Project assistance completion report : rural electrification project (386-0462) : India

The project met its goals a year ahead of schedule. By March 1986 electrical connections totalling 380,000 kilowatts had been completed. The total cost per kilowatt was $390.26, of which A.I.D. contributed 39.1%. The turning point for the project occurred in 1984. Up to that time, the implementing State Electrical Boards (SEB"s) had focused on procurement and construction, and had given little attention to providing actual electrical connections for the rural population. The project design was altered in 1984 to tie disbursal of A.I.D. funds to the SEB"s to actual kilowatts connected, rather than simply making lump disbursals to cover the costs of equipment, and Mission staff regularly reviewed SEB records and made site visits to verify that connections had been made. The design change also placed a premium on connecting higher-load devices, particularly electric irrigation pumps, instead of household connections, which made small farmers the prime beneficiaries of the project. The project has had a positive impact on the life of beneficiaries. Increased use of irrigation on small farms (up to 2 ha) has increased farm income 50-80% per unit of land. Electrification also brought with it higher employment, lower lighting costs (savings per family of Rs 200-600 per year compared to kerosene costs), and improved quality of life. Further, the "backward" population (Scheduled Castes and Scheduled Tribes) owned 25% of the electric irrigation pumpsets in four states surveyed and constituted 20% of domestic connections. The project"s main lesson is that future rural electrification projects should tie financing to actual kilowatt connections, in order to ensure that expensive infrastructure is put to use.