Centre Proposes Cashless Settlement in Himachal BBMB Dues; SC Chides Punjab
UPSC / SSC current affairs note · Polity
Why in news
The Supreme Court is hearing a long-pending dispute over BBMB power dues owed to Himachal Pradesh since 1966. The Centre has proposed a cashless settlement, which Punjab has objected to, drawing a rebuke from the Court. The next hearing is on August 12.
Background
The Bhakra-Nangal and Beas hydro projects are managed by the Bhakra Beas Management Board (BBMB). After the Punjab Reorganisation Act, 1966, the power generated was to be shared among Punjab, Haryana, Himachal Pradesh, and Chandigarh based on population ratio. In 2011, the Supreme Court upheld Himachal's claim to 7.19% of the total power generated.
Key facts
The Supreme Court in 2011 upheld Himachal Pradesh's claim to 7.19% of total power generated from Bhakra-Nangal and Beas hydro projects.
The entitlement is based on population ratio transfer under the Punjab Reorganisation Act, 1966.
Punjab and Haryana have not cleared outstanding dues of 13,066 million units owed since 1966.
The Centre proposed a cashless settlement: Punjab and Haryana will return over 12,000 million units of electricity instead of a monetary payout.
Himachal will not pay ₹420 crore dues to Punjab and Haryana; this amount will be adjusted from the electricity units.
Himachal also does not have to pay over ₹400 crore towards capital cost to Punjab and Haryana.
Himachal and Haryana governments agreed in principle to the Centre's proposal, but Punjab objected.
The Supreme Court pulled up Punjab for not agreeing, observing it had a habit of not following court decrees.
Punjab's objection was over the rate of ₹2.5 per unit for arrears, claiming a loss of around ₹2,000 crore.
The Court gave Punjab two weeks to clarify its stand; next hearing on August 12.
Prelims pointers
- Bhakra Beas Management Board (BBMB)
- Punjab Reorganisation Act, 1966
- Bhakra-Nangal and Beas hydro projects
- Supreme Court bench: Chief Justice Surya Kant, Justices Joymalya Bagchi and V Mohana
- Next hearing: August 12
Mains angles
- Discuss the role of the Supreme Court in resolving inter-state water and power disputes in India.
- Critically examine the effectiveness of cashless settlement mechanisms in inter-state disputes.
- Analyze the federal issues arising from the Punjab Reorganisation Act, 1966, and its long-term implications.