Wednesday, August 1, 2012

Power Blackout Indian Style

India is a big country.  So when a blackout hits India, it's not like upper Manhattan or parts of Queens going dark.  Early reports had 10 percent of the world's population being without power.  A more thoughtful piece from INDIAREALTIME puts the actual number at around 320 million people going without power, since you had to have had electricity in the first place before you suffered a power loss.

Much better than any of the Indian jokes circulating about the blackouts is this statement from a 2003 Indian Ministry of Power report,
"Power plays a vital role in all economic activities leading to a better quality of life. The Ministry of Power has set a goal to provide "Power for all" by 2012."
The summary states that 70,000 rural villages are not electrified as of 2003.  According to IndaiRealTime, about 303 million people live in the states of Uttar Pradesh and Bihar, where the percentage of households with electricity is 37 percent and 16 percent respectively.  It looks like about thirty percent of the households without power were in these two states.  Per capita income in New Delhi is said to be 5x the level of per capita income in Uttar Pradesh and 7x the level in Bihar.  The Central government in India is incapable of dealing with even managing the current electrical grid. 

Large businesses and outposts of multinationals are able to have standby and backup generators for their operations.  Commuters on the rails, and folks looking to draw water for cooking and bathing are out of luck.  From a 2009 post,

"India's economic development has been misguided since the 1950's, when teams of Harvard and MIT development economists were relentless advocates for heavy industrial development. Today, the new mantra is to develop the Internet infrastructure. We're told that 30% of the population now live in urban areas. However, that means 70% of the population still live in villages, and Silicon Valley expats not withstanding, India is still a nation of villages.

Clean water, sanitation and reliable power are keys to sustainable economic growth. In the villages, people need simple, low cost and reliable ways to use sustainable fuels for cooking meals, and foodstuffs that don't rely on high cost inputs. Power, water and sanitation are large-scale public works projects, and the government has to find a way to become more effective at delivering these needs."
When the United Nations talked about completely redoing the infrastructure around  its Headquarters, it got into a unbelievably complex bidding process, driven by politics among American and European companies bidding for the job. In the end, Donald "The Donald" Trump said that he would do it for less and have it finished in less than a year.  Since he was too busy firing people on television, he wasn't taken up on his offer. 

I think that the Indian government should call in mega-moguls Mukesh Ambani and Sunil Mittal and give them the job of getting India a modern, universal electric grid.  Refuse to grant them any licenses to put up a 4G wireless network and force a truce in their power struggle over this vanity issue.  They would have to come up with financing plans, aided by the Government, to get the job done.  Everything would be on the table to discuss. When the grid gets done, we can talk about 4G.

Think about how ridiculous it is to hear them talk about the need for India to have a 4G network so that a wealthy New Delhi resident can call her favorite quick service restaurant to have her order ready upon arrival.  Let's scrap all this nonsensical talk and get down to providing one of the backbones of civilized living for all Indians, namely widely available, stable electrical power. 

By the way, I would propose that Messrs. Ambani and Mittal get a completely free hand to hire whatever firms they want to get the job done.  If they need to fire Indian bureaucrats, they are able to sub-contract that job to The Donald.  Seriously, let's try to harness the abilities of our biggest, most powerful moguls to a meaningful, high private and social rate of return project. I fear that this kind of solution is the only way for an Indian government to deliver critical social needs.  

No comments: