| JK Govt pays more than Rs 300 cr as interest under UDAY scheme | | PDD ruthlessly fails to realize power revenue, incurs heavy losses to exchequer | | EARLY TIMES REPORT
JAMMU, Feb 20:
In yet another clear reflection of how the government money was being drained by the power department, records are revealing that the Jammu and Kashmir government so far paid more than 300 crore rupees towards the interest on bonds issued under Ujwal DISCOM Assurance Yojana (UDAY) scheme.
Records reveal that in March 2016, the Ministry of Power, Government of India and Government of Jammu and Kashmir signed a Memorandum of Understanding (MOU) under the scheme UDAY and borrowed funds to the tune of Rs 3,537.55 crore (Rs 2,140 crore in 2015-16 and Rs 1,397.55 crore in 2016-17) from RBI by issue of Non Statutory Liquidity Ratio (SLR) bond at the rates ranging between 7.07 per cent to 8.72 per cent with maturity date from March 2022 to October 2031.
The function of electricity supply to consumers is being handled departmentally in the State so this money was utilized by the State Government to clear liabilities of the Central Public Sector Undertakings (CPSU). The State Government has to pay interest on the bonds and bonds amounting Rs 353.755 crore will also be maturing every year from 2021-22 to 2031-32.
During 2017-18, Receipt on account of sale of power was Rs 3,151 crore against the target of Rs 4,841 crore. The revenue realized from sale of power was less than the cost of purchase in all the years. The State had set its revenue collection targets lower than the cost of purchase. This less realization of revenue against cost of power purchase during respective years was a burden on the State. Difference between cost of purchase of power and actual revenue realized from sale of power is on account of operational inefficiencies and slow implementation of power reforms. The State has very high AT&C losses (50 percent) which are much higher than that of the neighboring state of Himachal Pradesh where AT&C losses are just eight per cent.
During 2017-18, the Department purchased power worth Rs 5,709 crore against which it paid only Rs 3,036 crore to the power producers, thus creating liability on account of power purchase. The department had liability of Rs 7,018 crore on account of unpaid power purchase bills.
The State Government was in the year 2018 showing revenue surplus of Rs 7,595 crore but after taking into account the deferred liability on account of outstanding power bills amounting to Rs 7,018 crore, the revenue surplus will be reduced to that extent. With the objective of ensuring financial turnaround of Power Distribution Companies (DISCOM), the Ministry of Power, Government of India (GoI) introduced the UDAY scheme in November 2015 to improve the operational and financial efficiency of the State DISCOM. States were to take 75 percent of DISCOM debt as on September 2015 over two years i.e. 50 percent of DISCOM debt shall be taken in 2015-16 and 25 percent in 2016-17. |
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