Why is Smriti Irani so keen to sell off NTCL?

Union Minister for Textile has ignored proposals to revive NTCL and shunted out bureaucrats who favoured the proposals. Her whimsical decisions are also said to have hastened demise of the sick PSU

Photo courtesy: Social media
Photo courtesy: Social media
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Ashlin Mathew

Even as India witnesses a surge in the import of yarn and cotton fabric and a slump in exports (25% slump in yarn and 7% in fabric), decks have been cleared for ‘strategic sale’ of the National Textile Corporation Ltd (NTCL) along with 10 other ‘ailing’ PSUs including Bharat Heavy Electricals, Hindustan Copper and Mecon.

While employees of NTCL, which has 23 functional mills operating currently across the country, are resigned to this so-called ‘strategic sale’, they wonder if the government is interested in unlocking the real value of the NTCL.

The land held by the NTCL alone was valued at ₹5,700 Crore in 2014, they point out. Most of the prime land owned by NTCL is in Mumbai and in Tamil Nadu.

NTCL, which the Niti Aayog describes as ‘having no strategic importance’, was set up in 1968 to take over 124 sick textile mills and turn them around. But only 23 of the mills remain operational under NTCL as on date.

Since 2014-15, the Corporation has posted losses worth over ₹1,500 crore. Employees and trade unions, however, blame the Textile Ministry under Smriti Irani for making little or no effort to revive the PSU.

Turnaround of NTC rejected

In 2017, Joint Secretary in the ministry, Sanjay Saran, had made a presentation, in the presence of the then Textile Secretary Anant Kumar Singh and the minister, on proposals to revive and revamp the NTCL. It involved manufacturing of textile products for import substitution. India is currently importing several technical textile products such as tent fabrics, fibres such as nylon, flax and linen fabric and manmade fibre-based sportwear.

The presentation spoke about changing NTCL’s product mix, which is currently only yarn, towards technical textiles as there is a higher margin to be had and the country is importing around $ 1,000 million worth of such products. This does not include protective textiles such as high-altitude gear and bullet-proof gear.

The JS had suggested a joint venture with an international firm with technology transfer too, with the majority stake held by NTCL. But for reasons which are not clear, the revival plan was shelved and never heard of again.

Anant Kumar Singh was interested in taking the proposal forward, but the minister wasn’t. He had also around the same time pointed towards irregularities worth around ₹200 crore that were detected in the National Handloom Development Corporation (NHDC), a public sector undertaking under the Textiles Ministry. He had even referred the case to CBI.

He was shunted out within three days, as Secretary, Department of Land Resources. This was the second time a Secretary was shunted out because they did not get along with Irani. Irani was at loggerheads with her first secretary Rashmi Verma and the Prime Minister’s Office (PMO) had to step in then.

No top management

That Smriti Irani was not interested in reviving NTCL has been evident for quite some time. For the past three years, the PSU hasn’t had a permanent CMD, making do with a part-time CMD, Nihar Ranjan Dash, who is a Joint Secretary in the ministry. For the past six months, there has been no Director (HR) either.

There has been no Director (Marketing) for the past three years and Director (Technical) either for the past five years. In 2013, Executive Director Vivek Plawat was posted as Director (Technical) but he was not given charge. The post was advertised in 2017 and then again in 2018. But although Plawat was selected again in 2018, the minister cancelled the decision.

Ironically, a similar advertisement was put out in 2019 as well but Plawat allegedly was not allowed to send in his application. No selection has taken place this time either.

Marketing Department transfers

After Smriti Irani took over, more than 40 of the marketing staff were transferred in 2018, including some to the HR department, of which they had no experience.

The Executive Director (Marketing) Aseem Chitkara was transferred from Delhi to Kanpur, where there is neither a mill nor an office of NTCL. DGM (Marketing) Sunil Kumar Mandal was transferred from New Delhi to the HR department of a mill in Tamil Nadu. Mandal allegedly does not speak or understand Tamil though.

Vinu Nair, Joint Marketing Manager, was transferred from Delhi to Bhopal. He resigned within a month. His colleague Priyadarshi Ashok, who was also a Joint Marketing Manager in New Delhi, was transferred to the HR department of a mill in Ahmedabad.

The DGM (IT) Rajasekheran Malleala also resigned after he was transferred. SS Vasaan, who was General Manager (Technical), was transferred to the Marketing department, as was K Madhusudan while Ajit Singh, also from the Technical department, was transferred to the HR department.

But Sameer Aggarwal, who was GM (Export-Marketing) in Coimbatore and has a complaint pending against him with the Central Vigilance Commission, was transferred to another mill in the same city.

(A questionnaire sent to the Minister, Textile and Secretary at the ministry 72 hours ago remain unacknowledged and unanswered. We will update the report as and when a reply is received.)

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