Will not get electricity after 15 days? 34 power companies threaten to go bankrupt
For the power sector 15 days are very delicate. The deadline set by the Reserve Bank of India (RBI) for the 34 power companies, including Reliance Jindal, JP Power Venture, Prayagraj Power, Jhabua Power, KSK Mahanandi, stuck in debt ended on August 27 (Monday) and the central The bank is not ready to give them a moratorium. Banks have over Rs 1.5 lakh crore on these 34 power companies.
According to media reports, the Reserve Bank clarified in a circular in February 2018 that if 70 companies drowning in debt delayed in repaying it, assuming that they declared defaulter, their loan amount declared as NPAs (lending). It called ‘one day default norm’ in technical language.
It implemented from 1 March 2018. Banks given 180 days from March 1, 2018, to complete all previous cases which were completed on Monday (August 27). During this period, the accounts of all those companies which have not been settled between companies and banks can be forced to join the process of declaring bankruptcy. A total of 3800 billion rupees of banks are liable in these accounts. RBI has given these 70 companies 15 days time so that they can apply for their attorney and resolution professional. If the companies offer any solutions in these 15 days and all those lending banks approved, then these accountsnot sent to the courts.
Bank already has a solution: SBI
State Bank Chairman Rajneesh Kumar said that the timelines not any impact on the provision of banks as the banks already engaged in the process of resolving these accounts. Apart from the annual general meeting of the Indian Bank Association (IBA), Kumar said, “The provision of deadline for August 27 not any substantial impact on the requirements as most of them classified as immersed in debt.” 16 of the 34 distressed power companies already sent to NCLT, their total value is $ 1740 billion and in seven cases, I am in phase.
Government of India has debt problems: Jaitley
Finance Minister Arun Jaitley has said that during the UPA, the high economic growth figures and the floods of banks (NPAs) are actually due to the indiscriminate debt given before and after the global debt crisis of 2008. Between the ruling BJP and Jubani Jung in the Opposition Congress in the Congress about the figures of economic growth during the UPA government, Jaitley said that the growth of that time was an indiscriminate loan.
Banks provided loans to unrealistic projects at that time, due to which the NPAs have reached 12% in the banking system. For these reasons, macroeconomic problems arose in 2012-13 and 2013-14.
Finance Ministry will soon negotiate with RBI
Ministry of Finance can soon interact with the Reserve Bank to resolve issues of power sector.The sources said that under the order of the Allahabad High Court, the Ministry would consult with the RBI. The court refused to give any interim relief to the private power companies by the order of February 12 on the NPA of RBI. Eight-nine power projects affected by Allahabad High Court’s decision.