Mumbai: Government provides guarantee to MahaVitaran to raise loans worth Rs 2,800 crore

The Maharashtra government will provide guarantee to the state electricity distribution company MahaVitaran to raise loans worth Rs 2,800 crore for the implementation of a high voltage distribution scheme in the state. The government has also agreed to waive the guarantee fee.

MahaVitaran will borrow Rs 1,500 crore from Punjab National Bank and Rs 1,300 crore from Punjab and Sind Bank. The company had earlier tied up with Bank of Baroda for a Rs 1,300 crore loan, but it was not cleared by the bank. It then approached Punjab and Sind Bank for the loan and it was approved.

MahaVitaran proposed to strengthen the high voltage distribution system in Maharashtra, excluding Vidarbha and Marathwada, to provide assured and reliable power to agricultural pumps. The money raised through these loans will be used for the same purpose. In addition, MahaVitaran will use funds to construct 105 new sub stations.

Finance Department deputy secretary Jayant Kulkarni, in a government resolution, said that the government’s guarantee will be valid for six months. MahaVitaran will have to raise debt from these banks during this period.

Meanwhile, the state government has appointed a seven-member committee, headed by the MahaVitaran chairman and managing director, to streamline the procedure to provide relief to industrial consumers, especially in underdeveloped and developing regions covered under D and D plus categories in Maharashtra.

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