1. March 2005 Indian Power Industry Unprecedented Growth Opportunity

2. March 2005 Power  India - An Overview  Market and Growth Potential  Players  Opportunities  Why India?  Contact in India

3. March 2005 India - An Introduction  Population  States/UTs  Geographical Area  Languages recognised  Business language  Per Capita Income**  GDP** Over 1 bn 35 3.3 mn sq kms 22 English US$ 534 US$ 650 bn **(at factor cost & at current prices) 1USD=43.54 INR (as on July 4, 2005) Source:CSO Statistics

4. March 2005 India - Fast pace Growth  Largest democracy  4th largest economy by PPP index  6th largest energy consumer  ForEx reserves skyrocket from US$ 42 bn (2001) to US$ 133 bn (February, 2005)  GDP growth to continue between 6-8%  3rd largest economy by 2050: Goldman Sachs  Leading in IT & BPO  Oil & Gas and Biotechnology sunrise industries

5. March 2005 India - Leading the world  Hero Honda - largest manufacturer of motorcycles  Moser Baer - 3rd largest optical media manufacturer in world  Pharmaceutical Industry - 4th largest in world  Walmart, GAP, Hilfiger sources more than USD 1bn worth apparel from India  100 Fortune 500 have set R&D facilities in India including GE, Delphi, Eli Lilly, HP, Heinz and Daimler Chrysler

6. March 2005 Power  India - An Overview  Market and Growth Potential  Players  Opportunities  Why India?  Contact in India

7. March 2005 Power Sector Installed generation capacity 112 GW Total generation531 billion units CAGR5.8% Per capita consumption355 kWh T&D network5.7 million circuit kms Energy power deficit9% Peak power deficit12%

8. March 2005 Growth Potential Investment of US$ 90 billion in T&D infrastructure Addition of 100,000 MW by 2012 Source: Blue Print for Power Sector, Ministry of Power

9. March 2005 Generation Capacity Composition Installed capacity targeted to double by 2012 Thermal 69% Hydro power & wind power 28% Nuclear Power 3% Total Generation Capacity Source: 16 th Electric Power Survey, Central Electricity Authority

10. March 2005 Power  India - An Overview  Market and Growth Potential  Players  Opportunities  Why India?  Contact in India

11. March 2005 Domestic Players

12. March 2005 Foreign Investments Foreign MajorInvestmentCapacity (MW) CLP Gujarat PEC655 PSEG & Marubeni Corporation PNP Power Generation CompanyLtd 330 Marubeni Corporation BPL Power Projects 520 CMS Energy GVK Industries235 Doosan Heavy Industries and Construction NTPC660

13. March 2005 Power  India - An Overview  Market and Growth Potential  Players  Opportunities  Why India?  Contact in India

14. March 2005 Generation Opportunities Investment requirement of US$ 200 billion by 2012 By 2012 demand for electricity to double 100,000MW Additional generation capacity required 21% private sector capacity addition Source: 16 th Electric Power Survey, Central Electricity Authority

15. March 2005 Private Power Policy 36 projects commissioned in private sector Another 6 projects underway 55 projects under various stages of development 7000 MW 3000 MW 27,800 MW

16. March 2005 Transmission & Distribution Opportunities Transmission Distribution US$ 16 bn investment required by 2012* US$ 5 bn private investments through ITPCs and JVs Imminent private sector participation in AP & Karnataka Opportunities in power distribution companies * Source: PGCIL

17. March 2005 Trading Opportunities  Stage set for Active Bulk Supply Market  2400 MW bilateral trade in six months  USD 0.2 bn electricity traded by PTC in six months

18. March 2005 Power  India - An Overview  Market and Growth Potential  Players  Opportunities  Why India?  Contact in India

19. March 2005 Indian Achievement Share in world electricity generation increased from 2.4% (1994) to 3.6% (2002) Sixth in world electricity generation and third in Asia - Pacific (2002)

20. March 2005 States - Progressing markets Liberalised Competitive Market 2003-04 recorded reduction of over USD 1.7 billion in SEB losses in as many as 11 states

21. March 2005 Regulatory Reforms Tariff rationalisation Risk mitigation Demand side management Efficient market structure Environment concern Reduction in losses based on annual targets            

22. March 2005 Electricity Act - 2003  Power generation completely delicensed  Conducive atmosphere for private investments in generation,trading & distribution of electricity.  Competitive power markets Revolutionising the power scenario Post passage of Bill led to surge in investment 2002-034% 200416.2% (1/3rd of total project investment)

23. March 2005 Fiscal Incentives  FDI 100% allowed in Generation, Transmission and Distribution  Tax holidayOn profits on investments during block of 10 years in first 15 years  Capital import Waived for mega power generation duties projects

24. March 2005 Key Features A financial Special Purpose Vehicle (SPV) to be established to finance infrastructure projects. Electricity to 1.25 lakh villages. Creation of a rural electricity distribution backbone envisaged, with a 33/11 KV substation in each block and at least 1 distribution transformer in each village. Union Budget 2005-06

25. March 2005 Power  India - An Overview  Market and Growth Potential  Players  Opportunities  Why India?  Contact in India

26. March 2005 Contact in India Ministry of Power Shram Shakti Bhawan New Delhi Tel 23711316, 23710271 Fax 23721487 Website www.powermin.nic.in

27. March 2005 Contact in India Confederation of Indian Industry (CII) 249-F, Sector 18, Udyog Vihar Phase IV Gurgaon 122015 Tel 0091 124 5014060-67 Fax 0091 124 5014080/5013874 E mail v.raghuraman@ciionline.org