Orissa to restructure small industries arm

The Orissa government is planning to restructure the Orissa Small Industries Corporation (OSIC), a government-owned corporation charged with the responsibility of promoting small scale industries (SSIs) in the state.

The directorate of industries has already sent a proposal for restructuring of the OSIC to the state government.

“The restructuring plan for OSIC is under the consideration of the state government and it will be put before the cabinet for approval,” a senior official associated with the process told Business Standard.

The accumulated losses for the corporation touched Rs 18 crore by 2007-08 -end.

Sources said the restructuring process includes business restructuring, financial restructuring and man power restructuring. Under the business restructuring plan, the OSIC is intended to move from non-profitable and fund-based activities where there is a huge requirement of working capital to non-fund based commercially viable activities.

The corporation is expected to form a consortium for small industries and participate in the large-value government order for the small scale industries (SSIs). However, it will continue to ensure raw material supply to units in the SSI sector.

Under the financial restructuring plan, the bond liability of the corporation and the liability of the Small Industries Development Bank of India (SIDBI) are proposed to be settled by the One Time Settlement (OTS) system. Similarly, the large credit support given by OSIC to large number of industries is also proposed to be settled through OTS.

Under manpower restructuring, of the 13 depots of the corporation, unviable depots are proposed to be closed down. The manpower engaged in the unviable depos will be shifted and will be engaged in emerging economic activities.

As a matter of policy, the corporation will henceforth focus on locations like Rourkela and Balasore.

The corporation provides raw material support to the SSIs. Quality raw materials like iron and steel, aluminium, wax rubber, plastics, coal, bitumen are supplied to these units by OSIC.

It achieved a turnover of Rs 105 crore in 2005-07 and this increased further to Rs 217 crore in 2007-08.