The 1996 performance review of the Board for Industrial and Financial Reconstruction reveals that the cumulative net losses of 1,447 sick companies registered with the board added up to Rs 23,793 crore. Of this amount, accumulated losses of the public sector undertakings reached Rs 15,392 crore. Outstanding bank credit locked up in these enterprises amounted to several thousand crore rupees. These figures suggest a colossal waste of resources. And yet, a large part of the reason for the waste is the whole system of referring to the BIFR itself. Although the system has not succeeded, we persist in the delusion that if only the loopholes were plugged, or the system expedited, these enterprises could be turned around. Yet,there is no reason why the decision to support or not support a rehabilitation programme should not be left to the financing institutions and the promoter. If the market feels that an enterprise is capable of being revived, rest assured that there will be several bids for the unit. If not, the market's judgment in these matters is likely to be correct. Referring to outside agencies only serves to prolong the death throes of the unit, while money which would have been better utilised elsewhere continues to be locked up, at the same time as the value of the assets deteriorates.

This procrastination is more than a putting-off of the inevitable-it also has a very real economic cost attached to it. As a matter of fact, the money saved by a prompt closure or sale could be utilised to pay off workers or even retrain them.