Centre Govt & AIIB Sign $304-million Pact to Boost Power Sector in Assam

NEW DELHI:

Centre & AIIB Deal for Power Transmission Network in Assam: The Government of India (GoI) and the Asian Infrastructure Investment Bank (AIIB) on Tuesday signed a loan agreement for a $304 million 'Assam Intra-State Transmission System Enhancement Project' to improve the reliability, capacity and security of the power transmission network in Assam.

Of the $365 million total estimated cost of the project, $304 million will be financed by the AIIB. The counterpart funding from the Government of Assam is $61 million. The $304 million loan from the AIIB has a five-year grace period and a maturity of 24 years.

India Govt & AIIB Loan Deal for Assam Power Sector

The project aims to strengthen Assam's electricity transmission system by following the following three steps: Construct 10 transmission substations and lay transmission lines with the associated infrastructure; upgrade the 15 existing substations, transmission lines and existing ground wire to optical power ground wire; and provide technical assistance to support project implementation.

The programme will strengthen the existing intra-State transmission network of Assam by augmenting it with newer networks to achieve affordable, secure, efficient and reliable 24×7 power. This will, in turn, bring Assam closer to ensuring long-term sustainability of its electricity supply.

The loan agreement was signed by the Joint Secretary in Department of Economic Affairs, Ministry of Finance, Baldeo Purushartha and the Acting Director General, Investment Operations of the AIIB, Rajat Misra.

Purushartha said that the project is expected to improve the transmission network and reduce transmission losses. The strong backward and forward linkages associated with the project will create socio-economic opportunities for both households and business communities in the State. He added that this project financing will help achieving the AIIB Energy sector mandate and also support the Government of India in fulfilling the national development priorities.

Assam currently witnesses substantial energy and peak demand deficits. One of the main reasons for the power-deficit scenario in Assam is congestion of the electricity distribution and transmission networks. The project would improve the transmission network constraints and congestion in the State.

The Assam Electricity Grid Corporation Limited (AEGCL) — the sole transmission utility in Assam — is responsible for the operation, maintenance and development of the transmission system in the State. The AEGCL currently operates 66 substations with 6,882 megavolt-ampere capacity; and its transmission network comprises 5,701 circuit kilometers of transmission lines.

AIIB vice-president D.J. Pandia said that the AIIB's investment will improve the reliability, capacity and security of Power transmission network in Assam. The project will also help in reducing greenhouse gas emissions and improve the quality of Power supply to the ultimate consumers. (PIB)

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