The Chief Minister, Mr Manohar Parrikar answering the questions during the question hour on Monday.
PANAJI: The Chief Minister, Mr Manohar Parrikar on Monday assured that if required, the government is ready to pump money into M/s Goa Auto Accessories Ltd (GAAL); however, the industrial concern should stop making further losses.
"The concerned persons should understand that the government can't run a production facility," he added, pointing out that measures like bringing in professional approach in the GAAL and changing the production line could help the plant.
The Chief Minister, who also handles the finance portfolio, said that the Economic Development Corporation has already provided assistance to GAAL for upgrading its plant and machinery, based on the request from time to time.
"The EDC may consider financing additional assistance for upgradation of the plant and machinery subject to the technical feasibility and financial viability," he observed, noting that over the years of operation, GAAL has accumulated losses of ` 8.52 crores.
"The EDC has extended loans to GAAL from time to time as also provided financial restructuring package in 2004 and 2011," Mr Parrikar told the House, briefing that presently, the EDC investment amounts to ` 5.59 crores by way of capital and has also extended term loans of ` 90 lakhs as well as non fund support of ` 1 crore as on March 31, 2012.
GAAL is a wholly owned subsidiary of the EDC operating on commercial lines, manufacturing automobile components and supplying them mainly to Tata Motors.
The Chief Minister informed that the Tata Motors now has similar facility at Jejuri, near Pune and finds the motor components manufactured there, much cheaper.
"The Tata Motors have to bear 7 per cent extra cost on automobile components manufactured at GAAL as compared to those manufactured at the Jejuri plant, mainly due to transportation aspect," he informed.