US firm's Rs 10,000 cr MP investment looks uncertain

US-based ISN Information Systems & Networks Corp's Rs 10,000 crore investment in power in Madhya Pradesh seems to be in limbo.

Officials have no confirmation of the company's proposal. Similarly, up-to-date information on other mega power plant proposals is not available either with the energy department or the department of industry.

Government officials are unable to provide information on another power generation proposal of GMR Ltd, which is of Rs 8,000 crore. Industry Minister Babulal Gaur had included these figures in the investment list in a recent investors' meet, organised by the State Industrial Development Corporation.

Officials in the energy department say they have no clue on either the companies' positions or various clearances to the firm from the Central Electricity Regulatory Commission (CERC).

ISN (Information Systems & Networks Corp) has proposed investing $2 billion (Rs 10,000 crore approximately) to set up a power project of 2,000 Mw (four units of 500 Mw each) in the Sidhi district of the state.

A power purchase agreement draft, sent by the Madhya Pradesh State Electricity Board (MPSEB) to the company in the US a week ago, has evoked no response. "There's no way they can be contacted except on email. Their seriousness in the project is evident from this," a senior official in the Madhya Pradesh State Electricity Board told Business Standard.

State energy department officials, however, say something may happen after the election in Budni. Chief Minister Shivraj Singh Chouhan is contesting the election.

"Terms and conditions on the power purchase agreement have been changed. The CERC has to give clearance and the coal linkage is yet to be ascertained. The picture will clear only after the Budni election," Sanjay Bandopadhyay, ex-officio secretary, energy department, told Business Standard.

Official sources told Business Standard the project was proposed to come up in the Chitrangi tehsil of the Sidhi district. The company has sought the status on fuel (coal) linkages; land acquisition, and the availability of water and its charges.

The state power board, according to sources, has asked for only 200 Mw from the project. "The demand may go up to 500 Mw," a source told Business Standard.

"Bidding process norms have been changed, and we have asked the firm to come through competitive global bidding but it would be difficult for them," said an MPSEB official.

The project, as proposed, is likely to be completed by 2009. According to the Trade and Facilitation Corporation, a body that functions under the department of industry, a plot of 470.16 hectares (private land), and another one of 1589.10 hectares in the Bagiya and Badgarh villages of the Chitrangi tehsil have been approved.

The power generated from the project will be shared by the Indian Railways (1,000 Mw), the National Mineral Development Corporation (500 Mw), and the Madhya Pradesh government (500 Mw).