Government strives to resuscitate ailing textile units including NTC

YarnsandFibers News Bureau 2014-12-09 10:00:00 – New Delhi

The Textile Ministry is working toward resuscitating sick mills including the National Textile Corporation (NTC). The government wants to bring to profit a total of eleven mills of NTC in next three months. NTC had acquired 119 mills, out of which 78 are closed under the Industrial Disputes Act, Textiles Minister Santosh Gangwar informed Rajya Sabha.

He was replying to a debate on the Textile Undertakings (Nationalisation) Laws (Amendment and Validation) Bill, 2014, which replaces an ordinance promulgated some time back.

The bill, already passed by Lok Sabha, was approved in the Upper House.

Gangwar said that the government was not in favour of Ordinance but had to bring it to prevent NTC land slipping out of its hand and there is no intention to sell mills as Prime Minister too has pronounced the importance of the textile sector.

The legislation aims at ensuring proper and effective implementation of the revival scheme for sick textile units. As the textile sector has immense employment potential and India had many "Manchesters" but neglect during past years resulted in closure of many units.

He said that 23 NTC mills were running and five were in profit while 11 in dispute are put to arbitration and two have been handed over to Puducherry, while NTC is out of BIFR.

Allaying fears that the proceeds from sale of land will be misused Gangwar said that they had received Rs 6,547 crore from sale out of which Rs 1,618 crore was spent on modernisation while Rs 2,379 crore was spent on VRS and Rs 2,388 crore on wages. They have with them balance Rs 1,480 crore.

As far as modernisation of NTC is concerned, 50 per cent of it has been achieved. Government had committed to increase employment and at present there were 8,000 permanent and 3,000 daily wage workers with NTC.

Further to promote the sector, a skill centre is being set up Varanasi besides cloth manufacturing and other centres across the country to promote handicraft.

They have also requested the Finance Minister for eight textile centres in addition to 13 textile parks announced a month back. Fifteen more parks will be announced in a month and they will ensure one park in each northeastern state besides reserving 25 percent of parks for states that do not have such facility.

He admitted that despite production of 400 million bales of cotton, exports were not picking up as China was not buying it. In this regard, the exporters have been asked them to explore newer markets.

Admitting market rates were not good for cotton crop this year, he said steps were being taken in this regard.

Earlier, introducing the bill, Gangwar said that the measure seeks to free the ailing National Textile Corporation (NTC), which has property worth Rs 25 lakh crore, from rent control laws.

The amendments are made to protect assets of sick textile undertakings and ensure lease-hold right of such units remains with the central government.

However after expiry of the lease-hold tenure, owners of the sick units went to courts taking advantage of the rent control laws like the Maharashtra Rent Control Act, 1999 that exempts land leased by the central government, he said.

The Minister said that amendment bill seeks to clarify the vesting of lease-hold land with the central government, in order to prevent the vacating of this land by NTC, at the expiry of the lease.

These rights will be exercised by the NTC on behalf of the central government. Besides, no court may order the divestment of the property vested with NTC by the central government.

NTC, a central public sector enterprise under the Ministry of Textiles, manages affairs of sick undertakings, in the private sector, taken over by the government. NTC is managing 119 units at present.

Initiating the debate, Ananda Bhaskar Rofolu (Cong) said that he supports the bill because it is part of the protective measures taken by the UPA government towards reviving sick textile units in the country.

The bill would stop real estate and property builders from taking over huge acres of land of NTC in cities such as Mumbai, Kolkata, Kanpur and Warangal.

However, Rofolu said that the government should also come up with solutions to the current problems faced by cotton growers and handloom weavers.

Favouring amendments to the bill, V P Singh Badnore (BJP) said that only 28 out of 119 sick textile units owned and regulated by NTC are surviving. The bill is in the right direction and should compete with private players.

While, Chaudhary Munaveer Saleem (SP) said that liberalisation is proving harmful to the sector but the bill is good and its intention is good.

M P Achutan (CPI) was of the view that proceeds from sale of mill land should be used for modernisation alone.

According to Madhusudan Mistry (Cong), closure of mills has brought workers on the brink of starvation and hence steps should be taken to clear their dues.

Chunibhai Kanjibhai Gohel (BJP) said that textile industry was the most important after agriculture employing 35 million people but sadly India was lagging much behind China.

Sharad Yadav (JD-U) said that land should not be allowed to pass on to private hands and demanded that area should be developed in lines of 'Delhi Haat' for the benefit of artisans and other traditional craftsmen.

T Rathinaveli (AIADMK) demanded modernisation of NTC mills in Tamil Nadu and consideration of a proposal to set up a textile apparel park in the State.

A V Singh Deo (BJD) sought to know if government was preparing a blueprint for the revival of NTC and steps to reinstate the jobless workers.

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