The move will unlock land resources currently tied up in non-functional units and help attract investment in labour-intensive sectors.
The cabinet in India’s Odisha state has approved ₹2 billion as the first phase of liability settlement for closed cooperative spinning mills, power loom units and a state-run sizing unit.
The decision will facilitate transfer of valuable land to the Odisha Industrial Infrastructure Development Corporation and pave the way for setting up industries, particularly in the textile and apparel sectors.
The decision will facilitate transfer of valuable land to the Odisha Industrial Infrastructure Development Corporation (IDCO) and pave the way for setting up industries, particularly in the textile and apparel sectors, State chief secretary Anu Garg was quoted as saying by local media reports.
The defunct units, operating under the Odisha State Co-operative Spinning Mills Federation Ltd (SPINFED) and registered under the Odisha Co-operative Societies Act, 1962, had ceased operations over the years due to financial distress, obsolete machinery and other operational challenges.
As their revival was found to be economically unviable, the government had earlier decided to liquidate the units and utilise their assets for fresh industrial development, she said.
An empowered committee formed to manage liability settlement, asset transfer and land utilisation assessed the total statutory and non-statutory liabilities of the closed spinning mills, power loom units and one sizing unit at ₹3.6167 billion.
The ₹200-crore budgetary provision will be used for one-time settlement of dues with creditors and financial institutions, Garg added. The settlement is expected to remove legal and financial encumbrances on the properties, enabling their transfer to IDCO for industrial use.
Fibre2Fashion News Desk (DS)
