Patiala- Paving the way for subsidy-free electricity supply and strict guidelines related to power supply in the country, the Power Ministry has warned distribution companies in six states to adopt 'privatization' or ensure reduction of their losses. The states have been warned that central financial grants will be stopped if they do not follow the reform measures.
According to information, the states of Uttar Pradesh, Andhra Pradesh, Madhya Pradesh, Maharashtra, Rajasthan and Tamil Nadu were told in a meeting held on October 10 that they will not get financial assistance from the central government if they do not adopt privatization or other reform measures to reduce their losses and improve efficiency.
According to information, these states have been given three options.
The first option is to sell 51% equity of the discoms to private firms whose debt will be borne by the government. The second option is to sell 26% stake to a private company with full management control and the third and last option is to allow the discoms to get financial assistance from the center. Includes listing on a stock exchange with a minimum 'A' rating.