Hyderabad: Even as the Telangana government is busy gearing up for the foundation-laying ceremony of a mega textile park at Warangal, the status of the existing apparel parks in India's newest State is anything but good with the much-publicised Handloom Park at Pochampally failing to achieve its stated objectives even after nine years of inception.
A recent audit report by Comptroller and Auditor General of India (CAG) rapped the Handloom Park’s management and state government for its tardy progress, highlighting cost overrun, 42-month delay in execution and lack of sufficient working capital.
Established in 2006 and developed in public private partnership (PPP) mode by Pochampally Handloom Park Limited to encourage renowned Pochampally handlooms, the park was designed for 2,000 looms, comprising 1,495 cotton looms and the remaining 505 silk rooms. Its detailed project report (DPR), meanwhile, envisaged creation of 8,050 direct and indirect jobs at the park located near Bhoodan Pochampally village in Yadadri Bhuvanagiri district.
“However, only 500 looms (cotton looms: 425 and silk looms: 75) could be installed as of July 2016, and out of these, only 150 to 200 looms could be operated on an average per month due to inadequate working capital and other allied reasons.
This resulted in generation of employment for only 300 to 350 persons on an average per month against the expected direct employment of 5,050 and indirect employment of 3,000,”CAG said in its compliance audit report on ‘Development of Textile and Apparel Parks’. The report is part of the CAG’s overall report (Report No.7 of 2016) on Economic Sector (in Telangana) for the year ended March 2016.
The apex auditor of the government expenses also observed that the “Park has been incurring losses ranging from Rs 44 lakh to Rs 4.73 crore since its inception and was being sustained mainly through grants received from GoI (Government of India)”. CAG also found fault with the way the DPR of the park was prepared. “The DPR initially submitted in April 2006 was revised in May 2008, increasing the total outlay from Rs 18.49 crore to Rs 34 crore mainly to improve the common facilities, such as effluent collection and treatment system, testing equipment, etc. There was an overall increase in the project cost by Rs 1.04 crore (actual cost of Rs 35.04 crore against the approved cost of Rs 34 crore),” it explained.
The DPR overestimated the international demand for its products and the increased outlay did not serve its purpose, CAG commented. Meanwhile, the management of the handloom park, when contacted, expressed optimism about future development of the park.
“As of now, 250 looms are in operation out of 500 installed. Efforts are underway to operate all the 500 installed looms by the end of June 2017. Thereafter, we will draw up plans for installing 1,500 new looms, thereby taking the total to 2,000,” Damoder Seetha, CEO, Pochampally Handloom Park Limited, told The Hans India.
He, however, admitted about lack of adequate working capital. “Handloom sector plunged into crisis in 2008, affecting our plans. In the initial years, we worked very hard to create a brand for Pochampally handlooms. Pochampally Ikat is a renowned brand now and ready to take off. The park achieved a total turnover of Rs 8 crore last year. We expect the turnover to reach Rs 9 crore this fiscal, but inadequate working capital is impacting us,” Damoder maintained.