Discom bailout scheme is likely to dominate the meeting of Power Min and State Energy Ministers on Tuesday. States have raised several objections with the bailout package but Power Minister has refused to budge so far. This has caused the delay in signing up by the states with the deadline extended to March 31 now.
Meanwhile, Coal Ministry has mooted for cost pass through for imported coal to bridge deficit of 15% to meet 80% trigger level for fuel supply pacts by Coal India and rejected CEAS mechanism of pooling. CCEA will meet on Tuesday and take a decision on mechanism for pooling. Sumit Jha gives the details of the meeting to be held tomorrow.
The Power Minister is meeting state energy ministers tomorrow to discuss various issues related to the power sector, but the main focus is going to be in the financial restructuring plan for discoms.
States have raised several objections to different proposals in the scheme. The main objection being that they want the Centre to allow them to borrow more so that they can stick to their Fiscal Responsibility and Budget Management (FRBM) targets.
The states say that once they start paying interest on the bonds they are going to issue, it will be difficult for them to keep within the FRBM target set for them.
They have also written to Power Ministry explaining their concerns and grievance but the Power Ministry replied that any tweaking in the scheme will need a Cabinet nod.
It seems that if both sides don't budge, the deadline that stands today- March 31 will have to be further extended for states to come and sign up for this proposal. There are five states that are keen on signing this proposal, these are Punjab, Haryana, Rajasthan, Uttar Pradesh and Tamil Nadu.
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