Pradeep Kumar Biswal
Odisha has more than 80 Public Sector Undertakings (PSUs) in the state. Barring a few, most of them are suffering from years of neglect and mismanagement leading to losses year on year.
Once upon a time Odisha Textiles Mill(OTM) had a good name throughout the country. But it could not survive for long. Similarly, Konark TV once considered to be a reputed brand at the national level in the early color television era, which had to face a slow death.
If we look back at these developments, we have to admit our failure to maintain the legacy of these two brands. Who is to be blamed for this? Prolonged mismanagement, financial irregularities, lack of effective marketing strategies and poor leadership issues were squarely responsible for this. Overall and above, indifference of the state government also contributed to the closure of these public companies.
Coming to the present moment we find ourselves struggling with the same issues far from being resolved. In the nineties when Biju Patnaik became the Chief Minister for the second time, he created Department of Public Enterprises with the intention of revamping the state PSUs and bringing reforms in the system. Prafulla Chandra Ghadai, one of the ablest ministers of his team, was appointed as the Minister of this newly created department.
The department is currently functioning with a skeletal structure and without any effective oversight over the PSUs. Rather, the respective administrative departments have more authority over the PSUs under their control. The role of the Public Enterprise Department is being confined to categorization of the PSUs as per their performances.
Many of the PSUs incur losses from year to year, many of them default in finalizing the annual accounts in time and fail to rise in their performance. The departments consider the PSUs as milching cows. They are asked to provide costly vehicles for the masters in the department and bear all sundry expenses of the department not manageable within the budgetary framework.
Sometimes the state government pounces upon their CSR funds to run government schemes as extra budgetary resources. The PSU management is always prompt in obliging the masters in the government.
The system of appointing politicians as heads of the PSUs suffers from some inherent incompetence and lack of accountability and professionalism. They never follow the rules, get their persons appointed even not warranted and award contracts to their henchmen. Sometimes, decisions are taken on political considerations largely compromising the interest of the organization.
Odisha is the first state in the country to privatize electricity sector. Power generation, transmission and distribution were separated and different entities were created for each of these activities. The distribution job was entrusted to private companies. Unexpectedly, some of the PSUs in the power sector show losses. The only state-owned jute mill in the state at Dhanmandal had to be closed. It was under IDCOL management. IDCOL, which had once some of the profit-making units like IDCOL Cement at Bargarh, Ferro Chrome Plant at Jajpur Road and Kalinga Iron Works at Barbil, had to be amalgamated with OMC to save it from collapsing.
The Charge Chrome Plant at Brahmanipal was privatized quite early and was taken over by TATA. When it was constantly showing losses, it started showing profit once it got privatized. Same thing happened when IDCOL Cement got privatized. It clearly proved the ills of our system.
Now except few state PSUs in non-power sector like Odisha Mining Corporation (OMC), Odisha Construction Corporation (OCC), Odisha Beverage Corporation, IDCO, Supply Corporation, most other organizations are continuing with losses or no appreciable profit margin. Few are managing to garner operational profit.
Today, most of the PSUs depend upon budgetary support from the government. It’s a Herculean task to bring them back on rails. However, the State Government cannot afford to keep alive the ailing PSUs with budgetary support for long. They have to be made to perform or perish. Some of the loss-making PSUs have to be closed or amalgamated with profit making PSUs. Some of them can be privatized following a transparent process.
In order to make the PSUs vibrant, experienced professionals can be hired from the open market at the higher management level with a fixed tenure basis. Bright Young managers may be recruited at the entry level having professional qualifications from reputed institutes. The existing staff may be provided management training and professional training in reputed institutions.
Moreover, a Public Sector Recruitment Board may be formed to recruit qualified candidates for the state PSUs in a transparent manner. The Public Enterprise departments should be strengthened to ensure healthy management of the public enterprises in the state.
(The author is a poet & columnist and a former bureaucrat. Views expressed are personal)
