Chidambaram criticises AP's fiscal policy

Union Finance Minister P C Chidambaram on Saturday criticised the Andhra Pradesh's government's fiscal policy.

Addressing the media in Hyderabad, the finance minister said the state had the worst power crisis in the South. The state showed a power deficit of 20.2 per cent as against the southern region's average of 16.7 in 1995-96. The all-India figure is 9.2 per cent.

In 1996-97, the peak deficit in the state was 36.8 per cent and the energy deficit 26.5 per cent.

Though the state's plant-load factor is a healthy 78 per cent, the transmission and distribution losses are 18.75 per cent. This has to be cut down to the global level of 3-4 per cent, he added.

If the state’s power position has to improve, he said that the myth that people want free power needs to be broken. ''What they need is reliable, uninterrupted, high quality power and they will pay for it,'' he pointed out.

Chidambaram also took the state government to task for slow implementation of projects including those aided by the World Bank. If these projects are not delayed, huge interest costs could be saved.

The state has been lagging behind in the area of resource mobilisation also, he added.

Despite the tardy progress, the Centre has finalised World Bank aid for three projects -- the AP Hazard Mitigation and Emergency Project, AP Irrigation Project (III) and the AP State Highway Project -- at the cost of Rs 45.34 billion.

Chidambaram said the state's power position will improve with the clearance of the National Thermal Power Corporation's Simhadri power project.