MP power firms under ₹49,000 crore debt:3 DISCOMs run into ₹71,000 crore losses; state enters list of unstable regions

Although the country’s power distribution companies (DISCOMs) may have earned a profit for the first time in the financial year 2024-25, Madhya Pradesh’s power distribution companies are still burdened by heavy debt. According to the central government, Madhya Pradesh’s DISCOMs have a debt of 49,239 crore by March 31, 2025, while the state has recorded a cumulative loss of 71,394 crore. This information was provided by Minister of State for Power, Shripad Naik, in a written reply in the Rajya Sabha. MP’s Liabilities Included in ‘Unstable’ States The central government stated that Madhya Pradesh is among the six states whose DISCOM liabilities have been deemed ‘unstable’ by the regulator. These six states (Uttar Pradesh, Andhra Pradesh, Madhya Pradesh, Maharashtra, Rajasthan, and Tamil Nadu) account for 66 per cent of the country’s total DISCOM debt. The total unstable liabilities of these states are reported to be around 2.74 trillion. Heavy burden on all three distribution companies According to government data, the condition of all three power distribution companies in Madhya Pradesh remains concerning. Profit at the national level, the challenge of improvement in MP At the national level, DISCOMs recorded a post-tax profit of 2,701 crore in the year 2025, but in states like Madhya Pradesh, recovering old losses and debts still remains a major challenge. Hope from reform schemes The central government stated that the Revamped Distribution Sector Scheme (RDSS) has been implemented to improve the financial condition of DISCOMs, linking funding to the performance of states. Additionally, states have been allowed to borrow an additional 0.5 per cent of GSDP, provided structural reforms are made in the power sector. The government says that technical and commercial losses have decreased, but there is still a long way to go to improve the financial health of power distribution companies in Madhya Pradesh. States with the highest losses (cumulative deficit) Top-5 states with the highest debt on DISCOMs Now, what is cumulative loss? Cumulative loss means that the losses incurred by electricity companies each year kept adding up and over the years became a large sum. For example, if a company incurred a loss of 5 thousand crores in one year. The next year, 7 thousand crores, and then 10 thousand crores, then the total amount formed by all these losses combined is called the cumulative loss. This means that even if there is a profit today, the old losses do not disappear on their own.