| Author | Ganguly, Sujoy |
| Call Number | AIT RSPR no. SM-95-71 |
| Subject(s) | Energy devlopment--India--Finance
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| Note | A research submitted in partial fulfillment of the requirement for the degree of Master of Business Administration. |
| Publisher | Asian Institute of Technology |
| Series Statement | Research studies project report ; no. SM-95-71 |
| Abstract | This study attempts to understand the mechanism of project financing in the power sector in India based on a case study on a public sector organisation. The study also encompasses the modes of financing by the private pa1iies with special reference to the fast track power projects by the independent power producers. The information used in this study was gathered through interviews and discussions with the chief executive officers and top managers of several financial institutes, banks and power corporations in India. The study is also based on company reports, manuals, newspaper clippings, published academic literature and business magazines. The study identifies the typical features of project financing in the developed and the developing countries, the level of risks and the sources of finance needed to fund such high leverage, long gestation projects. Power being the most critical among all the infrastructure facilities has been taken up as the topic of investigation. Demand supply patterns, installed capacities and consumption are some of the important parameters in the Indian power sector which have been studied at length and emphasis has also been given on the future projections. Based on these projections, the level of investments needed have been estimated followed by optimal funding mechanisms which are best suited in the Indian financial market. By developing a case study on a public sector power corporation, typical funding mechanism and financing strategies of a public sector project has been analyzed. This has been compared with the financing issues of private sector power projects with special reference to the ongoing fast track projects. Finally, the study identifies the necessity of private investments in the power sector to meet the shortages, provided it does not circumvent the basic interests of the nation. The study has revealed the requirement of huge amounts of power in the next fifteen years or so, concomitant with the needs of long term financing like pension funds, insurance companies, mutual funds and deferred instruments. It has been found that the public sector alone cannot meet all the expenses needed and hence there is no other option but to allow the private promoters to build their own projects and absorb most of the risks. Corporatisation of the government bodies and divestiture of the ongoing loss making bodies like the State Electricity Boards into private units may enable in lowering the allowable loss margin. All through the study, the basic intention has been to prove the fact that privatisation of the power sector is the only best means to rejuvenate the ever ailing Indian power sector. |
| Year | 1995 |
| Corresponding Series Added Entry | Asian Institute of Technology. Research studies project report ; no. SM-95-71 |
| Type | Research Study Project Report (RSPR) |
| School | School of Management (SOM) |
| Department | Other Field of Studies (No Department) |
| Academic Program/FoS | Master of Business Administration in International Business (Publication code = SM) |
| Chairperson(s) | Pandey, I. M. |
| Examination Committee(s) | Gupta, J.P.;Khang, Do Ba |
| Scholarship Donor(s) | Asian Institute of Technology. |
| Degree | Research Studies Project Report (M.B.A.) - Asian Institute of Technology, 1995 |