India’s government is being pressed to implement reforms to the energy sector to encourage private participation after the latest Economic Survey found that State electricity boards (SEBs) are expected to deliver a minus 28% rate of return.
Commercial losses of SEBs are expected to cross Rs22,000 crore ($51 million) in 2005 – 2006 and though transmission and distribution losses have reduced to 32.54% in 2002-2003 from 33.98% in 2001-2002, the losses continue to mount. The total commercial losses of SEBs, excluding subsidies in 2004-2005, are Rs 20,715 crore. While direct transfers from State governments to SEBs in the same period stood at Rs 9,825 crore ($22 million).
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