PUNJAB STATE Power Corporation Limited (PSPCL) is in serious financial crisis due to mounting cash deficit with expenditure exceeding revenue receipts and corporation is virtually on bank of bankruptcy.
To bridge the gap between revenue receipts and expenditure, PSPCL is depending mainly on short term borrowings from banks and financial institutions. Further PSPCL is borrowing to repay earlier loans and thus pushing in to a debt trap.
Padamjit Singh, patron of PSEB Engineers Association said that while restructuring PSEB in to PSPCL and PSTCL no policy was devised to ensure financial viability of new companies by the Punjab Government. This has led to virtual financial bankruptcy
The projected revenue receipt for next financial year has increased from 13234 crore to 14718 crore.
The outstanding loans are increasing more rapidly from this years 17584 crore to 20530 crore for the financial year 2010-11.Short term loans will increase from Rs. 9562 crore top Rs. 10194 crore .during the same corresponding period.
The annual interest liability next year will be Rs. 2289 crore and increase of about Rs. 433 crore over this year.
Further, Punjab is depending heavily on power purchase particular during paddy season The power purchase planned for next year is worth Rs. 6319 crore whereas for the current financial year it is Rs. 5427 crore.
It may be added that PSPCL made cash payment for supplying free power to agriculture sector Punjab Government made only book adjustment against earlier loans.
Padamjit Singh said that at the time of restructuring of PSEB the earlier loans should have written off and power corporations be given clean slate to start with.
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