A proposal has been forwarded to the Cabinet for waiver of all government loans amounting Rs 21,707 crore, sources in the department said. While the outstandings accrued to HFC stood at Rs 1,9O5 crore, the interest on the amount was estimated to be at Rs 7,770 crore, and the loan amount including interest for FCI was about Rs 12,032 crore, the sources said.
An official in the department said, The department has sought the waiver on the plea that funds extended to the PSUs are almost sunk and there is no hope of a recovery either. The only alternative is to clean up the balance sheet through a waiver of outstandings and draw up a revival plan, he said.
The official said both companies had been suffering heavy losses because of low efficiency, both in terms of capacity utilisation and energy consumption for years, before final closure in 2002
However, to cover up these losses, the government was extending heavy non-Plan support by way of loans. The accumulation of these loans, along with interest has touched Rs 21,707 crore.
Sources from the department of public enterprises (DPE) said though the government had, in 2002, considered closure of these two loss-making PSUs, the plan now was to revive them. A revival package has been chalked out for these two PSEs and is currently with the ministry of chemicals and fertilisers, a DPE official said.
The revival will depend on the specific plant on the basis of techno-economic viability. FCI had four units, namely Sindri, Gorakhpur, Talche and Ramgundam, and HFC had three armsBarauni, Durgapur and Haldia, the officials said.