Textiles sub-group clears fund infusion plan into state-run unit
Kohinoor Mandal
CALCUTTA, January 13: The sub-group on textiles public sector for the Ninth Plan (1997-2002) has approved funds for National Jute Manufacturers Corporation of India(NJMC) and Birds Jute & Exports Ltd(BJEL). However, the report has advised Jute Corporation of India to restructure its infrastructure and reduce manpower.All the three organisations are facing financial constraints. While NJMC was referred to the Board for Industrial & Financial Reconstruction, Birds Jute remained closed for eight years and Jute Corporation is awaiting funds from the central kitty. The report has analysed the activities of these three organisations during the Eighth Plan period (1992-97) and recommended ways of solving their problems during the Ninth Plan period. JCI was created by the government to act as its official agency in implementing price support operations in the raw jute market. As a policy measure, the government decided to reimburse the losses incurred by the corporation. JCI's financial problems began when the
government delayed reimbursing the losses and it notched a backlog of subsidy dues to the extent of Rs 61 crore as on March 31, 1995. The corporation also supplied raw jute to NJMC at the insistence of the Union ministry of textiles, but is yet to receive payments for that. As on March 31, 1995, NJMC owed JCI Rs 69 crore, without taking into account interest accruals of Rs 120 crore. "Because of backlog of large amounts in dues, JCI suffered from acute working capital problems and consequently could not continue with its normal activities," the report noted. According to it, JCI's activities should be reoriented to achieve the following objectives:
JCI will operate in the raw jute market through regular buying and selling of raw jute so as to generate funds from its commercial activities;
Raw jute should be imported at the opportune moment considering international fibre prices and the overall demand-supply situation in the domestic market;
Price support operations should be
conducted whenever required.The sub-group has advised JCI to restructure its infrastructure and prune manpower by 25 per cent and realise the large amounts of receivables of Rs 61 crore (backlog of losses from market operation) and Rs 69 crore (principal dues) from NJMC to achieve these objectives. NJMC was incorporated in June 1980 following the nationalisation of six jute mills -- National, Khardah, Kinnison, Alexandra, Union and a mill in Bihar. It employs about 25,000 people and contributes almost 10 per cent of the industry's production. According to the report, the eighth plan had targeted an annual production of 1.3 lakh tonnes for NJMC. In his regard, an estimated cost of Rs 34.8 crore was also planned for machinery balancing and renovation of the existing machinery. However, the target could not be achieved as NJMC did not get the funds. NJMC could not carry out the routine machine maintenance programme, thereby seriously affecting the productivity of the existing machinery. Inventories of
raw material and essential stores were reduced to dismal levels and the mills often had to be kept idle. The 9th Plan's objectives for NJMC include pruning/discarding uneconomical systems and unremunerative products, rationalisation of labour force by reducing natural wastage or voluntary retirement schemes.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
|
