Maharashtra has begun the process of merging its state textile, powerloom and handloom corporations to reduce losses, cut administrative expenditure and streamline their operations, Textile Minister Sanjay Savkare said on September.
The proposed merger involves the Maharashtra State Textile Corporation, Maharashtra State Powerloom Corporation Limited and Maharashtra State Handloom Corporation Limited. The process is currently being conducted at the level of the Comptroller and Auditor General of India, where the financial accounts of the three corporations are being reconciled.
The merger has not yet received final approval. Once the reconciliation process is completed, the proposal will be sent to the Finance Department for approval and then placed before the state Cabinet, Savkare said. The Cabinet will take the final decision on whether the three corporations are to be combined.
The move follows a recommendation by the Finance Department’s Public Sector Undertakings Committee, which had advised that loss-making corporations should either be closed or merged. The Textile Department subsequently initiated the merger process.
According to the minister, the handloom and textile corporations are currently operating at a loss. The financial position of the powerloom corporation has improved after it reduced its losses, allowing it to pay workers’ salaries regularly, the report said.
Under the proposed arrangement, the work of the three corporations would be brought under a unified administrative structure. The government expects the merger to reduce administrative and other operating costs and allow the combined organisation to function with the available workforce.
The staffing position differs across the three corporations. All employees in the Textile Department’s corporation have currently retired, while the Handloom Corporation has a mix of permanent and contract employees. If the merger is approved, the three corporations would be managed by a single managing director instead of separate leadership structures.
Savkare said the decision was taken because a unified corporation would be administratively and financially more manageable. The department had prepared the proposal and forwarded it to the Finance Department. Following the Finance Department’s instructions, the financial reconciliation of the three corporations is now being undertaken at the CAG level.
The next formal steps are the completion of the reconciliation, Finance Department approval and submission of the merger proposal to the state Cabinet. Until those stages are completed, the merger remains a government proposal rather than an implemented restructuring.
