Schenectady ready, but RPower’s Samalkot not | business | Hindustan Times
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Schenectady ready, but RPower’s Samalkot not

Most of those in the audience at GE’s Schenectady plant didn’t know anything about Samalkot, but heard President Barack Obama on Friday talk about its importance in his efforts to drive up employment. Yashwant Raj and Anupama Airy report.

business Updated: Jan 23, 2011 22:34 IST

Most of those in the audience at GE’s Schenectady plant didn’t know anything about Samalkot, but heard President Barack Obama on Friday talk about its importance in his efforts to drive up employment.

“Most of you hadn’t heard of Samalkot,” Obama said at a town hall meeting of GE employees at the plant, adding, “but now you need to know about it, because you’re going to be selling to Samalkot, India.”

But can Samalkot live up to expectations?

Under a $750 million deal signed during Obama’s India tour last November, GE’s Schenectady facility will manufacture gas turbines for a power plant owned and run by Anil Ambani’s Reliance Power in Samalkot, Andhra Pradesh.

The president said this deal will create 1,200 manufacturing and 400 engineering jobs, just the kind of boost that the US economy needs. He has named GE CEO Jeff Immelt to head a council on creating jobs. “The deal in Samalkot means jobs in Schenectady,” Obama said.

But the GE workers might have also wanted to know what the Samalkot plant runs on. Not yet. There are only commitments, a fallout of a messy dispute between Anil Ambani and his brother Mukesh.

The gas allocation for Anil Ambani’s 2,400-mw, R10,000-crore Samalkot power project has to be decided by the Empowered Group of Ministers (EGoM) headed by finance minister Pranab Mukherjee.

The EGoM last met on July 28, 2010 and referred the Samalkot project for assessment by the power ministry. The ministry recommended that the plant be given gas, but a firm allocation is pending before the EGoM. And no dates have been fixed yet for the next meeting.

A Reliance Power spokesperson refused to comment. The company had on January 10 written to the ministry asking for “an urgent meeting of the EGoM to allocate gas on a firm basis to Samalkot project at par with other projects likely to be commissioned” in 2011.

It said part of the project was ready for commissioning this year, and sought “an immediate gas allocation of 6.4 units by December 2011” and another 3.2 units by January 2012. The letter refers to the “strategic partnership with GE” and reminds that the deal was signed in the presence of the US President.

Perhaps Reliance needs a push from Obama to get this one over the hump?