Durgapur, located in the Paschim Bardhaman
district of West Bengal is perhaps the only city in the four states of West
Bengal, Jharkhand, Bihar and Odisha
combined that has the immense potential of leapfrogging as the city of the
future. Yet the vast potential is
being wasted due to lack of Government initiative and harmful political
activity. Needless to say that the
principal sufferers are the residents of Durgapur and its vast surroundings, all of whom the industrial city
sustains through employment,
business and a host of other economic activities.
Three
Central Public Sector Undertakings (CPSUs) that were amongst the vital pillars
on which the industrial city grew and sustained itself while providing much
needed employment to thousands of people across the country, were shut down in the early 21st
century for having suffered losses over a protracted period of time. The three CPSUs that were shut down
were the Mining and Allied Machinery Corporation (MAMC), Hindustan
Fertilizer Corporation Limited (HFCL), Durgapur and Bharat Ophthalmic Glass
Limited (BOGL). Lack of much needed modernization resulting in failure to keep
up with technological changes,
inefficient management, certain economic
factors and irresponsible trade unionism were some of the reasons behind the
sustained financial losses suffered by the three CPSUs. Additionally, in 2018 the Government of India recommended the strategic
disinvestment of another ailing CPSU,
the Alloy Steels Plant (ASP), a subsidiary unit of SAIL. The move has been temporarily shelved.
Industries
once shut down, does in no way mean
that they should be shut down forever.
Ways have to be explored to revive them and make them profitable. More than one and a half decade has
passed, since the three CPSUs were shut down. And a lot has changed in Durgapur during this intervening period,
for which it is imperative to revisit all the three closed CPSUs as also ASP, with some concrete plans for revival. Some of the important points in
Durgapur’s changing profile are
discussed below.
·
With the gradual erosion of the support
base of the Left parties, militant
trade unionism is virtually nonexistent in Durgapur these days.
·
The NSSO’s report on employment is a cause of concern. The issue of unemployment has to be addressed by the Government on
a war footing. The existing
infrastructure of the three closed CPSUs can be profitably utilized for their
revival or to set up new industries in their place.
·
Leaving the leftover facilities of
closed industries like shed,
buildings, machinery, land etc. to rust and rot amounts to non-utilization of available resources. In a state like West Bengal where land for industries is hard to
come by and land acquisition becomes a political issue of discontent, leaving industrial lands unutilized for
decades after the industries have shut down is nothing short of a sin. If the earlier industries cannot be
revived, some new industries must
come up in their place. But land and
other facilities simply should not be wasted.
·
Durgapur was included in the initial
list of smart cities, although it
was subsequently excluded. This
signifies that it has the basic modern infrastructure on which a smart city can
come up. Indeed, there is no dearth of educational institutions imparting quality
education at school and higher levels,
good hospitals and recreational facilities.
Basic infrastructure like power,
roads (both internal and NH-2),
water supply, telecommunications and
railway connectivity are excellent. If
there are adequate modern amenities,
it is surprising indeed that the same is not matched with infusion of
industries through Government initiative.
·
A vital new infrastructure that has come
up in Durgapur in the not too distant past,
is the Kazi Nazrul Islam Airport,
Durgapur. Initially, air services to and from the airport
had to be shut down occasionally due to lack of adequate number of passengers. Fortunately, services have become more regular these days and flights are
operating to different new routes.
The future of the airport and the air traffic industry at Durgapur depends to a
great extent on organized industrial growth of the city. Similarly, the land
port that exists in Durgapur can also optimally fulfill its purpose with
adequate industrial growth.
·
Durgapur has a vast pool of young, educated and professionally trained work
force, who unfortunately are forced
to leave their city for other far away destinations in search of employment. Any industry in and around Durgapur
can be serviced from this local talent pool.
Employing the local youth, companies
can thereby save the expenses of providing housing facilities, which they would have to incur on
employees recruited from outside.
·
Durgapur
is generally renowned as a peaceful city inhabited overwhelmingly by law
abiding, honest citizens. The law and order situation is
generally very good. It is a modern city
with a multi ethnic population known for peaceful cohabitation of people from
all over the country and even from abroad.
No caste and communal clashes have ever been reported from Durgapur.
·
Inspite of its gradual downslide over
the years, Durgapur still remains
the most developed city in the region.
Revitalisation of the industrial scene in Durgapur will definitely act as a
catalyst in the industrial development in the adjoining districts of Bankura
and Birbhum, which will lead to much
needed all round development of the entire region with Durgapur as the
epicenter.
·
There is no labor in all the three
closed CPSUs in Durgapur, although
the land, shed and staff quarters (both in dilapidated condition) and infrastructure like good road
connection and water supply still exists.
Hence, with none of the baggage from
the past to carry, new initiatives
can be started from scratch.
Some
proposals for the revival of the three closed CPUs and ASP are given below. The proposals are neither entirely
new nor original. They might be
inadequate for Durgapur’s revival. But they are definitely something to
think over, maybe over again. The one and only issue is industrial
revival. If these proposals are
partially viable, they may be
suitably modified. If they are
entirely unviable, fresh proposals
may be considered. There is no
dearth of experts in our country.
But let the Government kindly take the first concrete steps towards industrial
revival of Durgapur. If the aforesaid
proposals are seriously considered and implemented, the turnaround for
the ailing ASP will be spectacular and unlike any industrial turnaround that
India has ever seen.
1) Mining and Allied Machinery Corporation (MAMC): Set up in 1965 with Soviet help and technology for manufacturing
equipments for various mining industries.
It slipped into the red in 1992
and was shut down in 2002
on the recommendations of BIFR.
·
A failed revival scheme: A consortium of
Bharat Earth Movers Limited (BEML), Coal India Limited (CIL) and Damodar Valley Corporation (DVC) was formed to
revive MAMC. DVC could source
equipments and spares for its aging thermal power plants, while CIL will get its equipments for coal mining with the Centre
emphasising on even greater volumes of mining of coal. The Centre has to formally approve the consortium’s move. But unfortunately the revival plans are yet to materialise and
the reasons for the same are unknown.
·
Alternate proposals for revival:
If the consortium has backtracked on its plans and are no longer interested in
MAMC’s revival, let the reasons for the same be known. If the viability of MAMC’s
traditional mining products is an issue,
alternative mining products in keeping with modern times and trends can be
manufactured. If it is beyond the
financial capacity of the consortium to go into the manufacture of a new line
of products, let the Central
Government think seriously about selling the facility to one of the internationally
renowned manufacturers of construction and mining equipments like Hyundai, Kobe,
Komatsu,
TATA HITACHI, JCB etc.
·
Assets of the CPSU: The CPSU has
its land and shed although most of the machineries are stolen. There are no employees. There is also a sprawling township
with residential quarters which only need minor repairs. MAMC and its residential township have good electricity and water
connections as well as a good network of roads. Thus a buyer can virtually start from scratch. There is every possibility of international corporations showing
interest in taking over the closed PSU.
Let some serious thought be devoted to MAMC’s
revival instead of letting it rust and rot.
If no mining industrial company expresses interest, the Government may contemplate inviting automobile manufacturers.
2)
Hindustan Fertilizer Corporation Limited (HFCL): Set up in 1974 for manufacturing fertilizer from naphtha, production stopped in 1998 and was shut down in 2002
on the recommendations of BIFR.
·
Revival stalled: It is learnt
that revival of the Durgapur unit of HFCL was proposed by converting production
from naphtha to gas to be supplied through pipeline laid from Jagdishpur, Uttar Pradesh or from coal bed
methane gas from Raniganj, West
Bengal. However, no concrete decision has been arrived at and the exact reason for
the delay is also unknown.
·
Is land acquisition standing in the way
of revival:
It is also learnt from certain unconfirmed sources that the Centre had
requested the West Bengal Government for additional land acquisition for the
sake of the unit’s revival, but the State Government has turned
down the request. While I personally
discount the validity of such a report,
it would be extremely unfortunate if the same is true and Central and State
Governments fail to converge on matters of national development.
·
Revival can contribute to agricultural
development:
The Central Government over the years, has exhibited great concern for the
nation’s agricultural sector through
increased budgetary allocations.
Availability of fertilizer at affordable prices to the farmers is a vital
component of the nation’s
agricultural development and rural prosperity. In this perspective,
there is no plausible reason as to why HFCL,
Durgapur should not be revived, as
it can play a major role in the nation’s
agricultural development.
·
Assets of the CPSU: Like MAMC, HFCL, Durgapur has its land and shed, though much of the machinery is stolen and the land is now a
jungle. The quarters in the sprawling
beautiful township are in need of urgent repairs. But there is electricity and water connection. Thus, inspite of all this positives, why should this CPSU not be revived? Should petty politics play overwhelming role in the perpetual
shutdown of rich revenue and employment opportunities?
·
Alternate proposals for revival: If the Central
Government cannot renew fertilizer production by reviving HFCL, Durgapur, it may consider making the unit a subsidiary to or selling the
unit to a reputed Government owned or private national or international
fertilizer and chemicals manufacturing company. Mangalore Chemicals & Fertilizers Limited; Zuari
Agro Chemicals LTD.; Gujarat
Narmada Valley Fertilizers & Chemicals Limited; The Fertilizers
& Chemicals Travancore Ltd.; Rashtriya Chemicals and Fertilizers Limited; Chambal Fertilisers and Chemicals Limited;
Gujarat State Fertilizers & Chemicals Ltd.;
Coromandel International Ltd.
etc. are some of the important names
in the fertilizer industry that can be considered for the purpose. If fertilizer production is not
possible at this unit any more, it
may be sold to some prominent chemicals and/or
pharmaceuticals company, rather than
leaving it to rot.
3) Bharat Ophthalmic Glass Ltd. (BOGL):
Set up in 1972,
BOGL made ophthalmic flint buttons (FBs), optical glass items and radiation shielding window glass. Its entire product range were import
substitutes and some were of strategic importance. It went to BIFR in 1992 and was
shut down in 2006.
·
Assets of
the CPSU: Of all the three closed CPSUs in Durgapur, it is estimated that revival of BOGL would cost the least. The land and shed as also the
employees’ quarters in dilapidated
condition still exist. There is
proper road connection too. Being
located within the Durgapur Municipal Corporation area, providing of electricity and water
connections are no problem either.
·
A glorious past: The optical
glass produced by BOGL was a product of strategic importance and was
indigenously developed by BOGL. Radiation shielding window developed by
BOGL, used to absorb short-wave X-ray and Gamma radiation,
had received national award for import substitution and were used in the
nuclear research establishment in Kalpakkam.
It is highly unfortunate that the organisation that once played such an
important role in India’s ophthalmic
industrial self-sufficiency has died
such a pitiable death.
·
Inputs for
revival: Close interaction with the Central Glass and Ceramic
Research Institute, Kolkata can help in the revival of this closed CPSU, while Coke Oven (CO) gas, which acted as a fuel for BOGL can be procured at a concessional
rate from The Durgapur Projects Ltd./WBSEDCL.
·
Alternate proposals
for revival: If revival of BOGL is considered totally unviable, the Central Government could consider selling the facility to
prominent ophthalmic glass manufacturers like Zeiss, Essilor etc.
4) Alloy Steels Plant (ASP): Proposal for revival of another CPSU, the Alloy Steels Plant (ASP), Durgapur, a subsidiary of the Steel Authority of India Ltd. (SAIL), is another matter that should come up for serious consideration. Set up in 1965, ASP produces a diverse range of stainless and special steels catering to critical
end-use by strategic sectors like
Defence, Railways, Automobiles, Power Plants etc.
·
Great
contribution to India’s defence sector: The special steel used to make the country’s first indigenously
designed artillery gun ‘Dhanush’ which was inducted in the army on 8th April, 2019, was supplied by ASP,
Durgapur. Earlier, ASP had also supplied special steel
used in the manufacture of army’s
MBT Arjun and the Indian Navy’s INS
Vikrant, INS Kiltan, INS Kamorta respectively. Undoubtedly, ASP has played a major role in providing valuable support and
self-reliance to India’s defence sector.
·
Strategic
disinvestment decision: ASP has been consistently running into losses since many years, with the figure touching 483 crore rupees between 2011 and 2016. Consequently, the Government
of India decided to strategically disinvest ASP in 2017, whereby ASP was planned to be transferred to the strategic investor on a
going concern basis by way of slump sale through business transfer agreement. The plan had been shelved, which many people believe to be only temporary in view of the
elections. Workers apprehend that
the elections being over, the
Government would now push for disinvestment of ASP once more.
·
Proposals
for turnaround: However, the
following actions if taken, can turn
ASP into a profitable entity,
thereby obviating the need of disinvestment.
Ø
Modernization of the plant: ASP has remained largely deprived of
major modernization since inception.
Considering the last modernization/augmentation
of the plant took place as far back as 2012, there is a need for comprehensive, immediate modernization of ASP.
Ø
Merger of Durgapur Steel Plant and Alloy Steels Plant: Both plants are subsidiaries of SAIL and are located
adjacent to each other. A merger of
the two plants is a very healthy proposition for either of them considering
that some of DSP’s outputs can be
directly utilized by ASP, while the
latter can save substantially on its expenses on sourcing those inputs from
elsewhere. Merger would also lead to
a wider array of finished steel products,
which can be enhanced even more over the years. Since finished products add to the profitability quotient, the merger will be a win-win situation for the unified entity. Optimal utilization of the synergy
and resources of each will considerably enhance the efficiency and output of
the other.
Ø
Streamlining of the labor force: If considered as utmost necessity, voluntary retirement scheme can be
offered down the line for the sake of a leaner and more efficient work force.
04.41 PM, 19th
June, 2019
Bhopal
© Sugato Mitra
