NEW DELHI: State-run Power Finance Corp and RECNSE -1.91 % Ltd will offer medium-term concessional loans with two-year moratorium to state electricity distribution companies, which will be backed by budgetary support from state governments.
This would require easing FRBM limits for some states that have breached their borrowing limits. The proposal, aimed at infusing liquidity in the power sector amid the coronavirus pandemic, has met in-principal nod from top authorities and will soon be put forth the Union cabinet.
ET was the first to report on April 8 that the government is working on a package to offer loans to state power distribution companies to help them clear select dues of electricity generation plants to prevent blackouts as the projects face a severe liquidity crisis.
