The State government plan to implement a package to modernise and revive the ailing textile sector remains a non-starter.
Despite having a track record of resuscitating and taking over sick public sector undertakings, including those owned by the Centre, the State government had not made any serious initiative for implementing the package, sources said.
An expert committee headed by P. Nandakumar had conducted a detailed study and submitted a comprehensive package for rejuvenating the sector that had immense employment potential.
The committee, most importantly, recommended a one-time fund infusion of Rs. 494.81 crore — Rs. 317.89 crore as capital investment and Rs. 176.92 crore as working capital — for putting the 17 mills in the public and cooperative sectors back on track.
A review report of the Public Sector Undertakings Restructuring and Internal Audit Board had pointed out that all textile mills are incurring loss and the Kerala State Textile Corporation was on top of the list of loss-making units.
The corporation’s turnover increased from Rs. 9.73 crore in 2016-17 to Rs. 32.13 crore the past year, but the loss also grew from Rs. 29.36 crore to Rs. 31.60 crore. Sitaram Textiles and other units too share the same plight.
The 17 mills together offer direct employment to 5,000 persons and indirect employment to 15,000 persons. The package had suggested a slew of reforms to give a fresh lease of life to the mills and thus optimise its employment potential.
Implementation of the package was expected to address the problems thrown up by demonetisation, inherent problems plaguing the sector such as lower capacity utilisation, and outdated technology. The government had approved the report, but the uncertainty in releasing funds has halted its execution.
Textile and garment making are two sectors that do not demand a massive investment, but have immense job employment potential, compared to other areas. States such as Jharkhand, Bihar, Andhra Pradesh, Telangana and Maharashtra are placing due accent on this sector. The effort has yielded good results too.
Compared to these States, Kerala has more advantages as it has spinning and weaving infrastructure, skilled manpower and a potential market. Implementation of the revival package would give instant results, sources said.
A resource-starved government could even opt for a phased implementation of the package, but it had not figured in its priorities so far, sources said.
Aim is to put 17 mills in public and cooperative sectors back on track
The mills employ 5,000 persons and give indirect employment to 15,000
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