A decision by India’s top court to quash a method prescribed by its central bank for dealing with bad loans has triggered renewed demand to set up a manager for stressed power assets estimated at $36 billion.
Now that the court has voided the Reserve Bank of India’s directive on dealing with soured debt the finance ministry “should be able to form a much-needed” state-run manager to acquire power generating companies, according to a research note by BofA Merrill Lynch on Wednesday.
Fuel shortages and insufficient demand from state distribution companies have left Indian power plants underutilized, with many struggling to generate enough cash to repay debt. Read More
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