Revival plan for 2 jute mills awaits BRPSE approval

The government has formulated a revival scheme for two mills of the National Jute Manufacturers' Association (NJMC) that envisages handing over their managements to private parties.

The scheme has been forwarded to the Board for Reconstruction of Public Sector Enterprises (BRPSE) for approval, sources said.

"The revival scheme for two mills of NJMC has been formulated in consultations with the companies' managements and ministry of textiles. The proposal has been sent to BRPSE," sources said.

The government proposes to carry out the revival of two mills on the company in partnership with private players. "The managements of the mills will be handed over to private players," they added.

To make the revival of the two mills easier, the government has already committed Rs 978 crore for voluntary retirement scheme for all the six mills of the company, including its head office, liquidating statutory arrears, gratuity and other secured liabilities. The cabinet has already cleared the proposal for VRS.

NJMC had six mills, of which just two are functioning. "Revival of more mills can be considered later if the revival of the two mills is successful," sources added.

NJMC was declared sick and referred to the Board for Industrial and Financial Reconstruction (BIFR) in 1992. BIFR had recommended that the company be wound up and Calcutta High Court had subsequently appointed an official liquidator.

The government, however, obtained a stay against the operation of the BIFR's order.In keeping with the National Common Minimum Programme's promise to revive sick PSUs, the government had decided to revive NJMC.

A high powered committee under the chairmanship of secretary in the ministry of textiles was constituted in this regard. The committee held field visits and decided to recommend revival of two of the six mills.