SHILLONG, DEC 21: The state Cabinet today approved the proposals of the power department for the Meghalaya Power Generation Corporation Limited (MePGCL) to avail loan of Rs 60 crore and also to convert loan of Rs 60.25 crore to equity.
Speaking to reporters after the meeting held here on Thursday, Chief Minister Mukul Sangma said, “We have approved the proposal for conversion of loan of Rs 60.25 crore for the Myntdu Leshka Hydro Electricity Project into equity and issuance of government guarantee for availing loan of Rs 60 crore by MePGCL for 3X24 MW project from REC.”
Stating that the project was developed and substantial investment has been taken place, he said that the project is commissioned and operational but in the meantime there are certain loan which are required to be further availed by the MePGCL.
Another part is to convert Rs 60.25 crore from the loan component which was extended to MePGCL to equity, so both proposals have been agreed upon, he said.
According to the chief minister, the usual procedure is that the total capital cost of power project shall include debt and equity.
“In order to ensure debt and equity is balanced 70:30 per cent this proposal is required to be considered by the cabinet meaning the loan component which is part of the loan has to be converted into equity so that it ultimately stabilized at 70:30 per cent,” he added.
By Our Reporter
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