#JKBudget2018: Dr Drabu steps down from ex-officio position as Chairman of the J&K SFC

Tasavur Mushtaq

Srinagar

Finance minister Dr Haseeb A Drabu has stepped down from my ex-officio position as Chairman of the J&K State Finance Corporation.

This he announced during his fourth budget speech in Jammu on Thursday.

“With the Hon’ble Chief Minister and the Hon’ble Deputy Chief Minister setting the standards and relinquishing their ex-officio positions as Chairman and Vice Chairman of the J&K SPDC board respectively, I am emulating them and stepping down from my ex-officio position as Chairman of the J&K State Finance Corporation.,” he said and added that “with a professional Chairman and Chief Executive at the helm and an independent board, we should see a dramatic turnaround in the performance of not only the corporation but also the harnessing of our water resources for hydropower generation.”

Dr Haseeb A Drabu walking towards assembly where he presented his fourth budget (Image: DIPR)

The stepping down he said is to set the trend and make it easier to professionalising the boards and management structure of all corporations dominated, as they are by, departmental secretaries on an ex-officio basis. “This existing model conveniently lent itself to ex-ante controls of Government in the management of these corporations,” he said and added that “these companies now need to be freed from the control of the Government and domain professionals need to be on the Boards of these Companies with no or minimum representation from the Government.”

Talking about their hierarchy, he said: “instead of MDs, these companies should be administered by CMDs, who have to be professionals in the company’s verticals, so that they could be run on professional lines.”

Dr Drabu told the house that he has initiated the process of financial engineering in Public Enterprises and J&K SPDC, for instance, has made considerable progress in this regard. “Their Balance sheet at the end of the year will show that the Corporation a debt-free company,” he said.

J&K SFC, he said have issued a share buyback offer and have got an unexpectedly good response. “I am making a provision of Rs. 15 crores to fund the share buyback.

He talked about Asset Reconstruction Company. “To provide financial institutions like J&K SFC and commercial banks a market route and avenues for recovery of toxic assets, I have set up the J&K Asset Reconstruction Company with an authorised capital of Rs. 100 crore and a paid-up capital of Rs. 2 crores.”

He proposed to set aside a sum of Rs 8 crores as one-time equity support from the Government. J&K Government’s stake in the company is 51 percent while the stake of the J&K Bank Ltd. is capped at 49 percent. The Board of Directors of the Company stands constituted. To allow the company to start operations, I propose to set aside a sum of Rs. 8 crores as one-time equity support from the Government.”

For the twin Handicraft Development and Handloom Development Corporations, Dr Drabu said he is providing Rs 5 crore each. This will set them on a path of recovery and from there we will clean their balance sheets and restructure their business operations as is underway in the case of J&K HPMC.

He mentioned JKSRTC as well. “The J&K SRTC is up for focussed attention and in the course of this year, it shall be our endeavour to strengthen its balance sheet and clear off its liabilities before showcasing it for a public-private partnership while retaining majority control.”

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