Update on India’s States: June 14, 2017

A week of farmer unrest as protestors are shot in Madhya Pradesh, Maharashtra announces a total loan waiver program, and Uttar Pradesh struggles to find money for its waiver program; Karnataka puts the brakes on wind power; Madhya Pradesh and Rajasthan expand privatization of power distribution; and more.

Center–State relations

The Goods and Services Tax (GST) Council reduced tax rates on 66 items after encountering stiff criticism from the private sector. Goods with reduced rates include some food items and cheaper movie tickets. The council also raised the turnover threshold for participation in a simplified tax-paying scheme to $116,000 per year from $77,000. Source: Economic Times

Goods and Services Tax Tracker: Twenty-three states —Telangana, Bihar, Rajasthan, Jharkhand, Chhattisgarh, Uttarakhand, Madhya Pradesh, Haryana, Goa, Assam, Uttar Pradesh, Gujarat, Andhra Pradesh, Arunachal Pradesh, Odisha, Maharashtra, Mizoram, Tripura, Sikkim, Nagaland, Himachal Pradesh, Manipur, Meghalaya — have passed the model version of the Goods and Services Tax (GST). Jammu & Kashmir, Karnataka, Kerala, Punjab, Tamil Nadu, and West Bengal were yet to pass the tax as of June 12.

Energy Efficiency Services Ltd has begun a campaign to retrofit 1 million conventional street lights with LED lights in seven districts in Andhra Pradesh. This is the first rural LED street lighting project in under the center’s Street Lighting National Project (SLNP). Replacement will reduce carbon dioxide emissions by 132 million tons. The entire cost of the project is being funded by the Agence Française de Développement. Source: Hindu Business Line

SB Energy, a joint venture between Softbank, Bharti Enterprises, and Foxconn Technology Group, has started commercial operations at a 455 megawatt (MW) solar plant in Andhra Pradesh. Source: PV-Tech


Nothing critical to report this week.

Tata Power Delhi Distribution and Russia’s Federal Test Center have agreed to participate in joint development of smart grid, renewables, and energy efficiency technologies. Among other projects, Tata Power may invest in Federal Test Center’s research and development center. Source: Bureaucracy Today

Adani Power Ltd has suspended supplying power to Gujarat’s utilities despite a 25-year Power Purchase Agreement (PPA) which guarantees 1,800 MW of supply per year. Adani has stated that higher fuel costs at its Mundra Power Plant have made it impossible to provide power at the PPA cost of 3.6 cents per unit. Source: Hindu Business Line


UNICEF will provide Haryana with sufficient doses of pneumococcal vaccine to cover more than half a million children in the state. The doses cost as much as $185 on the open market and each child must receive three for the vaccine to be effective. Source: Business Standard


Siemens has signed a Memorandum of Understanding (MoU) with the Karnataka government to establish four Centers of Excellence that will offer skill development and benchmarked education curriculum with a focus on Automation, Mechatronics, and Internet of Things infrastructure. Source: Money Control

Karnataka Electricity Regulatory Commission (KERC) ordered distribution companies not to sign any PPAs with wind power suppliers until further notice. The regulator is concerned that signing further PPAs will result in the state being on the hook to purchase more power than it needs. Karnataka has already signed enough PPAs with renewable energy developers to ensure it fulfills its renewable purchase obligation until 2020. Source: Economic Times

Karnataka will seek a $350 million loan from the Asian Development Bank to help develop 740 miles of its core road network under the third phase of the Karnataka State Highway Improvement Project. Source: The Hindu


Five farmers were shot and killed by police  during a protest at Mandsaur district in western Madhya Pradesh. The five were part of a group of farmers protesting low prices for agricultural products. The state government claimed that the police had fired in self-defense. Source: Hindustan Times

Three Madhya Pradesh distribution companies have signed an agreement with privately-owned Feedback Energy Distribution Company (FEDCO) to provide power distribution services on the management operator model in five districts of the state. Under the terms of the agreements, FEDCO will carry out meter installation and services, feeder metering and energy audit, and revenue collection. Its area of responsibility includes half a million customers. Source: Financial Express


In a major concession to the farmers’ lobby, the Maharashtra government announced a waiver of farm loans, although with conditions to ensure the waiver does not apply to those whose main source of income is from other enterprises. As a first step, government fully waived the loans of farmers with less than 2.5 acres at a cost of $4.7 billion. Source: Livemint

The Maharashtra Pollution Control Board launched new rating system that assigns factories from one to five stars based on the amount of air pollution they produce. The rating will be based on two years of data collection at the point of emission. Researchers from the Abdul Latif Jameel Poverty Action Lab, the University of Chicago, Yale, and Harvard collaborated on developing the rating system. Source: Economic Times

The central government approved a total investment of $10.4 billion over three years to improve urban infrastructure in Maharashtra, including $2.96 billion for seven smart cities and $3.11 billion for the planned metro rail systems at Nagpur and Pune. Source: Livemint


Ajmer Vidyut Vitran Nigam Limited, Rajasthan’s distribution company, has signed a 20-year Distribution Franchisee Agreement with Tata Power Delhi Distribution Limited (TPDDL). TPDDL will be responsible for operating and maintaining the distribution network and managing billing and collections in Ajmer City. Source: Bureaucracy Today

Rajasthan has raised the coverage amount for farmers participating in its subsidized crop insurance scheme by $1,550, to $9,300. Nearly 700,000 farmers who have taken crop loans from state cooperative banks will be eligible to pay an annual 41 cent premium. Source: Business Standard


The state government signed an MoU with the Civil Aviation Ministry to implement the central government’s UDAN scheme promoting regional air connectivity. Source: Economic Times


All of Telangana’s 72 municipal governments now offer online services, including processing building plans under the Development Permission Management System. Three quarters of them offer services within each of the 18 essential municipal functions online, including issuance of birth and death certificates, trade licences, and tax payments. Source: The Hindu


Uttar Pradesh chief minister Yogi Adityanath has approved the state’s new industrial policy, which focuses on promoting industries in the less-developed Purvanchal and Bundelkhand regions by simplifying the clearance process and offering a strict timeline for approvals. Source: Economic Times

The Power Finance Corporation has offered four state distribution companies a $558 million loan to help them expand connectivity. The three-year loan, the largest ever to be offered by the state-run financier to distribution companies, will help the state connect 1.14 million households. Source: Economic Times

With its budget squeezed by a $5.66 billion waiver of farmers’ loans, the Uttar Pradesh government has decided to borrow $2.57 billion to execute highway, housing, and power projects. Source: Economic Times


Nothing critical to report this week.

Best of the Rest

Assam

Assam Gas, a state government enterprise, has submitted an expression of interest to the Petroleum and Natural Gas Regulatory Board to lay, build, and operate a 450-mile natural gas pipeline from Barauni in Bihar to Guwahati. The pipeline would link the Northeast with the national grid. Source: Economic Times

See the entire digest at Engaging Indian States.

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