Samba cement plant likely to be outsourced
Srinagar, Oct 24: With authorities failing to review the JK Cements Limited, the government is mulling to outsource the Samba cement plant.
An official of the JK Cements Limited told KNS that government was considering outsourcing its Samba cement plant. “Final decision is yet to be taken,” he said.
He said that government was mulling to outsource the cement plant in view of heavy losses witnessed by the JK Cements over the last few years. “So far the authorities have failed to review the JK Cements. Even its employees are willing to move out of the corporation on deputation to other departments,” he added.
The JKCL was set up three-decades-ago of producing quality cements at the reasonable prices and generating revenue for the state. However, sources said that production has declined over the years due to government’s interference in the affairs of the JKCL.
The samba plant was established at the cost of 27 crores. “The delay in its launching has been attributed to inordinate delay on the release of equity by the government and also delay in the installation of receiving station by PDP,” sources maintained.
Sources maintained that though the government has considered outsourcing the production and marketing, but at the same time the contractor who was awarded the contract of installation of plant and machinery has claimed a revision of 5 crores.
Sources said that the board of directors in its recent meeting has ordered the management of JKCL to look into the matter after constitution of committee.
The commissioner secretary industries and commerce confirmed to KNS that JKCL management has been directed in this behalf. The Managing director JKCL said that the board has accorded approval to look into the matter of the claim preferred by the contractor.
Meanwhile though the terms about how to outsource the plant has not been put to public domain, but it is learnt from the sources that the proceedings about the same have been put in place.
Sources said that in violation to the business practices, the JKCL management has not issued letter of intent inviting the big business houses for outsourcing the plant so far.
Sources said that the plant was not able to face the tough completion of the private players in the market within and outside the state which are selling cement lower than the price fixed by the JKCL. “Though the JKCL enjoys the patronage of government for making direct purchases, but despite of that the Jammu office could not capitalize on the opportunity” sources maintained.
However sources said that the incumbent Managing Director was trying hard to bring samba plant on the profitable point.
The JK Cements has two plants with individual capacity of around 600 tonnes per day which has declined to 70 percent now. The successive elected governments had blamed each other for downfall in its production and both the NC-Congress and PDP-BJP government termed it a “victim of politics”.
Being a state owned company, it has a pivotal role to produce cement of well standard quality at the reasonable rates. “Unlike other cement plants operating in the Valley, it has lost its market value due to production of lower quality cement as authorities have been purchasing sub-standard material for its production,” insiders said.
There were also reports that government had decided to shut this cement plant. But the employees had resisted the move as around 10000 employees are dependent on it. (KNS)