Rural Infrastructure Schemes

[op-ed snap] In a state of energy povertyop-ed snap


Mains Paper 2: Governance | Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

From UPSC perspective, the following things are important:

Prelims level: Discoms, “Power for all”, etc.

Mains level: The regional imbalances in electricity access, challenge from Distribution network capacity, etc.


  1. It is uncertain if the goal of electrifying all ‘willing households’ will mean universal access

Important turnarounds

  1. There is now 100% village electrification in India, an important milestone in the country’s development trajectory
  2. Another important turnaround came last year when India claimed to be a net surplus and exporter of electricity (a scenario projected to continue for at least a decade)

But do these developments mark an end to India’s energy poverty?

  1. 31 million rural households and about five million urban households are still to be connected to the grid( the highest in any single country)
  2. At the same time, a significant portion of connected rural households is yet to get adequate quantity and quality of supply

Future plans of the government

  1. The Central government has set itself an ambitious target of connecting all remaining households by the end of March 2019 and made budgetary allocations to cover the cost of electrification
  2. As part of a Centre-State joint initiative on 24×7 ‘Power for All’, State governments have already committed to ensuring round-the-clock supply to all households from April 2019

Regional imbalances in electricity access: Barriers and fallibility

  1. Seven States (Uttar Pradesh, Bihar, Odisha, Jharkhand, Assam, Rajasthan and Madhya Pradesh) account for 90% of un-electrified households
  2. Coincidentally, these States are ranked poorly in social development indices and house about two-thirds of the population living below the poverty line
  3. This concurrence between economic poverty and energy poverty will be a barrier to the goal of universal access

The main issue in these seven states

  1. Electricity distribution companies (discoms) in these seven States are already highly indebted, accounting for 42% of accumulated debts of all discoms as on March 2016
  2. \Their debts account for 17% of accumulated liabilities of the States
  3. Despite continued State subvention (except by Odisha), all these discoms have been consistently running at a loss, accounting for about 47% of the loss in electricity distribution business

Given the context, it is uncertain whether the goal of electrifying all ‘willing households’ by March 2019 would translate into universal access to electricity

Challenge is from Distribution network capacity: Another major challenge

  1. The distribution infrastructure in India is overburdened causing a high level of technical losses and frequent breakdowns
  2. The distribution network capacity in several States is inadequate to carry available electricity
  3. Subsequently, discoms have been resorting to load shedding while their contracted generation capacities are underutilised
  4. Adding new load to the existing fragile distribution network will only compromise the quality and reliability of supply
  5. It could result in continued blackouts for the rural poor during peak hours

Efforts done by the government: Inadequate funding

  1. The available funding support has been short of the growing requirement
  2. Current allocations under the Deen Dayal Upadhyaya Gram Jyoti Yojana (DDUGJY) and Integrated Power Development Scheme (IPDS), to augment rural and urban distribution networks, respectively, are only a fraction of the requirement
  3. Moreover, disbursement of these grants has been much slower, 17% under DDUGJY and 31% under IPDS, reflecting sluggish implementation

The way forward

  1. Low achievement of earlier electrification schemes has often been blamed on incompatibility and a lack of cooperation between the Centre and States
  2. Given that six of the seven low access States as well as the Centre are run by a single political party (and allies), there seems to be a strong political consensus on the goal of universal access

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