In order to promote corporate governance in Public Sector Undertakings of Jammu and Kashmir, Minister for Finance, Dr Haseeb A Drabu, on Saturday volunteered to relinquish his post of Chairman of J&K State Financial Corporation (JKSFC).Dr Drabu announced the decision while chairing the JKSFC's 234th Board of Directors meeting which was held at its regional headquarter in Sonawar here. The JKSFC Board later resolved to have its own independent chairman.The Finance Minister said the time has come to set the Public Sector Undertaking free of government intervention which is known to prove adverse for the health of such institutions. He said that post liberalisation, the condition of SFCs across the country has been hit as they failed to acclimatise with the changing fiscal environment."The changes taking place in the global economy demand that the PSUs should be run under corporate governance structure so that they compete successfully and avoid excessive dependence on government recapitalisation," Dr Drabu said.
The Board members suggested that the JKSFC should diversify its investments by venturing into different sectors like transport, tourism and education, etc. They also suggested adoption of industrial estates in Kargil, Kupwara and Rajouri for cluster funding to improve the financial health of the Corporation.Dr Drabu said as a first step towards diversification, the JKSFC should reassess its financing models and venture into financing contractors with R&B department which has been allocated nearly Rs 1500 crores this fiscal. He said the Corporation can also venture into promoter funding and thereby increase its lending."You can also start giving out finances in the field of housing and private transport for government employees. The idea should be to prepare a customer for becoming viable borrower and and institution which makes target decisions," Dr Drabu said.Urging the Board to reassess its composition and restructure the Corporation, the Finance Minister said the focus of JKSFC should be on functional areas of business rather than geographical areas.
"You should do away with district offices and instead set up regional offices for assessing business potential in different parts of the state. I also propose to have a woman lawyer on the Board of Directors in deference to our Chief Minister Mehbooba Mufti's steps for welfare of women," Dr Drabu said.The Board resolved to provide one-time exit policy for some deserving borrowers of the Corporation based on merit of each case depending upon the performance and working results of the funded units. Deliberating upon the performance of the Corporation, the Minister directed the Corporation to come up with newer business models for acquiring of infested assets from financial institutions on discount rates on the pattern of ARC and focus upon revival or resale of such assets on viable lines.The Minister also directed the JKSFC management to streamline and rationalise its business network and resources across the state and concentrate upon reducing expenditures and creating fresh opportunities of investment to ensure increased returns so that the Corporation can be set on profitable lines.The Board also approved the balance sheet and profit and loss account of the JKSFC for the financial year 2015-16.The meeting was also attended by Principal Secretary, Finance, Navin Kumar Choudhary, JKSFC Managing Director, Mohammad Farooq Thoker, President (LBD/SLBC) J&K Bank Ltd, SK Bhat, Industrialists Zahoor Ahmad Bhat and Ghulam Jeelani Ahanger, besides other board members.