InvestorQ : Why does the government plan to invest Rs.300,000 crore in power distribution?
diksha shah made post

Why does the government plan to invest Rs.300,000 crore in power distribution?

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Niti Shenoi answered.
2 months ago
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This investment is a bid to revive the ailing power sector in India so that foreign investments can be attracted into this all important segment. In the forthcoming Union Budget on 01-February, the government plans to allocate a sum of Rs.300,000 crore or $41 billion and this will largely go towards the infrastructure of power distribution companies.

This is broadly expected to be a game changer for the rather slow growing power sector in India. It is ironic because the demand for power is huge at this point of time. The main purpose of this move would be to reduce the losses of plethora of regional power distributors across India focused on various states.

The outlay by the government will essentially focus on upgrading infrastructure and technology of these power distribution utilities. The idea is to make these state bodies more efficient, independent and resource generating by reducing their losses. The centre will provide grants to the states on a periodic basis against actual performance..

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