State may still be burdened with huge power subsidy
Jangveer Singh
Tribune News Service

Chandigarh, January 20
Punjab may still be burdened with a huge subsidy on account of agriculture power supply with the power charges recommended by the two-member resource mobilisation committee only meeting a fraction of the total power being consumed by the farm sector.

The recommendations will also have to pass muster with the Punjab State Electricity Regulatory Commission (PSERC), which is yet to decide on the power tariff petition for the next financial year.

According to sources the two-member committee has made a political point by imposing nominal charges at the rate of Rs 50 per BHP on farmers, which will be reimbursed at a later stage but has failed to come out with any plan to take the Punjab State Electricity Board (PSEB) out of the red. In fact, from what can be gathered from the recommendations of the committee, the PSEB will continue to be dependent on the government for its survival.

Though government sources claim that Rs 621 crore will be collected by way of charging farmers Rs 50 per BHP biannually, All-India Power Engineers Federation chairman Padamjit Singh says the board will collect Rs 494 crore only through this exercise. He says the total agriculture subsidy comes to Rs 2,797 crore and that the government will still have to pay the board Rs 2,303 crore if it does not want the farmers to bear this load.

Explaining the logic behind the calculations, Padamjit said in the tariff order for 2009-10 the PSERC had calculated the average price of one unit supplied to the agricultural sector at Rs 2.85. He said the same when converted per horsepower because agriculture supply was unmetered came to Rs 283 per HP per month. He said with the PSEB getting only Rs 50 per HP biannually, the remaining gap would have to be filled by the government.

However, all this will have to be put before the PSERC and the subsidy bill of the government could go up in case the PSERC increases the average per unit price. The PSERC has been increasing this price annually with the aim of eliminating cross-subsidies in a gradual manner.

Former Vice-Chancellor S. S. Johal said he approved the steps taken by the two-member committee to give relief to farmers, as the state would now be able to get funds from international bodies like the World Bank. He, however, said steps should be taken to ensure big farmers alone did not usurp the productivity bonus as they were the ones who did the proper paperwork upon getting their produce to the market.

Bharatiya Kisan Union (Rajewal) president Balbir Singh Rajewal said the government should ensure prompt reimbursement to farmers when they got their produce to the market.