India needs to use Rs. 80000 crores of funds stuck up in various hydel projects which have been invested in the past to solve partially the shortage of power in the country said Prof. J.D. Agarwal, Chairman, Indian Institute of Finance while addressing the delegates of International Conference cum Exhibition “INDIA HYDRO 2004”. This massive amount has become non-performing asset and the nation is loosing because these projects for one reason or another are not being allowed to be completed. In view of the ever increasing need for large river projects, it is necessary to shape public opinion and build public awareness. The creation of local level institution will also prove effective in this direction suggested Prof. Agarwal. He feels Government's role should be limited to technological, training and financial aspects.

Prof. Agarwal reiterated that there is a need for U.S. $ 10 billion in power sector per year to meet the shortage of power and bridge gap between demand and supply. Besides capital expenditure in the form of plant and equipment, a major chunk of the money is spent on fuel (in case of thermal) besides other expenditure and overheads. He strongly feels, considering the fund crunch being faced by State Electricity Boards, private promoters should turn to Indian and foreign financial institutions. Joint ventures should be formed with 100 percent equity holdings shared by both the Indian and foreign promoters. In case of foreign loan it would be required that supplier's credit is guaranteed by Export Credit Agencies from the country of export. In his speech, he also outlined various strategies for financing of Power Projects.

Advocating the hydel power, Prof. Agarwal emphasised that hydel power is cheaper, does not pollute environment and is based on renewable natural resources unlike thermal power. Oil, Coal, Gas resources can be used for producing power, but are getting scarcer day by day and involve high cost and put strain on foreign exchange. However, he says that despite such clear advantages only one-fifth of hydro power has been harnessed in the country so far as compared to other countries where ratios is very high. Norway uses 99 % of power from Hydro Power. In a country like India it is very important that water resources be utilized efficiently and effectively. According to Dr. Agarwal, Indian economy largely depends on agriculture. It is adversely affected by floods and droughts. The investment in Hydropower projects will not only generate power but is multipurpose, it could control floods and provide water to drought hit areas through proper water resource management. It would also reduce dependence of India’s agriculture on monsoons, It is environment friendly and less polluting.

Power is a one of the most vital input needed to fuel the engine of economic growth and to fulfill the basic needs of the entire population of a coun-try said Prof. Agarwal. Energy differentiates a least developed or developing economy from a developed economy. According to him, power is the most critical input for agricultural, industrial production, IT & telecommunications and raising the quality of life of people.