Finance Minister Nirmala Sitharaman declared on May 13 that Rs 90,000-crore liquidity infusions into cash-strapped power distribution companies (discoms) is facing a demand slump due to a lock-down of COVID-19.
Punjab, Uttar Pradesh, Rajasthan, Manipur and Karnataka have shown interest in borrowing under the Rs 90,000-crore liquidity package to pay off their utilities outstanding to Gencos, the senior official said on Monday.
Finance Minister Nirmala Sitharaman declared on May 13 that Rs 90,000-crore liquidity infusions into cash-strapped power distribution companies (discoms) is facing a market downturn due to a lock-down of COVID-19.
As of May 13, discoms had a total of Rs 94,000 crore to power generation companies (gencos).
“Already some states like Punjab, Uttar Pradesh, Rajasthan, Manipur and Karnataka have evinced interest to avail this (Rs 90,000 crore liquidity) package,” a statement quoted Ravinder Singh Dhillon as saying while addressing Power Finance Corporation’s employees after assuming charge as the Chairman and Managing Director of the company.
State-run non-banking finance firms — PFC and REC — were mandated to sanction loans within 45 days and disburse liquidity package funds within 60 days from the date of submission of the proposal.
Dhillon told employees that financial assistance under the liquidity package is expected to be provided within 60 days.
He asked employees to interact actively with States to expedite financial assistance within the timelines stipulated.
“We have to continue our business growth and profitability and also enable overall power sector reform and development. For this we urgently need to increase our share of 54EC Capital Gain Tax Bonds, open up new avenues like a borrowing facility from RBI and also tap retail going forward in the near term,” Dhillon said.
On lending business, he said, “We need to diversify our business into new areas, new sectors and also go for geographical diversification. We need to fund areas such as charging infrastructure and electric vehicles, renewable energy sources with substantial storage and also make full efforts to tap business from good business houses.”
Dhillon brings with him close to 36 years of experience that spans across the entire value chain of the power sector.
