PSUs turn into liability for Govt: Revenue generation remains a distant dream

Srinagar, Oct 26: Having been set up to generate revenue and create job opportunities in the state, most of the public sector undertakings (PSUs) are running in losses, which have become a huge burden on the state exchequer.

There are 19 public sector undertakings in the state under the administrative control of various departments.

According to official sources, most of the PSU (corporations) are running in heavy losses. Several are even failing to pay salaries to their employees.

Sources reveal that seven PSUs are being provided budgetary support by the state government to meet their wage bills as they failed to pay salaries to employees. The State Road Transport Corporation is also running into losses, which has become a liability on the state government. It has suffered over Rs 150 crore losses over the years and its most assets are lying defunct for the last five years.

Official figures reveal that SRTC has earned revenue of Rs. 98.29 crore during the year 2016-17 and Rs. 41.82 in the current fiscal so far. “The revenue part is continuously declining and even not able to pay salaries to employees,” an official said.

The Corporation had around 2000 vehicles including buses and trucks in 1900s whose number has reduced to around 1500.

J&K State Handloom Development Corporation was established in 1981 to assist handloom weavers’ societies and SSI units in the handloom sector.

However, it has been continuously running into losses.

During 2013-2014, the Corporation witnessed around Rs 9 crore losses while the loss level increased to Rs 14 crore during 2016-2017.

Jammu and Kashmir State Industrial Development Corporation Ltd (SIDCO) used to provide term loan assistance to industrial units under refinance scheme of IDBI, SIDBI. “However, most of the units went into default. An amount of Rs.12.90 crore on account of principal is recoverable from 23 units, besides interest of Rs. 377.05 crore,” the sources reveal.

Jammu and Kashmir Minerals Limited was incorporated in 1960 as the first public sector undertaking of the state. Since than, the corporation according to official figures had been incurring losses.

JK Cements Limited has also suffered heavy losses over the years. The JKCL was set up three-decades-ago of producing quality cements at the reasonable prices and generating revenue for the state. However, it production has gone down over the years and its employees are often protesting against non-releasing of salaries.

JK Forest Corporation, JK Industries Limited, JKWDC, J&K Horticulture Produce Marketing and Processing Corporation Limited, J&K Minerals are also running in losses worth crores of rupees.

Sources said several PSUs have failed to pay salaries to their employees, who would often come to the streets, seeking releasing of their remunerations.

“They have suffered heavy losses due to mismanagement by authorities,” an official of the Industries and Commerce Department, said.

He said that state government has signed an MOU with the Centre government to gradually phase out the budgetary support.

(Except for the headline, this story has not been edited by The Kashmir Monitor staff and is published from a syndicated feed.)