UDAY not failure; new scheme likely in Budget: R K Singh

Asserting that the UDAY scheme was not a failure Power Minister R K Singh on Monday said an improved version of the programme, meant for revival for discoms, may be announced in the Union Budget later this week.

"We have discussed the new (UDAY) scheme with the Finance Ministry. We expect it to find a place in the Budget," Singh said at the sidelines of the listing ceremony of the USD 750-million international bond of Power Finance Corporation (PFC) at NSE.

He also indicated that unlike the earlier practice of having multiple schemes, the centre would channelise all efforts through one scheme, and states would have to reduce the losses of discoms to get all the benefits.

Targeting to cut discom losses to below 15 per cent, he said power would be sold on the strong financial mechanism and the states would decide on their own subsidies.

"The Ujwal DISCOM Assurance Yojana (UDAY) scheme is not a failure. We have reduced losses of discoms from over 22 per cent to around 18 per cent...," he stated.

Last year in August the centre had made it mandatory to provide a letter of credit for buying power by the discoms.

Besides, a single day advance payment mechanism had also been introduced.

Meanwhile, at the event, PFC CMD Rajeev Sharma said the company's single largest bond attracted demand of USD 2.2 billion and was priced at 3.95 per cent coupon rate for the tenure of 10.25 years taking the total foreign borrowings to USD 6 billion.