New Delhi
The Union Cabinet, led by Prime Minister Narendra Modi, has approved the Ministry of Power’s proposal to provide Central Financial Assistance (CFA) to North Eastern Region (NER) state governments. An outlay of Rs. 4,136 crore has been allocated for their equity participation in developing hydroelectric projects.
These projects will be executed through Joint Ventures (JVs) between state entities and Central Public Sector Undertakings (CPSUs). The scheme will be implemented from FY 2024-25 to FY 2031-32, aiming to support a cumulative hydro capacity of around 15,000 MW. The funding will be drawn from 10 percent of the Gross Budgetary Support (GBS) allocated to the North Eastern Region from the Ministry of Power’s total budget.
CFA for the NER state governments’ equity share will be capped at 24 percent of the total project equity, with a maximum limit of Rs 750 crore per project. This cap may be reviewed on a case-by-case basis. The equity ratio between CPSUs and state governments will be maintained when disbursing the grant. CFA will be provided only to viable hydroelectric projects, with states expected to waive or stagger free power and/or reimburse SGST to ensure project viability.
The scheme aims to minimize issues like land acquisition, rehabilitation, resettlement, and local law and order, reducing the risk of project delays and cost overruns. The development of these hydroelectric projects will also contribute to India’s goal of establishing 500 GW of renewable energy capacity by 2030.
