The report submitted by the Railway Convention Committee to the Parliament has dashed the hopes of employees of the Autokast Ltd.
The Autokast, which was delinked from Steel Industrials Kerala Ltd (SILK), was banking on the proposed joint venture with the Railways for manufacture of rail components, for its revival.
The report said that the company will continue as a state public sector undertaking and the railway will award various construction and fabrication works to the unit. The Railway budget of 2007-08 had allocated Rs 85 crore for the proposed joint venture. A MoU between the Railways and the State government was signed on June 28, 2008.
The RITES limited had conducted a feasibility study on the joint venture project Kerala Rail Components Limited. A share holders agreement was also signed between the Railway and the Government of Kerala in February 2009. The plan was manufacture components of passenger coaches utilising the facilities of the Steel Fabrication Unit and the Autokast Ltd.
Prince, former secretary of Silk Employees Limited Kerala, said that they have lost all hopes regarding the revival of the company. The Board of Industrial and Financial Reconstruction (BIFR) had earlier recommended the liquidation of the Autokast, which declared as a sick unit.
According to Prince, the lack of political pressure and the presence of North Indian lobbies could be reasons behind the collapse of JV. “Private firms are supplying coaches to the Railway. If a PSU enters the trade, it has the potential to affect the private sector,” he said.
Autokast MD R Rajesh said that the company had made earnest efforts to revive the unit with the help of the Railway, but their hopes have been lost.