Power Minister Jyotiraditya Scindia today said that as many as six States have come forward for the Government’s financial rejig plan of the State discoms.
“Bihar, Andhra Pradesh, Uttar Pradesh, Tamil Nadu, Kerala and Haryana have agreed to the debt recast plan,” Scindia told reporters here.
He also said that the Government is hopeful of executing the power distribution companies’ debt restructuring soon.
Faced with mounting debt of power distribution companies (discoms), which is over Rs 2.46 lakh crore (as on March 2012), the Government, in October last year, came up with the financial restructuring plan.
The Centre would recast Rs 1.5-lakh-crore debt of the State Electricity Boards.
Taking over of 50 per cent short-term liabilities of discoms by respective State Governments is a major proposal in the Central Government plan.
Re-reimbursement of debt
Incentives such as re-reimbursement of 25 per cent of discoms debt taken over by the State Government are part of the scheme. However, the Power Ministry has not given specifics regarding re-reimbursement of debt burden to the States.
As per the financial restructuring plan, the Central Government would provide 25 per cent capital reimbursement of principal repayment by the respective State Government on the liability taken over by it.
Under the scheme for state-owned discoms, the respective State Government is to take over 50 per cent of the outstanding short-term liabilities up to March 31, 2012.
According to the plan, this shall be first converted into bonds to be issued by discoms to participating lenders, duly backed by State Government guarantee.
The last date for the States to register for the recast plan may be extended from March 31.