Power discom reform: Trickle begins in UDAY benefits

States begin looking at interest cost savings; slow pace in operational efficiency improvement

The power distribution reforms scheme, Ujwal Discoms Assurance Yojana (UDAY), is improving, slowly, the financials of distribution companies (discoms).

States which have initiated financial restructuring by issuing bonds against the discoms' debt are looking at estimated yearly interest saving of a combined Rs 7,255 crore.

Of the 22 states which have joined UDAY, 15 have issued bonds against the debt they took over of the discoms as part of the restructuring. The total amount of bond issuance is Rs 2.7 lakh crore. Of this, Rs 1.83 lakh crore is by the states and the balance by the discoms.

For the states that agreed