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Foreign firms exit as India fights Enron

US energy giant Enron Corp is not the only foreign power company to face problems in India. Fed up with red tape and legal hassles, four other foreign companies have either pulled out or are close to pulling out.

After more than a decade, India's power sector reforms have generated more controversy than investment.

The factbox below describes the travails faced by other foreign power companies once interested in investing in India:

1. Cogentrix: Repeated litigation and delays in government approval forced the US giant to walk out of a project to build a 1,000 MW power plant in Karnataka in October 1999.

2. Electricite de France: The French power giant last year scrapped plans to take a 15 per cent stake in a $1.4 billion, 1,084 MW, project in Maharashtra, citing better prospects in other emerging markets.

3. Daewoo Corp (South Korea): The Korean chaebol abandoned a 1,070 MW project in Chhattisgarh last year due to delays in securing key approvals and financial problems back home.

4. PowerGen Plc: The British giant set up two joint ventures in India in the early 1990s to build two plants with total capacity of over 1,000 MW.
Both projects have been delayed as bankers and the state governments have been unable to finalise terms for paying for the electricity purchased by the cash-strapped state utilities. PowerGen is reportedly planning to exit the ventures to concentrate on buying a major US utility.

5. National Power Plc: The British company's joint venture with the London-based Hinduja group is still trying to secure clearances for a 1,040 MW plant in the southern state of Andhra Pradesh. The project was conceived more than five years ago.

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