ower companies may index rupee debt with global currencies: Piyush Goyal
The government is considering allowing power companies to index rupee debt with global currencies to attract cheaper long-term loans from foreign investors, power minister Piyush Goyal said on Thursday.
Goyal said the move to allow indexing of a portion of power plants’ debt was demanded by the Indian industry and is expected to attract foreign lenders.
“Anything that can help reduce the tariffs for people of India, I am open to consider. One of the suggestions to attract large amount of foreign investors, and reduce forex risks and there by tariffs, is to index a portion of the tariff to a basket of global currencies,” he said in Tokyo. The minister said Japanese banks and corporations are willing to invest in Indian energy sectors, with existing investors such as SoftBank, which has committed $20 billion, indicating to increase its investments.
Goyal has asked Japanese financial institutions to cofinance Indian power projects with state-run power sector financiers such as Power Finance Corporation and Rural Electrification Corporation.
Six leading banks of Japan including Sumitomo Mitsui Banking Corporation, Mizuho Bank, Bank of Tokyo Mitsubishi, JICA, Nippon Export & Insurance Investment and JBIC are meeting Goyal in Tokyo to discuss opportunities for investing in Indian energy sector including in ultra mega power projects, renewable energy projects, rural electrification, and transmission and distribution projects.
The meetings are part of an ongoing India-Japan energy dialogue led by the Confederation of Indian Industry. Goyal said the banks evinced lot of interest in investing in India. “All six banks have expressed a great deal of satisfaction at the progress made in India. A few issues were raised by banks related to regulatory concerns both in financial services and power sector,” he said.