High-level committee recommends measures for stressed assets

An empowered high-level committee headed by the cabinet secretary has suggested measures for the revival of stressed assets in the power sector. The panel has suggested that banks can make direct payments to generators by adjusting receivables from state discoms. In the case of a default by the discoms, the Reserve Bank of India may recover the dues from the states’ account and pay the financial institutions. To ensure timely payments, the panel has proposed that there should be a mandatory late payment charge for discoms. Another recommendation calls for aggregation of power procurement contracts by a nodal agency on behalf of the states for three-five years and auctioning them with attached coal supplies.