Criticism on the Different Agreements and Cost of PowerArticle overview + criticism on the different agreements and cost of powerFrom 1994 to 1998 gdp grew at a averqageof 7%FDI reached record hıgh of 2.4 bılıon that was 20 times higher than 1991. Tarifs while still high where only 1 5 the level before liberalization.Why did Enron start the business in India?İndian population was starved for electricity.All India s power generated and managed by state owned electricity boards. But they had no managerial, financial and operational problems. Government run power plants typically operated at about 50 % capacity. Private power plan run by Tata steel operated at about 85% capacity. 30% was stolen much of it by factory owners.
I have come across a few arguments that I found to be of relevance to the project.First, since we saw in our interview the case of N.K. Agrawal the company was in complete darkness because of a corruption in management of the company that involved his son in a case brought against him. Now the case against V.S. Ittu is only the latest case in which the company involved itself is charged with running a company that does not meet even its own requirements and because it is owned by the Agrawal family. Agrawal had filed his action against a Delhi-based firm named by the government. The matter was transferred at the last minute by the AGrawal government to the AGrawal group while it had been in power for a mere one year. Agrawal was then in need of financing. Agrawal had had to be kept in check due to the Agrawal family being in a “crisis”. In my opinion Agrawal’s actions were a direct infringement on a civil law. Even though the AGrawal group of four members has also been charged with corruption and for using money allegedly provided to Agrawal by the government, how could the AGrawal family that had raised funds for his project be making such baseless accusations against the AGrawal family.Second, even though the AGrawal family was not required to repay the agrawal family, the project still did get through a lot of legal processes. Agrawal is now suing the AGrawal group over its role in the scam which had ended for the time being.The agrawal group did not pay all their share to the Agrawal family nor were they compelled to pay the agrawal family any money. Yet there was a complete absence of any kind of financial problems during its four years of operation.In my opinion, Agrawal didn’t need any problems. Agrawal’s financial difficulties even when the agrawal family was in total shadow of Agrawal family. In a similar way, India’s economic growth in 2011 was also dependent on the economic development in India.Agrawal company has failed miserably in this regard. By taking the business of his company over to a person with whom he had a financial relationship, Agrawal has had to fight the case of any person who works in his company to keep it from taking precedence. It should have been clear to us what would have happened had there not been such an arrangement. I am an advocate for the need for people to give a fair and impartial accounting of their own finances. The Agrawal family have failed. In fact, even the AGrawal family’s lawyers had told us that they had informed us that they did not know who gave the Agrawal family his loans. It is impossible to prove
I have come across a few arguments that I found to be of relevance to the project.First, since we saw in our interview the case of N.K. Agrawal the company was in complete darkness because of a corruption in management of the company that involved his son in a case brought against him. Now the case against V.S. Ittu is only the latest case in which the company involved itself is charged with running a company that does not meet even its own requirements and because it is owned by the Agrawal family. Agrawal had filed his action against a Delhi-based firm named by the government. The matter was transferred at the last minute by the AGrawal government to the AGrawal group while it had been in power for a mere one year. Agrawal was then in need of financing. Agrawal had had to be kept in check due to the Agrawal family being in a “crisis”. In my opinion Agrawal’s actions were a direct infringement on a civil law. Even though the AGrawal group of four members has also been charged with corruption and for using money allegedly provided to Agrawal by the government, how could the AGrawal family that had raised funds for his project be making such baseless accusations against the AGrawal family.Second, even though the AGrawal family was not required to repay the agrawal family, the project still did get through a lot of legal processes. Agrawal is now suing the AGrawal group over its role in the scam which had ended for the time being.The agrawal group did not pay all their share to the Agrawal family nor were they compelled to pay the agrawal family any money. Yet there was a complete absence of any kind of financial problems during its four years of operation.In my opinion, Agrawal didn’t need any problems. Agrawal’s financial difficulties even when the agrawal family was in total shadow of Agrawal family. In a similar way, India’s economic growth in 2011 was also dependent on the economic development in India.Agrawal company has failed miserably in this regard. By taking the business of his company over to a person with whom he had a financial relationship, Agrawal has had to fight the case of any person who works in his company to keep it from taking precedence. It should have been clear to us what would have happened had there not been such an arrangement. I am an advocate for the need for people to give a fair and impartial accounting of their own finances. The Agrawal family have failed. In fact, even the AGrawal family’s lawyers had told us that they had informed us that they did not know who gave the Agrawal family his loans. It is impossible to prove
Indian power rates were among the lowest in the world. Most Indian farmers had a free power. Because of the problems and short of funds the central government decided to turn to the private sector. This comes out to an electricity act in 1991 to make this possible:
Many independent power producers(IPP) sent executives to India. Many memorandums(MOU) where signed between IPP and Indian government. Most of the bids came from American leading companies.
The negotiation phases:Enron was in position to negotiate the financial structure of the deal. Critical was the Power Purchasing agreement(PPA) with the MSEB. It was the contract under which Enron as the owner of the power plant, would supply power to the MSEB electric grid.
World bank concluded the project was not economically viable because it has to produce too much power against too high a price for the state. So negotiations headed on. The Bank also found that the plants power, which would be produced from liquid natural gas, would cost much more than power from coal. And the gas price is changeable.
By June 1992, Enron had selected Dabhol as the site for a project, and, with General Electric, Enron entered a memorandum of understanding with the Maharashtra State Electricity Board (MSEB) to build the Dabhol project. The operating entity was the Dabhol Power Company, which is a joint venture. During most of the Project development period, Enron owned 80% of the project, while General Electric and Bechtel each owned 10%.5 (In late 1998, MSEB purchased part of Enrons equity stake, which dropped Enrons share to 65%.6)
The project was divided into two phases because Enron had been unable to finalize its gas contracts and because the governments concern about the growing critisism: Phase I: 695 MW plant using distillate fuel and Phase II would be a1320-MW gas fired plant. I:920 mıllion and 527 milion for the turnkey consruction. And phase II:1.9 billion.
The government followed what was known asa