Dhaka, June 8 (BDNEWS) – Although the country has been reeling under serious power crisis, the national budget for 2006-07 did not propose any new electricity generation project in the public sector.

Finance and Planning Minister M Saifur Rahman said an allocation of Tk 3,586 crore has been earmarked for 52 projects, including two new projects in the ADP in 2006-07, to improve power generation, transmission and distribution.

The allocation was made although he said an investment to the tune of about Tk 22,000 crore would be required to build an appropriate power infrastructure and therefore the government has involved private sector in this sector.

Experts said the lion's share of the allocation for 06-7 will go for transmission and distribution sectors as in the case of past four years of the four-party alliance government that did not give proper emphasis on the generation.

Officials said the government had two generation projects and for FY 2006-07 it is eyeing on these two - Sylhet (Fenchuganj) 90 megawatt and Chandpur 100 MW - power plants.

Although the Finance Minister in the budget speech himself admitted that "increased demand in relation to production is resulting in the deficit in power supply," the government has planned expanding the distribution system.

It planned to set up 14,330 kilometre distribution lines in 2006-07 while to give connections to 724,000 new customers. Also, setting up of 568 km transmission lines has been planned.

With the government plan to set up a 450 MW plant at Meghnaghat (2nd phase) under private sector by this fiscal, the experts called it absurd as no major progress took place for implementation of the project.

The total allocation for the power sector - revenue and development - for fiscal 2006-07 is Tk 4,286 crore. It is 14 percent higher than the revised budget of the current fiscal year, Saifur said.

He also proposed to create an 'Energy Development Fund' with an outlay of Tk 100 crore in FY 2006-07 to promote use of solar power and other renewable sources of energy for inaccessible localities where people are deprived of power supply.

A Power Rehabilitation Programme with an outlay of Tk 100 crore financed from non-development budget has been undertaken for repair and maintenance of old power plants. He proposed to allocate Tk 100 crore again for this programme in 2006-07.

BDNEWS/2018 hrs