MoST chalks revival plan for HDPE

MoST sources said the move to inject fresh funds and prune its staff of 1260 employees to about 400-500 will help to revive the shipyard. The ministry is finalising an attractive voluntary retirement scheme (VRS) for the workforce of HDPE. The revised scheme will also be referred to the secretaries’ panel for their comments.

The excess manpower — with an annual sales/employee ratio of barely Rs 32,479 as against Rs 750,000 of the private sector ABG Shipyard — has proved to be a major handicap for the shipyard.

Further, the transport ministry plans to streamline operations by asking the ailing shipyard to focus on the medium-size vessels segment. HDPE has been in the red for the last 30 years, with its accumulated losses going to Rs 80 crore as on March 31, 1996.

In its report, the consultant, ICICI Ltd, had attributed HDPE’s slipshod performance to improper planning, excess workforce, lack of focus, poor market image due to the delayed ship deliveries and obsolete machinery.It also blamed the company’s lack of business plan, budgeting, poor cost estimation and poor quality control for the losses.