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Q.3 What are the factors responsible for the deterioration of the financial position of the state-owned power distribution companies? Is bailout by the government a solution? (10 Marks)

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Staff @CD

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Mentor’s comment-
  • In the intro, mention the  increasing debt burden of the state-owned discoms.
  • In the body mention the factors responsible such as high losses, increased tariff due to cross subsidies, delay in clearance of dues by the state governments, inefficiencies etc. In the next part, mention the issues with the previous attempts at bailing out the ailing discoms and failures in it.
  • Conclude by mentioning the need for reforms in the sector affecting the economy as whole.

Comments

2 responses to “Q.3 What are the factors responsible for the deterioration of the financial position of the state-owned power distribution companies? Is bailout by the government a solution? (10 Marks)”

  1. believing is seeing Avatar
    believing is seeing

    JmQPOijgofaERD

    1. Staff @CD Avatar
      Staff @CD

      Hello

      Decent attempt, structure of the answer is fine, data quoted in intro can be cross-verified.
      Reasons are fine, some points are missing such as High AT&C losses, lack of metering, pandemic, Electricity for All scheme of the govt etc. Other points are fine.
      Next, mention 2-3 points on what all the strategy of govt has been till date.. You can mention UDAY scheme, bailout by government, Reforms-Linked, Result-Based Scheme for Distribution (RLRBSD) etc
      Then, you can mention the issues with bailout and way forward. Points are fine. Way forward can be written as a separate subsection.
      Keep practicing. 🙂

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