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K’taka looks to revive sick PSUs in a bid to restore economy
Bengaluru The Karnataka government on Friday said that it would revive sick and loss-making public sector industries and turn them profitable as a way to bring back jobs and kickstart the fledgling economy
Bengaluru The Karnataka government on Friday said that it would revive sick and loss-making public sector industries and turn them profitable as a way to bring back jobs and kickstart the fledgling economy.
“There are several corporations and institutions such as Kalaburagi Cement Corporation, Mysugar and Mysore Paper Mills that are on the path of bankruptcy,” Murugesh Nirani, Karantaka’s minister for large and medium industries said on Friday.
The minister, who is himself an industrialist, has conveyed the state government’s plans to revive loss-making public sector enterprises.
“I won’t allow closure of industries during my tenure and try to make them function 24 hours. Our goal is to utilise the state’s natural resources and create an industrial employment revolution,” Nirani added.
Karnataka, like its counterparts has seen many of its public sector units fail to perform and cease to be operational. Bengaluru is a city that has among the highest number of public sector units in the country for aerospace, electronics, defence, railways, telecommunications and several other industries that was one of the bedrocks on which the city has now grown into one of the most lucrative technology ecosystems in the world.
Karnataka gets a significant share of India’s total foreign direct investment (FDI) and some of the largest corporations in the world have a presence in Bengaluru, which has other monikers like “India’s IT capital”, “Knowledge Capital” , “startup hub” and other names which makes it an attractive destination.
Karnataka stands 4th in merchandise exports in the national export basket. Exports from the state stood at around $15 bn in 2019-20 which is 5.2% of India’s total exports. The state stands third among Indian states in terms of FDI inflows contributing 14.27% of total FDI inflow (as of March 2021).
However, acquisition of land, corruption and red tape among other issues has added to the state’s challenges over the decades.
The delays in procuring land for industries under Section 109 of the Karnataka Land Reforms Act had cost Karnataka a chance to convert investments totalling over ₹39,000 crore and a chance to create over 80,000 jobs between 2013 and 2019, Mint reported in November 2019.
The Act has since been amended along with other changes to industrial and labour laws to make it more attractive for investors to fund projects in Karnataka. The government has also announced to hold the Global Investors Meet (GIM) in February 2022, a biennial event until 2016, which was put off following the political uncertainty in the state.
Nirani added that any misuse of land allotted by the government would be probed.
He has also assured to put to use around 3,000 acres of unused land in Kolar Gold Fields, which have been exploited for centuries before losing most of its prized minerals.
“There are more than 3,000 acres of unused land in KGF. They used to get 40 grams of gold for one tonne of mining but now it has dwindled. The officials in their findings have declared that there is no scope for exploration in 3,200 acres of land. So we have urged the Centre to hand over that land to the state government. Revenue officials have been instructed to consider this. We will set up Industrial Township when we get the land,” he said.
The last two years have been particularly bad for Karnataka, a calamity-prone state, which has seen the extremes of floods and droughts, coupled with the Covid-19 situation further strap it for funds and other developmental works.
