India unveils $2.5bn plan to electrify all households by end 2018

Prime Minister Narendra Modi gestures as he addresses the nation from the historic Red Fort during Independence Day celebrations in Delhi, August 15, 2017. REUTERS/Adnan Abidi

India’s Prime Minister Narendra Modi on Monday launched a 2.5-billion-dollar project to electrify the country’s households by the end of 2018.

More than 40 million households -about a quarter of all in the country – are yet to be electrified and about 300 million of India’s 1.3 billion people are still not hooked to national grid.

The states will need to complete the electrification by December 2018 and the government will identify those eligible for free electricity connections across the country.

Modi said at an event where he launched the project that “no fee will be charged for electricity connection in households of poor citizens.”

The project, which would be mostly funded by the Federal Government and run by the state-run Rural Electrification Corp Ltd, was aimed at reducing the use of kerosene, the government said.

The government also said it would distribute solar power packs with battery bank to un-electrified households in such areas.

Another challenge will be to fix finances of debt-laden power distribution companies in states, which struggle to buy and supply electricity to consumers, Ashok Khurana, Director General of industry body Association of Power Producers, said.

He said government must take steps to improve the financial health of such companies if the new programme was to be a success.

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