Adding one more name to the Public Sector Undertakings (PSUs) that are being revived in the state, the Left Democratic Front (LDF) government in Kerala has decided to take over the Instrumentation Limited Palakkad (ILP), which had figured in the Centre’s list of PSUs to be shut down. The BJP-led Centre’s decision came up owing to its disinvestment from the Central Public Sector Enterprises (CPSEs).
Takeover of ILP by the LDF government comes at a time when the Centre is pushing the accelerator on selling off national assets, especially the public sector enterprises. In its four years, the Modi government has sold off Rs.1.96 lakh crore worth of public sector assets, according to the department of investment and public asset management (DIPAM). Kerala is setting an example of alternative policies as shown by the takeover of ILP and the earlier revival of several other PSEs.
The state’s decision to take over ILP, which has been incurring losses since 1993, was taken on Wednesday after estimating an asset value of Rs 53 crore for the PSU. A Memorandum of Undertaking (MoU) will be signed soon in this regard with the Centre. Also, assets of ILP would be transferred to a new company named Instrumentation Limited Kerala. Restructuring and Internal Audit Board (RIAB) has been entrusted to deal with these formalities.
The Instrumentation Limited was first set in Kota in Rajasthan in 1964, under the Ministry of Heavy Industries and Public Enterprises, to attain self-reliance in the field of control and automation, for the processing industry. The Palakkad manufactures flow elements, control valve and actuators etc. When the Centre announced its plans for disinvesting, a committee headed by chief secretary was set up to estimate the asset of the company.
Earlier, in November 2017, when the state government had announced its willingness to take over ILP, RSS-affiliated trade union BMS moved to the court, demanding that it should be allowed only after the arrears to the workers are paid. Though the BMS and BJP regime tried to stop the takeover, the state government’s interference saved one CPSE from being privatised.
On the other hand, the state government’s consistent efforts to revive the PSUs have turned fruitful in the financial year 2017-18. RIAB review report for 2017-18 said that the PSUs have registered a turnover of Rs 2,978.54 crore and a net profit of Rs 106.91 crore. More than that, 14 PSUs including Travancore Titanium Products Ltd, Travancore Cochin Chemicals Ltd, Transformers And Electricals Kerala Limited, Traco cables, Steel & Industrial Forgings Limited, and The Kerala Minerals & Metals Limited became profitable. The total turnover had seen a 7.5 per cent growth and profit had been stood against the loss of Rs 80.69 crore recorded in the previous year.
One of the promises made during the election campaign of the CPI(M) was to revive the public sector that had been plundered by the former UPA government and the neo-liberal policies of the central government. When the present government stepped into power, the net profit in the public sector was Rs 131.87 crores. By the end of the 2016-17 financial year, the PSUs had seen a significant growth and the loss had come down to Rs 80.67 crores.
The chemical sector had contributed to 48 per cent of the total profit, as the performance of Kerala Minerals and Metals Limited (KMML), Travancore Titanium Products (TTP) and Travancore Cochin Chemicals Limited had improved their performance. Comparing to the last financial year, KMML and the TTP had made profits 6 and 3 times more, respectively.
“It is the comprehensive intervention by the government to turn the PSUs profitable, which led to the historic achievement of the Industries Department,” said AC Moideen, the Minister for Industries. “The government adopted a professional approach for the renovation of the companies,” he added.