The government cannot fund turnaround of state PSUs and banks and financial institutions are not willing to lend money either. Therefore, the state PSUs are left with no option but sell their idle land and meet part of their financial needs with the money. But many wonder why their managements are failing to rise to the occasion.

Some young students of the Institute of Engineering & Management, Calcutta are rooting for such land sales as a strategic move to mobilise funds for turning around many of the 66 state PSUs or helping them to meet their working capital needs.

The students studied quite a few private sector organisations that have sold idle land to generate funds for a turnaround, and suggested that disposal of surplus land and other non-performing assets is necessary for the state PSUs to meet their outstanding loans and working capital requirements.

"This could be one of the major common strategies to be followed by such units," they say.

They also suggested that land and machine of an unviable unit located in a prime area be sold altogether and a modern unit set up in an area where land is cheaper.

Their views gained some currency at a seminar organised recently by the institute. The managing directors of a number of state PSUs, chairman of strategic business experts group (SBEG) of the state government, Mr PK Pal, and the former chief secretary, Mr Tarun Dutta, were among the speakers at the seminar.

The students prescribed land sale for Durgapur Chemicals Ltd, West Bengal Agro Textile Corp Ltd, West Bengal Chemical Industries Ltd, Gluconet Health Ltd, Neo Pipes & Tubes Co Ltd and The Shalimar Works (1980) Ltd. Although Shalimar cannot sell its surplus land as it has been taken on lease from Calcutta Port Trust, other units can easily do it, experts feel.

It is not that the state government is averse to the idea. Rather it issued issued a policy statement in January 1998 allowing sale of surplus industrial land enabling concerned units to mobilise funds.

"But it has to be seen that the money is being properly utilised and the entire process is transparent," state's industrial reconstruction department secretary, Mr Sunil Mitra, told The Financial Express.

Then what's stopping the ailing PSUs, especially when 44 of them have gone to the Board for Industrial & Financial Reconstruction? Many members of SBEG, which monitors day-to-day management and control of these units on behalf of the state government, believe the cumbersome legal procedure is the deterrent.