Financial Daily from THE HINDU group of publications
Sunday, May 11, 2003
Financial Daily from THE HINDU group of publications Sunday, May 11, 2003 |
|
|
|
|
|
Corporate
-
Performance Parliamentary panel raps SAIL for RSP cost overruns Ambarish Mukherjee
NEW DELHI, May 10 THE Parliamentary Standing Committee on Industry has come down heavily on the Steel Authority of India Ltd (SAIL) for cost and time over-runs in modernisation of the Rourkela Steel Plant (RSP). The committee has expressed dismay over the fact that while RSP was a profitable plant before modernisation, it started making losses post-modernisation. The cumulative loss of RSP till December 2002 stands at a whopping Rs 3,879 crore. According to the report, "The committee feels that RSP should have been performing well in the post-modernisation phase after employing new tools and technology. However, benefits of modernisation could not be availed with regard to RSP." The committee also said in its report that "after fixing the responsibility for the delay caused in the implementation of the modernisation package in RSP, compensation from the delaying agencies should be sought and be given to RSP." RSP's modernisation plan was originally scheduled to be completed by December 1995. But it was finally completed only in November 1999 resulting in a cost over-run of around Rs 1,150.84 crore. The reasons for the delay have been identified to be, among others, inadequate mobilisation of resources by the big contracting firms. This includes public sector units such as MECON and HEC also. The committee has said in its report that it is extremely perturbed to note the cost over-run in the modernisation of RSP. "The amount invested over the original cost on the modernisation project is a wastage of public purse," the report said. In order to improve the overall performance of RSP, the committee has suggested that steps such as adoption of economy of scale, optimum utilisation of installed capacity, cost reduction and saving measures, gainful human resource planning, diversification of product mix and strategic sale of idle resources should be taken up on a priority basis by the company.
Article E-Mail :: Comment :: Syndication
|
Stories in this Section |
|
The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription Group Sites: The Hindu | Business Line | The Sportstar | Frontline | The Hindu eBooks | Home |
Copyright © 2003, The
Hindu Business Line. Republication or redissemination of the contents of
this screen are expressly prohibited without the written consent of
The Hindu Business Line
|