Bhubaneswar, Nov. 14: The Orissa Cabinet today approved privatisation of 10 public sector units that have incurred huge losses over the last few years.
The Cabinet has decided to sell four subsidiaries of Industrial Development Corporation Limited (IDCOL), Kalinga Studio, three cooperative spinning mills and two cooperative sugar mills by next March.
The companies employing about 5,000 people are IDCOL Cement, IDCOL Rerolling mill, IDCOL Ferrochrome plant, Hirakud Industrial Works, Baramba Sugar Mills, Nayagarh Sugar Mills.
After privatisation, the new management cannot retrench the employees for one year. The employees will be given the option of working under the new management or quitting.
The Cabinet has also decided that in line with the Centre’s disinvestment policy, an empowered committee chaired by the chief minister will be formed to finalise the bidders as well as set the price.
An inter-departmental committee, to be led by the public enterprise department secretary, will provide the roadmap for privatisation. A restructuring panel will be formed under the chairmanship of chief secretary. Of the 68 PSUs in the state, only 30 are working.
The rest have either been closed or are under liquidation. Although they played a key role in the past, these enterprises have absorbed investments worth Rs 9,795 crore. In addition, the total amount of outstanding loan guaranteed by the government was Rs 4568 crore as on March 31, 2002.
Besides, the 30 functioning PSUs had incurred a loss of Rs 1642 crore till March last year. If the loss-making companies accumulate their losses at the same rate, the entire paid-up capital would be wiped out by the end of 2004-05.
The Cabinet has also fixed the paddy procurement target for 2002-03. Between October 1 this year and September 1 next year, 7.5 lakh tonnes of paddy would be procured from the farmers in 30 districts. Last year, the target was 15 lakh tonne. This year, the Food Corporation of India would buy paddy from the districts of Sambalpur, Bargarh, Kalahandi, Nuapara, Bolangir and Sonepur.