Circular debt to remain over Rs1.1tr by 2023

The power sector circular debt would stay above Rs1.1 trillion by end of fiscal year 2023 against about Rs2.55tr estimated at present.

According to a local media report, repeated tariff increases, buying out several old independent power plants (IPPs), fuel conversions, tax rationalisations and timely subsidy payments over the next two years would prevent it from reaching Rs4.7tr by end of FY2023.

A combination of ambitious policy actions will rein in circular debt growth to the extent of over Rs2tr in two years. The average tariff is projected to be Rs20.25 per unit by FY2023 from a little over Rs15.4 per unit at present, the report states.


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