Ministry of Textiles | Status on NTC Mills

PIB NEWS Update: Union Minister of Textiles, Smriti Zubin Irani,  has informed that National Textile Corporation Ltd. (NTC) was established primarily to arrange the affairs of the sick textiles undertakings taken over by the Government of India in three Nationalization Act in the year 1974, 1986 and 1995.  On the basis of techno-economic viability study, 78 unviable mills were closed under Industrial Dispute (ID) Act during 2002-2011 as per Board for Industrial and Financial Reconstruction (BIFR) approved Revival Schemes i.e. in 2002, 2006 and 2008 of National Textile Corporation (NTC). State-wise details are at Annexure.

There is excess labour in NTC in comparison to the norms of actual production. NTC mills require an uninterrupted supply of power for ensuring quality and productivity. In order to ensure steady supply of power, NTC has taken steps for installation of roof top solar panel with capacity of 780 KWP in two of the NTC mills and implementation of work load settlement coupled with improvement in modernisation level, to reduce the man machine ratio.

NTC has been reporting operating losses since its inception. NITI Aayog in its fifth tranche report stated that NTC is of no strategic importance and recommended that all the working mills should be 100 percent disinvested as separate units or in groups via a transparent two stage auction. In this regard, Core Group of Secretaries (CoS) on Disinvestment considered the above recommendations of NITI Aayog on 11.10.2018 and recommended that the Ministry of Textiles may prepare a blue print for bunching of the mills in two/three groups and demerge all lands to a Special Purpose Vehicle (SPV). Thereafter, a view on the strategic disinvestment of NTC may be taken.  NTC is engaging an independent expert Govt. agency for verification of its moveable and immovable assets.  After completion of this exercise, a final view on the issue of strategic disinvestment /disposal of assets of non-operating/closed mills will be taken with the approval of the competent authority.

The employees and workers of closed mills were paid attractive compensation package under Modified Voluntary Retirement Scheme (MVRS) and an amount of Rs. 1,574.83 crore was incurred towards payment of MVRS and other benefits to 46,150 employees relieved during 2002-2011 in 78 closed mills. The MVRS benefits given to the workers in closed mills were same as were given to the surplus workers of functional mills.

NTC revived 5 mills through joint venture route since November 2007.  Memorandums of Understanding (MoUs) signed with Joint Venture partners in respect of 11 other mills in 2008 were terminated on 14^th January, 2010 as the Joint Venture partners failed to enter into definitive agreements with NTC within the specified time.

Annexure