There will be no change in the grant schedule for the current year as all financing was approved earlier. The agreements concluded before May 13 this year will also not be affected, according to an US Exim bank announcement.

This money is the only direct financial aid the country receives under its bilateral agreement with these countries. Power ministry sources said there was no written communique given by these agencies. As interpreted by experts, the sanctions do not extend to private banks and financialinstitutions for lending money to private companies for investment in India.

Ministry sources, however, said there was a lot of ambiguity and the exact implications of these curbs was still unclear.

"Though it seems highly unlikely that the effect of these sanctions will cover private investments or funding from these countries, we are waiting for a detailed communique in this regard," they added.

"We, however, hope that these countries do not extend the scope of sanctions as it will hinder growth of their own companies also," they said. As the amount which will not be available to the power sector after the sanction is not considerable given its total needs, the overall impact will be relatively negligible, the ministry sources said. But even this is a big loss to a sector which is capital-intensive and crucial to the economy, they added.

Every year the country gets aid from OECF for developing the power sector, which is used by the centre and state agencies. At present, the Centre gets around Rs 800crore of the Rs 2,200-crore aid from OECF.

The Rs 5-crore aid by USAID and OPIC, which can be used by any power utility, is for research projects and exchange programmes through which personnel of these companies can mutually benefit.

Apart from the direct impact, the sanctions could also have a spillover effect, say analysts. Some US and Japanese companies may not be inclined to invest in new projects as these could be perceived as high-risk types.