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India's power outage puts its superpower dreams in a new light

The blackout that affected 600 million people underscores the gap between India's economic ambitions and its vast structural problems.

August 01, 2012|By Mark Magnier, Los Angeles Times
  • An Indian barber holds a candle as he gives a customer a haircut at his shop in Kolkata. Three of India's electrical grids collapsed Tuesday, leaving more than 600 million people without electricity.
An Indian barber holds a candle as he gives a customer a haircut at his shop… (Bikas Das, Associated Press )

NEW DELHI — On one level, the power outage that stalled trains, snarled traffic and left hospitals scrambling across much of India was an example of business as usual — except, of course, that this time it covered an area including nearly 10% of the world's population.

But taken another way, Tuesday's massive blackout, the second in two days, underscored the yawning gap between India's superpower dreams and a sweltering, gritty reality. Problems with an aging electrical grid, pricing system and inefficient mining practices combined to darken a stretch of northern and eastern India that is home to 600 million people, in the process illustrating the nation's deep structural problems.

Among them, analysts say, are a weak and indecisive national government, entrenched bureaucracy and a singular focus on local issues at the expense of the common good, all of which threaten foreign investment and undercut the aspirations of India's young, vibrant population.

"The size of this is a surprise," said Pramit Pal Chaudhuri, foreign editor of the Hindustan Times newspaper. "But the fact it happened as a consequence of a whole series of micro-decisions not made is not."

The trouble started early Monday. India's northern grid failed, affecting 300 million people in seven states. With the help of power diverted from neighboring states and from as far away as Bhutan, service was restored by evening.

But the grid collapsed again shortly after 1 p.m. Tuesday, taking two more of the country's five grids with it. That left the capital with only 1% of its usual power supply and tempers fraying in the 90-degree heat.

State-owned Power Grid Corp. of India reported late Tuesday that nearly all service was back to normal. About 250 coal miners trapped underground when electrical pulley systems stopped were rescued, news reports said.

Richa Hingorani, who works for a civic group in Delhi, countered the sweltering heat and lack of air conditioning by fanning herself with a newspaper for hours.

"With bumper-to-bumper traffic, it took me 40 minutes to travel a distance that should've taken 10 minutes," she said. "There's no Internet, and little respite when you leave the office, since there are so many crowds."

Many people took the crisis in stride. According to the last census, one-third of the country's 1.2 billion people have no access to electricity even in the best of circumstances.

And rolling blackouts are common in India's cities, given the aging grid, a 9% shortfall in electricity at peak hours, and the increase in demand as millions entering the middle class buy refrigerators and flat-screen TVs. Many houses and businesses have backup generators.

Still, the collapse of an entire grid is rare: The last such failure involving the northern grid occurred in 2001.

Finger-pointing over this week's blackouts was well underway.

The business community, which has lobbied long and hard for better infrastructure, said it was a wake-up call. Power failures undercut competitiveness, reducing India's growth rate by an estimated 1.2%, according to the government's Planning Commission.

"This situation is a grim reminder of the humongous task we have on our hands in improving the infrastructure facilities in the country," R.V. Kanoria, president of the Federation of Indian Chambers of Commerce and Industry, said in a statement.

Retroactive taxation and cumbersome licensing procedures have discouraged foreign investors at a time when India badly needs jobs for the millions of young people entering the workforce annually.

India's economy grew by 5.3% in the first quarter, its slowest quarterly growth in nine years. Manufacturing, agriculture and construction all lost momentum, while the call centers that have absorbed legions of young, well-educated Indians continued to hold their own.

Foreign analysts said that combined with other factors, the blackout was a worrisome sign for India's ability to attract investment.

"I imagine this event will make for a larger number of people thinking of pulling out, and moving out their investments, including back to the U.S.," said Joel Kurtzman, a senior fellow at the Santa Monica-based Milken Institute and director of its Center for Accelerating Energy Solutions.

"If you're doing a country risk assessment of where to go and where to stay, increased cost, a less willing political system and an unreliable grid are not good factors," he said.

India has added significant coal-fired generating capacity in the last year, analysts said, but much of it is unused because transmission lines can't handle the added load. Meanwhile, government-influenced pricing driven more by politics than the market often leaves suppliers unwilling to meet demand.

Energy officials said the immediate causes of the blackout were unknown, but said below-average rainfall, which limited hydroelectric generation, and the high temperatures related to this year's weak monsoon could be factors.

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