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Govt approves Rs 2,993 cr revival package for ailing NTC
The group of ministers on Tuesday approved a Rs 2,993 crore revival package for eight subsidiaries of loss making National Textiles Corporation (NTC) including Rs 1030 crore for Voluntary Retirement Scheme (VRS).
The group of ministers on Tuesday approved a Rs 2,993 crore revival package for eight
subsidiaries of loss making National Textiles Corporation (NTC) including Rs 1030 crore for Voluntary Retirement Scheme (VRS).
The GoM, headed by finance minister Yashwant Sinha, also approved a revival package for the Tamil Nadu and Pondicherry subsidiary of NTC, which is the only unit out of the BIFR net. Following the approval of the draft rehabilitation scheme (DRS) by the GoM, the same will now be sent to the BIFR for a final decision. Eight of the nine NTC subsidiaries were referred to the BIFR in 1994-95.
Of the Rs 2,993 crore, Rs 1030 crore would be used to give VRS to around 42,000 surplus workers while Rs 1,291 crore would be required for modernisation of the viable NTC mills. Of the 114 NTC mills under the BIFR net, the proposal envisages that 44 mills would be revived and around 60 mills would be closed. Of the 60 mills likely to be closed around 37 mills are already non-operative.
Sources said that the implementation would begin with the closure of the non-operative units. The corpus of Rs 500 crore, required initially for closure of these units would be rasied through a bridge loan from ICICI, which will be guaranteed by the Centre. To begin the process of implementation, NTC bonds of Rs 240 crore would also be issued and government loans of around Rs 2775 crore would be converted into equity.
Bureau Report
The GoM, headed by finance minister Yashwant Sinha, also approved a revival package for the Tamil Nadu and Pondicherry subsidiary of NTC, which is the only unit out of the BIFR net. Following the approval of the draft rehabilitation scheme (DRS) by the GoM, the same will now be sent to the BIFR for a final decision. Eight of the nine NTC subsidiaries were referred to the BIFR in 1994-95.
Of the Rs 2,993 crore, Rs 1030 crore would be used to give VRS to around 42,000 surplus workers while Rs 1,291 crore would be required for modernisation of the viable NTC mills. Of the 114 NTC mills under the BIFR net, the proposal envisages that 44 mills would be revived and around 60 mills would be closed. Of the 60 mills likely to be closed around 37 mills are already non-operative.
Sources said that the implementation would begin with the closure of the non-operative units. The corpus of Rs 500 crore, required initially for closure of these units would be rasied through a bridge loan from ICICI, which will be guaranteed by the Centre. To begin the process of implementation, NTC bonds of Rs 240 crore would also be issued and government loans of around Rs 2775 crore would be converted into equity.
Bureau Report