NEW DELHI: Power minister RK Singh has brought home minster and ruling Bharatiya Janata Party president Amit Shah in the loop on the Andhra Pradesh government’s decision to renegotiate tariffs for over 5 MW renewable energy projects. This indicates high-level political intervention with the state leadership to prevent possible dent in investor confidence.
According to sources, Singh earlier this week conveyed to Shah the alarm among investors caused by the YSR Congress government’s June 26 order to renegotiate PPAs (power purchase agreements) signed during the Telugu Desam Party’s rule and the negative impact it could have on India’s investment climate, particularly in the power sector.
Rating agency CRISIL reckons the state government’s order, stayed by the Andhra Pradesh high court on Thursday, could jeopardise wind and solar power projects with a debt exposure of over Rs 21,000 crore and aggravate the problem of delayed payments from distribution companies.
