The revival scheme sanctioned by a three-member bench of the board includes one-time settlement (OTS) of Rs 33.94 crore comprising repayment of principal term loan of Rs 30 crore and balance as interest. The board also approved the expansion project of TIEL, to set up an emulsion explosive unit at a project cost of Rs 14.50 crore to be financed through internal accruals.

In its submission to the board, TIEL has indicated that repayment of loans to Tamil Nadu government and Tamil Nadu Industrial Development Corporation (TIDCO) would be withheld during the implementation of the expansion project, to be completed by March 2001. The board in its order directed the institutions to waive off entire interest and other charges to the tune ofRs 30 crore.

It also said that the existing charge on the company's fixed assets and movable/immovable properties shall be retained by institutions and banks till its dues are fully repaid. The board had declared TIEL a sick company in September, 1992, due to the erosion of its networth by accumulated losses.

TIEL, promoted by public sector Tamil Nadu Industrial Development Corporation (TIDCO), had set up the unit to manufacture nitro glycerin in technical collaboration with Bofors Nobel Chematur of Sweden in 1986. The project, estimated to cost Rs 20.85 crore, commenced commercial production nine months behind schedule causing a cost overrun of Rs 4.7 crore.

The firm had set up another plant in collaboration with Joseph Meissners Gmbh, which was also delayed by nine months.