State-run telecom equipment maker ITI should look for foreign direct investment and technology from multinationals in order to revive itself, a Parliamentary panel has suggested.
The losses of ITI Limited stood at Rs 5,166 crore at the end of March 2015. The company's net worth has been eroded to a negative Rs 1,648 crore.
"The committee are of the opinion that ITI should take advantage of the foreign direct investment (FDI) policy to get one or more multinationals to transfer the latest technology to the company and invest shares in ITI so that the company becomes a joint venture," a standing committee on IT said in its report on revival of ITI.
The committee, chaired by Anurag Singh Thakur, said these kind of efforts were made by ITI in 2009-10, but did not fructify. With equity infusion of Rs 2,264 crore under the revival plan now, ITI over a period of time, would be a viable and stable unit attracting strategic partners to go for a joint venture.
"The committee, therefore, recommend that DoT should consider a proposal for approval with the objective to make ITI becomes a joint venture company," it said.
As per a proposal approved by CCEA in February 2014, ITI's revival has to be supported through financial restructuring by fund infusion of Rs 4156.79 crore.
The capital grant of Rs 2264 crore was to be given in the form of equity for project implementation for upgrading the manufacturing infrastructure at its various units for new projects and the balance amount of Rs 1892.79 crore to be financial assistance in the form of grant-in-aid for clearing statutory liabilities and meeting other commitments.
The committee visualise that once ITI becomes a joint venture company, it will have added advantages which can be capitalised gainfully to turn around the fortunes of the PSU.
