In what can be termed as a worrisome trend, the FM has noted a dampening sentiment for investment in the power sector, especially in generation and inter-state transmission, owing to concern on fuel availability, especially coal and gas.
- As an example, the minister has referred to the unwillingness of the banks to disburse the ongoing loans, as power project developer are unable to sign fuel-supply-agreement (FSA) with Coal India Limited (CIL).
- Further, this uncertainty, coupled with weak financial health of the DISCOMs, has also resulted in a weak global sentiment for investment in the sector, the minister maintained.
Keeping in view the above, the FM has asked for revisiting the individual/group/sector exposure limit for financing of generation projects and creation of a vibrant debt market for corporate debt bonds to give a fillip to the power project financing. Also, the minister has also stressed upon the ability of a power-debt fund to meet the financing needs of the sector.
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