FNPO PATTUKOTTAI

Going the HMT watches way: Govt shortlists 10 worst performing PSUs, set to axe some

 

The obituaries have already been written for erstwhile 'timekeepers of the nation' HMT watches, but it turns out the government may be planning on fast tracking the shutting down of some other major loss making public sector companies as well despite it risking a potential showdown with trade unions.

According to a Reuters report, cabinet secretary Ajit Seth will be meeting with top officials today to consider what to do with the ten worst performing public sector units that have run up combined losses worth Rs 24,500 crore as on last year.

A note prepared by the Department of Public Enterprises reportedly lists BSNL, MTNL, Air India, Hindustan Photofilms, Hindustan Fertilisers, and HMT watches among them.

So while the government may have drawn up a a phased Rs 30,000 crore rescue plan and is working on the merger of MTNL and BSNL to be completed by next year, others like film roll manufacturer Hindustan Photofilms and HMT watches are likely to be axed.

"There is no future for this company in the current environment. It is a fit case for winding down," said a government official at the Department of Public Enterprises, which is overseeing the privatisation of state firms. The official did not wish to be named due to the sensitivity of the matter.

A public sector company based in Ooty that was set up in 1960, Hindustan Photo Films is under the Department of Heavy Industry claims on its website that it is "the only integrated manufacturer of Photo sensitised goods in the whole of South East Asia".

Among the products it manufactures includes medical diagnostic films, industrial X-ray films, graphic arts films for the printing sector, Bromide paper and roll films for photography, aerial Film for the defence sector and inkjet papers.

Hindustan Photo Films Ltd, which employed over 714 employees as on 31 March, 2012, was declared sick by the Board for Industrial and Financial Reconstruction in 1996. The firm, with consultants, had come up with a recovery plan that hasn't been acted on by the government

The government in February this year approved a Rs 181 crore voluntary retirement scheme package for employees based on notional pay scales of 2007.

It, however, isn't clear if any of the other companies that find their way on to the Department of Public Enterprises note will also face the axe just yet and the government is bracing for opposition from the trade unions.

Officials said the government was also looking for ways to revive some of the sick companies through capital infusion, joint ventures and by bringing in new management.