POWER

CCEA approves relaxation in working capital lending limit to discoms

The Cabinet Committee on Economic Affairs (CCEA) on Wednesday approved a one-time relaxation in working capital lending limits by PFC and REC to state distribution companies. This will enable states like Tamil Nadu, Odisha, Bihar and Jammu and Kashmir to avail about Rs 32,000 crore loans under the Centre’s liquidity injection package for power sector.

“CCEA has approved one-time relaxation to Power Finance Corporation and REC for extending loans to discoms above limits of working capital cap of 25% of last year’s revenues under Ujwal Discom Assurance Yojana (Uday),” information and broadcasting minister Prakash Javadekar said at a media briefing after the Cabinet meet.

Currently, banks and financial institutions can lend only 25% of a discom’s revenue in the previous year for working capital.

Source
ET Energy World
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