NEW DELHI (Reuters) – India’s power ministry on Wednesday asked state-run Power Finance Corp and Rural Electrification Corp to arrange short term loans for power plants using imported coal that are facing financial stress or corporate debt restructuring.
India last week invoked an emergency law in a bid to start generation at some idle power plants running on imported coal which are not producing power because of financial stress or due to high international prices of coal.
“These plants need working capital to buy coal and start generating power in order to restart their operations,” the government said, adding that there was unprecedented pressure on domestic coal supplies due to rising power demand.
The power hungry country is also planning to reopen mines previously considered financially unsustainable, forcing utilities to step up imports for three years and Coal India to ramp up production to address supply shortages.
A heatwave-driven power crisis, the worst in over six years, has forced the world’s third-biggest greenhouse gas emitter to use more coal after months of low consumption.
(Reporting by Sudarshan Varadhan; Editing by Alison Williams)
