The government will meet power companies on Thursday against the backdrop of the large stressed assets in the sector — 75,000 MW at last count — and a recent court directive temporarily stalling action against a clutch of firms under the Reserve Bank of India’s (RBI) toughened norms for banks regarding early detection and resolution of stressed assets.
According to sources, the meeting would be attended by the secretaries of the department of financial services, and the power, coal, petroleum and natural gas ministries. RBI Governor Urjit Patel may depute a representative, not below the rank of Deputy Governor.
The Allahabad High Court ordered on May 31 that no action be taken against stressed private power players under the RBI’s February 12 circular till the Finance Ministry called a meeting with relevant stakeholders. Finance Minister Piyush Goyal and Power Minister RK Singh had preliminary discussions on the issue earlier this month to ascertain if a solution could be found without undermining the Insolvency and Bankruptcy Code (IBC) process. FE