New Delhi: Finance Minister Nirmala Sitharaman, who pushed for increasing capital expenditure in civil aviation and telecom sector last week, Monday reviewed the capital expenditure in the energy sector as she called top officials from the power and coal ministries and also from the department of atomic energy, said the officials.
This is the second such meeting after the second Covid wave. In June this year, Sitharaman had reviewed the government’s capital expenditure programme in the first round of capital expenditure review meetings after the presentation of the budget in February this year.
In the high level meeting, which was attended by the coal, power and atomic energy secretaries, Sitharaman urged the officials to carry out on the ground monitoring of infrastructure projects.
According to the officials, Sitharaman asked them to increase cooperation with States for faster implementation of the projects related to these three ministries.
Coal shortage
Finance Minister Sitharaman’s meeting with coal and power secretaries comes on the heels of report about acute coal shortage as the reports about the coal shortage at power plants emerged early last month.
According to reports, out of 135 power plants that are monitored centrally, more than half of them had coal stock left for just three days against the recommended stock of 15 days.
The problem occurred as there was an increasing demand for the electricity from the industry due to the improved economic activity at a time when supply was lower as coal mines and supply routes were affected during the monsoon season.
It affected the electricity prices in the spot market and led to a political blame between the government and the opposition as several chief ministers wrote letters to the Centre.
According to experts, the problem precipitated as India’s coal production has been stagnant for the last three years and increasing demand from the world’s second largest economy China spiked.
Capex Push
Increasing energy production is crucial for the government’s bid to revive the economy hit hard by the outbreak of Covid-19 global pandemic which killed more than 4,58,000 people in the country and caused a contraction of more than 7% in the country’s GDP in the last fiscal.
The deadly SarS-CoV-2 virus has so far killed more than 5 million people worldwide, destroying both lives and livelihoods as Covid induced lockdowns disrupted supply chains across different countries.
In order to shore up the slowing economy, Prime Minister Narendra Modi’s government has decided to ramp up the capital expenditure as it allocated a record Rs 5.54 lakh crore in this year’s budget.
In the meeting, Sitharaman reviewed capital expenditure of energy sector related departments and ministries in the first six months of the fiscal (April-September 2021). She also reviewed the capital expenditure of central PSUs active in the energy sector such as NTPC, NHPC and Coal India Limited (CIL).
The finance minister also reviewed the capital expenditure incurred on the ambitious National Infrastructure Pipeline (NIP) projects which aims for an investment of over Rs 100 lakh crore in the country’s infrastructure sector.
She also reviewed the funds to be raised by asset monetization, projects undertaken through public-private partnership (PPP) and convergence with the National Master Plan (Gati Shakti) which was announced by Prime Minister Modi last month.
Sitharaman told the officials that infrastructure projects were a priority for the government and their on-track performance was important for the economy.
She also asked the officers from the department of economic affairs that no civil work should be affected due to lack of coordination among the ministries.
Sitharaman also asked the ministry of power to reach out to States for faster clearance of the projects related to the ministry.
Similarly, the minister asked the department of atomic energy to fast track the procurement of critical equipment from international markets.
