The Power Finance Corporation (PFC) management has decided to assist projects in neighbouring countries if the projects can help improve power availability in India. PFC sources said the corporation is keen on picking up such projects, especially in Nepal and Bhutan.
Both these Himalayan nations have immense hydroelectric power generating potential very little of which has been tapped so far. Neither Nepal nor Bhutan can take up the capital-intensive projects on their own. In fact, they do not even require the huge energy that can be generated from such projects.
But, they are keen to have the projects as basically export-oriented power stations and earn money. The premier power project funding organisation is also shifting focus to a host of other activities. The idea is to serve its clientele by offering diverse financial products and services.
It will also offer assistance in non-fund areas to provide a single window facility for meeting wide ranging problems in the power sector.
The following will be its future business development areas: loan syndication, consortium lending, equity participation, suppliers' credit, project counselling, financial advisory services, joint venture, foreign exchange management service, funding of activities relating to forward and backward linkage to the power sector like coalmines, transport, roads etc.
The management is keen to `enter into strategic alliance to promote joint ventures with national and international agencies to provide advisory services and consultancy for arranging finance for power projects'.
PFC is also willing to have tie-ups with major Indian electrical equipment manufacturing firms to provide financial back-up or package so that such companies can promote both national and global sale of their products and services.
However, a more significant change in its business focus is the decision to participate in the equity of new power projects, or, enter into joint ventures to promote long term investments in power sector.
The main criterion will be to ensure that such projects are `bankable'.
In a major extension of its funding activities, PFC has already sanctioned loans for private power projects. This is a major deviation from its earlier policy of funding only state-owned power projects.
The corporation has so far sanctioned Rs 665 crore of loans for various private sector power projects besides agreeing to provide guarantee worth $4.7 million. The private power projects which have benefitted from PFC loan, are the following: 1) improvement of BSES transmission and distribution system in Mumbai; 2) the 400 mw Maheswar hydel power project; 3) 250 mw fluidised bed boiler power project at Mangrol; 4) 172 mw multi-fuel gas power project at Vijeswaram; 5) 12 mw diesel generating sets at Nandayal; and, 7) 355 mw naptha-based gas turbine power project in Krishna district.
