Cabinet approves closure of Burn Standard Company Limited
The Union Cabinet has approved closure of Central Public Sector Enterprise (CPSE) Burn Standard Company Ltd (BSCL) under Ministry of Railways. This decision was taken in view of continuous poor physical and financial performance of company for more than decade despite financial assistance and other support from government and low probability of its revival in future.
The closure of company will save public funds, which are currently being used for loss making BSCL and can be used for other developmental work. Central Government will provide one-time grant of Rs. 417.10 crore towards severance package and for clearing current liabilities of BSCL. In addition, outstanding loan of Rs. 35 crore given to BSCL by Ministry of Railways will be written off. The severance package will benefit 508 employees of BSCL from Voluntary Retirement Scheme (VRS).
Burn Standard Company Ltd (BSCL)
BSCL was incorporated in 1976 following nationalization and amalgamation of Burn and Company and Indian Standard Wagon Company Limited in 1987 under Department of Heavy Industries (DHI). The company was engaged in manufacturing and repair of wagons and production of steel.
It was referred to Board of Industrial and Financial Reconstruction (BIFR) in 1994 and was declared sick in 1995. The company continues to be sick company since then. Its administrative control was transferred from DHI to Ministry of Railways in 2010 as approved by then Cabinet Committee on Economic Affairs (CCEA).
Categories: Business, Economy & Banking