Industries Minister Elamaram Kareem told the Assembly on Monday that the Kerala Spinners, which had been taken over by the government, would be converted into a modern spinning and weaving mill.
The Minister was replying to the debate on the Kerala Spinners, Alappuzha (Acquisition and Transfer of Undertaking) Bill which seeks to replace the Ordinance issued by the government for take over of the mill from a private group.
Denying allegations by the Opposition, Mr. Kareem said the government had no plan to privatise the mill or hand over its land for tourism development. The State-owned Textile Corporation was ready to run the mill. Some of the retrenched workers would be taken back.
He said the spinning mills under the Corporation had posted a total loss of Rs. 17 crore last year because of the economic crisis. However, they were turning the corner with modernisation and an increasing demand for yarn. A corpus fund had been formed for the purchase of raw material (cotton) during season at low prices.
The Minister said the government had decided to take over the Kerala Spinners to protect the interest of the workers. The mill had been under lock out since 2003 and the adamant attitude of the management had come in the way of its reopening. The State Industrial Development Corporation and the Kerala Financial Corporation had shares in the company, and the prospects were good for its revival.
He said the government action was a warning to private managements who did not care for the workers. However, the government could not take over other sick private sector units such as Travancore Electrochemicals for want of funds and viability.
Earlier, raising their objection to the legislation, K.M. Mani (KCM) and Aryadan Muhammed argued that the Bill would not stand legal scrutiny. Besides, the Centre was taking steps to take over the mill, Mr. Muhammed said.
Mr. Kareem refuted their arguments noting that the State was not taking over control of management but was acquiring the company through the legislation. The Centre had no plans to take over the unit.
The House later referred the Bill to the Subject Committee.
