International investors back out due to the power failure in North India

August 03, 2012 17:49
International investors back out due to the power failure in North India

The massive power failure in Northern India has created an impresion on the international investors asa major weakness in our country's infrastructure and that it could also delay the growth. After the grid failure there were several reports that had criticising policies which all pointed out to a worrisome outlook.

Deutsche Bank said that the power failures were nothing new to India and that the consumers and businessmen were tactful enough to deal with the problem. However they also said that the losses in productivity and the efficiency in the procedures followed would lead to numerous negative impacts on the economy. Though there was a significant growth in the Indian economy a corresponding growth of the Indian Power sector was not evident.
In the report it has been mentioned that the power produced is much lesser than the power that is in demand with the growth in the economy. Other references to the lack of efficient transmission and distribution of the power is the highest in the world standing at a whopping 25%. There are also great amount of thefts of power in the country.

The Monday's blackout clearly highlights the incapability of the Indian infrastructure that dampens the growth of the country. The investors would be discouraged from investing in a country as reliability due to poor infrastructures would be low. The productivity improvements would also be very low. The power cut on Monday affected 8 states which only worsened on the next day affecting at least 20 states leaving over 700 million people waiting for it to be back.


(AW- Anil)

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