Report of Indian Institute of Public Administration ... - Ministry of Power

Year-wise Position of Loans Raised
State Reports (Vol.-III)
Study on `Impact of Restructuring of SEBs’
Loans Raised
6.30
(Rs crore)
1996 1997 1998 1999 2000 2001 2002 2003 2004
-97 -98 -99 -2000 -01 -02 -03 -04 -05
Long-term 837.88 942.62 1025.78 1160.02 1459.00 1584 1923 1001 1218
Short-term - 50.00 348.00 810.00 1085.00 1725 2233 2681 2681
Total 837.88 992.62 1373.78 1970.02 2544.00 3309 4156 3682 3899
Total of four years Rs 5174.00
Long-term loans are mounting year after year. After restructuring, the figure of
accumulated loans has shot up by nearly 80 per cent. The rise in the short-term loans
is really alarming. From a figure of Rs 681 crore at the time of restructuring, it has
shot up to Rs 4,291 crore.
During the four-year period prior to restructuring, total amount of loans obtained by
RSEB was Rs 5,174 crore while in the very first year after restructuring, the loan
amount was Rs 2,544 crore.
Restructuring of the State power sector may have taken place in other areas but the
financial wing continues to be centralised. On paper, each company has its separate
financial wing but de facto, the central financial wing of RRVPNL is acting as a
unified entity and in spite of multitude of constraints, it has managed the affairs well.
It has been able to avoid defaults in payment and maintain a façade of regular
payments. But the financial management cannot be divorced from the field level
working of the companies. With high T&D losses and increasing electricity thefts,
losses are on the increase. The most disturbing part is that short-term loans are rising
faster than the long-term loans. Long-term loans can be justified for capital investment
and asset creation but short-term loans are merely indicative of deficit funding. Very
often, the funds are borrowed merely to repay past loans. The interest burden is also
staggering.
Revenue % from Sale of Electricity- Consumer Category-wise
Category 2001-02 2002-03 2003-04 2004-05
Domestic 20.64 21.26 21.64 21.58
Commercial 11.37 11.79 12.05 11.89
Agriculture 10.49 10.66 10.83 11.73
Industrial 53.12 52.23 51.43 50.98
Others 4.38 4.06 4.05 3.82