The West Bengal State Electricity Board draws an average of 450-500mw -- or about a fourth of the state's requirement -- from the central power utility. The WBSEB also supplies some of the power to CESC, the private sector utility that supplies Calcutta and neighbouring areas.

NTPC chairman and managing director Rajendra Singh told a press conference here after his meetings with power minister Sankar Sen, chief secretary Manish Gupta and power secretary S B Barma that other defaulting states had taken steps to clear at least some of their dues but West Bengal has said it has no money.

The WBSEB owes NTPC Rs 657.76 crore as on July 31 this year, consisting of Rs 476.93 crore as the principal and Rs 180.83 crore as interest.

In terms of months, WBSEB ranks third among the three SEBs in theeastern region with its dues equivalent to 11.8 months' supplies. The Bihar SEB tops the defaulters' list with dues of 15 months, followed by Orissa SEB with 12 months. Damodar Valley Corp, which is owned jointly by the Union government, Bihar and West Bengal, owes NTPC 11.3 months' dues.

Singh said the Delhi and Uttar Pradesh SEBs have outstandings of nine months each. On the other hand, SEBs of western and southern regions have cleared more than 90 per cent of their dues.

The NTPC chief said the WBSEB has been paying an average of 33 per cent of its monthly dues. NTPC got 26 per cent of its dues in 1994-95, 51 per cent in 1995-96, 45 per cent in 1996-97, 42 per cent in 1997-98 and 30 per cent till July, 1998-99.

"No one can do business with such poor returns," Singh said.

Asked whether he had got any assurance from the state's authorities or was expecting any solutions by September 7, Singh said: "So far I have not received any assurance from anybody. But I am optimistic that something positive willcome up."

Asked about his meeting with power minister Sen, the NTPC chief said: "Sen has said that he knows the problem. But there is no money to pay."

Singh declined to clarify what he meant exactly by saying that NTPC will "regulate" supplies to the state. "If nothing happens and no solution is found, the inevitable will happen."

However, he added: "Stopping power supply to WBSEB will be a painful decision. No commercial entity would like to stop commercial activity. If we cut generation and supply only during peak hours, the cost of generation will be high and WBSEB will be the loser as it will have to pay the fixed cost of power whether it draws from us or not."

"On the other hand, if we stop generation our losses will be less as we will not have to pay for coal and oil which accounts for about 65 per cent of our generation cost," he said.

Speaking of Orissa, which owes NTPC around Rs 440 crore, Singh said the state has worked out a novel repayment method.

"They have promised to convert Rs 200crore of their dues into bonds by September 30. The state government will guarantee the bonds, which will be tradeable on the market," Singh said. The Orissa government has also agreed to clear its current dues in full.

Singh will take up the problems of Bihar soon.

Singh denied that he is being pressurised by the World Bank to take a tough stand. "Commercial considerations have prompted us to take the tough stand. On the one hand, NTPC is owed nearly Rs 8000 crore by various SEBs. On the other, it needs loans from the Bank to fund the projected capacity addition of over 14,000mw. They will certainly see that their money is paying back," Singh said.

When asked whether NTPC's pressure on the eastern states can be seen as a bias against governments not run by the Bharatiya Janata Party, Singh pointed out that NTPC had twice stopped supplies to Delhi and once in Uttar Pradesh, both run by the BJP.

"We stopped supplies to Delhi, which is run BJP, to UP also run by BJP. So the question of harassing non-BJPgovernments in the eastern states does not arise," Singh said.