NEW DELHI, OCT 15: The Union Power Ministry will seek Cabinet clearance for securitising through bonds Rs 12,000 crore worth of dues piled up by state electricity boards (SEBs). The securitisation will be in the form of 7-year bonds carrying an interest of 10.5 per cent and will wipe out around 50 per cent of the outstandings against central power utilities which currently stand at Rs 23,000 crore. This was stated by Power Minister P R Kumaramangalam, who today announced the 100-day agenda for his ministry along with the Minister of State Jayantiben Mehta.Of the Rs 12,000 crore, Rs 8,000 crore worth of bonds would be to securities outstandings of the power sector while Rs 4,000 crore would be towards the coal sector. Kumaramangalam explained that this would give states the reprieve on the interest charges (as the the outstandings are charged at an interest rate of 18 per cent) as well as help them repay the amount over a seven-year period.
Kumaramangalam also stated that he was scheduled to meet FinanceMinister Yashwant Sinha today to discuss the problems of financing power projects to be set up by the private sector. He said that almost the entire shortfall of 12,000 mw in setting up the targeted power capacities in the Ninth Five Year Plan was on account of the failure of the private sector power projects to take off.
The 100-day agenda unveiled by the minister targets an additional capacity addition of 1444.40 mw of power -- 532.40 mw in the central sector.
Copyright © 1999 Indian Express Newspapers (Bombay) Ltd.
Printer-friendly page