The Telegraph
Since 1st March, 1999
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Sick unit recast on track
- Hotel to be privatised, come what may: CM

Calcutta, March 18: The government today revealed its determination to press ahead with public sector restructuring by announcing the second phase of the exercise, involving mainly the transport and power sectors.

Chief minister Buddhadeb Bhattacharjee said in the Assembly a pilot project ' involving 19 public sector units comprising 9,000 employees ' will conclude this month itself.

The 19 sick units would be recast with funds from UK's department for international development (DFID), he added.

As part of the drive, the sick units have been divided into three categories. The government intends to retain ownership of only those enterprises that can be made viable by trimming workforce and expenditure. Joint venture partners will be sought for the second group ' to consist of units that might be made profitable by pumping in fresh capital. Enterprises that are unviable will be shut down.

The units to be restructured in the first phase include Great Eastern Hotel, India Paper Pulp, Sundarbans Sugarbeat and four subsidiaries of Webel, which have already closed down. Four joint venture projects ' Angel India, West Bengal Chemicals, Neopipe and Tubes and West Bengal Plywood ' also formed part of the exercise in Phase I.

Krishna Glass Factory, for which no suitable joint venture partner could be found, will be closed down soon.

In the second phase, 33 public sector units will be taken up for restructuring. Among them are the five state transport corporations (22,000 employees), the State Electricity Board (28,000 employees), Durgapur Projects Ltd and five units of the cottage and small-scale industry department.

The West Bengal Pharmaceutical Corporation, the West Bengal Tea Development Corporation, the Greater Calcutta Gas Supply Corporation and the West Bengal Mineral Development and Trading Corporation also feature on this list.

The chief minister said: 'We are going to restructure the units as our efforts to revive them have not been successful. Great Eastern Hotel will be privatised, come what may. This is the only way to protect the employees' interest.'

The observation is an indication of the government's eagerness to downsize staff in the loss-making units, ignoring objections from the CPM's trade union arm, Citu.

The government is already embroiled in a dispute with the union over its decision to privatise the 165-year-old Great Eastern and forcing its 440-odd employees to accept an early retirement scheme.

Both the Citu and the Congress's labour wing, Intuc, have refused to accept the offer, the deadline for which would expire on March 26.

Tourism minister Dinesh Dakua had ruled out any further discussion and warned that the employees will stop getting salaries as the hotel will die a natural death in months.

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