The Hindu Business Line : Revamped NTC revival package on cards

EVEN as the Government has raised, through its own guaranteed bonds, Rs 1,800 crore to meet the obligations of voluntary retirement schemes, revival and modernisation of the mills under the National Textile Corporation (NTC), efforts are under way to unveil a modified rehabilitation scheme for the mills in a month's time.

As the Textile Minister, Mr Shankersinh Vaghela, has set the settling of claims of workers as his first priority, voluntary retirements would be given in the extant 53 running mills too, wherever applicable, sources in the Government told Business Line here.

The sources said that as per the latest rehabilitation schemes, revival and closure of NTC mills, rehabilitation of the companies would cover revival of 53 operationally viable mills and closure of the 66 unviable ones at a projected cost of Rs 3,918.84 crore. Subsequent to the implementation of the scheme spread over two years beginning from 2002-03, the turnaround mills of NTC would start making profits and the net worth of these subsidiaries would wipe off the accumulated losses within 10-year span by 2013.

On the sale of surplus lands on which the success of the whole turnaround strategy is hinged, NTC got the assets unencumbered on settling dues of secured creditors. Assets Sale Committees have been constituted with representatives of he Government of India, Operative Agency, BIFR, NTC, NTC subsidiaries and the State Government to effect the sale of assets through open tender system. The sources said that so far, surplus assets valued at Rs 460 crore have been sold. The total area of surplus land of nine NTC subsidiaries identified for sale is 2,697.53 acres. The sources said the Textile Minister has taken up the issue with Maharashtra Chief Minister on the sale of surplus lands in Mumbai and substantial progress has been registered in this regard.

The sources said that with a view to conducting an analysis of the macro-level issues and to make recommendations for improving the system of NTC so as to improve the performance, the Government appointed a high power committee in October 2003. The committee recommended, among others, that all future relationship between the Government and NTC should be in terms of a memorandum of understanding (MoU) between the Ministry of Textiles and NTC (Holding Company). The MoU should define the annual and quarterly goals to be achieved by NTC (HC) covering progress in sale of surplus assets, progress in giving VRS to surplus workers and modernisation of the viable mills.

The sources said the committee recommended that the NTC subsidiaries should be assessed on the basis of production value, capacity utilisation, percentage of net contribution to the wages/salaries, percentage of operational profit to production value and productivity. This committee felt that annual targets in this regard should be attainable and recommended specific targets to each NTC subsidiary for the year 2004.

The sources said that it was categorically made clear that while appreciably higher performance would be rewarded with higher allocation of working capital/preferential financial allocations, lower performances would be recorded in the annual personal performance file of the Managing Directors.

It was also pointed out that the categorisation of NTC Madhya Pradesh, Uttar Pradesh, Gujarat and WBABO (West Bengal, Assam, Bihar and Orissa) is to be downgraded in view of their reduced production capacity. The sources said that the Government has approved the report of the high-powered committee and directed the NTC to implement the same with the Ministry of Textiles reviewing the matter on a regular monthly basis.