Piyush Goyal to meet PSBs to discuss stressed assets

Reeling under the burden of increasing debt woes and amount of stranded assets, the minister of state for power, coal and new & renewable energy will hold a discussion with the leading public sector banks (PSBs) and financial institutions.

The meeting, sources said would focus on the stranded assets worth Rs 3.5 lakh crore, as compiled by PMG in July.

The centre is also likely to discuss its plan to restructure the bad loans taken by the state owned power distribution companies (discoms).

The total debt burden of the discoms is Rs 4 lakh crore as on August 2015. Major PSBs have the largest exposure to the discoms feared to turn NPAs.

The central government is likely to put on states, the onus of restructuring the debt of power distribution companies. Under the new financial restructuring plan (FRP) for discoms, the state governments are to take over the entire debt of these companies. Banks and other lenders would not be asked to restructure any part of the loans, said senior central and state government officials.

The plan is likely to be discussed with the banks. Also the banks are worried on resolution of the stranded assets.

Senior officials said this is one of the several meetings being held to reach a consensus over the problems plaguing the power sector.

Goyal has maintained that the sector has been suffering from legacy issues of fuel crunch and lack of policy coordination. While fuel issues have bend resolved to a level, financially crunched status of discoms and lack of transmission planning continues to hurt the whole supply chain.