New Delhi: Security concerns are expected to delay power projects in states such as Assam and Tripura where contractors are not ready to start project work due to threats from extremists, officials said.
These projects include Oil and Natural Gas Corp. Ltd’s ONGC Tripura Power Co. Ltd, which is setting up a 740MW gas power project in the state to use ONGC’s idle gas resources in Tripura.
Others include Assam Power Generation Corp. Ltd’s (APGCL) 140MW Namrup modernization and replacement power project and Assam State Electricity Board’s 38MW Lakwa combined cycle power project. These projects involve a total investment of around Rs4,000 crore.
Development roadblock: A facility of Mangalore Refinery Petrochemicals, an ONGC subsidiary. ONGC plans to set up a 740MW gas power project in Tripura to use its idle gas resources in the state.
“There is not an easy way out. What to do? No contractor is willing to go there in spite of security assurance. These projects will get delayed,” said a senior government official who did not want to be identified.
This comes at a time when there is already a shortage of skilled manpower such as fitters, welders, among others, at power project sites across the country. India is also unlikely to meet power generation targets of around 3,000MW from its eastern region by 2012 due to a shortage of cement as reported by Mint on 14 May.
While a senior ONGC executive denied that the Tripura project is facing any security threat, a senior executive at Bharat Heavy Electricals Ltd, or Bhel, the company which has been given the contract to set up the project, confirmed that there were problems in getting contractors at the project site at Palatana.
In most states in the North-East, overt opposition and threats to projects involving roads, oil and gas production are posing a serious challenges to the completion of around Rs20,000 crore investments that have been initiated in these regions as reported by Mint on 31 July 2007.
Assam has seen violence by insurgents from the United Liberation Front of Asom, the Muslim Liberation Tigers of Assam, the National Democratic Front of Bodoland and the Bodo Liberation Tigers.
Interestingly, while public sector projects are struggling to cope with the insurgency problem, private sector initiatives in the same region seem to proceed without much of a hitch. Some experts believe that this is largely due to the public sector being seen as a proxy for the government. Private companies, unlike their PSU counterparts, have the freedom to negotiate with terrorist groups. The PSUs, bound by the Central Vigilance Commission guidelines, do not enjoy the liberty of dealing with such groups.
Government officials in Assam and Tripura couldn’t be immediately reached for comment.
“As far as Tripura is concerned, the situation has improved. In Assam, the residual terrorist threat remains... These groups are principally extortionist now... Infrastructure projects are difficult to set up in these parts,” said Ajai Sahni, an expert on internal security and executive director of the New Delhi-based Institute for Conflict Management.