The Kashmir Chamber of Commerce and Industry on Saturday welcomed the decision of the State Administrative Council to approve reforms aimed at streamlining the functioning of Public Sector Undertakings (PSU’s), Autonomous Bodies and Societies.
A spokesperson of the KCC&I said that it was a long pending demand of the Kashmir Chamber that the functioning of State-owned PSU’s and other Autonomous Bodies be regulated.
“The KCC&I is on record to have invited the attention of the Government towards the need for unlocking of the major resources in the shape of assets and personnel by the PSU’s and their proper utilization,” said the spokesman.
“The PSU’s have instead of providing support to the economy only managed to create liabilities running in thousands of crores on the State Exchequer and blocked revenue generating assets of equal value. The KCC&I had also expressed concern at the absence of a clear Tendering and Procurement Policy for the State which could stem major losses especially in the Power Sector,” he said.
“Projects have suffered massive cost escalations and time delays due to the shortcomings of the present procedure of tendering and procurement,” he added.
“While the intent to address issues related to transparency, equity and economy of expenditure are indeed appreciable, at the same time the Government needs to exercise utmost caution while dealing with financial bodies and undertakings,” said the KCCI spokesman in a statement.
He said that the reforms are long overdue and desperately needed but the exercise should not end up throwing the baby out with the bathwater.
“The State has to be equally sensitive to the need for preserving the autonomous character of institutions and to ensure that actions and reforms do not trigger a virtual shutdown of these institutions,” said the spokesman.
“A case in point is the hue and cry with regard to the Jammu and Kashmir Bank Limited. A month down the line, it appears that the normal operations of the Bank have suffered a slowdown and a credit squeeze is palpable. The only news emanating is about the registration of cases and measures aimed at the curtailment of powers,” he said.
“In doing so, the State appears to be oblivious to the situation of crisis suffered by the borrowers of the Bank. It would be helpful, if the State appreciated that the J&K Bank had come out in support of its borrowers in the aftermath of the September 2014 floods. And then again in the 2016 turmoil when the accounts were again restructured. The repayment cycle of the settlement of the accounts falls due around the end of this year. Taking cognizance of the condition of the economy, the State itself has declared numerous interventions seeking to support the revival of the local economy,” he added.
“During the intervening period of these five years, circumstances have prevented the business community of the Kashmir from taking advantage of the interventions of the Bank and also of the State. Although the economy of the whole country suffered due to Demonetisation and the imposition of the GST, the local economy was already trying to recover from the impact of the floods of 2014 and the turmoil of 2016,” said KCCI spokesman.
“The State is on record in acknowledging the adverse impact of localized factors of 2014 and 2016 and the policy shocks of demonetisation followed by a major regime change in the shape of the GST. The above factors have taken away the opportunity from borrowers and the business community to develop the capacity to settle their accounts,” said the spokesman.
“The KCC&I wants to convey a note of caution to the State to pay close attention to the prevailing financial crisis and existing stress while going for major reforms and overhauling of institutions. A proper Tendering and Procurement Policy also needs to be formulated,” said the spokesman.