The Kerala government had constituted a panel which decided to expend with a one-time funding package of INR 494.81 crore to the textile sector. As per the state government’s plan the package would provide impetus to modernize and revive the sick textile sector. However, this plan remains to be a non-starter.
According to sources, the state government has failed to take serious initiative to implement the package. Though the government has a good track record of rescuing and rehabilitating sick public sector undertakings, it is yet to cover grounds on the ailing textile sector.
A detailed study report was conducted by an expert committee under the aegis of P Nandakumar. The report submitted a comprehensive package to revive the textile sector in the state to enable generation of employment to full potential.
According to the committee’s recommendations, the state government was expected to infuse a one-time fund of INR 494.81 crore in the form of capital investment and a further INR 176.92 crore for working capital. This was intended to put the 17 public and cooperative sector mills back on track.
The need to revive these mills was endorsed by a review report of the public sector undertakings and it indicated that the mills were incurring heavy losses and required urgent attention. In response to the situation, a source pointed out that the government could choose to implement the package in a phased manner but it’s yet to prioritize the option.
Source: http://www.textileexcellence.com