Modi unveils $2.5 billion electrification scheme for rural India

Prime minister defends economic record as growth slows

A villager girl switches on a light powered by solar energy in the village of Morabandar on Elephanta Island, off the coast of Mumbai in western India on late night December 20, 2010.Three villages on the island, which is home to the Elephanta Caves UNESCO World Heritage Site, are being provided with round-the-clock electricity for the first time as part of a scheme launched by an Australian firm, Solar-Gem.Fast-growing India wants to become a world leader in the solar power sector and aims to source 20,000 megawatts of electrcity from the sun by 2022 to meet its growing energy needs, ensure security of supply and tackle climate change. AFP PHOTO / Sajjad HUSSAIN / AFP PHOTO / SAJJAD HUSSAIN
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Indian prime minister Narendra Modi unveiled a renewed $2.5 billion push to electrify every Indian house by the end of next year, promising free and uninterrupted power to poor families and streetlights on every road.

"Even 70 years after independence, it's unfortunate that 40 million households still don't have electricity," Mr Modi said on Monday evening. "The poor used to have to go around in circles trying to get electricity [connections]… The government will now go to their homes to give them electricity."

Mr Modi’s announcement came in the form of a long speech in New Delhi, at a meeting of the Bharatiya Janata Party’s (BJP’s) national executive, which was attended by roughly 2,000 party workers.

At a time when he is coming under heavy criticism for mismanaging India’s economy, Mr Modi sounded frequently defensive.

In this financial quarter, India’s economic growth rate has fallen to 5.7 per cent - the lowest since 2014, when Mr Modi was elected, and a sharp drop from the 7.1 per cent rate for the 2016-17 financial year.


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Both demonetisation and the complex new sales tax were pushed through by Mr Modi, so he has come under sharp personal attack for the wobbling economy.

In his speech, however, Mr Modi argued that his government had been working assiduously for the families living below India’s poverty line. “The lives of the poor will only improve when they get electricity,” he said.

The new, 163bn rupee ($2.5bn) electrification scheme - named "Saubhagya," or "Good Fortune" - builds on an earlier promise. In November 2015, Mr Modi had said that his government would need just 1,000 days to forge last-mile connectivity to the 18,000 Indian villages that fell outside the power grid.

Since then, he said, progress has been swift. Three thousand villages still need to be hooked up to the grid. “In the last three years, India's renewable energy capacity has been doubled to nearly 27,000 megawatts,” Mr Modi said. Nearly three-and-a-half million streetlights had also been installed, he added.

Showing night-time photographs of the Indian subcontinent in 2012 and 2016, and saying they’d been taken by the US space agency NASA, Mr Modi pointed to the heavier belts of illumination seen in the more recent photo.

The spreading network of electricity will help wean poor households off kerosene, which is still used to provide heat and light in many parts of rural India, he said. "Many women still cook in the dark. Children have to study in the light of a candle or a kerosene lamp," Mr Modi said. "This situation will change. We are moving from 'bijli deficit' [electricity problems] to 'bijli surplus'."

Mr Modi’s statistics about rural electrification only tell part of the picture, however.

An Indian village is deemed electrified if one out of every 10 houses has an electric connection. The successful electrification of a village on paper can thus still leave millions of homes unlit.

As of May, roughly 13,500 of the targeted 18,000 villages had been looped into the electric grid. But according to data published by the Ministry of Power, only a thousand could boast a power line running into every home.

In several states in north India, including in Uttar Pradesh and Bihar, less than 50 per cent of homes in villages had any electricity at all. Poor families had to pay an upfront connection cost of up to 3,000 rupees, which they were often unable to afford. Mr Modi's speech specified that this fee would now be waived.