In 75th year of Independence, govt may shut down British India Corp

Once the iconic red-brick building of British India Corporation (BICL), which manufactured the popular “Lal-Imli” brand of woollen products, made Cawnpore (now Kanpur) the Manchester of the East.

In the 75th year of independence, the government may finally pull the curtains on the century-old, now defunct public sector enterprise.

“The Department of Public Enterprises (DPE) has floated a draft cabinet note for closure of British India Corporation (BICL) along with National Textiles Corporation (NTC).

“The Cabinet may soon take up the matter after the inter-ministerial consultation is over,” a government official said.

NTC is another Central public sector enterprise under the Ministry of Textiles and incorporated in April 1968 for managing sick textile undertakings in the private sector taken over by the government.

Established by British entrepreneur Sir Alexander MacRobert in 1920, the public limited company produced woollen products under the brand “Dhariwal, apart from “Lal-Imli”— once household names.

In 1981, the government nationalised the company.

BICL has been incurring losses since then.

Owing to this, it was referred to the Board for Industrial and Financial Reconstruction in 1991 and was declared sick in 1992.

The government approved revival schemes in 2001, 2005 and 2011 of Rs 211 crore, Rs 47.35 crore, and Rs 338.04 crore, respectively.

Those were not successful because permission for converting leasehold land into freehold and their disposal to generate funds was not given by the state government.

In reply to a question by Member of Parliament Satyadev Pachauri, who represents Kanpur in the Lok Sabha in December 2019, Smriti Irani, who was textiles minister, said: “The NITI Aayog recommended the closure of BICL in 2017.

“The pending salaries and other dues of the employees will be paid on the closure of the company and disposal of its assets as per terms of closure to be approved by the competent authority.”

BICL incurred losses of Rs 106 crore in FY21, with 1,209 employees waiting for a final settlement of their dues through a voluntary retirement scheme.

Under the new public sector policy of the government, the Department of Public Enterprises (DPE) has the responsibility of identifying Central public sector undertakings (CPSEs) for closure in non-strategic sectors in consultation with administrative departments and to take in-principle approval from the Cabinet Committee of Economic Affairs (CCEA) in respect of such identified CPSEs.

Once the in-principle decision for closure of a CPSE is obtained from CCEA, an inter-ministerial committee will be constituted by the DPE to drive the process.

1920: British India Corporation (BICL) was established as a public limited company

1981: Prime Minister Indira Gandhi’s government nationalised BICL

1991: BICL was referred to Board for Industrial & Financial Reconstruction and was declared sick in 1992

2001: Government announced a series of unsuccessful revival schemes

2017: NITI Aayog recommended closure of BICL

Source: Read Full Article