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AP to reform power sector to rope in Rs 500 billion

International funding agencies have been approached for investment of up to Rs 500 billion over the next eight to 10 years to meet the needs of the Andhra Pradesh power sector, said Chief Minister N Chandrababu Naidu on Wednesday.

Naidu said domestic and foreign financial institutions were reluctant to provide credit and were insisting that the Andhra Pradesh State Electricity Board be restructured. The institutions were also keen on restructuring and reforming the power sector including the tariff regime.

The government proposes to break up the board into smaller, viable units, with APSEB handling the transmission of power, he said.

He also announced the government's decision to restructure the Andhra Pradesh State Electricity Board as part of its plans to reform the power sector.

Naidu, however, promised that APSEB employees would not be retrenched in the process.

The board will be converted into a corporate body under the Indian Companies Act, 1951, with the state government as the sole equity-holder. As for the generating stations under the APSEB, they would be converted into separate companies.

UNI