Bhubaneswar, Sept. 21: A Centre-financed employment-intensive public sector project has been lying idle for the past three years apparently because of the state government’s apathy.

A rubberised coir plant, set up by the state-run Orissa Cooperative Coir Corporation with a funding of Rs 4.17 crore from National Cooperative Development Corporation, has remained unproductive since 2008.

The plant has been closed for lack of working capital. The Orissa Cooperative Coir Corporation itself has turned sick and is not able to run the plant, said industries minister Raghunath Mohanty.

Ironically, a couple of similar private sector plants are making profits. A private plant, located a few hundred yards away from the defunct unit, runs on full steam. “Our plant, which was set up in 1993, has been running successfully with a production capacity of 650 tonnes of mattresses and cushions per annum,” said Shameem Ali, administrative officer of Kurlon Limited.

According to a conservative estimate, the private manufacturers and distributors sell rubberised coir mattresses worth more than Rs 3 crore a year in the state. “The average annual turnover of the rubberised coir mattresses will be to the tune of Rs 3.5 crore per month,” said Rajanikant Sahu, proprietor of PD Enterprise, a clearing and forwarding agent of mattress companies.

Eleven private parties, including leading manufacturers, had offered to run the plant on long-term lease basis in response to the expression of interest invited by the corporation last year. But the state government has remained undecided yet.

“The proposal submitted by the Coir Corporation for revival of the plant through a long-term lease is pending approval of the government,” said Mohanty. “The plant, which had ISO certification, was allowed to lie idle despite good market demand, which, in turn, favoured the private parties,” said Orissa Cooperative Coir Corporation Employees Union secretary Narayan Das.

While the state government attributed fund-crunch to the closure of the plant, Coir Corporation chairman Ramakrishna Das Mohapatra blamed it on the “lack of will and incompetence” of the plant management.

The plant, set up on about two acres of prime area in Chandaka industrial estate on the city outskirts, was inaugurated by chief minister Naveen Patnaik in August, 2008. It started trial production six years after the revised date of completion (the original target of commissioning was September 2002).

During the trial production period, the corporation could standardise the product, create market outlets and maintain a continuous flow of orders. The plant ran on the orders from East Coast Railway for its coach repair factory and other agencies, said Das Mohapatra.

However, the plant was shut down in February 2009, as the corporation could not arrange required working capital of Rs 1 crore to run the unit round the year, said corporation sources.

The corporation needed a financial assistance of Rs 30 lakh from the government to meet the margin money required for availing Rs 1 crore working capital from the commercial banks or other financial institutions.

Unable to arrange funds, the plant’s managing committee decided on April 8 last year to run the plant through a joint venture or long-term lease basis and, accordingly, an expression of interest was invited through newspaper advertisements. “Eleven parties had shown interest,” said Das Mohapatra.

The managing committee, at its meeting on February 23, expressed displeasure as no visible progress was made in this regard and decided to submit a proposal to the government for running the plant on a long-term lease basis. On April 28, the director of handicrafts and cottage industries, N. Palai, sent the proposal to the government to this effect. It is still pending with the government.

“I have been pursuing with the government for early revival of the rubberised coir plant at Chandaka and the coir processing plant at Birapratappur near Puri,” said Das Mohapatra.

However, uncertainty looms large over the closed plant with 25 employees and workers going without salary for the past 14 months.

“A public asset created out of borrowed funds for the benefit of the community has remained unproductive due to absence of concerted effort of the industries department though the plant was installed more than four years ago,” said the comptroller and auditor general in its latest report.