Syllabus section: economy
Why in News?
The Finance Ministry informed that the Central government has inked a loan agreement worth $304 million with the Asian Infrastructure Investment Bank- AIIB for strengthening the electricity transmission system of Assam.
• The total estimated cost of the project in Assam is $365 million, out of which $304 million will be provided by AIIB and the rest of the amount by the Assam State Government.
• The loan from AIIB comes with a maturity of 24 years along with a grace period of 5 years.
The funds from AIIB will be used for improving the existing power transmission network in Assam and will build new networks for ensuring affordable and reliable power supply in the state.
Assam Power Transmission Project:
• The Assam Power Transmission project seeks to address the substantial energy deficit faced by the state on the account of congestion in transmission networks and electricity distribution.
• The project will include laying a transmission line and construction of 10 transmission substations. Apart from this, 15 other existing substations will also be upgraded and the existing transmission lines will be converted to the optical power wire.
• It will also help in reducing greenhouse emissions and will also improve the quality of the power supply to the ultimate consumers.
• It will strengthen the existing intrastate transmission network of the state by augmenting it with new networks for achieving secure, affordable, reliable, and efficient power.
Assam faces energy deficit:
• Assam has been currently witnessing an energy deficit, especially during peak hours and one of the main reasons behind it is the transmission networks and congestion of electricity distribution.
• Currently, the Assam Electricity Grid Corporation, the sole transmission utility of the state, manages the maintenance, operation, and development of 66 substations along with 6,882 megavolt-ampere capacity as well as a network of 5,701 circuit km of the transmission lines.
Source: Economic times