New Delhi: National Films Development Corporation (NFDC), which funded or coproduced around 300 films, including cult classics such as Jaane Bhi Do Yaaron, Pather Panchali and Gandhi, is among the 50 central public sector enterprises the government is considering to shut down as they have “lost relevance”.
Set up in 1975, Mumbai-based NFDC had been in the red for many years. It reported a net loss of Rs 7.13 crore in 2009-10, after which the government injected Rs 30 crore under a revival package. It posted a net profit of Rs 6.34 crore in 2012-13, but slipped into the red again in 2013-14.
Others on the list include Indian Telephone Industries (ITI), Scooters India Ltd, Hindustan Antibiotics Ltd, Fertilisers & Chemicals Travancore, Hindustan Antibiotics, Madras Fertilisers and Bengal Chemicals & Pharmaceuticals Ltd.
The Prime Minister’s Office (PMO) had earlier asked the department of heavy industries to present a three-year revival plan for its companies that could achieve operational profits and identify those that could not be revived even with infusion of funds. “Those that cannot be revived will be shut,” an official in the heavy industries ministry said.
The official indicated the government is also planning tougher norms for sanctioning revival packages for sick companies. “It has not approved any revival plans so far,” the official said.
Last week, heavy industries minister Anant Geete had said his ministry is preparing a proposal for a one-time settlement to employees of six PSUs that cannot be revived. “It would be better to make a one-time settlement and eliminate higher recurring expenditure,” he had said. Officials said the settlement could cost the government around Rs 1,000 crore. These companies are HMT Watches, Hindustan Photo Films, HMT Bearings, HMT Chinar Watches, Tungbhadra Steel and Hindustan Cable.
A committee of secretaries, headed by Cabinet Secretary Ajit Seth, has already given its nod for laying new parameters for the revival of ailing companies.
“All administrative ministries will be asked to give a proper roadmap and state whether these companies will be able to post profits,” said another official aware of the developments. Any new revival proposal will now be considered on the basis of “bankability” and “sustainability”, the official said.
Fate of companies such as ITI is also under a cloud as they have not been able to present a financially viable revival plan. The UPA government had, earlier this year, sanctioned an infusion of Rs 4,156.79 crore in ITI. “Of this, Rs 400 crore has been sanctioned for giving salary to employees. The company has been unable to strategise its plans for proposed project implementation, including the Akash Tablet,” said the above quoted official. ITI was to participate in building the low-cost tablet Akash, which was aimed at enhancing the quality of education. The government has also set up a committee headed by NTPC chairman but nothing emerged out of that Positively.