Hinduja Counter-Guarantee Signing Today

The finance ministry and the Hinduja-National Power Company Limited (HNPCL), promoters of the 1000 mw Vishakapatnam power project are to sign the counter-guarantee today. The counter-guarantee for the project will however come into effect once the coal supply and transport agreement between the promoters and the ministry of coal is signed.

Before the centre issues the counter-guarantee for the project, the state government has to sign a tri-partite agreement with the Reserve Bank of India and the centre for ensuring the timely payments towards the central power undertakings such as NTPC and NHPC.

In the event of a default of the state electricity board this agreement gives the centre the right to deduct the outstanding dues towards the central PSUs from the state's RBI account.