PowerMin approaches DoD to defer NHPC stake sale

The Ministry wants a permanent CMD and delays in execution of some projects be done with before going ahead with the stake sale

As the government gets ready to kick-off this year's disinvestment drive, the Power Ministry wants to 'wait' and 'watch' on sale of stake in state-run hydel producer NHPC.

The ministry is believed to have approached the Department of Disinvestment to wait for some more time before selling stake in the firm.

The ministry is of the view that in the absence of a permanent Chairman and Managing Director and delays in execution of some of its projects, shares of the company may not get a good valuation, sources said.

The sources said Power Ministry feels that once these issues are resolved, they would give a boost to the company's proposed stake sale.

At present, R S T Sai is the acting Chairman and Managing Director of the company. Before Sai, the post was held by G Sai Prasad, who was working in the capacity of Joint Secretary in the Ministry of Power.

Some of the projects of the public sector firm are running behind schedule which includes the proposed 2,000 MW Subansiri hydro power project in Arunachal Pradesh.

Subansiri Lower project has been stalled since December 2011, after the local people raised issues related to its safety and downstream impact.

The original sanctioned cost of the plant was Rs 6,285.33 crore which was revised to Rs 10,667.09 crore and is now likely to touch Rs 12,000 crore.

The other projects which have run into cost overruns are - Teesta Low Dam IV (West Bengal), Parbati II (Himachal Pradesh), Nimmo Bazgo and Uri II (Jammu & Kashmir). These projects have a combined capacity of 1,345 MW.

They are in various stages of construction and have exceeded the amount that was initially sanctioned.

Ministry of Finance, which plans to garner over Rs 58,000 crore through disinvestment during the current financial year, has lined up PSUs including Coal India, ONGC and NHPC for stake sale.