Rich in coal but acutely short on electricity, Jharkhand is set to announce its first power policy to attract much-needed investment in the sector.

A government committee has prepared the draft of the power policy that aims to bring in investment worth Rs.200 billion ($4 billion).

"The draft policy focuses on the core issues that will attract investors and help the state improve its power scenario," an official in the Chief Minister's Office (CMO) told IANS.

It stresses the need to exploit coal reserves for power production in the state. It also lays down the condition that investors will have to supply 40 percent of their total production to the state.

The power situation in Jharkhand is very poor. So far only 7,000 villages of the total 32,000 have been electrified. Per capita power consumption in the state is only 200 units as against the national average of 360 units.

The draft promises project clearance through the Single Window System, providing coal linkages and coal blocks to investors and setting up of land banks.

It also talks about subsidies on investments.

"The draft policy will soon be announced. The state government is determined to improve infrastructure in the state to attract investors," said the official.