to procure power through the process of competitive bidding, Patel added that today this sector generates profits of Rs 550 crore per annum for the state and while it also has 23000 MW of capacity to address a peak demand of only 13800 MW. He said that despite Gujarat’s excess capacity, power-deficient states are unable to benefit as much because of some states’ inability to pay and poor transmission systems across the country.

Patel explained how investments in a strong transmission network within the state and a clear and strong stand to prevent electricity theft in rural areas went a long way in ensuring access to power at market prices. These government actions resulted in about 18,000 villages having access to power 24 hours a day. Access to power raised the standard of living in villages like improving education, access to water, education outcomes, and enabling several small and large-scale industries to be able to compete effectively and thereby increase profits. The minister attributed a large part of the increase in the state’s GDP to these steps and said that today Gujarat holds an impressive share of close to 7% of India’s GDP.

Looking to the future, Shri Saurabh Patel emphasised the government’s political will and desire to work hard on partnering with businesses, increasing the representation of women in the workforce in rural sectors, investing in education, and on promoting manufacturing units in the state in the future. Another area that the minister pointed out as being important was land acquisition. He stated that the GIDC has implemented an excellent land acquisition programme in the state that benefitted landholders and also shared profits of the resale of land with them.

Patel also answered several questions from students of the PGPX batch. IIMA’s PGPX batch comprises eighty-five highly experienced professionals from diverse sectors and the programme is currently in its 9th year. Earlier this year, several prominent leaders including the former Indian President Dr. APJ Abdul Kalam, Renuka Ramnath, Founder – Multiples Alternate Asset Management and Usha Ananthasubramanian, CMD of Bharatiya Mahila Bank had interacted with the students as part of the ‘PGPX Speaker Series’. year.

Article courtesy Financial Express