‘No plan for bond issue despite dues from power firms crossing `18K cr’

KOLKATA: Coal India Ltd (CIL) has no plan to go for long term borrowing by issuing bonds even though its outstanding dues from the power sector have already crossed Rs 18,000 crore, an official said on Tuesday. The dues are likely to be more than Rs 20,000 crore by end of June, he said.

The outstanding dues started to climb from the last fiscal as the power sector has been reeling under crisis and the Maharatna PSU continued to push coal after the government asked the miner to ramp up its production and dispatch.

“Low realisation is a shortterm issue. Coal India does not have any plan for long term borrowing through instruments like issuing of bonds,” a top company official said on condition of anonymity. CIL had earlier said it continues to face tepid demand for coal, with most of its customers, like the power producers, shying away from lifting adequate quantities. “We had permitted subsidiaries to enhance their working capital limit and allowed them to borrow money from banks to tide over the crisis,” the official said. The power sector accounts for close to 80 per cent of CILS total supplies. “The problem of cash flow is severe with some of the subsidiaries like Bharat Coking Coal Ltd, Western Coalfields and Central Coalfields Ltd. They are facing liquidity crunch to fulfil their statutory obligations like payment of salaries in the wake of the low realisation,” the official said.

During May, the power sector lifted 30.15 MT of coal from CIL sources, down 25 per cent from 40.38 MT in Ma last year.