UDAY Scheme - GS questions based on daily current affairs

1)   Which of the following statements is/are correct about UDAY scheme?

1. UDAY scheme shifts 50 per cent of power DISCOMs debt burden to states’ balance sheets.
2.States can convert the debt into state bonds.

a. Only 1
b. Only 2
c. Both
d. None
Answer  Explanation 

ANSWER: Only 2

- UDAY scheme shifts 75 per cent of power DISCOMs debt burden to states’ balance sheets.
- The scheme ensures the ease of financial crunch facing power distribution companies, or discoms, that has impaired their ability to buy electricity.
- State governments, which own the discoms, can take over 75 percent of their debt as of September 30 and pay back lenders by selling bonds.
- For the remaining 25 percent, discoms will issue bonds.

2)   UDAY scheme is implemented by -

a. Ministry of Skill Development And Entrepreneurship
b. Ministry of Human Resouce Development
c. Ministry of Minority Affairs
d. Ministry of Power
Answer  Explanation 

ANSWER: Ministry of Power

- UDAY is Ujwal DISCOM Assurance Yojana
- UDAY provides for the financial turnaround and revival of Power Distribution companies
- DISCOMs in the country have accumulated losses of approximately Rs. 3.8 lakh crore and outstanding debt of approximately Rs. 4.3 lakh crore (as on March, 2015).

Four initiatives of UDAY scheme:

1. Improving operational efficiencies of DISCOMs
2. Reduction of cost of power
3. Reduction in interest cost of DISCOMs
4. Enforcing financial discipline on DISCOMs through alignment with State finances