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New Stressed Asset Resolution by RBI, A Bitter Pill to Swallow for Power Sector !

RBI recent notification on stressed asset resolution to bring in financial discipline among the sector and to curb wilful defaulters, has bring in a  major turmoil in the entire infrastructure segment. Though this recent move by RBI, will clean the bad loan out of the system, however, regulator must take in to consideration genuine difficulty of the developer, specifically in power sector.

Considering irregularity in payment from discoms, regulatory delays, and coal supply constraints as the three main factors  grappling the sector which are beyond the control of the developer, RBI should grant a little buffer to the power sector, which will save the banks and financial institution also from a significant dip of profitability.