Latest News | Punjab, UP Among 5 States to Evince Interest for Loans Under Rs 90K Cr Liquidity Package for Discoms

New Delhi, Jun 1 (PTI) Punjab, Uttar Pradesh, Rajasthan, Manipur and Karnataka have evinced interest for taking loan under the Rs 90,000-crore liquidity package for discoms to pay their utilities' outstanding towards gencos, a senior official said on Monday.

Finance Minister Nirmala Sitharaman had on May 13 announced Rs 90,000-crore liquidity infusion into cash-strapped power distribution companies (discoms), facing demand slump due to the lockdown to contain COVID-19.

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As on May 13, discoms had a total outstanding of Rs 94,000 crore towards power generation firms (gencos).

"Already some states like Punjab, Uttar Pradesh, Rajasthan, Manipur and Karnataka have evinced interest to avail this (Rs 90,000 crore liquidity) package," a statement quoted Ravinder Singh Dhillon as saying while addressing Power Finance Corporation's employees after assuming charge as the Chairman and Managing Director of the company.

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The state-run non-banking finance firms -- PFC and REC -- have been mandated to sanction loans within 45 days and to disburse funds under the liquidity package within 60 days from the day of submission of proposal.

Dhillon told employees that the financial assistance under the liquidity package is envisaged to be provided within 60 days.

He asked employees to actively interact with states for expediting financial assistance within the stipulated timelines.

"We have to continue our business growth and profitability and also enable overall power sector reform and development. For this we urgently need to increase our share of 54EC Capital Gain Tax Bonds, open up new avenues like a borrowing facility from RBI and also tap retail going forward in the near term," Dhillon said.

On lending business, he said, "We need to diversify our business into new areas, new sectors and also go for geographical diversification. We need to fund areas such as charging infrastructure and electric vehicles, renewable energy sources with substantial storage and also make full efforts to tap business from good business houses."

Dhillon brings with him close to 36 years of experience that spans across the entire value chain of power sector.

Out of this, 27 years of experience is in PFC, 6 years in Central Electricity Authority, and 3 years in Bharat Heavy Electricals Ltd.

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