narendra modi led
central government is exploring a law to protect investments affected by state governments’ decisions to scrap contracts. This is to reassure foreign investors who are riled up by YS
jagan Mohan Reddy Government's plan to annul some clean energy agreements. It is known to our readers that the
jagan government decided to reopen renewable energy contracts inked under the previous state
government led by his rival Chandrababu Naidu.
The move drew criticism from the Union
government, as well as governments of
france,
canada, and Japan. The Center feels that is has sent a very bad signal to
international investors. The Act being explored is that in the
event of investments reaching a certain stage, a state
government can’t arbitrarily cancel the contracts. In the
event of any such step taken by a state
government, it will attract penalties and will make it difficult for them to do so
Despite several warnings, the jagan government is still adamant about canceling the renewable energy pacts. Andhra Pradesh’s decision could put at risk 5.2 gigawatts (GW) of solar and wind energy projects, with an estimated debt exposure of more than ₹21,000 crores.