Impact of UDAY Scheme
(a) whether impact of Ujwal Discom Assurance Yojana (UDAY) launched in the year 2015 with a view to bring back good health in State-owned Discoms has started giving a wrong impact on Discoms and is being turned as another window to pile up fresh debts;
(b) if so, the details thereof;
(c) whether Government has made any review of implementation of UDAY, if so, the findings thereof; and
(d) the steps being taken by Government to implement the scheme in letter and spirit and direct Discoms not to use it as another window to pile up debts?
GOVERNMENT OF INDIA
MINISTRY OF POWER
RAJYA SABHA
STARRED QUESTION NO-190
ANSWERED ON-20.03.2017
Impact of UDAY Scheme
190 . Shri T.G. Venkatesh
(a) whether impact of Ujwal Discom Assurance Yojana (UDAY) launched in the year 2015 with a view to bring back good health in State-owned Discoms has started giving a wrong impact on Discoms and is being turned as another window to pile up fresh debts;
(b) if so, the details thereof;
(c) whether Government has made any review of implementation of UDAY, if so, the findings thereof; and
(d) the steps being taken by Government to implement the scheme in letter and spirit and direct Discoms not to use it as another window to pile up debts?
ANSWER
THE MINISTER OF STATE (INDEPENDENT CHARGE) FOR POWER,
COAL, NEW & RENEWABLE ENERGY AND MINES
( SHRI PIYUSH GOYAL )
(a) to (d) : A Statement is laid on the Table of the House.
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STATEMENT
STATEMENT REFERRED TO IN REPLY TO PARTS (a) TO (d) OF STARRED QUESTION NO.190 TO BE ANSWERED IN THE RAJYA SABHA ON 20.03.2017 REGARDING IMPACT OF UDAY SCHEME.
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(a) & (b) : No, Sir. Ujwal Discom Assurance Yojana (UDAY) aims to reduce interest burden, cost of power & power losses in the State owned Distribution Utilities (DISCOMs) with an objective of achieving their sustainable operational and financial turnaround.
UDAY provides for debt financing by Banks and Financial Institutions (FIs) to DISCOMs only for Working Capital, and only to the extent of 25% of their previous year’s revenue. UDAY also provides that Banks/FIs would not advance short term debt to DISCOMs for loss financing, and current losses, if any, would be financed only upto extent of loss trajectory finalized by Ministry of Power (MoP) with the States. Such financing will be done through State issued Bonds or Bonds issued by DISCOMs backed by State Guarantee. Further, UDAY also provides that State shall also take over future losses of DISCOMs in a graded manner.
As per information available, the interest cost of States participating in UDAY have reduced by Rs.11,989 crores approx. for the first 09 months of the current Financial Year (2016-17), as compared to the previous Financial Year (2015-16). Thus, the question of UDAY opening up another window to pile up fresh debts does not arise.
(c) : Review for implementation of UDAY is a continuous process. A monitoring committee under the Chairmanship of Secretary (Power) has been constituted to ensure close monitoring of performance of the participating States under UDAY. The committee reviews the operational and financial parameters of participating States at regular intervals. Further, States specific focused meetings have also been initiated.
The details of performance of DISCOMs under UDAY, as reported by them, are available on the web portal www.uday.gov.in. Performance in respect of major parameters are given in the Annexure.
(d): Electricity is a concurrent subject, and Distribution of electricity and management of associated functions is carried out by State owned DISCOMs. Further, UDAY is an optional Scheme. However, all parties involved in the Memorandum of Understanding (MOUs) under UDAY, including the States and their DISCOMs, have well defined commitments to fulfill. The Government of India is continuously monitoring the implementation of the scheme and hand holding States in achievement of the objectives envisaged under UDAY. The inbuilt control mechanism of UDAY ensures that there is no debt piling.
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Source: Rajysabha
{http://164.100.47.234/question/annex/242/As190.pdf}
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