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Dec 06, 2017 12:19 PM IST | Source: Moneycontrol.com

Government forms panel to tackle NPAs in power sector

As per the Economic Survey 2016-17, non-performing assets (NPAs) in power generation were around 5.9 percent of the banking outstanding advances of Rs 4.73 trillion.

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The government has set up a committee to address the issue of rising stressed assets in the power sector, reports the Livemint. The committee will be headed by the Niti Aayog Chief Executive Amitabh Kant.

As per the Economic Survey 2016-17, non-performing assets (NPAs) in power generation were around 5.9 percent of the banking outstanding advances of Rs 4.73 lakh crore.

The committee has already had its first meeting. Secretaries from ministries of coal, power and financial services were present at the meeting, a source told the newspaper.

The Department of Financial Services has identified an estimated debt of Rs 1.77 lakh crore from 34 coal-fueled power projects. These projects are facing issues of lack of funds, no fuel security, and absence of fuel power-purchase agreements.

According to the Mint report, PPAs hold the key to solving problems of stressed assets in the power sector.

Around 58 percent, or around 1,93,426 MW of the power generation sector is fueled by coal. India's installed power generation capacity stands at around 3,31,118 MW.

The government also plans to investigate whether private developers have inflated project costs to show higher debt, Mint reported in November.

The government this year launched the Pradhan Mantri Sahaj Bijli Har Ghar Yojana, which aims at reducing imports of fossil fuels and boost demand for electricity in the country.

tags #Economy

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