The Centre has approved a Rs 650 crore package for the revival of National Projects Construction Corporation (NPCC), involved in fencing of the Indo-Bangladesh border in the North East and developing irrigation infrastructure.
The capital of the company eroded fully a few years ago and in December 2008 its net worth was negative by Rs 184 crore, the Ministry of Water Resources has said.
The public sector enterprise functions under the Water Resources Ministry. As per the plan, there would be no cash infusion but book adjustment. The government loan would be converted together with interest into equity capital totalling to Rs 650 crore and further lowering to 10 per cent value.
According to Water Resources Minister Saifuddin Soz who announced the revival plan, NPCC would now be able to show profit in its balance sheet, which would make the organisation competitive.
The authorised capital of the company is Rs 30 crore with paid up capital of Rs 29.84 crore. Shares valuing Rs 28.79 crore are held by the President of India and balance shares valuing Rs 1.05 crore are held by the Governors of fourteen states.
The performance of the company initially was good, however, it deteriorated from 1987-until 2005-06. The company had to avail plan and non-plan assistance valued at Rs 19.49 crore until 2005-06 in the form of 'interest bearing loan' in addition to Inter-Corporate and bank loans for its maintenances during its turbulent years.
