- The government plans to warehouse stressed power projects totaling 25,000 MW under an asset management firm to protect the value of the assets
- This will prevent their distress sale under the insolvency and bankruptcy code until the demand for power picks up.
- State-run Rural Electrification Corp. Ltd (REC) has identified projects with a total debt of around Rs 1.8 trillion as part of the scheme, which is under government consideration
- It has been tentatively named Power Asset Revival through Warehousing and Rehabilitation, or ‘Pariwartan’.
- The ‘Pariwartan’ scheme is inspired by the Troubled Asset Relief Programme, or TARP, which was introduced in the US during the 2008 financial crisis.
- The proposed plan also aims to stem the rise in bad loans in the power sector.