Chhattisgarh today joined the UDAY scheme after inking a Memorandum of Understanding(MoU) with the Central Government.
"The Government of India, Chhattisgarh and power distribution company CSPDCL signed an MoU under the Ujwal DISCOM Assurance Yojana today for operational and financial turnaround of the CSPDCL," a statement from the Ministry of Power said.
Chhattisgarh would derive an overall net benefit of approximately Rs 3,100 crore through UDAY. The agreement was signed in the presence of Power Minister Piyush Goyal today.
UDAY was launched by Central government on November 20, 2015 to enable the distribution utilities break out of a long standing debt of almost Rs 4.3 lakh crore.
The MoU would have significant benefits for CSPDCL, with Chhattisgarh taking over 75 per cent of the outstanding debt of CSPDCL as existing on September 30, 2015 and the balance debt re-priced or issued as State guaranteed DISCOM bonds, at coupon rates around 3 per cent less than the average existing interest rate.
The DISCOM's debt would reduce from Rs 1,740 crore to Rs 435 crore. CSPDCL would have annual savings of about Rs 52 crore as annual interest cost through reduction of debt and through reduced interest rates on the balance debt.
