DECEMBER 22: Power Minister P R Kumaramangalam today said that SBI Capital and ICICI have been entrusted with the task of suggesting ways to restructure public sector units in the power sector. These institutions are expected to make their first presentation within two weeks and submit final report in six weeks.Briefing mediapersons on the achievements in the power sector in the current calendar year, Kumaramangalam said that ``the power sector required investments to the tune of Rs 11 lakh crore, which is why we have asked SBI Caps and ICICI to review the entire power sector including options of merging National Thermal Power Corporation (NTPC) and National Hydro Power Corporation.''The minister said that financial institutions had been asked to suggest all possible options some of which may include direct sale of government equity in NTPC and NHPC, creation of a holding company and issuing fresh equity of shares in these companies.Kumaramangalam said that the government had not reached any finaldecision on the proposed takeover of NHPC by NTPC saying that it was only one of the options being considered. ``There is a need for extensive financial engineering to fund the power sector because raising debt would not be a problem for the projects but the problem is getting money for equity requirement for which alone would be to the tune of Rs 3.5 lakh crore,'' Kumaramangalam said.The minister said the sector during the calendar year 1999 had made a capacity addition of 4,591 MW with central sector contributing 1,441 MW, state sector 2,277 MW and the private sector 873 MW.Kumaramangalam said that thrust would be given on the development of the hydro power projects including the central sector projects like the 1,215 MW Kopilli Phase-II, Chamera phase-II, Parbati phase-II and Loktak power projects.``The 910 MW of capacity is likely to be added within the current financial year with Teesta phase-V and Koteswar projects coming up,''he said. Speaking on the issue of the Cogentrix power projectin Karnataka, Kumaramangalam today said there were enough investors, including NTPC to take over the 1,000 MW Mangalore power project in case the US multinational Cogentrix wanted to exit from the project.Kumaramangalam said the Cogentrix had written to the power ministry seeking the draft counter-guarantee before reconsidering their decision on the $ 1.3 billion project, from which it had earlier announced decision to pull out of the project citing government delays and legal wrangles as the reasons for their decision.The minister said that the power ministry had already moved a proposal for cabinet's consideration for the draft counter guarantee. The draft would list all the conditions, including the power purchase agreement for signing of the counter guarantee, he said.Asked about the progress on the securitisation package of Rs 12,000 crore for clearing off dues of the central public sector companies, Kumaramangalam was confident that the approval would be obtained that he would get the approvalof the cabinet and resolve the issue within this financial year. The cabinet had earlier referred the matter to a group of ministers to give their recommendations within three weeks.Though the outstanding of central power PSUs from state electricity boards (SEBs) had touched Rs 21,000 crore by November this year, the securitisation package would help clear their dues of Rs 8,000 crore by way of issuance of special bonds, he said. The remaining Rs 4000 would be for coal PSUs.
