Liquidity Boost for Discoms
The finance minister has announced a Rs 90,000 crore liquidity injection for power distribution companies, where revenues have plummeted. The liquidity will be infused by the Power Finance Corporation and Rural Electrification Corporation, Sitharaman said. The loans will be given against state guarantee for exclusive purpose of clearing of discoms’ liabilities to the power generators. Central Public Sector Generation companies will give rebate to discoms which will be passed on to the customers. Sandeep Upadhyay, MD – Infrastructure Advisory, Centrum Capital Ltd expressed hies views, “Infrastructure sector could be a game changer acting as a catalyst for the government to not just jump start the economy but also to lead the economy towards a sustained long term growth. Fresh injection of Rs. 90,000 Crs into DISCOMs would certainly lead to financially de-stress them and in turn improve the liquidity for Power Generation companies. This was long due and hopefully would lead to end consumers getting benefited in terms of cheaper tariffs, however that is likely to happen on a medium to long term. Going forward one needs to ensure that Developers and the investors get a clear understanding and the precise details of the upcoming projects to start preparing for it sooner than later.”
Tags : ALLIED discoms Finance Minister Liquidity Boost for Discoms Sandeep Upadhyay Centrum Capital Ltd Power Generation Rural Electrification Corporation