Vasundhara Raje today rolled back higher electricity tariff rates in Rajasthan which were earlier imposed on farmers to recover state losses accrued by the last government.
Given that last government led by Ashok Gehlot took heavy loans to provide electricity, his government allegedly paid ornamental sums of money to a private firm, thereby earning it’s favouritism for bagging political accolades in more ways than one.
This new decision of Raje led BJP government is a stellar movement to reimburse state losses and recover the glory of state’s treasury, as was seen before 2008.
The previous government resorted to short term borrowing amounting to more than Rs. 45 thousand crore. This led to an accumulated debt of DISCOM of Rs. 75 thousand crore and total accumulated loss to Rs. 77 thousand crore (as of March, 2014)
The Government of Rajasthan has taken over debt of DISCOMs amounting to more than Rs. 62 thousand crore under UDAY.
Dishonest verdicts led to this menace
In 2011, Gehlot government agreed to the World Bank condition that tariff shall be hiked. Contrary to his statement, Gehlot assured the Assembly that no tariff hike shall take place. He was playing a two-face game, in which he earned his vote-bank but the whole state suffered. This is not how leaders are supposed to be. Isn’t it?
The incumbent government had no option but to announce tariff hike to peacefully overcome the odds created by the previous government. The pains of farmers was a repercussion of the baseless assurance furnished by the Gehlot government.
All said and done, masses still have high hopes pinned onto the present government to ameliorate their pains. The present government is sensitive towards the needs and aspirations of the farming community. After detailed stake holder consultation the government has finally decided to subsidise tariff loss of Rs. 500 crore to the DISCOMs so that farmers could continue to pay as per old rates (i.e. rates prior to hike by regulator)
The present government has not only empathized with the masses but also played a sturdy and proactive role in mitigating financial pressures mounting on the farmers due to the tariff hike.
The financial mess in DISCOMs which till 2007 were cited as a success story of power reforms, is to be blamed on Chief Minister Ashok Gehlot’s series of bad decisions immediately after coming to power in December 2008.
Just a glimpse of Gehlot’s faults; only a fraction of wrong-doings
During his tenure, Rajasthan owned five power distributing companies (DISCOMS) which faced bankruptcy with a debt trap of Rs 46000 crore accumulated loses. As a matter of fact, this was recorded as the highest for any state.
Keeping in light the unconvincing figures of Loans and debts, the banks too gave hope on them. Banks too stopped granting loan amounts to the government, with the fear of non-recovery and NPA’s
To top it all off, the government stopped giving Rs 490 crore monthly interest to banks since June 1. This further worsened its standing by making it a major defaulter.
He imposed an embargo on tariff for agriculture sector for five years to get votes in general elections in 2009. The same year he purchased power as high as for Rs 8 a unit amid allegations that it was to favour private producers because in 2011 power was bought for highest rate of Rs 4.50.
Moreover, after he came to power in 2008, it took him 34 months to revise power tariff for remaining consumers in September, 2011.
Distorted Budget Loss figures
To cover up intense accusations and charges of masses and opposition, Gehlot manipulated facts and figures to portray a false picture. Given the fact that government who owned the DISCOMs, also posed as a guarantor to loans, Gehlot took to acts of perfidy by not adding loans of as much as forty thousand crores in the budget. The implications of this have been felt by not only the incumbent government formed by Smt. Vasundhara Raje but also left severed impact on the consumers and the farmers at large.
In other words, if that loan amount was integrated into the Budget, the government would have been barred from becoming a recipient of any form of loans from Reserve Bank of India or elsewhere for any sector.
Doesn’t show losses in budget
Ashok Lavasa, additional secretary, power also suggested poor results and deliveries from Gehlot’s government. He spelled out: Distribution is a state subject and unless the states translate into action whatever is proposed at Centre’s level, no remedy will work.
Credibility going south
The bankers point out poor credibility the Rajasthan’s power sector enjoys. “We never privatised distribution companies and ran them like any other bureaucratic set up,” confides a senior officer in power department.
Notably, Gehlot ousted five heads of power companies in his first year of tenure, and gave extension to half a dozen superannuated chief engineers. Not to be taken as a shock, these engineers planned a massive game play and are to be blamed for this mess. On being asked to justify unceremonious sacking of Power officers, Gehlot cited a no-brainer reason for the same. He stated that lack of adequate personnel was the sole reason behind these replacement moves.
Caused unreasonable delay…
In his tenure, Gehlot resorted to unfair means for gaining favouritism from various private top-notch parties. Gehlot turned down two tenders worth Rs 1200 crores that were to set up two thermal power stations, one each in Chabra and Suratgarh.
The government cancelled the tenders on April 25, 2012 because it could not force some offices in tender committee to give one of the contracts to a private firm even when public sector undertaking Bharat Heavy Electricals Limited (BHEL) had quoted the lowest bid for the both.
Purposeless cum selfish efforts towards bolstering alleged relationships with private parties only led to degradation of state’s commitment to ameliorate power generation.
Negligible Subsidies for farmers and BPL
This financial mess is having direct adverse affect on masses. The power companies impose unofficial cuts – often double of what Gehlot publicly asks them to adhere to to save on subsidy since every unit consumed adds to losses. Every unit that is unsold saves money and reduces losses.
Ashok Lavasa pointed out that Rajasthan was the only state where every unit costs Rs 6.40 if state doesn’t buy expensive power like it did in 2009 was subsidised. To industry, it gives power at Rs 5.78 unit. Agriculture got it for 90 paise, domestic for 4.78 and commercial for Rs 6.39.
Government compensates nominally, just 33 paise for agriculture and Rs 1.40 for below poverty for whom rate is Rs 2.25.
While Gehlot left office after performing his wrong-doings, doing perfidy and indulging in selfish politicking, we are glad that the incumbent government has overcome all odds and countered prime issues confronting the state’s progress. Thanks to the Raje government for addressing all problems with full regard to the masses and their aspirations.
Had Gehlot been ruling, the state would have drenched in rains of losses and bankruptcy.
