As India limped back to normal Wednesday after power was restored to its full capacity following two days of blackout due to the collapse of the three electricity grids, the country's economy has undergone a jolt.
India has set a goal; Mission 2012: Power for All. But, economists and captains of the industries say that the current supply and demand situation in the country apparently make it evident that the objective may not be achieved. In fact, the fear now is that the power crisis may stunt India's economic growth.
"Energy is like blood in your veins. It is as vital as that to the economic growth. If there is a shortage of blood, you can't function; similarly if there is a shortage of energy, the economy can't work," Rajiv Kumar, secretary general of the Federation of Indian Chambers of Commerce & Industry, told the media.
Another leading business lobby, the Confederation of Indian Industry (CII), has said that the industry, particularly the small and large business, had suffered a loss of billions of rupees. " The repeated outages carry a very negative image of India, when already sentiments about the country are low on account of the current economic situation," CII Director General Chandrajit Banerjee has said in a statement.
Though major industries have their own power back-ups, the inconsistent supply hits investment and disrupts small businesses, according to a senior official of the Indian Commerce Ministry, unwilling to be named.
India currently generates more than 65% of its total electricity from non-renewable sources of energy such as coal, gas and oil. About 19% comes from hydro power, just over 2% from nuclear energy and 12% from other renewable sources.
India is Asia's 3rd-largest economy. The country always suffers a peak-hour power deficit of about 10%, affecting economic growth.
"As the Indian economy has grown, so has its energy appetite. Power failure for two consecutive days has hit industry sentiment very badly. It is time that the Indian government starts taking a serious look at other sources such as solar power," said the official.
Paul A. Ebeling, Jnr.
Paul A. Ebeling, Jnr. writes and publishes The Red Roadmaster's Technical Report on the US Major Market Indices, a weekly, highly-regarded financial market letter, read by opinion makers, business leaders and organizations around the world.
Paul A. Ebeling, Jnr has studied the global financial and stock markets since 1984, following a successful business career that included investment banking, and market and business analysis. He is a specialist in equities/commodities, and an accomplished chart reader who advises technicians with regard to Major Indices Resistance/Support Levels.