The Hindu Business Line : NTC revamp may prune viable mills to below 50

THE ongoing restructuring of the ailing National Textile Corporation (NTC) textile units may see the final tally of the viable units falling even below the originally set 53 textile mills, according to Mr S.B. Mohapatra, Secretary, Ministry of Textiles.

At present, the NTC revamp has set to revive 53 textile units identified as viable ones, while the administration has already closed the 66 unviable plants. However, the Union Textile Secretary is of the view that the current thinking in the Government is to amalgamate/merge the units that are viable so as to strengthen their status both technologically and financially.

"If this could be done, perhaps, the number of viable units that could be modernised and revived may even go down to an extent, say, up to 30," Mr Mohapatra said.

Talking to presspersons at the sidelines of the launch of the academic courses at the national textile management institute, Sardar Vallabhbhai Patel Institute of Textile Management, here on Saturday, the Textiles Secretary said even as the NTC revamp is on, there has been improved working of the units whose combined sales turnover had gone to Rs 50 crore a month on average.

The Government had been advocating the corporation to streamline its marketing and outsourcing of products wherever possible. He said the modernisation of the viable NTC mills might require Rs 400 crore or so but the corporation could manage the fund infusion with the proceeds of its surplus land sale.

Cenvat duty: With regard to the ongoing debate on changes in the `Cenvat' duty structure in textiles to pacify the powerloom cloth producers, Mr Mohapatra said the Finance Ministry was seized of the whole issue and if the small weavers faced difficulties on account of the Cenvat duty, the Government must address it.

But he felt that even within the powerloom sector, the problem with regard to the `Cenvat' duty was not uniform. Only those small-time powerloom cloth producers whose finished products do not go for further processing find the duty structure problematic.

Debt reconstruction fund: The Ministry wanted that the present textile debt-recasting package be improved so as to bring down the interest burden on the debt funds, which can be availed by the units seeking assistance. But the issue to be sorted out was who will bear the interest burden, the industry or the bankers.

Mr Mohapatra felt the overall size of the debt fund needed to be recast still remained the same at Rs 10,000 crore.