WHITE PAPER

 

 ON

 

PUBLIC AND COOPERATIVE ENTERPRISES REFORM

 

  

April, 2002

 

 

DEPARTMENT OF PUBLIC ENTERPRISES

GOVERNMENT OF ORISSA

BHUBANESWAR

 

 

 

CONTENTS

 

 

Chapter

 

I.                 Introduction

 

II.                Public Enterprises: Past & Present

 

III.              Objectives & Benefits of Reforms

 

IV               Options before the Government

 

V.               Progress Achieved So Far

 

VI.              Remaining Agenda

 

VII.             Procedure for Prioritization

 

VIII.            Institutional Arrangements

 

IX.                              Implementation, Monitoring & Evaluation

 

Annexure

 

 I.            Enterprise-wise Investment, Profit & Loss position of State PSEs

 

II.            Enterprise-wise Investment, Profit & Loss position of selective

      Apex Co-operative Enterprises, Spinning Mills and Sugar Mills.

 

III.            Number of VR/VS opted employees of different enterprises received

      financial assistance

     

IV.            Enterprise-wise employees covered under Social Safety Net programme.

 

V.            Phase-wise Schedule for Divestment and Restructuring. of Public sector 

     and Co-operative Enterprises.

 

VI.            Progress of Restructuring of State PSUs and Co-operative Enterprises.

 

 

 

 

CHAPTER - I

INTRODUCTION

1.1       Public Enterprise reform has been at the top of the reform agenda worldwide since the early 1980s.  In India, at the centre and at the State levels the process has gained momentum with the policy of liberalisation and reform announced by Government of India in 1991.  The Government of Orissa has also embarked on a process of reform with restructuring of Power Sector, sale of Charge Chrome Plant at Brahmnipal to TISCO and sale of Talcher Thermal Power Plant to NTPC.  However, the process of reforms, which has involved restructuring and disinvestment, has often been controversial, misunderstood and faced with legal hurdles.  There are differences among political parties with regard to the objectives and processes of reforms.  As the Public Enterprises involve taxpayers’ money, the public is also naturally interested to know about the reforms policy. The Administrative Departments and management of Public Enterprises (PSEs) also need a mandate in terms of clear policy pronouncements, so that they can effectively plan and implement the reform programmes.  Keeping these needs in view, the Government of Orissa has decided to bring out this White Paper on Public Enterprise Reforms, which will serve as a basis of discussion and eventually as a policy paper for reforms programme.

1.2       In the context of India the reform process has been relatively new.  The limited experience gained during the last ten years has demonstrated the difficulties that governments have faced in achieving reforms.  The requirements of professional skill and strong political will for effectiveness of the process have created difficulties for smooth implementation of the reforms programmes.  Lack of clarity about the reform process has often created confusion, and to a certain extent suspicion in certain quarters.

1.3       In spite of the difficulties, reform has become essential to ensure higher growth, promote efficiency, provide competition, improve quality of life and provide good governance.  The Government of Orissa is determined to achieve a higher economic growth rate for the State through economic and social developments including development of industry, improvement in living conditions of weaker sections, employment creation and provision of facilities in social sectors, such as, health and education.  During the last fifty years, however, the trend shows that the State has become poorer compared to the rest of India on various economic indicators.  The Government of Orissa is committed to reversing this trend.

1.4              It is well recognised that quality of life not only depends on income level, but also on quality of goods and services available for consumption.  In our national planning up to 1980, emphasis was laid on increasing production to meet the growing demands in all sectors and quality was neglected.  The PSEs, with their monopoly positions, played a key role in production.  The thrust since 1981 has been changed from production to productivity (through better use of resources) and also from volume to quality of production.  This changed need can no longer be met by PSE monopoly, but by fair competition, which can be possible by encouraging multiple private owners.  The State Government is committed to reforms, which will bring in such private owners.

 

 

1.5       Orissa has remained a backward State compared with the rest of the country on various indicators of development.  The per capita income in the State (New series 1993-94) is Rs. 6767, which is short by Rs. 3437 or 34% of the All India average of Rs. 10,204.  Similarly, for the whole country the population living below poverty line is only 26% whereas, for Orissa it is a staggering 47%.  On social aspects the situation is no better.  While the State's literacy rate is 51%, the All India average is around 62%.  The infant mortality rate is 97 per 1,000 in Orissa whereas it is 70 per 1,000 for all States taken together.  On infrastructure development, on percentage of children attending primary schools, on percentage of people living in pucca houses and households having safe drinking water, Orissa is far behind the All India average as is evident from Table-1.1.  These conditions make it essential that the State lays greater stress on investment in the social sector.

Table –1.1

SELECT SOCIAL INDICATORS OF ORISSA AND FOR ALL INDIA

Sl. No.	INDICATOR	ORISSA	ALL INDIA
01	Per capita Income	Rs.6, 767	R.10, 204
	(New Series /1993-94)
02	Relative Infrastructure	98.90%	100%
	Development Index
03	Attending Upper Primary Schools	51.30%	57.60%
	(Classes VI-VIII)
04	Literacy Rate	51%	62%
05	Urban Household Living in Kutcha House	28.20%	9.50%
06	House Holds having safe drinking water	39.10%	62.30%
07	Infant Mortality Rate	97per'000	70 per '000
08	Life Expectancy at Birth	57.2 years	61.1 years
09	Population in Poverty	47.10%	26.10%

Source:  “Fiscal impact and Financial performance of State level Public Enterprises in Orissa” by Infrastructure Professional Enterprises (P) Ltd. Basing on the report on CMI, Planning Commission Economic Survey etc.

1.6       The State of Orissa is in a disastrous financial situation, with huge revenue deficits year after year leading to repeated borrowings.  The outstanding debt burden at the end of 2000-2001 was Rs. 21,035 crore and if no action is taken, this is likely to go up to Rs. 37,063 crore by 2005-2006.  At present, the State's own revenue together with its share of central taxes and grants from the centre falls short of the expenditure on salary, pension, interest payment and repayment of principal by more than Rs. 150 crore and to meet this deficit and other expenses, the State is borrowing heavily.  The State is no longer in a position to pay for the increasing needs of PSEs, which have accumulated very heavy losses and require heavy doses of fresh equity capital and loans to survive.  The Government cannot afford such expenditure.  The Government needs resources much more for social development, which has been relatively neglected.  In the circumstances, the PSEs cannot expect to get any budgetary support from the Government.

1.7       This phenomenon of financial crisis, which the State is facing today, is also true for other States in India as well as for other countries.  The demand on government funds has been rapidly increasing to meet the increase in expenditure on social services, which has created difficulties for government to provide sustained support to PSEs.  It is also increasingly felt that in several activity areas, the private sector can undertake the job of owning and running enterprises equally or more efficiently than the public sector.  A set of wide ranging international examples is set out below.

a) Like India many Latin American countries have faced situations in which PSEs incurred unprecedented losses leading to high inflation and high levels of government debt.  The governments were compelled to resort to privatisation and restructuring.  In case of UK, to revive the sluggish economy, the government accepted the free market policy and as a part of this policy most PSEs have been privatised.

b) An Indian neighbour, Sri Lanka, has carried out large-scale disinvestment in plantation, manufacturing, petroleum, finance, trading, agro, utility and service sectors.  To expedite the process of disinvestment, it has set up the Public Enterprise Reform Commission (PERC) as a powerful body.  A total of 42 enterprises have been privatised.  Other neighbouring countries in Asia, such as, China, Malaysia, Pakistan and Nepal have also embarked on a process of privatisation.

1.8  Internationally, success or failure of reforms programme has depended on a number of factors.  Committed leadership, clear policy framework, optimal institutional arrangement and clear phase-wise programme, supported by adequate communication and public relations efforts have been found to contribute to such success.  Increasingly, governments are changing from ad hocism to clear policy on all these factors.

1.9  In view of the change taking place worldwide and its own need and rationale of reform, the Government of Orissa has accepted Public Enterprise reform as a part of its economic and development policy.  In a larger sense the policy will be applicable, in addition to Public Enterprises, also to Co-operative enterprises and Departmental Enterprises engaged in commercial activities. The purpose of this White Paper is to set out this policy in clear terms, initiate a debate on this policy, build consensus among the stakeholders, seek support from other political parties and public in general and also provide through the white paper a mandate to officials to act, so that while implementing the policy everyone can work with a purposefulness and maximum economic and social benefit can arise for the State and the public whilst mitigating any negative effects. 

 

 

CHAPTER - II

PUBLIC ENTERPRISES: PAST & PRESENT

2.1  Historically the public sector has played a key role in the growth of the economy, both at national and State levels.  Soon after independence when private capital was scarce and government was keen on achieving rapid economic growth, it was necessary to set up PSEs with substantial government direction and control to provide essential infrastructure, like railways, transport systems, electric power, roads, telecommunications and other essential services.  Simultaneously, it was also felt that without the State's active role in the development of heavy industries, such as, steel, mines, coal, chemicals, petroleum and cement requiring large-scale investment, all-round development could not be achieved.  Thus, the public sector was involved directly in manufacturing of essential products and services.  By the mid 1960s the public sector was occupying the "commanding heights" of the Indian economy.

 

2.2 Following the Industrial Policy Resolution, 1956 and the primacy given to the State for development, the State government in Orissa set up a number of undertakings to operate in sectors, such as, power, transportation, construction, industrial promotion and development, forestry, fisheries, mineral and metals, textiles, tourist services, engineering goods and consumer products.  There are 68 Public Sector Undertakings (PSUs) comprising of 64 Government Companies and four statutory Corporations. In addition there were 3 companies under the purview of Section- 619-B of Companies Act, 1956 as on 31^st March 2001. However, out of 64 Government companies, 30 Companies are now working companies. Out of the 34 non-working companies 09 are under liquidation, 23 are under closure and 2 have been merged.

2.3  Although a majority of PSEs have not performed well and have therefore been either closed or liquidated, their contribution to the State's development cannot be overestimated.  When private capital was unavailable, particularly for the infrastructure sector, the State Electricity Board supplied electric power to remote areas.  IPICOL and OSFC undertook the risk and provided much needed equity capital and term loans to private entrepreneurs.  IDCOL directly set up industrial units of its own to produce cement, pig iron, ferrochrome, cables, transmission towers, tiles, rolled products, fasteners, etc and created the industrial base to attract other investors.  OSIC played the nodal role of supplying inputs to small industries.  In promoting social justice, the contribution of Orissa State Civil Supply Corporation was enormous as it supplied mid-day meals to school children and food grains at subsidised prices to weaker sections.  Some PSEs also helped people in far off areas to upgrade skills and technology.

2.4  While PSEs have played key roles in the past, these enterprises have also absorbed huge investments of Rs. 9,795 crore in government companies and statutory corporations.  In addition, the total amount of outstanding loan guaranteed by the State Government was Rs. 4,568 crore as on 31^st March 2001. For the 30 working companies, 34 non-working companies and four statutory corporations, the investment and accumulated profit/ loss as on 31^st March 2001 are placed at Annexure-I. If the loss making companies continue their operation and accumulate losses at the same rate, by the end of 2004-05, it is expected that their entire paid up capital will be wiped out.

 

 

2.5  Due to poor financial performance, the PSEs have run into financial problems and data for the five years (1995-2000) show that year after year the State Government has bailed out these undertakings by infusing fresh capital, loan, subsidies and waivers.  Hidden subsidies by way of unabsorbed interests and guarantees have created additional burdens as are shown at Table-2. I.   On the other hand, the reverse flow or commitment from the PSEs by way of interest payment, debt redemption or dividend payout has been quite meagre.  During the five years such payments have been limited to Rs. 129 crore, Rs. 5 crore, Rs. 10 crore, Rs. 24 crore and Rs. 54 crore or on an average Rs. 44 crore per year.

TABLE-2.1

		BUDGET SUPPORT TO PSEs INCLUDING SUBSIDIES
							(Rs in Crore)
			1995-96	1996-97	1997-98	1998-99	1999-00	Avg.1
I.	Direct Budget Support of which:		192	2148	433	316	193	314
	Equity Capital		31	657	65	-115	0	-17
	Loan Capital		15	1321	251	322	48	207
	Direct subsidies/ waivers		146	170	117	109	145	124
II.	Hidden Subsidies		130	393	537	556	542	545
	Unabsorbed interest on state investment 2		259	398	547	580	596	574
	Less: Interest / Dividends from PSU’s 3		129	5	10	24	54	29
III.	Total Budget Support (I + II)		322	2542	970	872	735	859
IV.	Guaranteed issued during the year		1025	480	235	1744	683	887
V.	State’s commitment of Resources (III + IV)		1347	3022	1205	2616	1418	1746
	Memo Item State’s own Revenue Receipts		1755	1824	1963	2044	2972	2326
	NSDP (Current Prices/New Series: 1993-94)		23862	23174	28394	30857	33536	30929
	Data Source: Reports of CAG; State Budget Estimates (for the year 1999-00); Directorate of Economics and Statistics.
	1 Average for 3-year period from 1997-98 to1999-00
	2  Hidden interests costs have been estimated separately, but not shown here.
	3          Figure upto 1997-98 are available in the CAG Reports. The remaining figures are obtained from the budget document

 

2.6  The State of Orissa has a number of large and small co-operative enterprises categorised into Commercial, Commercial cum Promotional and Promotional. These Enterprises have played pivotal role in providing essential and allied services to member producers of various agriculture and allied products in sectors, such as, textiles, sugar, oil processing, dairy, poultry and handicrafts.   Although these enterprises have catered to the need of people in the state, due to host of internal as well as external factors most of these enterprises have become unviable and have become a burden on the state exchequer.  Most of these co-operative enterprises even   could not generate minimum cash to meet their operating expenses and protect the interest of their producer members. It has been brought out in the report of the Comptroller and Auditor General of India (CAG) for the year ended 31.3.2001 that realisation of loans, interests, dividend and other revenue from Co-operatives has continuously declined during 95-96 to 99-2000 with the percentage of recovery plunging from 14.30 in 1995-96 to 3.72 in 99-2000 to the total demands. A sum of Rs. 20.19 Crore was sanctioned as loan to 4 Co-operative Sugar Industries between January, 65 to March, 1999 for modernisation, clearance of liabilities and purchase of tools. C. A. G. has reported that principal amount of Rs. 8. 87 Crore and interest amounting to Rs. 15.19 Crore has not been repaid till now. Bargarh Co-operative Sugar Industries was sanctioned interest free loan aggregating Rs. 5.69 Crore during 1983-84 to 86-87 for rehabilitation, modernisation, wage and means advance, purchase of tool and plants subject to repayment within the stipulated period from August, 97 to January, 2001. The enterprise has failed to pay loans as reported by the CAG. There is, thus, clear evidence of declining operating efficiency in the Co-operative Enterprises and these are not being run on sound commercial principles. In some instances, mounting loan liabilities have forced the commercial banks to move the Debt Recovery Tribunal against the defaulting enterprises. Investment, accumulated profit and loss position of Apex Co-operative Enterprises (including spinning Mills and Sugar Mills) are placed at Annexure-II.   

 

2.7 On the question of returns from Public Enterprises and Co-operative Enterprises, various Finance Commissions have recommended the level of expected dividend as follows:

Nature of PSEs / cooperative Enterprises	Recommendation of 9th Finance Commission	Recommendation of 10th Finance Commission
Commercial	5%	6%
Commercial-cum-Promotional	3%	4%
Promotional	0%	1%

Against such recommendations, the average dividend received from the State's commercial PSEs has been on an average low at 2.79%.  The State has received no dividend from the other two categories of PSEs.  On the whole, the net commitment of the State's resources for PSEs after adjustment of dividend etc. during these years have been Rs. 1,347, Rs. 3,022, Rs. 1,205, Rs. 2,616 and Rs. 1,418 crore or a huge total of Rs. 9,608 crore. The Government of Orissa is no longer able to provide this kind of commitment to State PSEs. The financial state of the co-operative enterprises is not very different. This creates additional burden for the State Government.  

2.8 The State already has serious financial problems with its massive loan burden and fiscal deficits.  The burden of loan, which was Rs. 10, 323 crore in 1995-96, has increased to Rs. 17, 908 crore in 1999-2000 as presented at Table- 2.2.

 

Table-2.2

		Comparative Position of State Finance 1995-2000 including burden of loan
								(Rs. In crore)
Sl.			1995-96	1996-97			1997-98	1999-2000
1.	Gross Revenue Expenditure		4697.81		5117.25	5535.17	6819.15	8458.51
2.	Gross capital Expenditure		1315.50		3201.79	3908.70	4185.95	5584.51
3.	Fiscal Deficit		2071.49		3811.36	4687.69	5837.34	8055.57
4.	Revenue Deficit		-807.10		-830.49	-903.14	-2264.75	-2573.87
5.	G.S.D.P at current prices		27250		27053	32669	35834	39417
6.	Fiscal Deficit as a %age of GSDP		7.60%		14.09%	14.35%	16.30%	16.30%
7.	Outstanding Loan		10323		11966	13688	16485	17908

·Source: Reports of CAG, State Budget Estimates, and Directorate of Economics and

                   Statistics

Payment on account of interest alone is estimated to be Rs. 2,030 crore during 2001-2002 and is likely to increase to Rs. 3,945 crore by 2005-06.  This would absorb about 80% of the State's own revenue.  At present, the State's own revenue taken together with the State's share in central taxes and grants from central government falls short of salary, pension, interest payment and repayment of principal by more than Rs. 150 crore and there is, therefore, almost nothing left for goods and services and maintenance of capital assets.  In the circumstances, the State Government will not be in a position to support PSEs. Instead there must be a way by which PSEs can release funds for repayment of the debts, which were incurred partly to fund them.

2.9     The social sector in Orissa is in urgent need of new investments in education, health, housing infrastructure etc.  Independent professional estimates show that if only the hidden subsidies enjoyed by the PSEs were diverted to these sectors, it would have led to creation of about 21,000 new primary schools, 26,000 kilometres of new metal roads, 17,000 new doctors, nearly one lakh resettlement houses or five lakh new jobs over the three years, 1997-2000.  By putting money into PSEs, these opportunities for development in social sector have been lost undoubtedly.

2.10    In view of the above, there is no alternative for the State other than to carry out Public Enterprise Reforms involving restructuring and disinvestment.  The Government of Orissa is fully conscious of this necessity and is determined to develop an appropriate disinvestment strategy and carry through its implementation.

 

CHAPTER - III

OBJECTIVES & BENEFITS OF REFORMS

3.1       The objectives of the reforms will be:

(1)     To create competitive market conditions consistent with the policy of liberalisation and removal of protectionism by placing commercial activities in the hands of private owners.

(2)     To eliminate budgetary support for loss making PSEs and thereby make available the funds generated for much needed programmes in the social sector, such as health and education.

(3)     To prevent further loss of capital by undertaking speedy reorganisation of loss making PSEs, as with the passing of every additional year public enterprises face greater difficulty with the realisable value of assets progressively decreasing.

(4)     To mitigate the suffering of employees in loss making undertakings, who have not received their wages and salaries for months together, by providing to them a package towards severance of their service and thereby allow them with a clear mandate to pursue their own alternative plans and programmes.

(5)     To enable greater private initiative and facilitate infusion of private capital into these enterprises for undertaking expansion, technology upgradation and modernisation proposals.

(6)     To facilitate higher productivity and higher value-added for each of the factors of production such as capital, labour and other resources through more efficient deployment.

(7)     To free the Government from those economic activities where the private sector can play an effective role, thereby making the government machinery available for other purposes.

3.2       Other benefits from reforms will be:

(1)     The resources at the disposal of government are paid by taxpayers and are to be used only for the purpose of public good.  Putting these resources into the corporate sector, where the private sector is otherwise willing to invest, involves the unnecessary deployment of taxpayers' money.

(2)     Disinvestment will lead to the enterprises being owned by private owners, who, in the face of competition and changing market conditions, are obliged to be more efficient as otherwise their own financial viability and survival will be at stake.  They will find it necessary to professionalise their operations, introduce good governance practices and respond to market needs.  Such changes will bring in value additional for the economy and higher profit for company owners.

 

 

(3)     Disinvestment, irrespective of the method used, therefore leads to cash realisation of sales proceeds, elimination of the need to infuse fresh capital and removal of hidden subsidies.  These resources can be used for deployment in areas of much greater social priority, such as, education, health care and essential infrastructure.  The funds released can also be used to pay back partly the loans that the State has advanced.

(4)     Disinvestment will mean either, immediately or in due course, offering of such shares to the public for subscription or for purchase in the secondary market.  This will facilitate investment by small investors and employees and thereby widen the investor base of the company.

(5)     Disinvestment will also lead to more stocks floated in the market, which will help the capital market in terms of depth and increased liquidity.  The investors will find it easier to enter and exit capital markets.  Similarly, the private sector will be in a better position to evaluate the value of its shares, which, in turn, will help it in making a realistic assumption about its strengths to raise capital in the market for its existing or new projects.

(6)     Reforms and restructuring have been found to increase productivity and eventually to overall growth of the organisation.  Such growth has positive effects on the sense of achievement of the employees which helps in building up a good work environment and work culture.  In due course these may lead to increased employment potential in the State and increased tax collection by the State Government.

(7)     Disinvestment will lead to end of monopoly in some of the industrial as well as service activity areas and provide opportunities to consumers in terms of product choice, improved quality of product, cheaper prices and better after sales service consistent with a free market economy.  The consumer will eventually benefit from such changes and consequently be in a position to enjoy a better quality of life.

(8)          Disinvestment releases efficient and experienced manpower, particularly at higher levels, such as, able administrators and bureaucrats, who can concentrate more on developmental activities of the State, thus, benefiting the State and creating value additions in essential sectors.

(9)          Compared with the major States in India, Orissa has the largest proportion of population below the poverty line.  A part of the tangible and intangible resources released from the divested public enterprises can be used to improve the living condition of this population and for giving them, to the extent possible, a sustainable means of livelihood.

 

 

CHAPTER - IV

OPTIONS BEFORE THE GOVERNMENT

4.1       In view of the arguments presented in earlier chapters, it has become obvious that restructuring through disinvestment is essential for the PSEs in Orissa. Such disinvestment would involve transfer of ownership (equity or assets) from the public to the private sector.  The options before the Government are to:

i.          Privatise fully public sector enterprises.

ii.          Privatise partly so that discipline can be brought into PSEs with such private participation.

iii.         Retain units in the Public Sector but privatise certain activities on a competitive basis.

iv.         Retain units in the Public Sector, but contract out the management.

v.         Retain Public Enterprises in the public sector whilst carrying out reform through downsizing professional management, financial restructuring, etc.

           What it means to have different levels of shareholding?

1.   Private owner holds less than 10% and government holds the rest	Private owners called minority shareholders: confers rights to minority shareholder just like any other shareholder.
2.   Private owner holds more than 10% but less than 25%	Private owner can requisition extraordinary general body meeting. (Under Section 398- Indian Companies Act- mismanagement).
3.   Private owner holds more than 25% and Govt. holds less than 75%	Special resolutions such as, increasing share capital, selling a part of the company, etc. cannot be passed as it requires at least 75% shareholding.                                                         be passed, as it requires at least 75% shareholding.                                                         be passed, as it requires at least 75% shareholding.
4.   Private owner holds less than 50% and Govt. owns more than 50%	The status of the company will be treated as government company under Section 617. Such companies need to be subjected to CAG audit and reports are presented to the parliament or legislative assembly as the case may be. The company comes under COPU monitoring.
5.  Private owner owns more than 50%	Consequences as stated above will be reversed for the private party and the government.

4. 2      the alternative methodologies for disinvestment are:

i.          Capital market: Offer in the capital market can be made at a fixed price through a public issue, through book building or through sale in the secondary market.  Offering to the public by this method is more transparent, but the Government cannot have control over who is buying the shares.  The buyers also may be dispersed and none of them may be in a position to acquire the controlling interest to manage the enterprise.  Therefore, investors may not be willing to pay a higher price for such shares.

 

ii.          Strategic Sale: This involves selling a substantial proportion of the shares to give controlling interest to the investors.  The investor buys the shares because he sees a strategic fit of the acquired business with his existing business.  Strategic sale is effected through several rounds of discussion, with some of bidders being eliminated in each round.  The method incurs low transaction cost and often results in a higher sale price.  The acquirer may pay a higher price for the synergy that he may obtain by integrating it with his existing business.

            There may also be special conditions attached to strategic sale.  The conditions may include, maintaining prices for a foreseeable future period for the customers, job related guarantees, etc.

iii.         Management or employee buy-out: Enterprises where dependence on the employees is very high can be found to be suitable for disinvestment through the employee buy-out method.  However, the inability of the workforce to run enterprises effectively is found generally to be the major hurdle in the success of this method.

iv.         Sale through demerger: This method involves transfer of an undertaking to another existing company to a scheme of demerger.  Eventually the demerged company is sold to the private bidder.

v.         Liquidation and sale of assets: Liquidation and sale of assets as a method may be resorted to only when there are no bidders for buying the enterprise as a going concern.

4.3      Selection of Enterprise for Restructuring & Disinvestment: The Government of Orissa will use different options and methods depending on the needs of specific PSEs.  The criteria for choice will be:

i.        Profitability of the enterprise: Heavily loss making private sector units will be the prime candidates for privatisation/closure because of their budgetary impact.

ii.       Market structure: If such product or service could be reasonably supplied by the private sector, the enterprise will be privatised.

iii.      Public purpose: If an enterprise is fulfilling an essential public purpose or catering to the needs of an important social sector, the enterprise may continue to exist in the public sector.

iv.      Availability of private capital: If a particular sector is in a position to attract private capital and private entrepreneurs, such enterprise should be privatised.

Thus, an enterprise, which fulfils all the criteria, should be a priority candidate for disinvestment.  Likewise, a PSE, which does not fulfil any of the criteria, should have the lowest priority for disinvestment.  All other enterprises may be ranked in between appropriately.

 

CHAPTER - V

PROGRESS ACHIEVED SO FAR

5.1   Orissa was one of the first States to initiate the process of disinvestment even before the Government of India announced its policy of liberalisation in 1991.  The first unit divested was the charge chrome plant of the OMC Alloys Ltd., which was sold to TISCO.  The plant, which had started commercial production in 1987, made a loss of Rs.56 lakhs in 1988-89 and was facing difficulty in meeting its working capital requirement and in obtaining packing credit.  Therefore, the Board passed a resolution in 1989 to sell the unit.  There were 543 regular employees who were all taken on by TISCO.  The sale price of Rs. 156 crore was much higher than the project cost.  TISCO has increased the capacity utilisation from 75% to 100% in the second year after acquisition and then gradually to 120%. The fear that the privatisation would affect the interests of the employees has been proved wrong, as the following figures will show.

Benefit	OMC Period	TISCO Period
Average monthly salary paid to employees	Rs. 2,600/-	Rs. 9,800/-
No of houses provided to employees	158	190
Recreation facilities provided	Nominal facilities	New multi-channel T.V. connection. Sports facilities and library with 2000 new books.
Conveyance allowance	No conveyance allowance	Rs. 106,000 being paid as conveyance allowance per month.
LTC	Very nominal	Rs. 7,500/- per employee in every block of two years.
Protective Clothing	No protective clothing	160 Technical staff provided with protective clothing.

 

5.2              Another case of successful privatisation has been the case of Gangpur Weavers Cooperative Spinning Mills at Sundergarh.  The mill, which had sustained loss of over Rs. 16 crore, was declared locked out in August 1991 and closed in June 1992.  The mill was sold to Ashoka Synthetics Ltd. in 1993 at a bid price of Rs. 13.16 crore (against an original investment of Rs. 11 crore).  The performance of the mill has substantially improved as the following figures show:

	Prior to privatisation	After privatisation
Maximum capacity utilisation	65%	90%
Payment of salary etc.	Had been totally stopped	Regular payments are being made
Profit	Making losses	Earning 12% return on investment
Revenue for Govt. of Orissa	Nil	Rs. 1.5 crore per year
Exports	Nil	Foreign exchange earned through exports

The only objection to Gangpur Mills’s privatisation has been the loss of jobs as the total staff strength has been reduced from 1500 to 500.  However, it is also felt that had the mill continued in its previous condition, the loss would have been far greater and probably all the employees would have lost their jobs.

5.3      The next important case of disinvestment was in the power sector, which absorbed nearly 70% of the total public sector investment of the State.  The OSEB, which had become monolithic and unmanageable, was suffering from problems of adverse capital structure, uneconomic tariff, high T&D losses, weak billing and collection system, overstaffing and inadequate manpower and skill.  Continuous losses were eating into the backbone of the SEB and it was not in a position to pay its creditors and suppliers.  It was unable to attract capital for modernisation, which was an urgent requirement.  To respond to this problem, the Orissa Electricity Reforms Act was passed in January 1996 and it came into effect on 1 April 1996.  The reforms involved restructuring of the sector through unbundling of generation, transmission and distribution.  Privatisation of generation and distribution, competitive bidding for new generation, transparent and independent regulating agency and tariff reforms both at bulk power level and retail level have been the key components of reforms. The State Government has been the pioneer in privatisation of the Power Sector. As part of the process, 49% of Orissa Power Generation Corporation (OPGC) was sold to a strategic investor- AES Corporation of USA- in 1997 for Rs.603.00 crores (fetching a premium of 155% over the book value of equity). Likewise, 51% of equity shares of the four distribution companies were sold to private companies in 1999-2000 for Rs. 159.01 crores against book value of Rs. 114.72 crores.  The reform was supported by a World Bank loan of US $ 350 million and DFID grant of UK 65 million.

The salient benefits of divestment/restructuring has been that:

(i)         TTPS after being taken over by NTPC is now operating at a PLF (Plant Load Factor) of 75% whereas it had never operated previously beyond 30%.

(ii)        OPGC is consistently maintaining a high PLF of 70 to 80%, a performance level comparable to NTPC.

(iii)       Disinvestment of 51% of government share in distribution and also 49% in OPGC has unlocked substantial funds, which has helped the Government to reduce its fiscal deficit by 2%.

(iv)       The quality of power supply is improving and there are fewer interruptions.

(v)                Subsidies have been stopped and generating companies are distributing dividend.

(vi)              The system loss has been reduced from over 50% to 43%.

(vii)             Losses in distribution are now shared with private investors.

 

Though disinvestment in power sector has been an important divestment programme of the State, the Policy with regard to such divestment has already been stated in clear and specific terms through the Orissa Electricity Reform Act, 1995 and therefore this White Paper does not include any further discussion on Power Sector Reforms.

5.4       Biswal Committee recommendations

Simultaneous with the power sector reforms, the government felt the need to examine the possibility of reforms in other public undertakings and a Cabinet Sub-Committee with Shri B.K. Biswal, Deputy Chief Minister as Chairman was formed in October 1995.  The Cabinet Sub-Committee after considering the factors, such as, profitability, promotional nature, stage of implementation and possibility of turning around, recommended by way of general policy that:

a.         Promotional PSEs should continue.

b.         Commercial PSEs should be privatised as follows:

i.          In profit making PSEs, minority interest should be privatised.

ii.          In loss making PSEs, 51% or majority shareholding should be privatised.

iii.         In loss making PSEs, if partial or full privatisation is not possible, the units should be liquidated.

c.         Co-operative Sugar Mills (except Aska) should be privatised to the extent of 51% but cooperative power loom units should be totally privatised.

d.         PSEs with similar activities should be merged.

By applying the general policy, the sub-committee made detailed recommendation for 36 PSEs and the cooperative enterprises.  The recommendations were accepted by the State Cabinet in August 1996 and accordingly actions have been initiated for various PSEs.  The decision on these  PSEs  along with  actions  taken are  given in  Annexure-III.

5.5       Among other developments, the Government has constituted a Public and Co-operative Enterprises Restructuring Committee under the Chairmanship of the Chief Secretary, with Additional Chief Secretary, Additional Development Commissioner, Finance Secretary, Secretary Public Enterprises, Secretary Industries, Secretary Textiles, and Secretary Co-operation as members.  The committee supervises the process of restructuring and recommends to Government the terms and conditions of privatisation and the party in favour of whom the privatisation will be done.

5.6              The Government of Orissa believes in reform with a human face.  It is committed to safeguard the interest of employees in reformed units, by providing them not only the terminal benefits under VRS, VSS or Compulsory Closure Scheme, but also by providing them with opportunities for retraining and redeployment.  Voluntary Separation Scheme has been designed for the employees of closed/ liquidated enterprises and for enterprises slated for substantial restructuring.  Although the Government has initiated the reform process, the shortage of funds was a major hurdle as some of the PSEs had spent all their working capital and did not have any resource even to pay their salaries and wages.  In the process of implementation of Public Enterprises Reform Programme, Government of Orissa is receiving financial support from Department for International Development (DFID) for meeting a substantial part of the funds requirement for VRS/VSS payments.

5.7              DFID, UK Government is providing a £19 million grant to the Government of Orissa for Public Sector Reform Programme.  Out of this £19 million, £ 12.3 million was earmarked for the State Public Enterprises Reforms and the remainder was to be utilised for reforms in tax administration, civil administration etc.  £ 10 million (approximately Rs.65 crore) were for redundancy payment, namely, VRS, closure compensation and VSS payments.  The remaining £2.3 million was for technical assistance, consultancy, social safety net programme, appointment of valuation experts, etc.

 

 

5.8              Under the VRS, VSS and closure compensation under ID Act, an estimated 13, 638 employees have already taken retirement from various state PSEs and Co-operative enterprises. Number of employees of different enterprises received such financial assistance under Public Enterprise Reform Programme is shown at Annexure-IV. 

5.9              The PE Reforms programme has a component termed as the Social Safety Net Programme  (SSNP) intended to train and rehabilitate the displaced employees. Such a programme is assisting large number of skilled and capable retired persons to take up alternative employment and thus enable them to mitigate the trauma of joblessness. The programme includes the following

·Survey/ counselling for adjudging the skill set, aptitude capability and needs of individual workers and offering them vocational guidance.

·In-depth counselling for identifying available options for workers and exploration of opportunities including ad judgement of capability and offering skill up-gradation or acquiring new skills, which could improve one’s chances for alternative source of earning.

·Free vocational training orientation and guidance for alternative livelihood through either wage-employment or self-employment venture. . 

Under the SSNP, out of the target group of voluntarily retired workers, 7,277 had been surveyed,  6791 have been counselled and 1,486 have been either retrained or are undergoing training as on 31^st March, 2002.  Out of those who have received in-depth counselling or training, 1,270 have been re-deployed (1085 in self employment, 185 in wage employment). Enterprise-wise employees covered under SSNP are given at Annexure-V. 

 

CHAPTER - VI

REMAINING AGENDA

6.1              It may be observed that despite the acceptance of the recommendations of the Cabinet Sub-Committee by the Government, little progress was made on reforms as private investors showed not much of interest due to the following reasons:

i.         Almost every Public Enterprise  & Co-operative enterprise had surplus manpower. ii.          Plant and machinery had outlived their usual life; and banks and financial institutions were reluctant to extend any more credit for their expansion and modernization. iii.         Trade Unions were taking shelter under law, which delayed the process. iv.         Disputes regarding possession of land created hurdles. v.         Existing huge liabilities could not be cleared due to shortage of funds, without which private entrepreneurs were reluctant to invest. Buying of minority shareholding could not give them sufficient control. vi.         In many cases, there was lack of realistic opportunity for profit. vii.        There was no privatisation policy.

 

6.2      Since 1996, the situation with regard to PSEs has further changed in many respects.  It is now felt that the implementation of reforms programme has been slow and unless an expeditious and different approach is taken, the conditions of PSEs will further deteriorate.  In view of the need to check this deterioration, the following policy approach is adopted by the Government of Orissa:

a.         PSEs will be classified into (i) core enterprises and (ii) non-core enterprises.  Two types of public enterprises, namely, enterprises, which have promotional role, and enterprises which have been created as natural monopolies for extraction of rent from the state's natural resources are defined as core enterprises.  All other PSEs are treated as 'non-core' enterprises.

b.         Core enterprises will continue with appropriate financial and organisational restructuring.

c.         Government shareholding in non-core enterprises will be reduced to 26% or less.

d.         Preference will be given to strategic sale.  However, if there is poor response from strategic buyers, recourse should be taken to closure or liquidation by assets sale.

e.         The disinvestment proceeds will be used to the tune of 70% towards retirement of public debt and 30% for creating a State Renewal Fund, which will be used for implementing voluntary retirement and closure compensation schemes.

6.3      Implementation arrangements will be strengthened as explained later in this paper, to make the process expeditious.

6.4    For PSEs, which have become defunct, but still appear in the CAG list, steps will be taken for their disposal through liquidation and assets sale in consultation with the Registrar of Companies, Orissa and the Administrative Department.

 

6.5       As a major change in the institutional arrangement, the Government will appoint a Public Enterprise Reforms Commission (PERC) with an eminent person with experience for running public/private sector enterprises as chairman, a finance member and a legal member to deal exclusively with the cases of PSE privatization and restructuring (more about this is discussed in Chapter-VIII).

6.6      In keeping with the interest of the workers, the Government is planning to create a State Renewal Fund with contributions from PSEs, State Government, Co-operative Institutions and proceeds realised from disinvestment, to finance a part of the VR/Closure Compensation /VS Schemes.  The remaining part as well as the SSNP is expected to be funded by a donor agency.

6.7      The Government recognises that the consumer is the eventual user of the product or service that PSEs produce and their interests must be safeguarded against any possible negative impact.  It is true that some consumer goods or essential services may have higher prices after reform particularly where direct and indirect subsidies were provided previously by the state.  While such impact may not be totally eliminated the Government commits itself to take steps to keep such price rises to the minimum, while mitigating the suffering of the consumers in other ways by providing consumers with improved service, improved quality of products, assured supply, etc.  The interest of consumers living in remote areas, women, and backward classes will also be protected to the extent possible.

6.8      Given the wide-ranging social sector development programmes, such as, PMRY, SC Corporation programmes and schemes for artisans, efforts shall be made to integrate the displaced workers into these programmes so that sustainable self-employment ventures can be created for them.

6.9      Suppliers, such as craftsmen and weavers, need attention to ensure that the negative impact on them is minimised.  The Government will attempt to ensure that the claims are settled in time and they are not harassed by private owners if productive enterprises are transferred to members of suppliers community, there can be automatic checks and balances and thus their interests can be safeguarded.

6.10    Disinvestment, particularly through liquidation or closure may leave issues relating to environmental liabilities, which do not, figure in the accounting records but are nevertheless real.  Such liabilities should be identified and quantified as a part of the reform process.  Certain enterprises, which deal with toxic and hazardous chemicals and bacterial products hold the potential hazard of contaminating soil, waters and air which may affect health and safely of the local community.  Specific responsibility for such possibility will be fixed and resources allocated for undertaking clean up operation in future if necessary.  PERC may commission environmental audits to assess environmental liabilities before negotiating bids.

 

 

CHAPTER - VII

PROCEDURE FOR PRIORITISATION

7.1              The Cabinet Sub-Committee on functioning of Public Sector Undertakings had considered profitability, promotional nature of activities, and potential of turning around as the three criteria for selecting PSEs and Co-operative Enterprises for restructuring.  However since 1996, a number of changes such as emergence of a robust capital market, need for competitiveness in product markets and need for mitigating the suffering of employees have made it necessary for the Government to modify these criteria.  Accordingly other Co-operative enterprises such as Tribal Development Co-operative Corporation, Orissa State Handloom Weaver’s Co-operative Society, Spinning Mills and Powerloom Co-operatives have been included under the ambit of present PE Reform Programme. As stated earlier, the Power Sector Reforms programme envisages a structured time phasing of privatisation/ disinvestment of public sector entities in transmission, generation and distribution with clear milestones. Progress of disinvestment in this sector is also being separately monitored. Accordingly future programme of privatisation in the Power Sector has not been extensively discussed in the White paper.  

7.2              For selecting the PSEs for disinvestment, as explained earlier, the Government shall use the following criteria:

(i)         Profitability of the enterprises.

(ii)        Market structure of the industry.

(iii)       Level of public purpose.

(iv)              Attractiveness to private investors.

A large number of enterprises may fulfil the criteria and therefore a further screening will be made to draw up a list enterprises for phase-wise scheduling.  A phase-wise scheduling is also essential due to the following two prevalent conditions:

(i)         The financial support from the donor agency as well as from the Government required for undertaking reforms may not be available at once. The grant may be spread over a number of years. Accordingly the programme of reforms needs to be staggered.

(ii)                The skill and capability available with the PERC may also be limited to plan and implement reforms in a very large scale.  Therefore phasing of reforms programme will be necessary.

7.3     The criteria for screening and scheduling will be as follows:

(i)         Possibility of further loss.  If an enterprise still has an excess of employees the likelihood of further loss will be high.  Similarly, if an enterprise has an asset value in the form of plant and machinery and special purpose equipment whose value may deteriorate fast, it will also be incurring heavy loss.  In cases of such enterprises high priority will be given to disinvestment.

(ii)        The possibility of improving the fiscal position of the State.  Some PSEs may provide a higher realisation value and may help the State in improving its fiscal position substantially. Such enterprises will be given priority in scheduling.

            There are also other considerations in scheduling:

(i)         Enterprises (including co-operatives), whose restructuring processes have already been initiated and a reversal of the process is not possible, will be taken up on priority basis.

(ii)        Enterprises (including co-operatives) which fall in non-core areas but fulfil all or some of the above considerations will be taken up in phase - I.

(iii)               Enterprises (including co-operatives) falling in the core sector but amenable to substantial improvement if allowed to work under market conditions will be taken up for restructuring with respect to their specific activities or divisions in phase - II.

7.4 Based on the above considerations, the reforms programme for Public and Co-operatives enterprises is scheduled to be completed in two phases. Accordingly, MoU has been signed between Government of Orissa and Department of Expenditure, Ministry of Finance and Government of India to expedite the process of disinvestment. The experience from restructuring of Central & State Public Enterprises so far, show that the reform process for any enterprise will take somewhere between 12 months to 24 months depending on the size and complexity.  Given this time requirement and the resources at the command the State Government to effectively monitor the said process a schedule of such disinvestment or restructuring has been drawn up as shown at Annexure-VI. 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CHAPTER - VIII

 

INSTITUTIONAL ARRANGEMENTS

8.1              The existing institutional arrangements for processing of reforms involve the following steps:

 

i.         The administrative department prepares and submits proposals for the units under their administrative control for restructuring to DPE. ii.          The DPE presents the proposal to the Public and Co-operative Enterprise Restructuring Committee for consideration and recommendations. iii.         The DPE informs the recommendation to the administrative department. iv.         The administrative department obtains the approval of the Finance Department. i.                     The administrative department takes the necessary orders of the Government after              Which the desired restructuring can be effected.

 

8.2              In the above process there are several weaknesses:

i.         The process is too lengthy. ii.          The Public and Co-operative Enterprises Restructuring Committee (PCERC) consist of busy administrators who cannot devote sufficient time for deliberation of detailed issues relating to restructuring. iii.         Administrative Departments that play a key role in the process have a natural interest in keeping their enterprises in the public sector and therefore, may be somewhat biased against their restructuring in favour of private owners. iv.         Also PCERC does not have the required technical background support and skill for detailed appreciation of the matters relating to reforms and restructuring. v.         The structure seems to be more process oriented and less result oriented. vi.         There is no official implementing machinery.

 

8.3              International and national experiences show that institutional arrangements for

             reforms can take four alternative forms:

i.                    Administrative department:

It is argued that as the administrative department knows in detail the affairs of the Public Enterprise, it would be in a better position to assess the value of the enterprise and also negotiate the transactions effectively.  However, others argue against the involvement of the administrative department in such processes on the grounds of lack of adequate legal and technical skill.  It is further argued that as long as the administration of the PSE was a major issue, the administrative department can play a major role.  Such role could not be given to the administrative department when reform is the major issue.

 

ii.                  Public Enterprise Department:

This alternative does not work well because of the conflict in roles and responsibilities of this department and the administrative department controlling the public enterprise.  Moreover, the department, being more or less like any other government department, often does not possess the technical and legal skill to successfully plan and implement the reforms.  The administrative department also gets bogged down by the bureaucratic procedures, which involve following the rules of business on movement of files from the secretariat through various channels to the Cabinet, which creates inordinate delay.

 

iii.                Implementation Secretariat:

This generally involves appointment of very senior bureaucrats, generally with Chief Secretary as Chairman and Finance Secretary and Industry Secretary, etc. as members.  These senior bureaucrats may find it difficult to devote sufficient time for detailed discussion on various issues related to restructuring.

 

iv.                 Public Enterprise Reforms Commission:

A commission can be statutory or non-statutory. A statutory commission can have wide powers but it also needs a strong political will to establish a commission through law.  In this circumstance, a non-statutory commission is sometimes opted for by governments.  A non-statutory commission can be more moderate and human in its approach.

 

8.4       In view of the above strengths and weakness, the Government wishes to change the institutional arrangements as follows:

i.                     The PCERC will be dissolved and a separate non-statutory body called Public Enterprise Reforms Commission (PERC) will be constituted with members as follows:

a)                  An eminent person with experience and expertise in public/private systems             management. He should also be the chairperson of the commission. b)           An expert member (Finance) c)           An expert member (Legal)

 

ii.          The PERC will have Secretariat where the number of staff will depend on the number of PSEs and the value of assets being privatised.  The key staff of PERC will include, a chief executive, three transaction consultants/financial analysts, one legal advisor, one social safety net expert, one computer/MIS expert, one communication expert/media advisor and one administration manager.  Additional staff may be required as the work increases.  The Government is committed to recruit such staff on competitive basis from the private sector or from Government through proper interviews.  Expertise and efficiency should be the only consideration in their selection.

iii.         The role of PERC will be:

a)         Recommending PSEs for privatisation and preparing the annual programme for privatisation including priority list of enterprises.

b)         Appointing and managing advisors to carry out, inter alia, asset/business valuations and preparing information memoranda for PSUs approved for privatisation.

c)         Initiating and running a public awareness programme.

d)         Pursuing a strategy for financial restructuring including debt settlements and write offs.

e)         Managing the tender process including:

•   Advertising for privatisation of PSEs.

•   Managing the bid opening process.

•   Evaluating the bids and making recommendations to CSC.

•   Finalising the sale contract after approval.

f)     Organising the business hand-over.

g)    Post-privatisation monitoring.

h)    Other related matters, such as, managing liquidations.

i)     Monitoring the social safety net programme.

j)     Ensuring that environmental concerns are addressed as part of the programme.

k)    Entering into contract and receiving funds on behalf of the Government.

8.5       In the process of restructuring the role of the Department of Public Enterprise will be:

i.          To act as a link between government and PERC to facilitate liaison and communications.

ii.          To place recommendations of PERC before the Cabinet Sub-Committee.

iii.         To take all legal actions etc relating to restructuring as it is the statutory authority as well as the authority under tripartite agreement for restructuring.

8.6       There shall be a Cabinet Sub-Committee consisting of:

i.          Hon'ble Chief Minister (Chairman)

ii.          Hon'ble Minister (Finance)

iii.         Hon'ble Minister (Public Enterprise)

v.                   Hon'ble Minister (Law).

 

The Chief Executive of PERC will be the special invitees for the committee for briefing purposes.  The role of CSC will be:

i.          To approve procedures for different stages of the process

ii.          To take policy decisions on financial, contingent and other liabilities of enterprises.

iii.         To take decisions relating to simplification or modification of VRS, VSS.

iv.         To approve PERC's recommendations on privatisation modalities.

v.         To approve PERC's annual time-bound privatisation programme.

vi.         To approve preferred bidder and price

vii.        To finalise sale contract in discussion with the preferred bidder.

8.7       The Cabinet will be the highest body in the restructuring process with its role:

i.          To ratify recommendations made by Cabinet Sub-Committee, which becomes automatic approval if not ratified within 30 days.

ii.          To approve of the annual privatisation plan of privatisation within a set time frame.

iii.         To ratify major policy decisions on PSE reforms.

Once the Cabinet Sub-Committee takes a decision to privatise concerned PSEs administrative control shall automatically be transferred from the administrative department to the Department of Public Enterprises( DPE).

8.8              PERC will operate in a transparent manner, with public hearings.  All the recommendations of PERC will be presented directly to the Cabinet Sub-COMMITTEE, WHICH will approve (or reject) the recommendations within its jurisdiction of authority.  If a decision comes within the purview of jurisdictions of the cabinet, the Cabinet Sub-Committee will send such recommendations for consideration of the cabinet.

 

CHAPTER - IX

IMPLEMENTATION, MONITORING AND EVALUATION

9.1              The entire process of reforms will be carried out in a transparent manner following best available international practices. All privatisation process will be carried out following competitive bidding. The following procedures will be observed to maintain transparency.

(i)         Information will be shared with the stakeholders through the State Government's website.

(ii)        Information through regular monthly bulletins will be published by PERC.

(iii)       Suitable communication strategies will be evolved so that people's representatives as well as the public can be informed about the details of valuations and transactions.

(iv)              Audit of all privatisation programmes will be carried out by an independent entity.

(v)                On the basis of transparent competitive bidding, wherever required, reputed consultant will be engaged to act as advisors to help in structuring the bidding process by following best international practices.

(vi)              Enterprises will be sold to the highest responsive bidder. 

(v)                On all completed reforms programmes, a comprehensive report will be placed before the State Assembly.

In order to keep the decisions above individual bias, all decisions in PERC will be taken collectively and not by any single member or Chairman.

 

9.2      Different methods of disinvestment will require different activities.  Government will set standard times for these activities and the aggregate time taken for reforms and restructuring will be calculated.  For very large undertakings, the norms may be increased appropriately.

9.3      Political commitment and ownership of reforms programme is essential for the success of the programme.  The main opposition parties will be taken into confidence to strengthen the commitment and support for the programmes.

9.4      There are many misgivings about reforms and strong objections, particularly from Trade Union representatives. Through proper communication such misgivings can be avoided.  The Government will endeavour to:

(i)         Make video films on reforms programmes already completed and arrange for their viewing among employees.

(ii)        The abstract of the reforms programmes along with how it will affect various stakeholders should be published in the form of leaflets.

(iii)       Promotional materials giving common apprehensions or questions in the minds of the stakeholders along with answers to such questions shall be distributed.

9.5              Monitoring and evaluation shall be done by the government auditors.  Ex post, all  

transactions and deals will be subjected to CAG audit eventually.

…………….

						Annexure-I
		Enterprise Wise Investment, Profit and Loss Position of State PSUs
Sl.	Name of the Company	Type	Date of	Investment			Accumulated	Remarks
No.			Incorporation	Equity	Loan	Total	Profit/Loss(-)
A	WORKING COMPANIES
01	Orissa Agro Industries Corporation Ltd.	Commercial cum Promotional	20th Dec. 1961	715.15	1505.82	2220.97	-3913.13	Povisional as on 31.3.01
02	Orissa State Seeds Corporation Ltd.	Commercial cum Promotional	24th Feb. 1978	258.6	0	258.6	-182.48	Povisional as on 31.3.01
03	Orissa State Cashew Dev. Corpn. Ltd.	Commercial cum Promotional	6th Apl. 1979	155.04	0	155.04	452.49	Povisional as on 31.3.01
04	Agricultural Promotion and Investment	Promotional	1st Mar. 1996	110.00	0	110	0	Povisional as on 31.3.01
	Corporation of Orissa Ltd.				0	0
05	Neelachal Ispat Nigam Ltd.	Commercial	27th Mar. 1982	18730.04	61300.2	80030.24		Commercial production not yet started
06	Hirakud Industrial Works Ltd.	Commercial	18th Jan.1993	490.01	0	490.01	3.15	As on 1999-2000
07	Orissa State Electronics Dev.Corpn.Ltd.	Promotional	29th Sep. 1981	2203.5	0	2203.5	-244.66	Povisional as on 31.3.01
08	ELMARC Ltd.	Commercial	23dr Jan. 1990	101.57	164.06	265.63	-123.8	As on 1996-97
09	IDCOL Software Ltd.	Commercial	26th Nov. 1998	100.07	0	100.07	-22.47	As on 1999-2000
10	ABS Spinning Orissa Ltd.	Commercial	23rd Mar. 1990	300.00	720.75	1020.75	-3635.48	As on 1994-95
11	Orissa Forest Dev. Corpn. Ltd.	Commercial cum Promotional	28th Sep. 1962	128	4681.4	4809.4	-7824.41	Povisional as on 31.3.01
12	Orissa Mining Corpn. Ltd.	Commercial	16th May 1956	3145.48	2418	5563.48	6109.53	Povisional as on 31.3.01
13	Orissa Construction Corpn. Ltd.	Commercial	22nd May 1962	1150	0	1150	148.18	Povisional as on 31.3.01
14	Orissa Bridge and Construction Corpn. Ltd.	Commercial	1st Jan. 1983	500	0	500	-709.54	Povisional as on 31.3.01
15	Orissa State Civil Supplies Corpn. Ltd.	Promotional cumCommercial	3rd Sep. 1980	978.32	438.7	1417.02	299.71	Povisional as on 31.3.01
16	IDCOL Cement Ltd.	Commercial	26th Feb. 1993	8850.01	13188.02	22038.03	-4415.93	As on 1999-2000
17	Orissa Tourism Dev. Corpn. Ltd.	Promotional cumCommercial	3rd Sep. 1979	962.16	0	962.16	-666.8	Povisional as on 31.3.01
18	Orissa Power Generation Corpn. Ltd.	Commercial	14th Nov. 1984	49021.74	26182.04	75203.78	23614.18	Povisional as on 31.3.01
19	Orissa Hydro Power Corporation Ltd.	Commercial	21st Apl. 1995	32080	179143.2	211223.2	22330.38	Povisional as on 31.3.01
20	Grid Corporation of Orissa ltd.	Commercial	19th Nov. 1995	48981	322270.2	371251.2	-93879	Povisional as on 31.3.00
21	Industrial Promotion & Investment Corpn. Ltd.	Promotional	12th Apl. 1973	8314.29	7928.86	16243.15	-4019.81	Povisional as on 31.3.01
22	Orissa State Police Housing & Welfare Corpn. Ltd.	Commercial	24th May 1980	563.01	0	563.01	-21.38	Povisional as on 31.3.01
23	Industrial Dev. Corpn. Of Orissa Ltd.	Promotional cumCommercial	29th Mar 1962	5711.79	25627.22	31339.01	-4613.82	Povisional as on 31.3.01
24	Orissa Small Industries Corpn. Ltd.	Promotional cumCommercial	3rd Apl. 1972	965.86	451.21	1417.07	-101.19	Povisional as on 31.3.01
25	Orissa Film Dev. Corpn. Ltd.	Promotional cumCommercial	22nd Apl. 1976	540.05	129.58	669.63	36.37	Povisional as on 31.3.01
26	Kalinga Studios Ltd.	Commercial	25th July 1980	129.5	14.3	143.8	-168.67	As on 1996-97
27	Orissa Timber and Engineering Works Ltd.	Commercial	11th Jan 1994	0.05	0	0.05	0	1994-95
28	Konark Jute Ltd.	Commercial	29th July 1974	593.99	929.29	1523.28	-1053.21	As on 1996-97
29	Orissa Lift Irrigation Corpn. Ltd.	Promotional cumCommercial	21st Sep. 1973	7473.25	347.86	7821.11	-508.29	Povisional as on 31.3.01
30	Orissa Rural housing and Dev. Corpn. Ltd.	Commercial cum Promotional	19th Aug. 1994	1015	29250	30265	481.26	Povisional as on 31.3.01
	Statutory Corporations
31	Orissa State Road Transport Corporation	Commercial cum Promotional	19th May 1974	13498.03	6947.72	20445.75	-26477	Povisional as on 31.3.01
32	Orissa State Financial Corporation	Commercial cum Promotional	1955-56	8757.31	61225	69982.31	-37502.95	Povisional as on 31.3.01
33	Orissa State Warehousing Corporation	Commercial	1957-58	340	0	340	992.15	Povisional as on 31.3.01
34	IDCO	Promotional cumCommercial	1980-81	0	3750.5	3750.5	1187.92	Povisional as on 31.3.01
	NON WORKING COMPANIES				0	0
35	ORICHEM Ltd.	Commercial	29th July 1974	276.65	94.02	370.67	-323.76	As on 1999-2000
36	Konark Detergent and Soaps ltd.	Commercial	29th Aug. 1978	9.32	0	9.32	-0.96	As on 1981-82
37	Kalinga Steel Ltd.	Commercial	9th Jan. 1991	0.08	0	0.08	0	Production not started
38	Orissa Electrical Manufacturing Company Ltd.	Commercial	31st Mar. 1958	4.54	0	4.54	0	Closed since 30.8.76
39	Gajapati Steel Industries Ltd.	Commercial	15th Feb. 1959	4	0	4	0	Closed since 1969-70
40	Premier Bolts and Nuts Ltd.	Commercial	4th Aug. 1959	2.28	0	2.28	0	Closed
41	Modern Malleable Casting Company Ltd.	Commercial	22nd Sep 1960	4.2	0	4.2	0	Closed since 1968
42	Orissa instruments Company ltd.	Commercial	14th Mar. 1961	96.79	0	96.79	-72.3	Defunct since 20.5.98
43	Hira Steel and Alloys Ltd.	Commercial	23rd Aug. 1974	12.28	0	12.28	0
44	IDCOL piping and Engineering Works Ltd.	Commercial	26th Mar. 1993	193.15	3085.13	3278.28	-10305.73	As on 1999-2000
45	General Engineering and Scientific Works Ltd.	Commercial	11th Jan 1994	0.05	0	0.05	0	First Account not received
46	Manufacture Electro Ltd.	Commercial	24th Sep. 1959	0.06	0	0.06	0	Asset has been sold
47	Modern Electronics Ltd.	Commercial	22nd Mar.1960	4.37	0	4.37	0
48	IPITRON Times Ltd.	Commercial	11th Dec 1981	80.83	168.33	249.16	-225.77	As on 1991-92
49	Konark Television Ltd.	Commercial	26th Jun 1982	606.97	200.75	807.72	-3346.01	Defunct since 1999-2000
50	ELCOSMOS Electronics Ltd.	Commercial	12th Jan 1987	158.51	200	358.51	-40.48	As on 1991-92
51	ELCOPHONES Ltd.	Commercial	10th Dec 1987	0.01	0	0.01	0	First Account not received
52	ELCO Communication and Systems Ltd.	Commercial	8th Mar. 1989	63.8	72	135.8	0	As on 1989-90
53	Mayurbhanj Textiles Ltd.	Commercial	1943	3.79	0	3.79	0	As on 1970-71
54	New Mayurbhanj Textiles ltd.	Commercial	2nd Jun. 1976	16.94	0.68	17.62	-5.65	Defunct since 1992-93
55	Orissa Textile Mills Ltd.	Commercial	25th Jan. 1946	2470.23	1468.14	3938.37	-7445.99	Defunct since 2000-01
56	Orissa State Textile Corporation Ltd.	Commercial	10th Sep. 1981	452.92	162	614.92	-3274.33	Defunct since 1998-99
57	Orissa State Handloom Development Corpn. Ltd.	Commercial	1st Feb. 1977	417.74	158.08	575.82	-1710.1	Defunct since FY 1997-98
58	Orissa Maritime & Chilka Area Dev. Corpn. Ltd.	Commercial	29th Aug. 1978	623.38	22.15	645.53	-153.36	As on 1995-96
59	Orissa State Commercial Transport Corpn. Ltd.	Commercial	15th Feb. 1964	610	673	1283	-1863.5	Defunct since 25.7.98
60	Orissa Fisheries Dev. Corpn. Ltd.	Commercial	8th Aug. 1962	35	0	35	0	As on 1982-83
61	Orissa Fish Seed Dev. Corpn. Ltd.	Commercial	17th Dec. 1979	501.56	200.63	702.19	-448.06	As on 1993-94
62	Orissa State Export Dev. Corpn. Ltd.	Commercial	27th July 1990	4	0	4	0	Defunct since inception
63	Eastern Aquatic Products Ltd.	Commercial	6th May 1959	0.61	0	0.61	0	As on 1971-72
64	Orissa Boat Builders Ltd.	Commercial	8th Mar. 1958	5.23	0	5.23	0	Closed since 1987
65	Orissa Board Mills ltd.	Commercial	4th Apl. 1960	4.08	0	4.08	0	Closed
66	Orissa State Leather Corpn. Ltd.	Commercial	19th Apl. 1976	425.04	37	462.04	-589.53	Defunct since 18.6.98
67	Orissa Leather Industries Ltd.	Commercial	26th July 1986	65	176.96	241.96	0	As on 1991-92
68	Kanti Sharma Refractories Ltd.	Commercial	11th Jan 1994	85	65.98	150.98	0	First Account not received
				224101.2	755398.8	979500	-164234.23
	*  Orissa Maritime & Chilka Area Dev. Cprpn. Ltd. and Orissa Fish Seed Dev. Corpn. Ltd have been merged
	to form Orissa Pisciculture Development Corporation Ltd. w.e.f.14.10.1998
	[Source: Report of the Comptroller and Auditor General of Indis ( Commercial )
	for the year ended 31 March, 2001]

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ANNEXURE – II

 

Sl.	Name of the APEX Enterprises	Government Investment			Government Support		Business	Net Profit/	Accumulated	Remarks
No.		Share	Loan	Total	Grants /	Guarantee	Turnover	(-) Loss	(-) Loss
		Capital			Subsidy
01	Orissa State Co-op. Bank	625.00	1258.42	1883.42	0.00	0.00	47747.44	649.24	0.00	(FY 2000-01)
02	OSCARD Bank	347.10	855.00	1202.10	0.00	8541.10	0.00	-1930.76	-5197.93	(FY 1998-99)
03	Orissa Consumer Co-op. Federation	127.90	4.36	132.26	0.00	0.00	5201.84	-17.47	-239.17	(FY 1991-92)
04	Orissa State Tassar & Silk C.S	113.56	76.76	190.32	395.08	0.00	81.39	-25.81	-71.77	(FY 1998-99)
05	Mahila Bikash Samabaya Nigam	141.69	0.00	141.69	108.69	0.00	0.12	0.00	0.00	(FY 1996-97)
06	Orissa SC & ST Dev. Fin. Coop. Corpn.	986.53	256.80	1243.33	4626.48	0.00	0.00	2.63	-186.73	(FY 1993-94)
			(NSFDC)
07	Orissa State Co-op. Union	0.00	0.00	0.00	42.00	0.00	0.00	-1.35	-1.16	(FY 1997-98)
08	OMFED	80.00	0.00	80.00	207.36	808.91	10609.11	122.91	0.00	(FY 2000-01)
09	MARKFED	2474.69	3667.18	6141.87	11.84	22.94	16930.87	-1051.07	-8466.50	(FY 1997-98)
10	Rajya Talagur Sangha	1.00	113.43	114.43	60.50	0.00	33.23	-2.46	0.00	(FY 1998-99)
			(OKVI)
11	O. CHC	243.52	62.60	306.12	0.00	0.00	897.60	-85.98	-145.52	(FY 1995-96)
12	State Handloom WCS	573.42	34.05	607.47	0.00	0.00	7953.52	-32.83	-460.97	(FY 1995-96)
13	Orissa Co-op. Coir Corporation	31.15	22.89	54.04	0.00	0.00	31.60	-7.93	-23.62	(FY 1991-92)
14	OIL Orissa	65.95	0.00	65.95	34.20	0.00	1119.74	-94.27	-412.13	(FY 1996-97)
15	State Oil Processing Ind. Co-op. Federation	103.55	0.00	103.55	0.00	0.00	101.99	-7.33	-51.61	(FY 1995-96)
16	OPOLFED	3.00	6.88	9.88	180.18	0.00	243.33	-6.22	-27.41	(FY 1992-93)
17	Orissa Backward Classes Fin. & Dev. Corpn.	0.00	445.44	445.44	173.88	0.00	174.80	-0.13	0.00	(FY '99-2000)
			(NBCFDC)
18	SPINFED	329.55	30.00	359.55	0.00	0.00	0.00	-15.07	-46.91	(FY 1995-96)
19	State Handicraft Co-op. Corporation	148.30	0.00	148.30	156.24	191.82	745.69	-14.60	-104.45	(FY 1993-94)
20	FISHFED	20.00	40.50	60.50	120.50	0.00	22.24	-6.79	-12.74	(FY 1993-94)
21	TDCC	628.23	146.33	774.56	55.18	0.00	932.91	-119.89	-805.49	(FY 1984-85)
	SPINNING MILLS
01	Shri Jagannath Spinning Mills	523.00	50.00	573.00	0.00	370.00	1210.22	-452.73	-2542.02	(FY 1998-99)
02	Kalinga Spinning Mills, DKL	295.82	0.00	295.82	50.00	5.30	1097.21	-89.10	-438.53	(FY 1992-93)
03	Shri Gopinath W C Spinning Mills	904.40	0.00	904.40	25.00	568.00	180.73	-212.38	-1561.60	(FY '99-2000)
04	O W Co-op. Spinning Mills, Tora	265.99	0.00	265.99	0.00	13.60	745.31	-254.49	-865.97	(FY 1994-95)
05	Gangpur W C Spinning Mills	61.65	0.00	61.65	0.00	45.00	277.72	-309.72	-1386.91	(FY 1991-92)
06	Sarala W C Spinning Mills	573.50	0.00	573.50	15.00	352.00	1236.72	-192.11	-724.14	(FY 1992-93)
07	Utkal W C Spinning Mills	470.45	0.00	470.45	0.00	427.00	1028.06	-277.10	-1167.01	(FY 1991-92)
	SUGAR INDUSTRIES
01	Bargarh Co-op. Sugar Mills	740.82	878.55	1619.37	0.00	0.00	0.00	-61.59	-1577.63	(FY 1995-96)
02	Nayagarh Co-op. Sugar Industry	590.00	0.00	590.00	0.00	780.27	0.00	-224.81	0.00	(FY 1988-89)
03	Aska Co-op. Sugar Industry	310.48	0.00	310.48	0.00	0.00	28.67	-166.35	-1502.64	(FY '99-2000)
04	Baramba Co-op. Sugar Industry	805.00	100.00	905.00	14.46	0.00	0.00	72.39	-203.70	(FY 1994-95)
	[ Source: Director of Co-operative Audit]

 

 

ANNEXURE – III

 

PROGRESS OF ENTERPRISES REFORM PROGRAMME

 

Sl. No.	Name of the Enterprises	Actions Recommendation / Initiated	Steps taken till date
UNITS
01	Konark Television Limited	Asset Sale	Asset Valuation in progress
02	Orissa State Handloom Dev. Corporation	Asset Sale	- Do -
03	Orissa Instruments Company	Asset Sale	- Do -
04	Orissa State Leather Corporation	Asset Sale	- Do -
05	Orissa State Commercial Transport Corpn.	Asset Sale	- Do -
06	New Mayurbhanj Textiles	Asset Sale	- Do -
07	Kalinga Times	Asset Sale	- Do -
08	Orissa Textile Mills	Immediate Liquidation with VR benefits	Employees given VR/ VS
09	Orissa State Textile Corporation	Immediate Liquidation with VR benefits	Employees given VR/ VS
10	Orissa Agro Industries Corporation	Disinvestment of 74 % shares or more	VR in progress
11	Orissa Tourism Development Corporation	Privatization of Panthanivases	-
12	Orissa Pisciculture Dev. Corporation	Disinvestment up to 74 % or more	-
13	Orissa State Cashew Dev. Corporation	Privatization / Jt. Venture of Plantations	Option paper prepared
16	Re-Rolling Mill (IDCOL Unit)	Disinvestment up to 74 % or more	VR in progress
17	Ferro Chrome Plant (IDCOL Unit)	Disinvestment up to 74 % or more	VR in progress
18	Kalinga Iron Works (IDCOL Unit)	Disinvestment up to 74 % or more	VR in progress
SUBSIDIARIES
19	Orissa Timber & Engineering Works (OSIC)	Asset Sale	Asset Valuation in progress
20	General Engg. & Scientific Works (OSIC)	Asset Sale	Asset Valuation in progress
21	K S Refractories (OSIC)	Asset Sale	Asset Valuation in progress
22	IDCOL Cement (IDCOL)	Disinvestment of 100 % of IDCOL shares	VR in progress
23	Konark Jute Limited (IDCOL)	Disinvestment of 100 % of IDCOL shares	Disinvestment decision taken
24	Hirakud Industrial Works (IDCOL)	Disinvestment up to 74 % or more	VR in progress
25	Industrial Piping & Engineering Works (IDCOL)	Asset Sale	VR in progress
26	S N Corporation (IDCOL)	Asset Sale	-
Sl. No.	Name of the Enterprises	Actions Recommendation / Initiated	Steps taken till date
27	ORICHEM Limited (IDCOL)	Asset Sale	-
28	ABS Spinning Mill (IDCOL)	Asset Sale	-
29	Kalinga Studio Limited (Orissa Film Dev. Corpn.)	Privatization	Strategic Option study initiated
CO-OPERATIVE ENTERPRISES
SUGAR MILLS
01	Nayagarh Sugar Mills, Nayagarh	Privatization	Advertisement released  for appointment of Merchant Banker
02	Baramba Sugar Mills, Baramba	Privatization	-Do -
03	Bargarh Co-operative Sugar Mills, Bargarh	Privatization	-Do -
COOPERATIVE SPINNING MILLS
01	GOPISPIN, Baliapal	Asset Sale	-Do –
02	JAGANNATH SPIN, Nuapatna	Asset Sale	- Do -
03	KALICO SPIN, Dhenkanal	Asset Sale	- Do -
04	KONARK SPIN, Kesinga	Asset Sale	- Do -
05	ORICOSPIN, Bargarh	Asset Sale	- Do -
06	USPIN, Khurda	Asset Sale	- Do -
07	SARSPIN, Tirtol	Asset Sale	- Do -
POWERLOOM SOCIETIES
01	Baripada (Takatpur Powerloom WCS Ltd., Mayurbhanj)	Privatization	VR in progress
02	Maa Bauti Powerloom WCS Ltd., Athagarh	Privatization	VR in progress
03	Ramnagar Powerloom WCS Ltd., Bargarh	Privatization	VR in progress
04	Barunei Powerloom WCS Ltd., Bajpur, Khurda	Privatization	VR in progress
05	Mahalaxmi Powerloom WCS Ltd., Kundukela, Sundergarh	Privatization	VR in progress
06	Chhatia Weaving Mill, Chhatia, Jajpur	Privatization	VR in progress
07	Berhampur Powerloom WCS Ltd., Berhampur	Privatization	VR in progress
08	Sizing Units, Baripada (Takatpur) Powerloom WCS Ltd, Siminai, Dhenkanal	Privatization	VR in progress
OTHERS
01	Tribal Development Co-operative Corporation		Substantial Restructuring VR in Progress
02	Orissa State Handloom Weaver’s Co-operative Society		Substantial Restructuring VR in Progress

 

ANNEXURE – IV

 

ENTERPRISE WISE EMPLOYEES COVERED UNDER(VRS/VSS/CLOSURE COMPENSATION SCHEME) 

 

 

Sl. No	NAME OF THE ENTERPRISE	Number of Employees
01	Orissa Agro Industries Corporation	302
02	IDCOL  & its Subsidiaries	3029
03	Konark TV	462
04	Orissa State Road Transport Corporation	1562
05	Orissa State Textile Corporation (BTM)	765
06	Orissa State Handloom Weavers Co-operative Society	249
07	Tribal Development Cooperative Corporation	113
08	Orissa Mining Corporation	46
09	Orissa Construction Corporation	12
10	GRIDCO	647
11	Kalinga Studio	02
12	Orissa Power Generation Corporation	207
13	Orissa Hydro Power Corporation	685
14	Orissa Forest Development corporation	111
15	Orissa Textile Mills	2807
16	Orissa Handloom Development Corporation	276
17	SPINFED (including Spinning Mills)	1445
18	Oil Orissa	60
19	Nayagarh Sugar Mills	210
20	Powerloom Units	527
21	State Oil Processing Unit	11
22	Kalinga Times	110
	Total	13,638

 

ANNEXURE-V

 

ENTERPRISE WISE EMPLOYEES COVERED UNDER SOCIAL SAFETY NET PROGRAMME

 

 

(As on 31^st March, 2002)

 

VR AVAILED/ACCEPTED UNDER DFID ASSISTED PE REFORM PROGRAMME (DURING IMPLEMENTATION OF SSNP)

 

 

S.l	PSU	No of Applicant for VR / Retrenched	VR Accepted/ Retrenched	No of Employees Surveyed	No of Employees Counselled		Re-training Programme
					Initial	In-depth	Need Identified	Training Completed	Training Ongoing	Total
1	ABSA-1	68	61	58	58	46	15	14	-	14
2	ABSA-2	332	332	262	262	207	124	52	56	108
3	ABSB-1	634	576	553	553	473	247	210	27	237
4	ABSB-2	32	32	6	6	-	-	-	-	-
5	ABSS-1	92	91	83	83	65	44	42	-	42
6	ABSS-2	575	575	349	349	243	213	90	-	90
7	BTM	779	775	515	515	347	165	63	16	79
8	CSIL	211	211	19	19	2	9	-	-	-
9	FCP-1	27	27	17	17	16	5	1	-	1
10	Hira Cables	61	61	59	59	54	28	27	1	28
11	HIW	41	41	28	28	27	16	8	1	9
12	IDCOL Cement	35	24	16	16	10	6	-	-	-
13	IDCOL Corp. Off	14	14	7	7	3	1	1	-	1
14	IDCOL Piping	16	16	1	1	-	-	-	-	-
15	KIW-1	32	32	7	7	4	2	-	-	-
16	Konark Jute	103	103	56	56	41	23	1	-	1
17	KSPIN-1	273	273	248	248	243	106	73	-	73
18	KTV-1	251	251	139	139	98	132	77	6	83
19	OAIC-1	35	35	4	4	3	3	3	-	3
20	OAIC-2	26	26	-	-	-	-	-	-	-
21	Oil Orissa	60	60	23	23	19	18	7	-	7
22	Orichem-1	144	144	66	66	38	40	23	-	23
23	Orichem-2	21	21	10	10	5	-	-	-	-
24	ORICOSPIN	117	117	110	110	91	54	41	2	43
25	OSHDC-1	140	140	70	70	33	13	4	2	6
26	OSHDC-2	133	133	32	32	18	17	-	-	-
27	OSHWCS	158	158	31	31	16	8	1	-	1
28	OSRTC-1	775	624	649	649	503	197	87	3	90
29	OSRTC-2	387	199	299	299	201	95	-	17	17
30	OSRTC-3	687	457	215	215	173	96	-	1	1
31	OTM	2208	2208	670	670	376	360	77	68	145
32	Rolling Mill	94	81	89	89	79	44	20	-	20
33	SARSPIN	265	256	141	141	65	56	-	-	-
34	Spinfed	25	25	25	25	22	17	4	-	4
35	Uspin	569	569	301	301	198	158	38	6	44
Sub-Total (A)		9420	8748	5158* (59%)	5158** (100%)	4708 ** (91%)	2312** (49%)	964	206	1170 *** (51%)

 

Employees Who Have Applied for VR but Not Yet Separated

 

S.l	PSU	No of Applicants for VR	No of Employees Surveyed			No of Employees Counselled						Need Identified			Re-training Programme
						Initial			In-depth
			Up to Feb	Mar	Total	Up to Feb	Mar	Total	Up to Feb	Mar	Total	Till Feb.	In Mar	Total	Training Completed (B)	Training Ongoing (C)	Total (D=B+C)	To be Trained after VR [F=A- (E+D)]
1	KSPIN-2	205	124	8	132	124	8	132	100	7	107	48	7	55	-	-	-	55
2	OSRTC-4	550	24	68	92	24	68	92	15	39	54	7	16	23	-	-	-	23
Sub-Total (B)		755	148	76	224 * (30%)	148	76	224 ** (100%)	115	46	161** (72%)	55	23	78 *** (35%)	-	-	-	78 *** (100%)

 

 

Employees Separated before the Commencement of SSNP

 

S.l	PSU	No of Applicant for VR / Retrenched	VR Accepted/ Retrenched	No of Employees Surveyed	No of Employees Counselled		Re-training Programme
					Initial	In-depth	Need Identified	Training Completed	Training Ongoing	Total
1	Elcosmos	58	58	23	23	10	12	3	-	3
2	FCP-2	79	79	27	27	15	4	-	-	-
3	Ipitron	199	199	144	144	70	87	54	1	55
4	KIW-2	164	164	11	11	1	-	-	-	-
5	KSR	167	167	147	147	111	56	43	4	47
6	KTV-2	211	211	86	86	42	40	24	-	24
7	OAIC-3	52	52	37	37	21	8	2	-	2
8	OHPC	962	962	470	470	325	164	160	-	160
9	OLI	22	22	21	21	10	1	-	-	-
10	OSCTC	314	314	253	253	89	45	10	-	10
11	OSLC	183	183	126	126	49	34	11	-	11
12	OSRTC-5	279	279	64	64	52	53	3	1	4
Sub-Total (C)		2690	2690	1409* (52%)	1409 ** (100%)	795** (56%)	508 ** (36%)	310	6	316*** (62%)
Grand Total		12, 376	11, 438	7277* (64%)	6791 ** (93%)	4665** (64%)	2908 ** (40%)	1274	212	1486 *** (51%)

 

 

 

*Of the Target Retirees, ** Of the total Staff Profile Survey, *** Of the total Training Need Identified

 

@ Includes 486 target retirees surveyed from secondary sources (From family members, neighbours, colleagues & friends)

 

Abbreviations:

 

ABSA- ABS Spinning Mill, Aska,

ABSB- ABS Spinning Mill, Baripada,

ABSS- ABS Spinning Mill, Sonepur,

BTM- Bhaskar Textile Mills, Jharsuguda

CSIL- The Co-Operative Sugar Industries Limited, Nayagarh

FCP – Ferro-chrome Plant,

HIW – Hira Industrial Works,

KALICOSPIN- Kalinga Spinning Mill.

KIW – Kalinga Iron Works,

KTV- Konark Television,

OAIC- Orissa Agro Industries Corporation,

OHPC- Orissa Hydro Power Corporation,

OLI-Orissa Leather Industries,

ORICOSPIN- Orissa Weavers Cooperative Society Spinning Mill,

OSCTC- Orissa State Commercial transport Corporation,

OSHDC- Orissa State Handloom Development Corporation,

OSHWCS – Orissa State Handloom Weavers Corporative Society,

OSLC- Orissa State Leather Corporation,

OSRTC- Orissa State Road Transport Corporation,

OTM- Orissa Textile Mills,

SARSPIN  - Sarala Weaving Corporation,

Spinfed- Spinning Federation,

Uspin- Utkal Spinning Mill.

  

@@@@@

 

Annexure-VI

 

PHASE-WISE SCHEDULE FOR DIVESTMENT AND RESTRUCTURING

OF PUBLIC AND  CO-OPERATIVE ENTERPRISES

 

1^ST PHASE REFORM PROGRAMME

DISINVESTMENT

 

(TIME FRAME: 2002-2005)

 

 

Sl. No.	Name of the Enterprises	Actions Recommendation / Initiated
UNITS
01	Konark Television Limited	Asset Sale
02	Orissa State Handloom Development Corporation	Asset Sale
03	Orissa Instruments Company	Asset Sale
04	Orissa State Leather Corporation	Asset Sale
05	Orissa State Commercial Transport Corporation	Asset Sale
06	New Mayurbhanj Textiles	Asset Sale
07	Kalinga Times	Asset Sale
08	Orissa Textile Mills	Immediate Liquidation with VR benefits
09	Orissa State Textile Corporation	Immediate Liquidation with VR benefits
10	Sugar Mills ii.                    Nayagarh. iii.                   Baramba iv.                 Bargarh	Privatization
11	Cooperative Spinning Mills i.                     GOPISPIN, Baliapal ii.                    SARSPIN, Tirtol iii.                   JSPIN, Nuapatna iv.                 KALICO SPIN, Dhenkanal v.                  KONARK SPIN, Kesinga vi.                 ORICOSPIN, Bargarh vii.                USPIN, Khurda.	Asset Sale
12	Orissa Agro Industries Corporation	Disinvestment of 74 % shares or more
13	Orissa Tourism Development Corporation	Privatization of Panthanivases
14	Orissa Pisciculture Development Corporation	Disinvestment up to 74 % or more
15	Orissa State Cashew Development Corporation	Privatization/Jt. Venture of Plantations
16	Re-Rolling Mill (IDCOL Unit)	Disinvestment up to 74 % or more
17	Ferro Chrome Plant (IDCOL Unit)	Disinvestment up to 74 % or more
18	Kalinga Iron Works (IDCOL Unit)	Disinvestment up to 74 % or more
Sl. No.	Name of the Enterprises	Actions Recommendation / Initiated
SUBSIDIARIES
19	Orissa Timber & Engineering Works (OSIC)	Asset Sale
20	General Engineering & Scientific Works (OSIC)	Asset Sale
21	K S Refractories (OSIC)	Asset Sale
22	IDCOL Cement (IDCOL)	Disinvestment of 100 % of IDCOL shares
23	Konark Jute Limited (IDCOL)	Disinvestment of 100 % of IDCOL shares
24	Hirakud Industrial Works (IDCOL)	Disinvestment up to 74 % or more
25	Industrial Piping & Engineering Works (IDCOL)	Asset Sale
26	S N Corporation (IDCOL)	Asset Sale
27	ORICHEM Limited (IDCOL)	Asset Sale
28	ABS Spinning Mill (IDCOL)	Asset Sale
29	Kalinga Studio Limited (Orissa Film Dev. Corpn.)	Privatization

 

RESTRUCTURING

(TIME FRAME: 2002-2005)

 

Sl. No.	Name of the Enterprises	Actions Recommendation / Initiated
30	Orissa State Road Transport Corporation	Continue with substantial restructuring
31	Orissa Lift Irrigation Corporation	Continue with substantial restructuring (FORMATION of water user’s association)
32	Orissa State Financial Corporation	Continue with substantial restructuring
33	Orissa State Seeds Corporation	Continue with substantial restructuring
34	Orissa Construction Corporation	Continue with substantial restructuring

 

2^ND PHASE REFORM PROGRAMME

RESTRUCTURING

(TIME FRAME: 2005-2007)

 

Sl. No.	Name of the Enterprises	Actions Recommendation / Initiated
35	Orissa Mining Corporation	Continue with Organization & Financial Restructuring
36	Orissa Forest Development Corporation	Continue with organization & Financial Restructuring
37	Orissa State Civil Supplies Corporation	Continue with Organization Restructuring