Govt provides Rs 52.14 cr financial support to ALIMCO

Government today provided financial support to Artificial Limbs Manufacturing Corporation by converting Rs 52.14 crore interest on bank loans of state-owned firm into equity.
The Cabinet Committee on Economic Affairs has given its approval for conversion of interest of Rs 39.53 crore accrued on the loan of Rs 21.82 crore provided to ALIMCO during the years 1977-78 to 2001-02 and penal interest of Rs 12.61 crore on this amount as on March 31, 2015 that is a total of Rs 52.14 crore into equity.
Penal Interest after March 31 has been waived, Telecom Minister Ravi Shankar Prasad said after the meeting headed by Prime Minister Narendra Modi.

The increase in capital base support will strengthen the financial position of the corporation to fulfil the objectives for which it was established, he said.
"It will ensure availability of increased working capital required for enhanced targeted business and also enable the corporation to seek loans from Financial Institutions or Banks on favourable terms," he said.
This will also enable the Ministry of Social Justice & Empowerment to release grants to the Corporation for modernisation, he added.

ALIMCO was set up in 1972 under Section 25 (Not for Profit Motive) of the Companies Act, 1956. It is a fully owned Government of India undertaking working under Ministry of Social Justice & Empowerment.

"The Corporation has been working for the past 40 years and has manufactured and distributed various types of cost effective quality assistive devices to approximately 42 lakh Persons with Disabilities (PwDs) so far. It is currently on an average serving around two lakh PwDs every year," he said.
ALIMCO has an authorised share capital of Rs 3 crore and paid up capital of Rs 1.965 crore as on March 31, 2014. The Government had given interest bearing loans amounting to Rs 21.82 crore to the company from 1977-78 to 2001-02, for meeting its working capital requirements.
"However, interest was not paid and continued to be shown as accrued and due in the books of the Corporation. An interest of Rs 39.53 crore is accrued and due on these loans in addition to a penal interest of Rs 12.61 crore on this amount as on March 31, 2015," he said.

Subsequently, he said, ALIMCO has fully repaid the loan amount to the government of India by 2003-04.