Punjab has decided to spare apex cooperative institutions, Markfed and Milkfed, from the disinvestment axe. The decision follows reservations expressed by cooperation minister Kanwaljit Singh. ?How can one disinvest consistently profit-making cooperatives?, he told the media recently. ?The directorate of disinvestment, Punjab, can only recommend disinvestment of PSUs, not of cooperative bodies?, he added.
This is in contrast to the recommendations of the directorate which had said that as the PSUs and apex co-operative institutions had failed to deliver even a modest return of 4% on the equity invested by the state government, these should be disinvested. The panel had found that against ?the huge investment of over Rs 3,300 crore, the state had received only a small amount of Rs 8.40 crore as dividend on this investment in these PSUs and Cooperative Institutions. This investment does not include loans provided by the Government, which stood at Rs 4864.25 crore. The outstanding loans of other Institutions were Rs 19464.95 crore and out of these loans Rs 18707.12 crore was against Government Guarantee.?
Taking a complete U-turn, the Parkash Singh Badal govenment has now decided to spare the cooperatives. Highly placed sources in the chief minister?s office told FE, ?As far as Punjab Marketing Federation of Cooperative Societies (Markfed) is concerned, the move is to restructure the cooperatives by right sizing?. In case of Milkfed, the government is considering ?restructuring through downsizing, corporatization of milk plants at Ropar and Ludhiana?. However, there was no question of winding up the two cooperatives. as recommended by disinvestment panel, sources confirmed.
Kanwaljit Singh said Markfed had achieved a profit of Rs 8.56 crore during 2006-07, 154% more than the budgeted profit of Rs 3.37 crore. The overall profits of all Markfed plants have touched Rs 393 lakh compared with Rs127.26 lakh in the previous year. Markfed Canneries, a Markfed company, earned a record profit in 2006-07. It recorded all-time high sales of Rs.702.50 lakh and earned a profit of Rs.82.50 lakh during 2006-07.
He said even during 2000-01, Markfed had shown a profit of Rs 3.65 crore, despite the fact that it was involved in minimum support price-related activity of wheat procurement.
The overall profits of all plants touched Rs 393 lakh compared with the profit of Rs 127.26 lakh in the previous year, the minster added. The Markfed Vanaspati Plant at Khanna had shown a turnaround after a gap of 10 years and earned a profit of Rs 25.24 lakh in the financial year 2006-07 against a loss of Rs 114.82 lakh in 2005-06. The cattlefeed plants at Kapurthala and Gidderbaha had earned Rs.46.11 lakh and Rs 35.26 lakh, compared with a meagre profit of Rs 4.41 lakh and Rs 1.32 lakh, respectively, during last year.
Similarly, Milkfed, one of Punjab?s best known cooperatives that popularised the ?Verka? brand of milk products the world over, earned foreign exchange worth Rs 12 crore in the last financial year.