KVIC seeks loss write off; govt opposes move
The Khadi and Village Industries Commission (KVIC) has approached the government for writing off its accumulated losses of over Rs 80 crore.
By PTI |
NEW DELHI: The Khadi and Village Industries Commission (KVIC) has approached the government for writing off its accumulated losses of over Rs 80 crore, however, the Ministry of Micro, Small and Medium Enterprises is not in favour of such a move.
The MSME Ministry has asked the KVIC to improve its functioning and raise resources by giving on lease some of the loss-making outlets selling assortments of khadi and other cottage products.
"They (KVIC) want us to write off their losses and we have asked them why can't you lease out your outlets," a highly placed official of the MSME Ministry said.
He said the ministry was not in favour of cleaning the balance sheets of KVIC, which should be done by the organisation itself.
Over 5,000 institutions are affiliated to the KVIC but it runs at least 16 of its own retail outlets in big cities.
The official agreed that these stores were not managed professionally and could be improved only by roping in the private entrepreneurs who can run them as per the KVIC guidelines and still make profit.
The combined sales turnover of KVIC managed stores was Rs 52.10 crore in 2006-07. As per the commission data, while the bulk sales, including to the government agencies, was increasing, the growth at the retail level is negligible.
The MSME Ministry has asked the KVIC to improve its functioning and raise resources by giving on lease some of the loss-making outlets selling assortments of khadi and other cottage products.
"They (KVIC) want us to write off their losses and we have asked them why can't you lease out your outlets," a highly placed official of the MSME Ministry said.
He said the ministry was not in favour of cleaning the balance sheets of KVIC, which should be done by the organisation itself.
Over 5,000 institutions are affiliated to the KVIC but it runs at least 16 of its own retail outlets in big cities.
The official agreed that these stores were not managed professionally and could be improved only by roping in the private entrepreneurs who can run them as per the KVIC guidelines and still make profit.
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The combined sales turnover of KVIC managed stores was Rs 52.10 crore in 2006-07. As per the commission data, while the bulk sales, including to the government agencies, was increasing, the growth at the retail level is negligible.
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