Everyone on board to resolve discoms mounting debt issue:Goyal

The issue of burgeoning debt of power distribution companies will be sorted out soon as everybody is on board to resolve it, Power Minister Piyush Goyal said today.
"Everybody is on board that discoms (issues) are going to be sorted out soon," Goyal said after many rounds of meetings with distribution companies and bankers here in the Capital.
Hit by subsidised tariffs, state electricity discoms are facing cash crunch and are incurring annual losses of about Rs 60,000 crore. This is also affecting public sector banks as their bad loans are rising.
The Centre is working on recast debt of power distribution companies and a proposal in this regard is expected to be tabled before the Union Cabinet this month.

The government wants to draw a long lasting financial restructuring plan that would provide incentives to discoms to generate more revenue.
"Under the debt recast plan, the discoms will get some relief by way of reducing interest rate. That could be reduced from 11-12 per cent to 7-8 per cent. Besides the repayment tenure could be stretched," a senior official of discom who attended the meeting today said.
The Union Cabinet is expected to soon consider a proposal to recast over Rs 3 lakh crore loans of power distribution companies with a view to bring down their liabilities.