Meghalaya power
Credit: Representational image

Shillong: Meghalaya Power Minister James Sangma and Chairman-cum-Managing Director (CMD) of MeECL, Arunkumar Kembhavi called upon Chief Minister Conrad K Sangma on Tuesday to discuss the distribution franchisee, which the REC has put in the conditions for the Atmanirbhar loan to be sanctioned in the second tranche.

The CM said that the CMD, MeECL and the power department have held several discussions in the past three to four months regarding giving 100% budgetary support for the 1,345 crore loan.

“But when this condition was put in the Finance Department, they were of the opinion that the State Government and the Finance Department should not take the entire burden of this loan and some part of it should also be put on MeECL’s shoulders and hence the Finance Department proposed that at least 25% of this loan repayment amount should be in some way or the other incorporated into the overall improvement and efficiency of the MeECL. And that is where the REC proposed that certain distribution circles can be then given for management to the REC,” stated Sangma.

He further said if the government decides to give the entire guarantee for the loan, the distribution franchises would not be given. But if that were the case, the government has to pay an additional Rs 580 crore in the next ten years. “If we (Government) go ahead with this, some of the circles will be given to REC for management, but at the same time, the financial pressure will be lesser,” added Sangma.

The discussions with the Power Minister and CMD revolved around the point that if the Finance Department agrees to give full budgetary provision, then MeECL also has to agree to certain terms and conditions on how to improve the overall efficiency of the Corporation.

Sangma said the discussions were very positive, and the matter will be discussed in the cabinet tomorrow at 12:30 pm. The Cabinet will take a call on how they should move forward.

It may be mentioned that on Tuesday morning, an emergency meeting of the Coordination Committee of Registered MeECL Employees Associations and Unions (CCORMAU) was held under the CMD of MeECL Arunkumar Kembhavi.

According to Kembhavi, MeECL management had objected to privatisation or distribution franchisee (DF) but the situation was such that a difficult decision had to be made by the state government to handover 2 circles to the distribution franchisee, given the deadline set by the Ministry of Power for recovering 370.99 crore NEEPCO dues directly from RBI.

The CMD expressed his desire to take a delegation to meet the Power Minister and Chief Minister and urge the state government to reconsider the decision to hand over central and eastern circles to distribution franchisees and instead give a 100% budgetary guarantee for the 1,345 loan. In return, MeECL will adhere to strict targets, if any, to be set forth by the higher authorities.

Later in the day, a delegation was led by CMD to meet with Power Minister James Sangma. They highlighted how the 337 crore budgetary provision (25% of the 1,345 crore loan) is not appropriate to give 25% of the state injection for 25 years which in the long run will amount to thousands of crores.

CMD urged the Power Minister that MeECL is on a tipping point and a fair chance should be given to MeECL for time-bound turnaround and revival. Power Minister gave a patient hearing and assured the delegation that he will continue to exhort the cabinet against any DF proposal as he has been doing all along.

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