Over five decades after its inception, the massive Tractor Manufacturing Unit of the Hindustan Machine Tools (HMT), a PSU located on the outskirts of Chandigarh, in Pinjore, in Haryana, is likely to shut down its operations.
It was the first HMT unit to be established away from its Bengaluru factory way back in 1964. A communique from Union Heavy Industries Minister Anant G Geete to the State Government has asked Haryana to take over the entire land of the unit.
This would come in lieu of settling dues of voluntary retirement of its employees and for dealing with other outstanding liabilities.
The ministry’s response follows a communication by the state government, which had asked the ministry to transfer surplus land of the unit to the state for creation of another industrial estate.
Now, in the wake of a different, perhaps, unexpected response from the Centre, the state government is viewing the matter afresh. But the decision to shut down the unit may not be easy, given its political ramifications and the effect it will have on the 1,800 employees.
It is also being met with stiff resistance from politicians, including those of the ruling party who are against any such decision to shut down the plant, even as the ministry has said it could consider attractive compensations for the workers, before the unit is shut.
HMT has been in the red for several years now, and from a high production of nearly 19,000 tractors at one time in 1999, the production currently has dropped to about 10 per cent of its optimum high production.
HMT fell flat to competition and poor strategies. Around 12 years ago, the Centre had approved Rs 1,083 crore for its revival, but to no avail. The situation was so bad that nearly 1,500 employees were not paid salaries for 14 months until October.