Chandigarh, November 24
A select 43 well-established industrialists in the state have collectively benefited to the tune of Rs 203 crore under a scheme to waive the money they owed to a semi-autonomous body of the Punjab Government. In contrast, the Punjab Government is still grappling to formulate a policy to waive farmers’ loans.

A perusal of the record of such waivers offered by the Punjab State Industrial Development Corporation (PSIDC) in the past couple of years shows that some of the beneficiaries of the needless “charity” include big names in the industrial world and also politically well-connected families. In all, a sum of Rs 203 crore has been ‘sacrificed’.

The dues of these 43 industrialists had been pending payment for more than a decade. A one- time settlement scheme (OTS) was introduced in 2003. None of the 43 companies had made a loss, rather some of them are doing exceptionally well in their business and have expanded their operations.

Protests by the office of the Comptroller and Auditor-General against such waivers notwithstanding, the Punjab Government has been carrying on with the OTS scheme. The CAG has even called the scheme as an “ imprudent policy” that was causing a loss.

The genesis of the problem lies in the atmosphere created in the early 1990s when Punjab was just emerging out of the strife-torn period of militancy. The PSIDC was asked to attract more and more industries. It even picked up about Rs 400 crore from members of the public and private institutions by floating bonds in the open market. This was at an interest rate of more than 15 per cent per annum.

The PSIDC had a partnership with these companies and the corporation held shares of the said companies or forwarded them loans. In the late nineties, industrialists stopped honouring the commitment to buy back the shares held by the PSIDC under a financial collaboration agreement. The OTS scheme is flawed as it does not lay down a schedule for money re-pay. The lender can re-pay just 10 per cent of the agreed bailout amount and then pay the remaining 90 per cent at his own will within three years.

With no other option, a “jelly-kneed” PSIDC failed to recover the money and instead offered the OTS as a bailout package. It was then touted that some money had been recovered from these defaulters. However, the total sum sacrificed by the PSIDC remained a secret, well-placed sources said.

Among the major beneficiaries are Abhishek Industries (Rs 48 crore). The owner is Mr Rajinder Gupta, who has multi-crore units, Rana Polycot (Rs 24.74 crore) floated by Rana Gurjeet Singh, a sitting MP from Jalandhar, Suraj Solvents (Rs 19.69 crores) owned by Suraj Gupta, Malwa Industries (Rs 15.78 crore) owned by Rishi Oswal, Harpartap Steel (Rs 10 crore) owned by Mr G.S. Kairon, Cheema Spintex (Rs 8.68 crore) owned by Mr H.S. Cheema, Satia Synthetics (Rs 7.34 crore) owned by Mr Anil Satia, S.R. Industries (Rs 6.10 crore) owned by Mr R.C. Mahajan, and Winsome Yarns (Rs 5.28 crore) owned by son of a former Rajya Sabha MP.

Among the other beneficiaries for whom the PSIDC sacrificed a sum ranging between Rs 3.50 crore and Rs 1 crore are Supreme Yarns, Surya Medicare, Majestic Hotels, Ludhiana, Mohan Fibres, Capsugel India, Ind-Swift Laboratories, Sohrab Spinning Mills, Samana Roller Flour Mills, Prime Industries, Kamlesh Bhargava Hospitals ( Silver Oak, Mohali), Hotel Hayre Regency, Jalandhar, Shyam Indo-spin, Sportking Limited, Masuzawa Punjab Silk (a unit of the Birla group), Yogendra Worsted, Stelco strips, Deepak Gases, Kansal Fibres and Magnet resorts.

(To be concluded)