Tuesday, 26 August 2008

NTPC approaches govt to raise ECBs worth $25 bn

NEW DELHI: State-run power company NTPC has approached the government for free access to external capital markets for raising debt of around Rs 1.05 lakh crore (about 25 billion dollar) in order to become a 50,000 MW company by 2012.

The ECB would include Rs 60,300 crore in foreign currency and Rs 45,200 crore in rupee term.

In a letter written to Power Ministry, Chairman and Managing Director NTPC R S Sharma asked, "Government of India should recommend to the Reserve Bank of India for granting External Commercial Borrowings (ECBs) to meet both the rupee as well as foreign currency expenditure for subject packages."

Countries largest power producer NTPC wants to raise money in foreign as well as domestic currency without any ceiling.

In the present scenario, the companies can raise up to 500 million dollar per annum through ECBs under the automatic route for import of equipments. Apart from this an additional 250 million dollar can be raised for the said purpose with the approval of RBI.

NTPC is pursuing this matter with the power minister to achieve its ultimate objective of becoming a 50,000 MW company by 2012 and a 75,000 MW company by 2017.

For achieving these targets, the company is required to invest around Rs 1.6 lakh crore during the XI plan period.
The debt requirement is around Rs 1. 05 lakh crore with 70:30 debt equity ratio.

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