Shramik Adivasi Sangathan/NBA
  21 October 2002
Save The Narmada, Save Humanity!

Madhya Pradesh Government must withdraw the anti-people second tariff petition and cancel agreement with Asia Development Bank; Huge protest rally in Mandleshwar on the 26th of October marks beginning of state wide struggle

Jail Road, Mandleshwar
District Khargone, Madhya Pradesh
Tel: 07283-33162

The second tariff petition filed by the Madhya Pradesh State Electricity Board in front of the Madhya Pradesh Regulatory Commission is likely to destroy the entire economy of Madhya Pradesh. This petition filed at the instance of the Asian Development Bank has proposed increases in tariffs from 50% to 600% for various categories of consumers. If this proposal is accepted by the Regulatory Commission, millions of farmers and workers in Madhya Pradesh will be pauperized and have to take to the streets, small and medium industries will start incurring huge losses, and there will be darkness in the homes of ordinary people. In this context, the Jan Sangarsh Morcha demands that the state government must withdraw the anti-people petition filed in fulfillment of the conditions imposed by the agreement with the Asia Development Bank. If this is not done, farmers and poor people will launch a huge people's struggle all over the state, beginning with a huge rally at Mandleshwar on the 26th of October 2002.

It may be noted that when the farmers, wage workers and ordinary citizens of the state have not been able to absorb the tremendous shock generated by the last tariff order, the MPEB has filed yet another tariff petition in front of the Regulatory Commission. This tariff petition has proposed 50% increase in the tariffs for the domestic consumers, 300% increase for farmers using water from wells, and 600% for farmers pumping waters from rivers and canals, and 150% increase in the tariffs for important sectors such as the power loom sector. If this proposal is accepted, the farmers and workers of Madhya Pradesh will become completely pauperized, as irrigated farming becomes a thing of the past, small and medium industries such as the powerloom sector will close down and large numbers of domestic consumers will have to choose darkness over electricity. In all, this proposal for a tariff hike will adversely impact over 65 lakh consumers in the state.

The moot question is why yet another proposal for a tariff hike has been submitted by the Madhya Pradesh Electricity Board, so soon after the substantial 20- 25% tariff hike of last year, although the Madhya Pradesh Energy Reforms Act, 2001 allows the MPSEB to file a fresh proposal upto 3 years from the filing of the last proposal? The answer lies in the agreement signed by the Madhya Pradesh government with the Asia Development Bank in 2001. This agreement for a Rs. 720 crores Power Sector development loan states that the MPSEB will have to initiate a hike in power tariffs, before each loan instalment is given. The agreement envisages three instalments, one already given in December 2001, after last year's tariff hike, one instalment is due now since the MPSEB has fulfilled the condition of filing the second tariff petition by September 2002, and the third instalment in June 2003, after the third tariff petition has been filed. The fact is that the developed countries like the US and the multinational companies there are seeking to use institutions such as the Asia Development Bank, the World Bank and the World Trade Organisation in order not only to takeover our power sector, but to capture our large markets by first dismantling and destroying our agriculture, trade and industry.

The MPSEB has stated in this current proposal that the proposed tariff hikes have been contemplated in order to generate an additional revenue of Rs. 999 crores. But if this current proposal and the tariff order of the Regulatory Commision after the last tariff proposal is analysed closely, we find that had the MPSEB fulfilled the conditions of the last tariff petition to improve its own performance there would have been no need to propose a further raise in tariffs in this petition.

This analysis makes it clear that

The Madhya Pradesh Electricity Regulatory Commission had ordered the MPSEB last year that it should downsize it presently unbelievably large Transmission and Distribution losses of 51% to 42%. But the MPSEB instead of complying in full, with the MPSERC order has reported a decrease of only 2 % in the losses having brought them down only to 49%. This has resulted in a loss of revenue of Rs. 400 crores to the MPSEB.

The MPSERC has also ordered the MPSEB to work its thermal plants at the Plant load factor of 71%.But the MPSEB achieved a PLF of only 62% leading to losses of Rs. 215 crores. It may be noted that the average PLF for Andhra Pradesh and Rajasthan SEBs is 85% and for NTPC plants is 85-90%.

The MPSEB was also asked to recover its outstanding dues. However instead of recovering the dues of Rs. 720 crores from its HT consumers and reducing its outstandings, the outstandings of the HT sector has actually gone upto Rs. 950 crores in the last one year. This is in addition to the Rs. 85 crores outstandings for the LT sector.

In addition to the non- compliance on the above mentioned three aspects, the MPSEB has also failed to comply with a large number of other orders given by the MPSERC, and has therefore committed contempt of the MPSERC. It is clear therefore in the circumstances that the proposed tariff hike that seeks to put the burden of the incompetence of the MPSEB and its failure to comply with the orders of the MPSERC on the consumers, cannot be justified and is completely unacceptable.

As per the Madhya Pradesh Energy Reforms Act, 2001, the orders of the MPSERC are final and binding , and if flouted can attract punitive action under the Sections 45 and 46 of the Act. Had the MPSEB complied with the orders of the MPSERC, decreased T& D losses, increased Plant load factor and recovered its outstanding dues, it would have been able to generate a revenue of Rs. 2000 crores on these counts alone and the need for this current proposed tariff hike to raise Rs. 999 crores would not have arisen at all.

It may be noted that this tariff petition has made extremely insulting comments about millions of farmers and poor working people .The petition states that these categories of consumers are responsible for illegal and unauthorized activities, which has taken the shape of a social evil that needs to be eradicated. But the Petition itself documents that in fact it is the HT consumers who have outstandings of Rs. 720 crores where as outstandings in the LT sector is Rs. 85 crores, raising the question whether it is the farmers and poor working people or the rich industrialists who are economic offenders ? The first tariff petition also records that the theft in the Industrial and Commercial sectors is higher than in the domestic and agricultural sectors. It is clear that the insulting remarks made by the Board in their report and their attack on the dignity of millions of farmers and poor people is baseless and is refuted by figures given in the MPSEB'S own petitions.

The forum of people's organizations of Madhya Pradesh the Jan Sangarsh Morcha criticizes the anti-people actions of the Madhya Pradesh government and the MPSEB and the proposed power tariff hike and demands that the second tariff petition be immediately withdrawn. The state government and power utility must apologise to the farmers for these remarks. The Jan Sangharsh Moarcha and the Nimad Malwa Kisan Mazdoor Sangathan demands that the Madhya Pradesh government cancel the disastrous loan agreement with the Asian Development Bank, and that it should consult and confer with the common people of Madhya Pradesh in order to draw up power sector plans for the state, instead of working as an agent of international financial institutions such as the Asian Development Bank and the World Bank. If the state government fails to do this , the Jan Sangharsh Morcha along with other people's organizations of Madhya Pradesh will launch a struggle in order to protect the interests of the common people of Madhya Pradesh and to save the state and the country from domination by global financial institutions. This struggle that will extend to all of Madhya Pradesh will begin from a massive rally to be held in Mandleshwar on the 26th of October 2002 by the Malwa Nimad Kisan Mazdoor Sangathan. Thousands of farmers will attend this rally to herald the beginning of an indefinite phase of struggle against the anti-people and pro- ADB policies of the state.

Mangalsingh, Shramik Adivasi Sangathan
Sunil, Kisan Adivasi Sangathan
Alok Agarwal, NBA
Khuman Singh, Nimad Malwa Kisan Adivasi Sangathan