Government to shut HMT Tractor Unit, employees kills self

Author yuvamind

NEW DELHI: Government on Thursday approved closure of loss-making tractor division of HMT at Pinjore, while sanctioning Rs. 718.72 crore for payment of outstanding salaries and other dues at the public sector entity. The Cabinet, presided by Prime Minister Narendra Modi, also given its approval for transfer of selects small parcels of HMT land at Bengaluru and Kochi to different government entities for their use in larger public interest. "The Union Cabinet has approved the budgetary support to HMT Ltd for payment of outstanding salary/wages and other employee related dues.
"It also approved closure of HMT tractor unit by offering attractive VRS/VSS at 2007 notional pay scales," an official release said. The decision will have a financial implication of Rs. 718.72 crore for payment of outstanding salary, wages and statutory dues, VRS/VSS ex-gratia payments and clearing of tractor division ' s liabilities towards banks and creditors. HMT was established at Bengaluru in 1953 with the objective of producing machine tools required for building an industrial edifice for the country. It played a key role in laying the foundation for evolution of engineering and manufacturing capabilities in the country. The tractor division has been incurring losses continuously and is unable to pay the salaries and other statutory dues of its employees. Its employees based at Pinjore have not been paid salary since July 2014 and other statutory dues are also pending since November 2013. HMT tractor division was established in Pinjore, Haryana in 1971 to manufacture HMT Tractors. HMTL ' s profit making tractor business was affected due to poor off take, under-utilization of capacity and working capital constraints, the release said. "It was observed that continuation in tractor business with its insignificant market share in the sector may not be a financially viable and sustainable option for HMT Ltd and hence it would be prudent to close the tractor business, make an exit from this segment and focus on the core sector of machine tools," the government said. The statutory dues are also pending for the employees of other Divisions of HMTL.
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