Power distribution companies in the country are estimated to have incurred a staggering loss of about Rs70,000 crore in the last fiscal and the amount is expected to be as much as Rs1,16,000 crore by 2014-15
New Delhi: Raising concerns about the health of power distribution utilities, Planning Commission deputy chairman Montek Singh Ahluwalia today suggested introduction of different electricity tariffs for peak and off-peak hours, reports PTI.
Power distribution companies in the country are estimated to have incurred a staggering loss of about Rs70,000 crore in the last fiscal and the amount is expected to be as much as Rs1,16,000 crore by 2014-15.
Speaking at the power ministers conference on distribution reforms here, he said it is easy to have a 'time of the day tariff', where the rate is slightly higher for the peak period.
"The real issue is the difference between peak and non-peak is sufficiently large to actually encourage a switch.
That probably requires higher tariffs during peak period and may be even lower tariffs during non-peak periods," he said.
Peak period generally refers to the time when electricity is high compared to ordinary time.
There has always been a mismatch between power tariffs and the cost of generating electricity, which is hurting the financial health of power distribution companies (Discoms).
Going by estimates, electricity distribution losses touched about Rs70,000 crore in 2010-11.
Power secretary P Uma Shankar noted that electricity distribution losses are expected to reach as much as Rs1,16,000 crore by 2014-15.
"Losses are seeing an upward trend... We have to improve the health of Discoms," he said.
The main focus of the power ministers' conference is the financial health of Discoms and reasons for huge losses incurred by them. The country has about 73 power distribution entities.
"To tackle the commercial losses, strong political will is required. Curbing power pilferages and improving governance can bring down the losses," minister of state for power KC Venugopal said.
The government has taken various initiatives, including Restructured Accelerated Power Development and Reform Programme (R-APDRP), to reduce the Aggregate Technical and Commercial (AT&C) losses in power distribution area.
According to power minister Sushil Kumar Shinde, more than Rs40,000 crore have already been spend on R-APDRP.
AT&C losses in the country are pegged in the range of 20% to 40%.
After private equity funds, now strategic investors are moving in. Aetna has just acquired Indian Health Organization Pvt Ltd, a three-year old startup
The Indian healthcare sector with its super speciality hospitals and extensive network of healthcare service providers is proving to be an attraction for many. So far, private equity players have been showing great interest in the Indian healthcare sector, funding a series of startups. Now, a US-based healthcare benefits company has entered the market. Aetna International today announced the acquisition of Indian Health Organization Pvt Ltd (IHO), a three-year old company started by two Delhi-based entrepreneurs, that offers medical and dental care through an accredited provider network.
This comes close on the heels of a flurry of deals by private equity firms to fund India's burgeoning healthcare needs.
Recently, HDFC PE acquired a 12% stake in an e-hospital, MediAngels, founded by Dr Debraj Shome and Dr Arbinder Singal. Wellspring Healthcare, a preventive healthcare service founded by Dr Gautam Sen and Kaushik Sen received its first round of funding from Narayana Murthy's venture capital firm Catamaran, Anil Ambani Group's Reliance Venture Asset Management and some foreign investors.
Vasan Eye Care, chaired by Dr AM Arun, raised money from venture capital firm Sequoia Capital through three rounds of investments in the last two years, for its chain of 80 eye care centres. Glocal hospital raised equity funding to the tune of Rs15 crore for a minority stake from Elevar Equity and Sequoia Capital to complete the first phase of eight hospitals.
And now, following the IHO takeover, it seems that strategic investors too are interested in the Indian healthcare market. Aetna International's expatriate business is one of the industries largest and most prominent US-based international health benefits providers, supporting more than 400,000 members worldwide. With 80,000 members enlisted as IHO customers, Aetna has a platform to expand its network in the country. Entering the Indian market through an already established network will enable Aetna diversify into a new geography.
Derek Goldberg, Aetna's managing director, South East Asia, said, "India's growing healthcare market presents tremendous opportunity. The out-of-pocket medical spend in India is more than $30 billion annually, which is more than 60% of the total healthcare expenditure in the country. The service offered by IHO targets that direct consumer spending on healthcare by providing access to primary and preventive care."
Visham Sikand, IHO's co-founder and business development head, said, "As a global leader in healthcare, Aetna has the expertise and resources to take IHO's business to the next level. I am excited about the prospects of making quality healthcare and wellness programmes more affordable and accessible for consumers in India."
Aetna says it is convinced that IHO's network and market insight coupled with Aetna's global expertise and resource strength will make a strong statement by making healthcare and wellness programmes more affordable and accessible for consumers in India.
In a communication to ministries and departments on 11th July, the finance ministry had said there would be a ban on holding seminars and conferences in 5-star hotels and that foreign travels would be undertaken only in necessary and unavoidable cases
New Delhi: Faced with rising oil and food subsidy, finance minister Pranab Mukherjee today said the austerity measures, like curbs on foreign travel, will help government save 'wasteful expenditure', reports PTI.
"I am quite confident that some wasteful expenditure will be saved," Mr Mukherjee said adding a similar exercise to check government expenses in the past had paid dividends.
In a communication to ministries and departments on 11th July, the finance ministry had said there would be a ban on holding seminars and conferences in 5-star hotels and that foreign travels would be undertaken only in necessary and unavoidable cases.
Besides, there is a ban on creation of jobs in the government.
The government faces a challenging task to keep fiscal deficit target at 4.6% of the gross domestic product (GDP) in 2011-12.
"...last time when we had the austerity measures a couple of years back, we had good dividends and let us see how does it work (this time)," the finance minister said.
In September 2009, the government had put several restrictions on expenditure. These included instructions to ministers to fly in the economy class, leading to some resentment and the controversial 'cattle class' remark by then minister of state for external affairs Shashi Tharoor.
Due to volatility in global crude prices, the government's subsidy on fuel is likely to increase. It spends about Rs73,637 crore a year on fuel and fertiliser subsidies.
It plans to spend about Rs82,000 crore on food subsidy this fiscal which may go up to Rs95,000 crore once National Food Security Act comes into play.
Besides, the government is expected to lose around Rs36,000 crore during the current fiscal on account of duty cuts on petroleum products.
On the other hand, the government may find it difficult to mop up Rs40,000 crore from sale of equity in the public sector companies during the 2011-12 financial year.
Austerity measures were announced to ensure availability of adequate resources for meeting the development and priority schemes, the finance ministry had said.