Loans Worth Rs 1.35 Lakh Cr Sanctioned, Rs 46,321 Cr Released to Discoms: RK Singh

Loans Worth Rs 1.35 Lakh Cr Sanctioned, Rs 46,321 Cr Released to Discoms: RK Singh

RK Singh has said that so far, loans worth Rs 1.35 lakh cr have been sanctioned and Rs 46,321 cr has been released to Discoms

Union Minister for Power and New & Renewable Energy RK Singh has said that so far, loans of Rs 1.35,497 crore (Rs 1.35 lakh crore) have been sanctioned and that of that loan amount worth Rs 46,321 crore has been released to states/ Discoms by REC and PFC under the Liquidity Infusion Scheme for the stressed Discoms of the country as part of AatmaNirbhar Bharat Abhiyan announced by the Finance Ministry in May 2020.

The Government of India had announced a Liquidity Infusion Scheme on May 13, 2020, in the backdrop of the outbreak of the COVID-19 pandemic in the country. As per Minister Singh, due to the consequent nationwide lockdown, the revenues of the power distribution companies (Discoms) nosedived, as people were unable to pay for electricity consumed. 

Under the scheme, Power Finance Corporation (PFC) and REC had been assigned by the government to extend special long-term transition loans at concessional rates to Discoms against the receivables of the Discoms from the state government in the form of electricity dues and subsidy not disbursed, to enable them to clear their outstanding dues as existed on June 30, 2020, towards Central Public Sector Undertaking (CPSU) Generation (Genco) & Transmission Companies (Transcos), Independent Power Producers (IPPs) and Renewable Energy (RE) generators.

The Minister in his response to a question raised in the Rajya Sabha, further added that “to enable Discoms that do not have adequate headroom available under working capital limits of 25 percent of last years’ revenues, as imposed under Ujwal Discom Assurance Yojana (UDAY), or do not have adequate receivables from the State Governments, the Central Government has also approved a one-time relaxation to PFC and REC for extending these loans.”

So far, Loans of Rs 1.35,497 crore have been sanctioned and Rs 46,321 crore have been released to States/Discoms by REC and PFC.

As per the minister, this intervention has enabled Gencos to pay for coal companies and meet their operational expenses. This has enabled the continuation of uninterrupted power supply throughout the Covid period across the country. Further mitigation of liquidity issues enabled the power sector to cater to the highest ever peak demand on 189.395 GW on Jan 30, 2021.

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Ayush Verma

Ayush is a staff writer at and writes on renewable energy with a special focus on solar and wind. Prior to this, as an engineering graduate trying to find his niche in the energy journalism segment, he worked as a correspondent for