A tale of two tariffs: power and ports

Growth in the energy and infrastructure sectors has recently waned. We review the direction taken by recent tariff regulation and the potential growth impact in two sectors – power and ports.

The power sector

The past few years have seen a severe energy deficit, primarily because a coal supply shortage has impaired the ability of power companies to generate to their full capacity and to meet their power supply commitments under power purchase agreements with off-takers.

Following a presidential directive issued to Coal India Limited (CIL) in April 2012, the Cabinet Committee on Economic Affairs (CCEA) in June 2013 directed CIL to sign fuel supply agreements (FSAs) for a total capacity of 78,000 MW. A second presidential directive issued by Ministry of Coal called for CIL to sign the FSAs.

Neeraj Menon and Shruti Sahu are both counsel at Trilegal. Trilegal is a full-service law firm with offices in Delhi, Mumbai, Bangalore and Hyderabad.