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Last Updated : May 14, 2020 03:13 PM IST | Source: Moneycontrol.com

BIG STORY | Will liquidity infusion of Rs 90,000 crore help discoms?

In this edition of Big Story, Moneycontrol's Sakshi Batra shares her insight on the capital infusion of Rs 90,000 crore announced by the government.


Finance Minister Nirmala Sitharaman announced a one-time Rs 90,000 crore liquidity injection for the fund-starved electricity distribution companies (discoms) as a part of the 20 lakh crore economic relief package.

The funds will be used to pay central public sector power generation companies, transmission companies, independent power producers and renewable energy generators.

Discoms’ earnings have fallen to about Rs 12,000 crore in the last billing cycle from about Rs 55,000 crore during a 30-45 days cycle in 2019, exemplifying the lockdown’s effect on India’s power companies’ books.

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According to experts, this line of credit is laudable but its finer contours like the rate of interest at which this liquidity support is offered will be a key thing to watch.

Moreover, with economic activities resuming gradually, the demand from industrial and commercial sctors will improve but how soon it will be back to the pre-COVID-19 time remains a question.

In this edition of Big Story, Moneycontrol's Sakshi Batra shares her insight on the capital infusion of Rs 90,000 crore announced by the government.

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First Published on May 14, 2020 03:13 pm
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