Financial Daily from THE HINDU group of publications
Sunday, Sep 28, 2003
Financial Daily from THE HINDU group of publications Sunday, Sep 28, 2003 |
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Industry & Economy
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Power `Final Dabhol work plan by Oct 13' Our Bureau
Mumbai , Sept. 27 A FINAL proposal on how to restart work on the Dabhol power project is to be worked out and submitted by the Indian lenders to Overseas Private Investment Corporation (OPIC), a lender and insurer to the project by October 13. "By October 13, lenders will submit a final proposal to restart work on the power project. The framework will be worked out keeping the interest of all the stakeholders of the project — Indian lenders, foreign lenders, GE, Bechtel and the Government of Maharashtra — in mind,'' said Mr P.P. Vora, Chairman & Managing Director, IDBI, the lead lender to the project. He was speaking to reporters on the sidelines of the FICCI conference on "Indian Banking: Global Benchmarks `03'' here on Saturday. OPIC officials had met the Indian lenders in this regard recently, he said. According to Mr Vora, "Power will be made available at a reasonable price and once all the lenders agree on a mode of action, we can take the work on the project forward.'' The price for power is expected to be at Rs 2.70-2.80. Asked whether the international arbitration by GE and Bechtel would pose as an obstacle, "The arbitration is an independent activity. Once all stakeholders agree to a proposal over the counter, then there are ways to tackle the legal aspects,'' said Mr Vora. The model is being worked out with consultancy from Rothschild for financial engineering and from Tractabel for technical aspects. Ms Kalpana Morparia, Executive Director, ICICI Bank, one of the major Indian lenders to the project, said, "Even after the worst haircut from the lenders, the 2,100 MW project will be able to produce power at around Rs 2.70 per unit. At this rate it is an immensely doable project when many new projects are coming up in the country at Rs 3.50 per unit.'' About the classification of the exposure to the Dabhol power project Ms Morparia said, "For the first phase of the project, it has been considered as a non-performing loan. While the second phase of the project, which is under implementation and has been delayed, is given a non-accrual status in our bank. Provisions are being made for the same.''
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