Calcutta, Feb. 15: State-owned National Jute Manufacturers Corporation (NJMC) is working on a fresh revival plan amid fears of the Centre withdrawing its support.
The jute company, which operates two mills in Bengal and one in Bihar, expects to remain in the red this year. It may also miss the turnaround target set by the Board for Industrial and Financial Reconstruction (BIFR) unless production is scaled up.
The company, which is running on a revival scheme sanctioned by the BIFR in 2011, suffered a loss of Rs 6.55 crore in 2013-14. The officials expect the loss to widen in the current fiscal.
While sanctioning the scheme, the BIFR had projected that the net worth of the company would turn positive by 2015-16 and losses would be wiped out by 2016-17.
Kushal Bhadhuri, chairman and managing director of NJMC, said the company was still far from the targets set by the BIFR despite the revival scheme being in place.
Bhadhuri said the company was facing operating losses in the last few years because of factors such as low production, labour issues and overdependence on one product - jute sacks.
The three mills produce around 27 tonnes per day against a target of 308 tonnes per day.
The company has chalked out a turnaround plan to continue getting the Centre's financial support. The plan includes monetisation of assets; scaling up production, particularly from its Bengal mills; and diversification into jute bags.
"NJMC has worked out a plan to gradually scale up its production to 57 tonnes per day at Kinnison, Khardah and RBHM (Bihar). Though, in the last one-and-a-half months there has been some progress in Bihar, we are unable to increase production from our mills in Bengal," Bhaduri said.
While NJMC is looking to start operations in phases, unions are demanding work for all labourers, which is unviable for the company.
NJMC has idle land in three non-functional mills in Bengal - National, Alexandra and Union.
The company has approached the ministry to be allowed to appoint an adviser to work out a scheme of monetising idle assets through the joint venture route.
