Volume 1, No. 6, August 2000

The Andhra Suharto, Chandrababu Naidu, had bared his fangs again on the 80 million people of AP. In the last week of May 2000, even as the peasants in 18 out of the 25 districts in the state were suffering under the worst drought in recent years and were committing suicides unable to make both ends meet, the inhuman face of the comprador manager of the World Bank in AP has revealed itself in its true colours by the steepest ever hike in electricity charges.

Coming as it does on top of the unbearable burden of taxation and hikes in the prices of most of the essential commodities such as rice, wheat, sugar, kerosene, LPG, fertilisers, etc., the steep hike in the electricity rates threatens the very survival of the poor and middles class sections of the population in AP. The peasantry reeling under the worst crisis due to cuts in subsidies in agricultural inputs, an end to bank loans, over dependence on rapacious traders-cum-moneylenders who supply them with substandard seeds, pesticides and fertilisers, are already committing suicides.

In Rs. Per Unit

At one stroke, the TDP government in AP led by the World Bank stooge, Chandrababu Naidu, has imposed an additional burden of Rs 1100 crore on the people of Andhra Pradesh through a monstrous increase in power tariff. Perhaps nowhere in the world has there been such a steep rise at one stroke.

Thus, while under the existing system of tariff known as non-telescopic charges, the consumer has to pay Rs 1.20 for the first 100 units which comes under a single slab at the rate of Rs 1.20 per unit. But as per the recommendation of APERC which divides the first 100 units into two slabs under the so-called telescoping charges, the cost per the 100 units comes to Rs 267.50 (Rs 72.50 for the first 50 units at the rate of Rs 1.45 per unit plus Rs 195 for the next 50 units at the rate of Rs 3.90 per unit) which is a record all-time high. For the peasantry the hike is from 18 paise to 30 paise per unit (it should be noted that for the peasantry of Punjab, electricity is supplied free). And for the industrial units using low-tension (LT) power the tariff is hiked to Rs 4.30, which will affect small-scale industry severely.

The steep hike in power tariff has evoked massive protests from all sections of people all over the state. Dharnas, rallies, gheraos of government officials, attacking electricity offices, sub-stations, etc, has become a daily feature.

Hence the government, which was adamant and refused to intervene in the matter, was compelled at last to make a small reduction. The following table gives a picture of the hiked rates :

Announcing the marginal reduction in the APERC rates, Naidu tried to fool the people by churning out statistics. Defending the increase in the power tariff on the plea that the APTransco is facing heavy losses, he said that the increase would not hit the common man since 62 per cent of the total domestic users of electricity in the state consume less than 50 units per month; that those who consume between 51 to 200 units constitute around 33 per cent; those consuming between 201 to 400 units form only 4 per cent and that a mere one per cent of the consumers use over 400 units. Thereby he made desperate attempts to concoct the lie that the poor would remain practically unaffected by the rise in tariff and that it was principally aimed at the taxing the wealthy.

But the hard fact is that it is the poor and middle classes that bear the burden of the steep hike in the tariff. The peasantry using electric pumpsets is also the worst hit. The middle class consumers will now be paying for electricity as much as they pay for the house rent. For instance, if a middle class household consumes 200 units on an average, the electricity bill would come to around Rs 600 per month. A poor worker who shares a common metre with three others in a four-portion house will face an even worse plight. With an average consumption of 50 units each, the poor worker will have to shell out around Rs 150 per month, in place of the existing Rs 40, due to the common metre that reads 200 units for the four families. And in urban areas of our country such families residing in rented portions is the common feature.

The reasons given out by the government are most amusing, to say the least. It is claimed that the electricity charges had not been raised for years. The fact is that the rates have been raised thrice during the past five years of TDP rule – in 1995, 1996 and 1998. It was only the fear of losing the election that acted as a deterrent in 1999.

Another reason cited by the government for raising the rates is that the APTransco is suffering heavy losses. The losses of APTransco are shown as Rs 2,400 crore in January 2000 and within the next two months the losses were said to have reached a figure of Rs 3,800 crore. Leaving these figures alone, which are obviously being exaggerated in order to push through the real objective of privatisation, the question that comes to anyone’s mind is: who is responsible for the huge losses of APTransco?

It is the rapacious corruption by the unscrupulous and greedy officials, engineers of the electricity department on the one hand, and the evaders on the other, who are the chief culprits. It is said that the dues to the electricity department from the industrial magnates and the elite consumers runs to about Rs 1100 crore, which is more than the burden imposed on the people by the present steep hike. The power transmission losses in AP are said to be the highest in the country — around 38 per cent. Reduction of one percentage loss is said to reduce losses by Rs 100 crore. According to the recommended standards, the transmission losses should not exceed 15.5 per cent. This means at least Rs 2250 crore could be saved if the 22.5 per cent of additional losses in AP are done away with by more efficient management. Then there will not be any need for increasing the tariff.

In fact, in several other states, the electricity rates are far cheaper than in AP. In Kerala it is Rs 1.18 per unit, in Tamil Nadu it is Rs 1.68, in MP it is Rs 1.75, in UP Rs 1.78, and in Karnataka Rs 2.12. Even in Orissa where the so-called reforms dictated by the World Bank were initiated earlier than in AP, the rate is around Rs 1.60 per unit. But in AP, it has been hiked to Rs 3.90 though after much agitation, it now stands at Rs 2.95, it is still the highest in the country.

The shocking move by the Naidu government in AP to hike the electricity charges is actually outright implementation of the World Bank conditions. Dismantling the electricity board, privatising the generation of electricity, non-interference of the government in fixing electricity rates, etc., are the conditions imposed by the World Bank for granting loans. Formation of the AP Electricity Regulatory Commission and giving full powers to hike the tariff is only the first move. The next move is to hand over the entire generation and distribution of power to the private companies.

In fact, the high tariff announced by the APERC is intended to attract the private companies into generation of electricity, as the profits would be extremely high. The government had also announced the World Bank condition that the power tariff would be hiked in a similar fashion over the next four years. This means even the poorest consumers will have to pay at least Rs 10 per unit by 2004.

The entire move of the Naidu government is dictated by the World Bank upon whose instruction its pet body — APERC – was formed as an independent body with full powers to increase the tariff without the government’s intervention. It is worthwhile to note that the ERC had brushed aside even the recommendation of APTransco regarding the tariff increase. For instance, the latter had asked for increasing the tariff for LT electricity users in industry to Rs 3.90 but the commission had hiked it to Rs 4.30. And for the domestic consumers, the hike was five per cent more than that recommended by APTransco. The APERC as well as APTransco are guided by the consultants from the World Bank. The drama enacted by the trio — the regulatory commission (APERC), the AP Transmission Corporation (APTransco) and Chandrababu Naidu himself — is a great fraud and conspiracy. The steepest and all-time record increase in the tariff by the APERC and the consequent nominal reduction by Naidu’s government is a ploy to create the impression that it has heeded the voice of the people while maintaining the highest rates in the country.

The imperialist-dictated hike in tariff and the plans to privatise the entire electricity department have laid bare the anti-people essence of the World Bank-sponsored reforms which has been the pet theme of Naidu’s TDP and the NDA government at the Centre. The people are coming into the streets in a big way to fight against the brutal onslaught on their lives by the traitors in power. The increase in power tariff is bound to spell the doom of the imperialist broker Chandrababu Naidu who has mortgaged the interest of eight crore people of AP to the imperialist sharks.

<Top>