The country’s micro, small and medium enterprises (MSMEs) are at worse situation at this stage “for a much lesser fault of theirs” as compared to the stressed power projects that are currently seeking a relief from default guidelines stipulated by the Reserve Bank of India (RBI), Rajiv Kumar, Secretary of the Department of Financial Services, said in a submission before the Parliamentary Committee on Energy.
On February 12 this year, the RBI had issued a ‘Revised Framework for Resolution of Stressed Assets’ that stipulates that default of even a single day in payment of interest or principal amount would trigger a formulation of resolution plan by the committee of creditors. This framework states that the resolution plan has to be implemented within 180 days, otherwise the stressed asset would end up with the National Company Law Tribunal (NCLT). The Parliamentary Committee on Energy had studied the impact of this circular on non-performing assets of electricity sector and tabled the report on Tuesday in Lok Sabha. Read More