Electricity bonds to hide chronic debt of Indian SEBs
Is it any wonder foreign companies are avoiding India's power sector like the plague According to Dr Vallabhbhai Kathiria, a heavy industries junior minister, our state-owned electricity boards owe a massive $5.57bn (Rs26, 000cr) to power companies in unpaid dues! Speaking to parliament on 13th May, Kathiria said the figures were correct on 30th September 2001.
He said SEBs owe an additional $3.1bn (Rs15, 000cr) to coal, atomic energy and the railways and that the situation is getting alarmingly worse. What hope of recovering this money Very little, which explains the government's use of a time-honoured accounting trick to convert the debt into interest-paying bonds.