Centre to roll out attractive VRS package for 2800 employees in 5 sick PSUs

Union minister Anant Geete

THE Narendra Modi-led NDA government will give VRS to 2800 employees and in the process will free assets worth Rs 22,000 crore belonging to five sick public sector units under the ministry of heavy industries and public enterprises.

Union minister of heavy industries and public enterprises, Anant Geete, made the announcement recently.

These units fall...

under his ministry — including three companies of HMT. The Centre is going to shut down these “nonproductive units” by rolling out “an attractive VRS package” for 2800 existing employees.

“We have decided to close down five sick PSUs that fall under my ministry. There are three units that belong to HMT — HMT Watches, HMT Chinar Watches and HMT Bearings. The other two are Tungabadhara Steel Products Ltd and Hindustan Cables Limited,” the minister said on the sidelines of a workshop held in Ahmedabad.

These employees were getting salaries as per a 1997 pay-scale, VRS would be as per a 2007 pay-scale.

“Since 2007 there is not production in these units and we have already spent about Rs 4000 crore only on salary and wages of the employees. How long will we continue to spend on salaries in these nonproductive units,” the minister said.

“The cabinet has given an in-principal approval. We have also sent an unit-wise proposal to the cabinet and we are hoping to get wrap it up in the next 2-3 months,” the minister told mediapersons.

“The cost of shutting these units down is just Rs 14,00 crore and the asset value of these companies is Rs 22,000 crore, the minister said all the immovable properties of these companies including land, plant and machinery, will be sold to interested parties in “as-it-is, where-it-is” basis. “The decision for the sale of property is yet to be taken”, the minister said adding that these companies were located in prime zones.

“The highest number of employees is in Hindustan Cables; which has 1500 employees and the total number of employees involved in these five units is 2800,” the minister adding that his ministry had tired to find investors for these PSUs in the past but have been unsuccessful.

While the three HMT companies have manufacturing and administrative facilities in Hyderabad, Jammu, Bangalore, Tumkur (Karnataka) and Ranibagh (Uttarkhand), Hindustan Cables Ltd has units located at Hyderabad, Naini Allahabhad (Uttar Pradesh) and Rupnarainpur (West Bengal), while Tungabhadra Steel Products Ltd has assets in Hospet (Karnataka).