Dept. of Chemicals & Petrochemicals Annual Report 1999-2000

I.     INTRODUCTION

The Department of Chemicals & Petrochemicals has been a part of the Ministry of Chemicals and Fertilizers since 5.7.1991. The Department is entrusted with the responsibility of policy, planning, development and regulation of Chemical, Petrochemical and Pharmaceutical Industries. The business allocated to the Department is listed at Annexure-I.

Shri Suresh Prabhakar Prabhu assumed the charge of Minister of Chemicals and Fertilizers and Shri Ramesh Bais assumed the charge of Minister of State in the Ministry of Chemicals and Fertilizers w.e.f. October,13, 1999.

Shri Arvind Varma took over the charge as Secretary in the Department vice Shri Dipak Chatterjee w.e.f. October 22, 1999.

II.       PERFORMANCE OF INDUSTRIES

DRUGS AND PHARMACEUTICALS:

The Pharmaceuticals industry in India today is one of the largest and most advanced among the developing countries. Indian Pharmaceuticals Industry manufactures bulk drugs belonging to several major therapeutic groups requiring various manufacturing processes and has developed excellent facilities for production of all dosage forms like tablets, capsules, liquids, orals and injectibles etc. This achievement is strengthened by an assurance with regard to quality of the products. Over the last several years, policy inputs have been directed towards promoting the growth of the industry and in helping it to achieve a broad base in terms of the range of the products and technologies needed to produce them from as basic stage as possible. The result has been very encouraging. As on date, there are about 250 large units and about 8000 Small Scale Units in operation which form the core of the industry (including 5 Central Public Sector Units). These units produce the complete range of formulations i.e. medicines ready for consumption by patients and about 350 bulk drugs i.e. chemicals having therapeutic value and used for production of formulations. Today, India is in a position to meet 70% of the country’s requirement of the bulk drugs and almost all the demands for formulations. The setting up of the Penicillin factory at Pimpri, Pune in the early 1950’s and the construction of Indian Drugs and Pharmaceuticals Ltd. (IDPL) plants at Rishikesh and Hyderabad in 1960’s are important milestones in the history of the pharmaceutical industry in the country and public sector investment in the pharmaceutical industry in the initial stages played the role of a catalyst in the development of the industry in the last three decades.

1. PRODUCTION:

The following table shows the value of production of bulk drugs and formulations from 1990-91 to 1998-1999. (The production figures for 1999-2000 are not available.)

During 1999-2000, several proposals for technology transfer, including joint ventures, proposals for foreign direct investment, setting up of new undertakings/ expansion of existing units (manufacture of new articles in the existing units) have been received and processed. Following the delicensing of the pharmaceutical industry, a number of Industrial Entrepreneurial Memorandums (IEM) for the manufacture of various bulk drugs/drug intermediates/formulations were received. The major items covered by the IEMs include a wide range of bulk drugs, intravenous fluids, formulations etc.

During the period ending October 1999, 42 IEMs were filed by the pharmaceutical companies for various bulk drugs, formulations and intermediates. On the basis of this it is expected that employment would be generated and an investment of approximately Rs.376 crores on these projects would be made. During the same period, foreign investment proposals worth approximately Rs. 190 crores were approved. Several proposals for foreign collaboration for joint venture, research and development, establishing new undertakings/expansion of existing units (manufacture of new articles in the existing units) have been received.

2. EXPORTS:

From a meagre Rs.46 crores worth of pharmaceuticals exports in 1980-81, the exports have risen to approx. Rs. 6152 Crores (Prov.1998-99).

The details of the exports of Drugs,Pharmaceuticals & Fine Chemicals during the last three years are as follows:

Source: Foreign Trade Statistics of India, Vol.March, 1998,1999
Published by: Dte. Gen. Of Commercial
Intelligence and Statistics (DGCIS),
Ministry of Commerce.

2.3    During April 1998-March 1999, total exports amounted to Rs. 6152.22 crores, which was 13.52% higher than the performance during 1997-98.

3. IMPORTS:

In accordance with the information available from D.G.C.I.S. imports of medicinal and pharmaceutical products for the last three years have been as under: -

Source: D.G.C.I.S.

3.2   There have been no reports of shortage in recent years. As already indicated, the country is almost self-sufficient in case of formulations required by the consumers. It may also be mentioned that industrial licensing for most of the drugs and pharmaceutical products has been done away with. The manufacturers are free to produce any drug duly approved by the Drug Control Authority.

3.3    Imports of drugs and pharmaceuticals are allowed freely, excepting those in the restricted list of import under the current EXIM Policy, which can be imported under an import licence. In view of these steps, no shortage of medicines is likely to occur. Import can take place from any part of the World, there being no general restrictions.

4. REQUIREMENTS OF PHARMACEUTICALS DURING NINTH PLAN:

4.1    The Working Group on drugs and pharmaceuticals for the Ninth Five Year Plan period (1997-98 to 2001-2002) has worked out future growth rate as follows:

1. Growth rate for domestic consumption of formulations as 15%;
2. Growth rate for exports of formulations as 10%.
3. Growth rate for exports of bulk drugs as 20%.
4. Growth rate for bulk drugs production as 20%.
5. Imports of bulk drugs (CIF value) be restricted to 12% of the total value of bulk drug requirement;
6. Growth rate for the total bulk drug requirement for exports and formulation activity (for both domestic consumption and exports) as 16%;
7. The ratio of value of consumption of bulk drugs for production of formulations to the value of formulations produced as 1:4.

4.2    It may be stated that no country can become entirely self-sufficient in case of pharmaceuticals. Therefore, imports are expected to continue even with the advanced level of technological inputs. Import of a drug would be dependent upon variety of factors like incidence of disease for which it is used, feasibility of its production in the country or, if already being produced, status of its current indigenous production, availability of alternate/equivalent drugs, international price vis-à-vis price of indigenous produce, tariff rates, import policy etc.

5. RESEARCH AND DEVELOPMENT:

5.1   The Department of Science and Technology has a dedicated programme for promoting R&D in the drugs and pharmaceutical sector. A two-tier structure exists to manage the programme viz. an Apex Executive Committee at the Secretariat level, chaired by the Secretary, DST and an Expert Committee at the operational level.

5.2    To be globally viable in R&D, high-level expertise and adequate human resources as also modern facilities in specified areas of drug developments are required. It was, therefore, decided that the DST Programme, besides new drugs development projects, should also support creation of facilities that are essential for new drugs development. Accordingly, facilities that are needed urgently and that would need to be created, namely, (a) DHA gyrase screening facility; (b) Quantity-Structure-Activity-Relationship (QSAR) facility; (c) immunomodulators modeling and screening and (d) Pharmacological testing were identified. Under the said programme 34 proposals have so far been cleared. In the Department of Chemicals and Petrochemicals, a Budgetary provision of Rs.16 lacs exists for the year1999-2000 to fund R&D projects and R&D related studies in the pharmaceutical sector.

6. NATIONAL PHARMACEUTICAL PRICING AUTHORITY (NPPA):

6.1   The National Pharmaceutical Pricing Authority (NPPA) was established on 29.8.1997 with a view to enforcing the provisions of the Drugs (Price Control) Order (DPCO) and to perform the functions assigned to it. Upto 19.11.1999 the following actions/steps have been taken by NPPA since its inception:

1. During the year 1999-2000 (April 1999 till 19.11.99) it revised/fixed the prices of 17 scheduled bulk drugs and derivatives (10 bulk drug plus 7 derivatives) and 187 formulations packs.
2. NPPA vide its order published in the Gazette of India Extra Ordinary dated 27^th January, 1999, has asked the manufacturers of all the Scheduled formulation pack sizes to work out the prices of different pack sizes of the tablets and capsules of the same strengths or composition packed in different strips or blisters on pro-rata basis of the latest ceiling price fixed. This was done to ensure that (i) the manufacturers do not change their pack sizes in bid to remain out of price control and (ii) manufacturers are not forced to approach the Government/NPPA frequently for price approvals of different pack sizes.
3. Compiled the data on production of selected/monitored bulk drugs and imports of bulk drugs for the year 1998-99.
4. Analysed price movement between January 1994 and March 1999.
5. Fixed the prices of three commonly used I.V. Fluids by exercising the powers available under Para 10(b) of DPCO, 1995. These prices are lower by about 40% than the prices charged earlier by the companies from the consumers.
6. To keep a check on the prices of the drugs, besides advising the State Government to enforce the prices of scheduled formulations, NPPA held a meeting at New Delhi with the State Drug Controllers on 25^th Aug. 1999.
7. NPPA advised the States and Union Territories to nominate/set up nodal officers/monitoring cells to enforce/monitor the prices and availability of medicines.
8. NPPA notified the norms of conversion cost (CC) packing charges (PC) and process loss (PL) vide S.O. 578 (E) dated 13^th July 1999.
9. Overcharging cases were pursued vigorously by NPPA and, as a result, an amount of Rs. 327 lakhs was recovered from the companies on account of overcharging.
10. NPPA launched its website on 11^th Jan., 1999. It is accessible at www.nppaindia.com. All price notifications issued by NPPA, Drug policy, DPCO, 1995, notified norms etc. are available on the website.
11. One of the functions of NPPA is to render advice to the Central Government on changes/revisions in the Drug Policy. The Government constituted a Drug Price Review Committee on 18^th March 1999 to review the current Drug Price Control Mechanism and suggest alternative models among other things. Another Committee viz. Pharmaceutical Research and Development Committee was also constituted by the Government on the same date to recommend measures to strengthen the research and development capability of the pharmaceutical industry in the country and to identify the support required by the Indian Pharmaceutical companies to undertake domestic R&D. Chairman, NPPA was one of the members of these Committees. NPPA, being an expert body, rendered expert advice to both the Committees, besides providing inputs and various data.

7. Export Promotion Cell:

7.1    An Export Promotion Cell in the Pharmaceutical Division has been created with the objectives of boosting pharmaceutical exports and to act as a nodal centre for all queries/issues regarding pharmaceutical exports. The Cell also undertakes promotional activities for acceleration of pharmaceutical exports and considers suggestions for modifications in EXIM Policy from the industry. The Cell has also been entrusted with the organisation of seminars and workshops on standards, quality control requirements etc. of important countries so as to prepare the domestic companies for exporting their products. A major item of work undertaken by the Cell was the organization of visit of a team of Russian experts to India in April 1999 to explore the possibility of accreditation of Indian Testing Laboratories for pre-shipment inspection of pharmaceutical exports. The experts visited several Indian Testing Laboratories located in different parts of the country. The occasion was also utilised to organise a Seminar on the new drug registration procedure introduced in the Russian Federation. The experts’ visit was widely welcomed by the Indian exporters as was reflected in their overwhelming response. Consequent to the visit of the expert team, 13 reputed Indian Companies have been exempted from batch by batch testing for the purpose of export of pharmaceuticals to the Russian Federation.

8. Drug Prices Equalisation Account

8.1    The Department has referred 72 important assessment cases involving an amount of Rs.220 crores to the Drugs Prices Liabilities Review Committee. The Committee has already furnished its recommendations in 34 cases to the Department which in turn is taking further action on the recommendations of the Committee to recover the due amounts. In all the remaining cases, the Committee has put into motion the process of hearing the concerned parties by issuing notices to them. The Committee is giving adequate opportunity to the parties to present their point of view and after hearing them, it is giving its recommendations on case to case basis to the Department.

8.2    Till date, an amount of Rs.24.25 crores has been deposited in the DPE Account by the pharmaceutical companies. In the interest of work, the tenure of the Committee has been extended upto 31.3.2000.

B: CHEMICALS, PESTICIDES AND ALLIED INDUSTRIES

1.0    A large number of chemicals are manufactured in the country and the country is mostly self-sufficient in meeting the demands. The industry has maintained a steady growth. The chemical industry is highly heterogenous encompassing many sectors like organic, inorganic chemicals, dyestuffs, paints, pesticides, speciality chemicals, etc. Some of the prominent individual chemical industry sectors are caustic soda, soda ash, carbon black, phenol, acetic acid, methanol and azo dyes.

1.1    In tune with the liberalization policy of the Government of India, industrial licensing has been done away with for all the chemical industries except for a small list of hazardous chemicals. Entrepreneurs are, therefore, free to set up chemical industries by following the Industrial Entrepreneurs Memorandum Route. The Government of India is committed to promoting increased inflow of Foreign Direct Investment (FDI) and its intended benefits through high technology, modern management techniques increased opportunities for exports of Indian products and services of international standards for the Indian consumer. Towards achieving these objectives, the Government has put in place a transparent, dynamic and investor friendly policy framework. The Government has recently substantially expanded the list of industries eligible for Automatic Approval up to 51% and allowing Automatic Approval for the FDI up to 74% for products in the key sectors.

1.2    The chemical industry had flourished under the dual protection of licensing and high tariffs. The industry was characterized by uneconomic capacities, fragmented production base and poor marketing focus. As a part of the liberalization measures introduced in 1991 and thereafter, the capacity ceiling was removed, industrial licensing made redundant and tariffs were reduced.

1.3    The performance of the industry in the post liberalization period has been mixed. Domestic demand continued to be strong while global chemical prices were steady, in the early years. This helped to counter to some extent the drastic drop in tariffs. Moreover the dip in raw material prices helped, though, the duty differential between basic chemicals and the final product clearly narrowed over the years. However, the situation has turned more serious in the last two years, as the chemical industry faced recessionary conditions in the segments coupled with one of the worst global chemical price declines. While bigger companies have somehow managed to show small profits and sales growth, many of the medium and small scale companies have incurred losses.

1.4    Safety, health and environment protection are the key concerns for the chemicals industry. Along with modernization to improve the operating efficiency of the plants and energy conservation, safety in operations, health of the workers engaged in the processing industry as well as environment concerns are the prime need of the hour. Management of toxic chemicals is also receiving increasing attention. In the manufacture of caustic soda, more and more units are shifting to the membrane cell technology from the conventional mercury diaphragm technology. Over 66% of the total installed capacity in caustic soda manufacture is now based on the membrane cell technology which is a much cleaner technology.

1.5    The pesticide industry has developed substantially, contributing significantly towards India’s agriculture and health. In agro chemical sector, high volume low priced pesticides are being substituted by low volume high priced pesticides. Besides, use of natural pesticides, use of bio-pesticides is gradually picking up in the country. To utilize the idle capacity available with the pesticides units, the country has entered the competitive field of export of pesticides.

1.6    The country has started producing some new pesticides, but the manufacturers are continuing to import their intermediates in the absence of technology for producing them. Efforts are being made to acquire the right technology to manufacture intermediates for pesticides. The growth in dyestuff industry has also been noteworthy. Dyes and dye intermediates offer immense possibilities for exports from India in view of their international quality and competitive prices.

2.   PRODUCTION   

2.1    Production performance of some of the important chemicals including pesticides and dyestuffs are given below:

2.2    The capacity and production of chemical during 1998-99, 1999-2000 and anticipated production during 2000-2001 is at annexure - II.

3.    Export of Chemicals

3.1    There has been a steady growth in the exports of chemicals during the last three years. Export achievements of chemicals for the years 1996-97 & 1997-98 are mentioned hereunder:-

         (Rs. in crores)

4.    INDIACHEM – 2000:

4.1    To showcase the strengths of the Indian Chemical, Petrochemical and Pharmaceutical industry and to provide it a forum for interaction with the foreign companies, the Department has proposed to set up an international exhibition and conference called India Chem 2000. The first such event will be held in October 2000 in New Delhi and it will be held biannually thereafter.

4.2    The event is being organized by the Federation of Indian Chambers of Commerce and Industry (FICCI) with the support of 12 industrial associations related to these sectors.

5.    CHEMICAL WEAPONS CONVENTION

5.1   Chemical Weapons Convention is a universal non-discriminatory, multilateral, Disarmament Treaty, which bans the development, production, acquisition, transfer, use and stockpile of all chemical weapons. The Treaty puts all the States Parties on an equal footing. Countries who produce and use chemicals that can be conveniently converted into chemical weapons have to be open and transparent about the use they put these chemicals to. The Convention was opened for signature on 13^th January, 1993 in Paris. India signed the Convention on 14^th January, 1993.

5.2     The Convention entered into force on 29^th April, 1997. So far 126 countries have ratified the Treaty. Some of the important countries which have ratified the Treaty include USA, China, Japan, United Kingdom, France, Germany, Australia, Canada, Russia, Pakistan and Netherland . The Convention is being implemented by the Organisation for the Prohibition of Chemical Weapons (OPCW) established in the Hague.

5.3     As national implementation measure and in order to fulfil its obligation under the Convention, each State party has to designate or establish a National Authority to serve as the national focal point for effective liaison with the Organisation and other State Parties. In India the National Authority has already been established.

5.4     According to the Directory of the World Chemical Producers. India is a significant producer of scheduled chemicals accounting for 4.4% of the total production the world over. India also exports substantial quantities of scheduled chemicals. The Convention permits commercial production of those chemicals which are used for non-prohibited purposes.

5.5     The Convention identifies toxic chemicals in three schedules. Schedule 1 lists chemicals that are produced and stockpiled as chemical weapons. Schedule 2 contains such precursors which pose significant risk to the objective and purpose of CWC, since these chemicals are capable of generating Schedule 1 chemicals. In Schedule 3 are listed dual purpose chemicals that have large number of legitimate civilian commercial applications and which could also be used for purposes of developing chemical weapons.

5.6     Declarations and verification are the two important aspects for implementation of the Convention. Each State Party is required to make annual declarations of the production, import and export of scheduled chemicals and their production facilities. India has been making declarations within the prescribed time frame.

5.7     Inspections are routinely conducted by the OPCW to ensure that the activities in scheduled chemicals are in accordance with the provisions of the Convention. India has so far received three inspections – two in schedule 2 chemical production facilities and one of a schedule 3 chemical production facility.

5.8     The samples collected by the inspecting teams during the inspection are analysed in laboratories accredited by the OPCW. India so far has no such laboratory. The Institute for Pesticide Formulation Technology (IPFT) under the Department of Chemicals & Petrochemicals has been participating in the Round Robin tests conducted by the OPCW worldwide to assess the capabilities of laboratories. Laboratories are accredited if they succeed in these tests. Besides the IPFT, two other laboratories from India – IICT, Hyderabad and DRDO, Gwalior also participated in the last Round Robin test which was held in September, 1999.

5.9     To be able to discharge the obligations under the Convention, each country is required to have a domestic legislation, which makes the filing of correct information about various activities in schedule chemicals mandatory. The Indian CWC Bill was passed by the Rajya Sabha on 2^nd June, 1998 and was pending consideration in the Lok Sabha when it was dissolved. The Bill lapsed. In the meanwhile, the American Act was passed which contained provisions contrary to the provisions of the CWC. The developments related to the American Act were considered by the Steering Committee on CWC. The Steering Committee recommended some changes in the Indian Bill. The draft CWC Bill will now be put up for approval by the Cabinet after which it will be introduced in the Parliament.

C. PETROCHEMICALS INDUSTRY

1.0   Indian Petrochemicals industry has made rapid strides in terms of production and consumption. Production of major petrochemicals (excluding fibre intermediates) increased from 3575 KTs in 97-98 to 3904 KT in 98-99 registering an increase of 9% over the previous year. Consumption of major petrochemicals also increased from 4005 KTs in 97-98 to 4517 KTs in 98-99 registering an increase of 13%. Viewed in the backdrop of general economic slowdown and adverse impact of crisis in South East/ East Asian countries on domestic petrochemical sector, above growth figures assume added significance.

1.1    The country is poised towards increasing self reliance and reduction in import dependency in this sector. The Table given below shows the production and consumption of major petrochemicals:-

                                                                                                               (FIGURES IN KT)

2.0    OLEFINIC COMPLEXES :

2.1    IMPLEMENTED

1. AURAIYA GAS CRACKER COMPLEX
   

The project has been implemented as UP Petrochemicals Complex at Auriya, UP in March 1999. The products include 300,000 TPA Ethylene and downstream products dedicated HDPE 100,000 TPA and Swing plant for HDPE/LLDPE 160,000 TPA. The project cost is Rs. 2500 crores.

2. IPCL ( MGCC)
   

M/s IPCL have implemented the expansion of their existing gas cracker capacity from 300,000 TPA to 400,000 TPA and HDPE/ LLDPE swing plant capacity from 160,000 TPA to 220,000 TPA during April 1999-2000.

UNDER IMPLEMENTATION

3. GANDHAR CRACKER COMPLEX :
   

M/s IPCL are implementing a Gas cracker project at Gandhar, Gujarat, with Ethylene capacity of 300,000 TPA. In the first phase they have implemented 150,000 TPA of PVC and Caustic soda 1,30,000 TPA. In the second phase they have implemented 160,000 TPA HDPE The projects for the manufacture of 100,000 TPA MEG and Gas cracker are likely to be implemented by March, 2000.

4. HALDIA PETROCHEMICALS COMPLEX
   

Haldia Petrochemicals Ltd. is a joint sector project with West Bengal Industrial Development Corporation, Tata and Chatterjee Petrochem, NRI Group. The project includes 420,000 TPA of Ethylene and other downstream polymer products HDPE 225,000 TPA, HDPE/LLDPE swing plant and Polypropylene - The complex is expected to be commissioned in 1999-2000.

5. ASSAM GAS CRACKER PROJECT :

       vii. PUNJAB CRACKER PROJECT :

*******

III.   BHOPAL GAS LEAK DISASTER

1.0    Following the leakage of the lethal gas known as Methyl Iso-Cyanate (MIC) stored in the storage tanks of Union Carbide factory at Bhopal, causing death and injury to a large number of people of the Bhopal city, various relief and rehabilitation measures were undertaken by the State and the Central Government.

2.0    Action plan for the rehabilitation of Bhopal Gas victims

2.1    The Central Government had provided financial assistance to the extent of Rs.102 crore over a period of 4 years from 1985 for rehabilitation work. Subsequently, an Action Plan with an outlay of Rs.163.10 crore was approved by the Central Government for medical, economic, social and environmental rehabilitation of the victims. The major component of the Action plan was the medical rehabilitation which inter-alia, included addition of 785 bed-capacity by constructing 5 new hospitals.

2.2    A review of the implementation of the Action Plan was undertaken in July,1997 which revealed that many of the rehabilitation schemes were still incomplete. It was decided, in consultation with the Government of Madhya Pradesh, to further extend the period of the Action Plan up to 30.9.98 and again up to 31.7.99. The outlay has also been revised to Rs.258 crore, it has been decided that for subsequent maintenance and recurring expenditure in respect of all the schemes under the Action Plan, the State Government would make appropriate provision in its Annual Plan. The Central Government has released its share of 75% of the outlay.

3.   SPECIALITY HOSPITAL AT BHOPAL

3.1    The Supreme Court, vide its Order dated 3.10.1991, directed that the Union Carbide Corporation (UCC) should fund the construction, equipping and functioning of a hospital for the Bhopal Gas victims for a period of eight years. The company agreed to do so if they were allowed to raise funds by sale of Union Carbide India Limited (UCIL)’s shares held by them which were attached by the trial court in the criminal case against the company. Acceding to the request, the Supreme Court directed the sale of shares and released Rs.65 crore from the proceeds thereof to the company for the purpose. The Government of India made available Rs.57 crore which were recovered as capital gains tax on the sale of company shares (Rs.53.5 crore) and the dividend (Rs.3.5 crore) on the shares under attachment. The State Government made available 52.34 acres of land (free of cost) and subsequently made available additional 28.45 acres of private land. The Supreme Court, in April 1996, released a further amount of Rs.187 crore plus interest, from the attached amount, for setting up of additional facilities viz. Cardio Thoracic Surgery Unit, Research-cum-Teaching Centre and setting up of up to 10 Mini Units. The Hospital will have 300 beds.

4.    Adjudication of Compensation claims

4.1    The process of adjudication of claims for payment of compensation to the victims of the disaster commenced in February 1992. The actual disbursement of the money could be started only in October 92 when the compensation amount which had been deposited by the Union Carbide India Ltd. with the Reserve Bank of India under the orders of the Supreme Court was transferred to the Welfare Commissioner adjudicating the claims.

4.2    To give an opportunity to those persons who may not have filed their claims even during the five years period that was allowed for filing of claim applications, a notification under Section 4(1) of the Bhopal Gas Leak disaster (Registration and Processing of Claims) Scheme, 1985 was issued on 2^nd December, 1996. The total number of claims including those filed in response to notification dated 2.12.96 is 10,26,767. It is expected that all the claims filed will disposed of by the year 2000. The position of adjudication of compensation claims as on 31.8.99 was as follows:

IV.    PUBLIC SECTOR PERFORMANCE

A.    DRUGS AND PHARMACEUTICAL UNDERTAKINGS

    There are five Central Public Sector Undertakings and six Joint Sector Undertakings in the Pharmaceutical Industry Sector under the administrative control of the Department of Chemicals & Petrochemicals. Besides this, there are two wholly owned subsidiaries and a registered Society. The brief profile of these organizations is given in the subsequent paragraphs:

1.2    The report of the Operating Agency indicated that it would not be possible to prepare a viable and acceptable rehabilitation plan for IDPL. The Government had, thereafter been considering various options with regard to the future of IDPL. IDPL was advised to submit revised rehabilitation proposal as a whole and unit-wise, with a cut off date as on 30.9.98 and 31.12.1998 and 31.3.99. As per the Rehabilitation proposal submitted by IDPL computed as on 30.9.98, the total cost was Rs.2034.12 crores including Rs.48.01 crore towards capital Expenditure, direct cash financial Assistance of Rs.646.96 crore, the component of sacrifices being Rs.696.97 crore and write off of Rs.674.68 crore. This proposal has been obtained from IDPL to reflect costs and figures with cut off dates as of 31.3.2000 and 30.6.2000.

1.3    The operations of IDPL are closed except for marginal production in some of the units. The wages and salaries of the employees are being paid through non-plan assistance (loans) released by Government since October, 1996 pending a final decision on the revival of the company. The Group of Ministers considering the issue relating to revival of IDPL had decided in a meeting held on 8.8.1997 that such release of wages would be paid to the employees of five non-joint venture units. In the current financial year against a total provision of Rs.56.09 crore in RE 1999-2000 for meeting expenses relating to salary/wages of employees of IDPL under the non-plan (loans) Head, a total of Rs.55.676 crore has been release as of date covering the salary for the period upto December, 1999. A statement showing financial assistance made to the company since 1993-94 is enclosed.

2.    HINDUSTAN ANTIBIOTICS LTD. (HAL)

2.1    Hindustan Antibiotics Ltd. (HAL), Pimpri, Pune was incorporated on the 30^th March, 1954. This was the first Public Sector company in drugs and pharmaceuticals. HAL has its plant located at Pimpri. There are three joint sector units promoted by HAL in collaboration with the respective State Governments. These are Karnataka Antibiotics & Pharmaceuticals Ltd. (KAPL), Bangalore in Karnataka, Maharashtra Antibiotics & Pharmaceuticals Ltd. (MAPL) at Nagpur in Maharashtra and Manipur State Drugs & Pharmaceuticals Ltd. (MSDPL) at Imphal in Manipur. The main products of HAL are bulk drug Penicillin-G various salts of Penicillin and Streptomycin. The company produces a wide range of Pharmaceutical formulations including agro-vet products.

3.    BENGAL CHEMICALS & PHARMACEUTICALS LTD.(BCPL)

3.1    This was a sick company in the private sector in the name and style of Bengal Chemicals & Pharmaceuticals Works. The management of the company was taken over by the Central Government with effect from 15^th Dec.1977. It was nationalized from the 15^th Dec.1980. A new public sector company in the name and style of Bengal Chemicals & Pharmaceuticals Ltd. (BCPL) was incorporated on the 17^th March, 1981.

4.2    The company has two manufacturing units, one each at Baranagar at Calcutta (West Bengal) and at Dehradun (UP). The main products of the company are Sera, Vaccines and Toxoids with its own know- how and indigenous raw materials.

4.4    The performance of BIL during the first three years of the revival period i.e. 1994-95 to 1996-97 had been below the targets envisaged. The BIFR took a review of the progress in the implementation of the sanctioned revival package in a hearing held on 11.1.1996 at Calcutta. The BIFR directed the BIL management to prepare a perspective plan for the next five years. The BIFR also directed that BIL should get a manpower study conducted by a professional Consultant/Organisation with a view to laying down work norms and to determine option of utilization of manpower. BIL entrusted the manpower-cum-productivity norms study to the West Bengal Productivity Council (formerly Calcutta Productivity Council).

4.5    In the hearing held on 5.4.99, BIFR declared the Scheme sanctioned on 3.1.95 a failure. As per directions of BIFR, a consultant (IIM, Calcutta) has been appointed to conduct a techno-economic feasibility study. Report of the study is expected shortly, viability of the company would be known after details of the Report are examined .

4.6    Pending a decision on the future of BIL, non-plan assistance in the form loans is being released by Government from time to time for payment of wages/salaries of the employees, since August, 1998. During the current financial year out of a total of Rs.5.62 crore provided in RE 1999-2000 for meeting expenditure of BIL through non-plan loans, primarily for meeting salary/wages of the employees, a total of Rs.5.0354 crore has been released to BIL till date, which includes the salary/wages for the period upto December, 1999 only. A statement showing financial assistance released to the company since 1994-95 is enclosed.

5.     SMITH STANISTREET PHARMACEUTICALS LIMITED (SSPL)

5.1    It was a sick company in the private sector in the name and style of Smith Stanistreet Company Limited. The management of the company was taken over by the Central Government with effect from 4^th May, 1972. It was nationalized on 1^st October, 1977 and a new public sector company in the name and style of Smith Stanistreet Pharmaceuticals Ltd. (SSPL) was incorporated on the 19^th July, 1978.

5.2    The company has its registered office at 18, Convent Road, Calcutta(West Bengal). SSPL manufactures pharmaceutical formulations, viz. tablets, capsules, parenterals, liquid orals etc.

5.3    The company was formally declared sick by the Board for Industrial and Financial Reconstruction (BIFR) on the 21^st December, 1992. The BIFR, on the basis of the report of the Industrial Reconstruction Bank of India (IRBI) (now the Industrial Investment Bank of India (IIBI), Calcutta, the Operating Agency appointed by it and the support extended by the Government of India approved a revival package on the 31^st August, 1994. The revival package is for ten years beginning from 1994-95.

5.4    The performance of the company in the first three years of the revival period had been far below the targets for a variety of reasons including shortage of key manpower. The BIFR reviewed the implementation of the scheme in a hearing held on 3.7.1996. The BIFR noted that the performance in 1994-95 and 1995-96 was far behind the targets. The BIFR however, taking the efforts being made by the management and the promoters, took the view that the progress could be watched for some more time.The BIFR decided that the projections for the years 1996-97 to 2003-2004 would need reworking and passed directions to the Operating Agency (IIBI), Calcutta to rework the projections. The BIFR also directed the SSPL management and promoters to furnish revised projections to the Operating Agency. The company prepared the revised projections and forwarded the same to the Operating Agency (IIBI), Calcutta. The report of the Operating Agency (IIBI), indicated that the company would need extraordinary levels of support and sacrifices from the Government and others for revival. However, another PSU, BCPL was also advised to prepare a Revival Package for SSPL. A view is yet to be formulated by giving due consideration to the reports. Pending a decision on the revival, the Govt. is releasing non-plan loans from time to time to the company to enable it to meet the wages/salary commitments.

6.    Details of production and sales of PI-PSUs

PERFORMANCE IN 1997-98

PERFORMANCE IN 1998-99

7.    JOINT SECTOR UNDERTAKINGS.

7.1    RAJASTHAN DRUGS & PHARMACEUTICALS LIMITED (RDPL)

7.2     UTTAR PRADESH DRUGS & PHARMACEUTICALS LTD. (UPDPL)

This is a joint sector undertaking promoted by Indian Drugs and Pharmaceuticals Ltd(IDPL) and the Pradeshiya Industrial Investment Corporation of Uttar Pradesh(PICUP). IDPL holds 51% of the equity shares and the rest is with PICUP. The company was incorporated in 1978 and the commercial production was established in October 1979. The company has its manufacturing unit and the registered office located at Lucknow (Uttar Pradesh). The main products and pharmaceutical formulations are in the form of Tablets, Capsules, Powders, Liquid Orals and Injectables.

7.3     ORISSA DRUGS & CHEMICALS LIMITED (ODCL)

This is a joint sector undertaking promoted by Indian Drugs & Pharmaceuticals Ltd. (IDPL) and the Industrial Promotion and Investment Corporation of Orissa (IPICOL), IDPL holds 51% of the equity shares and the rest is with IPICOL. The company was incorporated in 1979 and commissioned fully for production from September, 1983. The company has its manufacturing unit and its registered office in Mancheshwar Industrial Area, Bhubaneshwar in the State of Orissa. The company is engaged in the manufacture of Pharmaceutical formulations in the form of Tablets, Capsules, Powders, Ointments etc.

7.4     KARNATAKAANTIBIOTICS & PHARMACEUTICALS LTD. (KAPL)

This is a joint Sector Undertaking promoted by Hindustan Antibiotics Ltd. (HAL) in collaboration with Karnataka State Industrial and Investment Development Corporation (KSIIDC). HAL holds 51% of the equity shares and the rest is with KSIIDC. The company was incorporated on the 13^th March, 1981 and the commercial production established from August, 1984. The manufacturing units and the registered office of the company is located at Bangalore (Karnataka). The main products are pharmaceuticals formulations like Tablets, Capsules, Injectables, etc., KAPL has from the very first year of its operations been earning profits.

7.5     MAHARASHTRA ANTIBIOTICS & PHARMACEUTICALS LTD. (MAPL).

This is a joint sector undertaking promoted by Hindustan Antibiotics Ltd. (HAL) and State Industries Corporation of Maharashtra (SICOM). HAL holds 51% of the equity shares and the rest is with SICOM. The company was incorporated in November, 1979 and the commercial production established in May, 1981. The registered office and the factory of the company is located at Nagpur (Maharashtra). This is also a pharmaceutical formulation unit manufacturing Tablets, Capsules, Liquid Orals, Ointments, injectables etc.

The company had incurred a net loss in 1995-96 and consequently the net worth of the company became negative. On a reference by the Board of Directors of the company, the BIFR formally declared MAPL as sick on 14.1.1997. IDBI, Mumbai was appointed as the Operating Agency for a techno-economic viability study. The Operating Agency made a techno-economic analysis and found that the revival of MAPL would require restructuring of the previous loans and fresh financial assistance of about Rs.1.26 crore from the two existing promoters. Since the two promoters did not come forward with the requisite support, the Operating Agency reported the matter to the BIFR for further directions. The BIFR in a hearing held on 25.6.97 passed directions, inter-alia, to the Operating Agency to proceed for issue of an advertisement for change of management. The BIFR also directed that proposals, if any, of the existing promoters, should be furnished and such proposals would be given preference. A proposal submitted by a private party, namely Neelam Gemstones is being considered.

7.6    MANIPUR STATE DRUGS & PHARMACEUTICALS LTD.(MSDPL)

This is a joint sector undertaking promoted by Hindustan Antibiotics Ltd(HAL) and in collaboration with Manipur Industrial Development Corporation (MANIDO). HAL holds 51% of the equity shares and the rest is with MANIDO. The company was incorporated on the 18^th July, 1989. The project with an estimated original outlay of Rs.2.50 crore is yet to be fully commissioned. A part of the production facilities has been commissioned. The manufacturing unit and the registered office is at Imphal(Manipur).

8.    WHOLLY OWNED SUBSIDIARIES:

8.1    IDPL(TAMIL NADU) LIMITED, CHENNAI.

In terms of the approved revival package the Surgical and Formulation Unit of IDPL at Chennai has been converted into a wholly owned subsidiary in the name and style of IDPL (Tamil Nadu) Limited, Chennai with effect from the 1^st April, 1994. IDPL holds the entire equity capital of this unit. The past long-term liabilities amounting to Rs.59 crore as on 31.3.1994 have been taken over by IDPL.

B.    PETRO-CHEMICAL UNDERTAKINGS/ORGANISATIONS

1.    INDIAN PETROCHEMICALS CORPORATION LIMITED

1.1    The formation of Indian Petrochemicals Corporation Limited (IPCL) as a public sector company was a culmination of the thought process of the Government on the Industry. The Corporation was incorporated on 22nd March, 1969 as a Company under the Companies Act, 1956 with its registered office at PO Petrochemicals, District Vadodara-391346.

1.2    CAPITAL STRUCTURE:

The capital structure of the Corporation as on 31st March, 1998 was as under:

A) Share Capital                                                                                           (Rupees in crore)

1.3    LOCATION OF THE UNITS: The company has three mega petrochemical complexes based at Vadodara and Gandhar, District Bharuch in Gujarat and Nagothane, District Raigad in Maharashtra.

1.4    The year 1998-99 was another year of hard work in an extremely challenging scenario for the global petrochemical industry especially in the context of Asian economic crisis. The international market remained highly volatile and prices dropped by 35 per cent in comparison to corresponding period of previous year resulting in squeezing of margins. The year witnessed a steady fall in petrochemical prices throughout the year due to oversupply in domestic as well as international market. Despite these adverse factors, the Company on the strength of its volume, supply chain management and efficient marketing net work and other appropriate business strategies posted reasonable performance and could overcome the difficulties prevailing in the petrochemical business worldwide.

1.5    FINANCIAL REVIEW:  The highlights of the financial results for the financial year ended 31st March, 1999 are as under:-                        

                                                            (Rs. in Crores)

1.6    1998-99 was a difficult year due to greater competition from cheap imports and supply - demand mismatch in the domestic market resulting in greater stress on margins. Further, the Company absorbed higher depreciation due to Nagothane expansion and interest charges due to increased requirement of funds for working capital and capital expenditure involved in the second phase projects of Gandhar Complex. Operating margin was achieved despite lower international prices, primarily due to enhanced focus on cost reduction and productivity through improved commercial orientation in material management functions, besides well maintained operations, marketing and management of finance.

1.7    DISINVESTMENT : In line with Government of India’s strategy to move out of non-core activities, the Disinvestment Commission identified petrochemicals as a non-core business and recommended a strategic sale of 25 per cent of its equity to a partner along with management control. Accordingly, the Government of India has initiated steps for the divestment process. The Government now holds a stake of 59.95 per cent in the Company which could be diluted to 51.2 per cent by 2002 if the outstanding foreign currency convertible bonds (FCCBs) are fully converted. The strategic sale, when completed will reduce the Government’s stake to 34.95 per cent.

1.8    REVIEW OF OPERATIONS: The operating performance of the Company’s three mega complexes at Vadodara, Nagothane and Gandhar during the fiscal 1998-99 was as under:-

1.9    Vadodara Complex : The production of major saleable products at Vadodara Complex during 1998-99 stood at 4.56 lakh metric tonnes compared to 4.18 lakh metric tonnes achieved in the corresponding previous year and registered a growth of 9 per cent. The overall capacity utilization of the Complex was around 95 per cent as against 87 per cent achieved in the corresponding previous year.

1.10    Nagothane Complex : The Gas Cracker Complex at Nagothane in Maharashtra performed well despite fairly long shutdown for maintenance and hooking up expanded capacities. The Complex achieved a record production of 3.63 lakh metric tones of MOU products and maintained it at the level of previous year despite 45 days’ long shutdown taken for expansion of the gas cracker plant from 3 lakh to 4 lakh metric tonnes per annum of ethylene coupled with expansion of downstream polyethylene swing plant from 1.35 lakh to 2.20 lakh metric tonnes per annum. The overall capacity utilization of the Complex was 87 per cent. The Company has entered into an agreement with Gas Authority of India Limited for committed supply of lean gas to Nagothane Complex.

The operations at Gandhar Complex has stabilized and the Complex, during fiscal 1998-99, produced 2.52 lakh metric tonnes of saleable products as against 1.76 lakh metric tonnes achieved in the corresponding previous year and registered 43 per cent growth in the production. The overall capacity utilization of the Complex was 89 per cent.

1.12     The combined production of all the 3 complexes taken together stood at 10.71 lakh metic tonnes as against 9.65 lakh metric tonnes achieved in the corresponding previous year and registered a growth of 11 per cent. The contribution of polymer, fibre & fibre intermediates and chemical group of products in the said production from all the three complexes, during the year was 68, 10 and 22 per cent respectively, whereas the combined capacity utilization of all operating plants in the three Complexes during 1998-99 was around 91 per cent.

1.13    All the three Complexes, gainfully utilized the infrastructure facilities available with the Company at Dahej (Jageshwar) and Pirpauv near Mumbai by importing significant quantity of key feed stock for running the plants at their peak capacities and registering savings on account of competitive feed stock costs from imports. The jetty and pipelines between Dahej and Vadodara were used optimally to fulfill the needs of both Vadodara and Gandhar Complexes.

1.14    SALES & MARKETING

The petrochemical industry witnessed considerable turbulence during the year as prices of all petrochemical products were at their lowest ebb. On the supply side, significant capacity additions have taken place for all major petrochemical products in the South- East Asian and Middle East regions. These countries with abundant and cheap feed stock are formidable competitors.

1.16     MEMORANDUM OF UNDERSTANDING : 1998-99

The Memorandum of Understanding for 1998-99 signed by the Company with Government of India, conceived detailed activities and milestones leading to fast completion of the second phase plants at Dahej and projects envisaged at Nagothane Complex with thrust on new and ongoing research and development activities, development of key catalyst, environment protection etc.

1.17    HUMAN RESOURCE MANAGEMENT REVIEW: The Company regards the human resource as its prime resource and the contribution from the employees has continuously been harnessed for attainment of organizational goals. During the year, a conducive and congenial work environment was maintained and some of the contentious issues were successfully resolved. The manpower strength as on 31st March, 1999 was 13904 inclusive of supervisory/ non-supervisory employees and trainees. In order to optimize manpower strength, the Company has introduced a voluntary retirement scheme on medical grounds. During the year, 7216 employees were trained and the services of Company's trained manpower are being availed by leading companies both within the country and abroad for operations and maintenance of plants.

1.19    The Company, as a matter of policy, continues to meet some of the basic needs of the villages surrounding its Complexes and developmental work is prioritized, according to the needs of the people in the peripheral village. As a part of good community relations and to encourage developmental efforts, the Company took up several projects in the vicinity of its Complexes to improve the quality of life of the people through recognized Trusts and welfare bodies promoted by the Corporation. During the year, efforts were intensified for progressive use of Hindi in official work in accordance with the provisions of the Official Language Act, 1963 and the Official Language Rules, 1976.

1.20    RESEARCH & DEVELOPMENT: The year 1998 has been eventful for R&D Centre as it celebrated its silver jubilee by organisining seminars on the theme ‘Business and Technology’ and ‘Research and Industry Partnership’. A new manufacturing capacity was created at Catalysts and Adsorbents Division at Thane for the production of dehydrogenation catalysts used in linear alkyl benzene manufacturing. Several important grades of molecular sieves and alumina were also commercialized during the year. A new grade of molecular sieve for removing carbon dioxide and moisture from air was successfully commercialized. This molecular sieve is used as adsorbent for manufacture of high purity nitrogen and oxygen used extensively in chemical and petrochemical plants and will reduce dependence on imports. The operations from CATAD unit during the year under review established sales of catalyst valued at Rs. 13.70 crores as against Rs. 5.42 crores achieved in the corresponding previous year and registered significant growth both in production and sales volume of catalyst.

1.21    The Centre bagged two awards from DSIR and Indian Institute of Chemical Engineers and the Centre’s out put in terms of presentation of scientific papers and filing of patents was commendable. The Centre was granted US Patent for development of a process for the production of para-diethyl benzene, a high value chemical used for separation of paraxylene from other similar compounds.

1.22    ENVIRONMENT, SAFETY AND ENERGY CONSERVATION: Safety, occupational health and environmental protection has always been of prime concern to the Company and are integrated with the management of entire supply chain. The Company’s constant endeavour to improve the standards of safety and environment is reflected in the practice of setting annual targets for all round improvement at all its manufacturing locations. Performance is monitored through regular safety and environmental audits, using internationally accepted methodologies. Safety training is imparted to employees at all levels. The British Safety Council Award was conferred for the second time in succession for excellence in safe operation of the plant. The Company’s safety performance got further recognition with awards from the National Safety Council of the United States of America for continuous operation without occupational injury or illness.

1.25   Energy conservation is a key element of corporate strategy for competitive advantage. The Company’s performance in the field of energy conservation has been receiving due recognition and appreciation by the Government of India through Energy Conservation Awards. The specific energy index during the year under review for three production complexes of the Corporation in its totality stood at 4.95 MMKCal per metric tonne. This is indicative of Company’s commitment towards energy conservation at every stage of its operations and maintaining the index well within the annually targeted figure of 5.50 MMK Cal per metric tonne.

1.26    INFORMATION TECHNOLOGY: The Company has its own communication net work with a number of locations connected through dedicated VSATs. This net work is being further strengthened and upgraded. The Company has made major efforts to examine all the information technology systems in use for year 2000 compliance and is fully geared to achieve compliance well before dawn of the new Millennium.

1.27    TECHNOLOGY/ENGINEERING SERVICES

The Company’s Technology and Engineering Services Department, in pursuit of excellence in their area of operation, contributed significantly in maintaining higher level of capacity utilization, quality improvement of products for value addition, strategic collaboration for forward and backward integration, construction of several landfill sites for safe disposal of solid waste, proper upkeep of equipment and maintenance to avoid downtime. Continued efforts are made by the Department to improve upon the adopted technology in close association with Research & Development Centre and Process Licensors, laying emphasis on consumption of raw materials and chemicals to optimize the cost of production and improve the value added grades for higher returns.

Low density polyethylene & polypropylene copolymer plants of Vadodara Complex; low density polyethylene & polypropylene plants of Nagothane Complex have the distinction of ISO 9002 certification and several improvements have been made in the quality management systems of these plants as a result of continued internal and surveillance audits. Similar quality management systems have been implemented for linear alkyl benzene, polyvinyl chloride and polybutadiene rubber plants at Vadodara Complex. Substantial progress has been made in the area of ISO 14000 certification. An environmental management system has been evolved and implemented along with an environmental policy with special reference to acrylonitrile, ethylene oxide, ethylene glycol, central waste water treatment plants, solid waste incinerators etc. which are more environmental sensitive compared to other plants. The policy and system have been evolved to take care of meeting the statutory standards, ensuring continuous improvement in prevention of pollution, development for minimising environmental impacts and conservation of natural resources. Necessary steps have also been initiated in the direction to obtain ISO 14001 certification. The total quality management has taken deep roots and is helping the Company face the challenges of competition.

1.29    INVESTOR RELATIONS

The Investors’ Service Department operates from Vadodara to provide assistance to shareholders in dealing with the securities of the Company in close coordination with the appointed Registrars and Share Transfer Agents. The Company has already set up the requisite facilities for dematerialization of its shares in accordance with the provisions of the Depositories Act, 1996 and the Company’s shares can now be held and traded in electronic form. The Company’s shares are listed and traded in Ahmedabad, Bangalore, Calcutta, Chennai, Delhi, Mumbai, Vadodra and National Stock Exchanges whereas the Global Depository Receipts (GDRs) and Foreign Currency Convertible Bonds (FCCBs) are listed on Luxembourg Stock Exchange and the annual listing fees have been paid to each of the above Stock Exchanges. Due importance is given to redressal of investors’ grievances on priority by deputing representatives of the Registrars to the Stock Exchanges to ensure personal attention and quick redressal of investors’ complaints/ grievances. The shares of the Company are included in the list of securities specified by Securities & Exchange Board of India for trading only in dematerialized form. The Company has also entered into a tripartite agreement with Central Depository Services (India) Limited and the Share Registrars & Transfer Agents, pursuant to introduction of a multi-depository frame work for accelerating the pace of shift to scripless settlement, improved investor protection, reduced risks and transparency of transactions in the securities market.

JOINT VENTURES

1.30    GE Plastics India Limited

The Company's joint venture, GE Plastics India Limited, is in the midst of restructuring and is, therefore, in the process of extending its financial year up to September 30, 1999, to reflect the impact on its balance sheet and performance.

The joint venture company, upto 31st March, 1999, achieved a turnover of Rs. 248 crores as against Rs. 200 crores achieved in corresponding period of previous year and registered a growth of 24 per cent. The growth in sales was achieved despite weak demand from major end-use industry segment. Despite growth in sales volume, the Company, upto 31st March, 1999, suffered a net loss of Rs. 9.10 crores. The Company’s contribution margin remained under pressure due to aggressive pricing by South-East Asian competitors and shift in product mix with higher volume of Cycolac (ABS) and Gelon (Nylon 6) which gave negative contribution to the business.

1.31    Gujarat Chemical Port Terminal Company Limited

Gujarat Chemical Port Terminal Company Limited (GCPTCL), a joint venture of IPCL, and six Government of Gujarat Undertakings will be commissioned by end of 1999. The facility has a total project outlay of Rs. 725 crores and will cater to both import and export and would attract investment of Rs. 17,000 crores in the region. The port would provide facilities at a single berth for ships ranging from 6,000 DWT to 40,000 DWT and upto 215 Meters in length. The port would be equipped with 7 loaded arms ranging in diameter from 8 inches to 20 inches. The jetty would be located at 2.4 kilometers from the shore and would have full-fledged chemical handling facilities backed up by an effective storage capacity of 3.11 lakh cubic meters. Two double-walled cryogenic tanks of 50,000 and 30,000 cubic meters capacity would also be available for use. Storage tanks are arranged on the basis of product classification and compatibility in dyked enclosures.

The chemical handling port project taken by GCPTCL has made considerable progress. The construction work on the 2.4 kilometer long jetty has already commenced and considerable progress has been made. The construction of onshore storage facilities is also progressing satisfactorily. The port is expected to become operational by end of 1999 and would facilitate handling export consignments and augment feed-stock requirements for its production complexes. The facilities for storage of polypropylene and propane is expected to be made available by the joint venture early in the year 2000.

1.32    Other Joint Ventures

The other joint venture companies envisaged by the Corporation for the manufacture of acrylic fibre, methyl methacrylate and polymethyl methacrylate will take shape immediately after the activities related to setting up of acrylonitrile plant at Gandhar Complex are geared up and the project work set in motion.

1.33    PROJECTS

Some of the major projects completed during the financial year are as under:-

1.34    Nagothane-based Projects

Air Separation Plant

IPCL successfully commissioned the third chain of air separation plant at Nagothane Complex. With the third chain coming into existence, Nagothane Complex has an additional capacity of 4,000 NM3/hr of gaseous nitrogen (99.99 per cent purity), 100 NM3/hr of liquid nitrogen (99.99 per cent purity) to meet the additional demand of nitrogen and oxygen for the units proposed under Nagothane-based expansion projects as well as to ensure uninterrupted supply of nitrogen and oxygen to the production units when one of the air separation plants is under shoutdown maintenance.

Cryogenic storage facility at Pirpau

Cryogenic terminal facility for unloading storage and transfer of additional imported feed-stock at Nagothane has been successfully commissioned at Pirpau jetty, Mumbai, as part of Company’s gas cracker expansion project at Nagothane. The completion of gas cracker expansion project gives IPCL an advantage of reduced ethylene production cost and flexibility to import cheaper feed stocks. The entire project was executed on fast track basis and was put into commercial production without any difficulty. The gas cracker expansion has pushed ethylene capacity from three lakh tonnes to four lakh tonnes at Nagothane. The World Bank has appreciated Company’s efforts in maintaining the tight schedule in completing and commissioning the project.

Gas Cracker Plant Expansion

IPCL has successfully connected and commissioned an additional furnace and increased the ethylene capacity from 3 lakh tonnes per annum of its gas cracker plant at Nagothane to 4 lakh tonnes per annum. The expansion project has been completed on a fast track basis and commissioned for commercial production.

Expansion of polyethylene plant

The linear low density polyethylene and high density polyethylene plants at Nagothane Complex originally with a capacity of 1.6 lakh tonnes per annum have been successfully expanded by 40 per cent by adopting B.P. Chemicals Limited’s Innovative technology. The plant has been upgraded to be advantageous of the latest process and product development.

1.35    Gandhar-based projects

The Company is implementing the Gandhar Complex in two phases. Phase-I plants comprising of chlor-alkali, vinyl chloride monomer, polyvinyl chloride, utilities and power plant have already been commissioned and are operational. The Phase-II plants comprising of C2/C3 separation, gas cracker, ethylene oxide/ethylene glycol, high density polyethylene, utilities and power plant-II are in advanced stage of implementation and expected to be commissioned shortly. During the year, Gandhar Complex successfully commissioned the HDPE plant of 1.60 lakh metric tonnes based on process licence from Hoechst AG of Germany.

Pursuant to commissioning of HDPE plant at Gandhar Complex and Nagothane gas cracker plant expansion coupled with expansion of downstream polyethylene swing plant, the Company has become the largest producer of polyethylene in the country covering the entire range of polyethylene family with the combined capacity of 5.40 lakh metric tonnes per annum.

The 90 MW gas turbine-based cogeneration captive power plant for second phase project at Gandhar Complex is being executed through Larsen & Toubro Limited and India Infrastructure Development Limited (IIDL), wherein Larsen & Toubro Ltd. is the EPC (Engineering, Procurement & Construction) contractor and IIDL would own and lease the power plant to the Company. The project risks are mitigated by a completion guarantee from Larsen & Toubro Limited to cover EPC delays. The fluctuation in lease rentals due to variation in Foreign Exchange rates, base interest rates, depreciation and tax rates are mitigated through hedging agreement and make up guarantee from Larsen & Toubro.

1.36    BOARD OF DIRECTORS

The Corporation has been identified as one of the select band of ‘Navratna’ Public Sector Undertakings for special attention to enable it to become a global entity. Accordingly, the Company’s Board of Management has been restructured by inducting non-official Directors to enable the Board to exercise enhanced autonomy and delegation of powers. Accordingly, S/Shri S.M. Datta, D. Basu, J.S. Juneja (Dr.) and Shri Rajinder Gupta have been appointed by the Government as part-time non-official Directors of the Company.

2.    PETROFILS COOPERATIVE LIMITED (PCL)

2.1    INTRODUCTION

Petrofils Cooperative Limited (PCL) was registered in 1974 as a joint venture of Government of India and Weavers Cooperatives. PCL is governed under the Multi-State Cooperative Societies Act, 1984. The principal objective is to provide the benefits of modern technology of Polyester Filament Yarn (PFY) to the weavers in the cooperative sector, a weaker section of the Society. Besides Government of India and NCDC, PCL has 1446 Weavers Cooperative Societies from all over the country as its members.

2.2    The authorised capital of PCL is Rs. 50 crore of which the paid-up capital is as under: -

2.3    PCL produces Polyester Filament Yarn, Nylon-6 chips and Spandex Yarn in its four plants located at Vadodara and Naldhari in Gujarat. PCL sells Methanol being its by-product.

2.4    The total manpower of the Society as on 31.3.1999 was 2069 comprising 291 supervisory officers and 1778 non-supervisory staff including workmen.

2.5    On account of severe financial constrains and impending disconnection of power supplies, the PCL management took a safe shutdown of all the plants from the last week of November, 1998. In the year 1999-2000, only a sum of Rs. 1 crore was provided in the Budget as non-plan assistance to PCL. However, with the approval of the Finance Ministry, it was decided to provide non-plan financial assistance so that the Society can pay the wages and salaries to the employees upto September 1999. For payment of wages and salaries and essential administrative expenses, a total sum of Rs. 13.16 crore was released by the Department from the overall budget provision of the Department. The additional provision asked for in the Revised Estimates is on account of funds required for payment of wages and salaries to the PCL employees. The total provision asked on account of wages and salaries is Rs. 20 crore and this would be for payment of wages and salaries upto January 2000.

2.6    A rehabilitation proposal, which is based on a techno-economic viability study made by CRISIL, submitted by the PCL management, is under consideration. At present, the employees of the Society are being paid wages and salaries on the basis of matching Non-plan assistance given by the Government.

C.     CHEMICALS & PESTICIDES UNDERTAKINGS

1.     HINDUSTAN ORGANIC CHEMICALS LIMITED

1.1    Hindustan Organic Chemicals Limited (HOCL) was incorporated in December 1960. HOCL manufactures basic organic chemicals which are essential for vital industries like pesticides, drugs & pharmaceuticals, dyes & dye intermediates, resins & laminates, rubber chemicals, paints, textile auxiliaries and explosives, touching virtually every facet of everyday life. The Company has two production units located at Rasayani in Maharashtra and Cochin (Kochi) in Kerala. the Rasayani Unit which manufactures Nitroproducts, Aniline, Formaldehyde, etc. was commissioned in the year 1970 and the which manufactures Phenol, Acetone, Propylene and Hydrogen Peroxide was commissioned in the year 1988. The installed capacity of Rasayani Unit is 2,24,870 TPA and that of Cochin Unit is 1,52,865 TPA. HOCL enjoys the Mini-Ratna (Category-I) status. The company has a subsidiary, namely, M/s. Hindustan Fluorocarbons Ltd. having its production Unit at Radraram in Andhra Pradesh, which manufactures Poly Tetra Fluoro Ethylene (PTFE).

1.2    The authorised capital of the company is Rs.70.00 crores. The paid up capital of the company as on 31.03.1999 is Rs.67.27 crores. The compant’s present turnover is abovt Rs.417 crores. The networth of the company is Rs.349.16 crores, which is 5.19 times its equity base. Presently the shareholding of the Govt. of India in the company is 58.61%. The Disinvestment Commission in its XII^th Report has recommended disinvestment of 33% of HOCL shares of the company’s equity out of GOI holding to a strategic buyer while retaining 26% of GOI. The recommendations of the Commission on HOCL are engaging the attention of the Govt.

1.3    Operations during 1998-99.

During the year under report the company achieved a production of 274447 MT against 270702 MT in 1997-98 and Sales Volume of 185862 MT against 178471 in 1997-98. However, the sales turnover for the year was Rs.417 crores in the year under report as compared to Rs.476 crores in 1997-98. The decline in turnover occurred during the second half of the year which was due to steep reduction in international prices of major products like Phenol, Acetone, Aniline, PNT, etc. increase in the customs tariff and increase in the prices of major feedstocks like Benzene, Toluene, LPG, Naphtha and Sulphur, which resulted in tighter margins. However, the reduction in Excise Duty by 2% and restoration of 100% Modvat credit was a positive step. The company recorded a Net Loss of Rs.23.05 crores in 1998-99 as compared to Rs.(-)0.82 in the previous year. The loss in 1998-99 as mentioned above is mainly on account of steep lowering of prices of the major products (Phenol, Acetone and Aniline) in the international market. These three products constitute about 65% of the total turnover. Safeguard Duty has been imposed on Phenol w.e.f. 30.06.1999. the entire Net Loss for the year under report has been set off against General Reserves and thus the company has no accumulated loss as on 31.03.1999.

1.4    The overall expenditure during the year was Rs.457.92 crores as compared to Rs.506.64 crores in the previous year. This reduction in expenditure was achieved by the company by way of savings in raw materials cost, factory and administrative overheads, etc. More efforts in this direction are continuing. Major focus during the year has been on reduction the fixed cost. In its effort to reduce personnel expenditure, the company introduced Voluntary Retirement Schemes (VRS) in January, 1999 and ffor the period upto March, 1999, 118 employees opted for the scheme. The entire VRS compensation was funded by the company. these efforts coupled with rationalization of manpower and retraining and redeployment will contribute effectively in lowering fixed cost particularly in the Rasayani Unit.

1.5    Physical and Financial Performance during the last five years.

1.6    Status of important projects

2.    HINDUSTAN INSECTICIDES LIMITED

2.1    Hindustan Insecticides Limited (HIL) was incorporated in 1954 and set up its factory in Delhi for manufacture of 700MT of Technical DDT and it’s Formulation into 50% wdp to meet the demand of National Malaria Eradication Programme (NMEP) launched by the Govt. of India. The production capacity of this unit was doubled in the year 1958-59 and thereafter, to reduce the import of DDT, the capacity of the plant was further increased to 2744 MT per annum to Technical DDT and 5488 MT per annum of Formulation DDT in 1969. In 1957, the company set up their second factory at Udyogamandal near Cochin for the manufacture of 1344 MT per annum of Technical DDT and 2688 MT per annum of Formulation DDT. In 1971, a plant was put up for the manufacture of Benzenehexachloride (BHC) having capacity of 3000 MT per annum to meet the requirement of agriculture and public health. In 1980-81 the company set up a plant at Rasayani in Maharashtra for the manufacture of 1800 MT per annum of Technical Malathion and 3200 MT per annum of Malathion (Formulation), an insecticide for public health. Further, another DDT Technical Plant with an annual capacity of 5000 MT and its Formulation with a capacity of 10,000 MT per annum was also set up at Rasayani in 1983.

2.2    With a view to diversify into Agro Pesticides, HIL put up manufacturing facilities for Endosulfan technical – 1600 MT p.a. and its Formulation – 1900 KL p.a. at Udyogamandal. Production facilities for Butachlor Technical – 1000 MT per annum, Butachlor Formulation – 905 KL and Monocrotophos technical – 300 MT and Monocrotophos Formulation – 255 KL, were also set up at Rasayani during 1990-91.

2.3    During 1995-96, one stream of Butachlor Technical Plant was converted for manufacture of Phosphamidon Technical Plant and Carboxin Tech. With the technology developed in-house at R&D Complex, Gurgaon.

2.4    A new plant for manufacture of 150 MT per annum of Dicofol Technical at Udyogamandal Unit was commissioned in 1996. a Plant for manufacturing of Mancozeb Technical with 1000 TPA capacity and its formulation is in an advanced stage of completion at Udyogamandal Unit.

2.5    The company has already entered in the field of eco-friendly bio-pesticides and has introduced Bti and Btk (both larvicides) for public health and plant protection respectively alongwith HILMILIN-an Insect Growth Regulator (IGR) used widely in agriculture as well as for Public Health.

2.6    As per order of the Hon’ble Supreme Court, the Delhi Unit of the company stopped functioning w.e.f. 30.11.1996. The site for relocation of Delhi Unit has been selected at Batinda in Pubjab and land measuring 54,383 Sq. yards (11.2 acres) has been acquired from M/s. Punjab Small Industries and Export Corporation (PSIEC). The foundation stone for a ‘State of the Art’ preticides formulation plant was laid on 08.07.1999 by Hon’ble Minister for Chemicals & Fertilizers. The project, in its first phase will be completed in 18 months at an estimated cost of Rs.7.70 crores and on its completion the plant will produce a wide range of eco-friendly and safer insecticides, weedicides, fungicides in various formulations like solid, granular and suspension concentrates.

2.7    The Govt. has imposed a ban on the production of BHC in the country. Hence, the company has stopped the operation of BHC Plant at Udyogamandal Unit w.e.f. 01.04.1997.

2.8    HIL has its Central R&D Complex at Gurgaon in Haryana. The Central R&D complex has scientific and technical personnel working in various departments such as synthesis, process development, formulations, entomology, residue studies, analytical techniques and pilot plant. At present R&D is developing process technologies for manufacture of technical grade pesticides and also for intermediate products. Other services rendered by R&D include pilot plant trials and attending to the day-to-day raw materials and finished products quality testing as well as trouble shooting at production units of the company.

2.9    The performance of the company is as under:-

                                                                                                                  (Rs. in Lakhs)

2.10    The turnover for the year 1998-99 was Rs.132.19 crore against previous year turnover of Rs.120.04 crore. The decline in profitability was mainly on account of loss of production and idle expenditure due to closure of Delhi unit w.e.f. 30.11.1996 as per orders of the Hon’ble Supreme Court, coupled with reduced order for DDT from NMEP.

2.11    HIL achieved an export turnover of Rs.10.32 crore in 1998-99 as against Rs.10.16 crore during 1997-98 by exporting its products to many developed and developing countries.

2.12    The company also has a subsidiary company, viz. The Southern Pesticides Corporation Ltd. with Headquarters at Hyderabad and factory at Kovvur in Andhra Pradesh.

2.13    DISINVESTMENT

The Disinvestment Commission has recommended diverting of 51% equity in HIL to a strategic partner, along with management control, so that the company could diversify and expand its activities with new technology and additional investment. The report is under examination by the Government.

A.    NATIONAL INSTITUTE OF PHARMACEUTICALS EDUCATION AND RESEARCH (NIPER).

1.1   As a part of the economic package for the State of Punjab, the setting up of a national level institute in that state was announced by the Government of India. A registered society in the name and style of the National Institute of Pharmaceutical Education and Research (NIPER) was set up on the 27^th February, 1991. The Institute has been set up at Sector-67; SAS Nagar, Mohali, near Chandigarh on 130 acres of land, provided free of cost by the State Government of Punjab. The Institute with an approved outlay of Rs.99 crores is ready with basic infrastructure.

1.2    The National Institute of Pharmaceutical Education and Research has been conceived as an institute of excellence and learning in pharmaceutical science and technology and it will be the only institute of its kind in the country. NIPER has been declared as an institute of national importance by Act No.13 of 1998.

1.3    The research activities of the Institute have been started from the year 1997. A number of sponsored projects from the pharmaceutical Industry in different disciplines of Pharmaceutical Sciences have been initiated. These also include some projects sponsored by World Health Organisation. The teaching programmes leading to the Masters and Doctoral Degrees have been initiated since January, 1998. In the continuous education programme, the Institute has conducted many seminars and workshops in the field of Pharmaceutical Sciences for pharmacy teachers and industry personnel. The Institute has published about 40 research publications in both national and international journals in the past two years. To give a boost to the R&D effort in the pharmaceutical industry, the Institute is in the process of setting up National Centres at various places.

1.4    With its multi-disciplinary approach, the NIPER would set standard for pharmaceutical colleges and for research & development in the field of pharmaceuticals. It is expected that the Institute through its students, faculty and its research programme will assist the pharmaceutical sector of the industry to make a confident entry into the new era of global competition.

B.    CENTRAL INSTITUTE OF PLASTICS ENGINEERING AND TECHNOLOGY(CIPET)

2.1    Central Institute of Plastics Engineering and Technology(CIPET) was established in 1968 as an Autonomous Organisation under the Administrative control of Deptt. of Chemicals & Petrochemicals. The basic objective of CIPET is to train people in various disciplines of plastics such as mould making, mould design, testing and characterization of plastics, plastic processing etc., for the plastic industry. The institute is also organising various short-term courses tailor-made courses, awareness programmes and entrepreneurs development programmes, etc., in the field of plastics at various centres located at 12 different places in the country viz., Chennai (HQ), Ahmedabad, Lucknow, Hyderabad, Bhubaneswar, Bhopal, Imphal, Amritsar, Mysore, Patna, Howrah and Assam(approved in March, 1999).

2.2    Training:- The Training Centre in Patna (Bihar) has been expanded to the level of extension centre and Extension Centre in Howrah (West Bengal) have been established to accelerate the growth of plastic industries in and around that area by providing the requisite training services required for these industries. The centre in Patna is also organising three long-term courses with 85 students and centre in Howrah is also conducting four long-term courses with 130 students in a year. The basic objective behind organising these activities is to create the necessary awareness as also to provide the basic knowledge to the budding entrepreneurs to set up manufacturing facilities for plastic goods.

2.3    2344 students were trained by the institute in eight long-term courses in 1998-99 as against the 1743 students in 199596. In addition, 162 short-term courses were conducted in 1998-99 involving 1463 participants, 49 tailor-made programmes were also conducted for the industry, besides undertaking a number of developmental projects and awareness programme. The institute also conducted State Govt. sponsored training programme in the specific areas for the benefit of SC/ST candidate, Women Entrepreneurs and Rural Small Scale Entrepreneurs, Modernization of CIPET facilities through World Bank Assistance has been implemented. The World Bank Project implementation was commenced in September, 1993 for Modernization of CIPET facilities at a total cost of Us $12 million has been completed in September, 1997.

2.4    Technical services:- CIPET undertakes fabrication of intricate moulds and provide the same to public / private sector undertakings, Govt. organisations and medium/small scale industries.

*******

C.    INSTITUTE OF PESTICIDES FORMULATION TECHNOLOGY (IPFT)

3.1    INTRODUCTION :

The Institute of Pesticide Formulation Technology (IPFT) was established in May, 1991 as a Government of India Society registered under the Societies Act under the Department of Chemicals & Petrochemicals, Ministry of Chemicals & Fertilizers, Government of India. IPFT is an institution building project of UNDP / UNIDO and Government of India to cater to the needs of not only the Indian pesticide industry but also of the Asia and the Pacific Region. It is a non profit making research Institute. The Institute has a Governing Body comprising of academicians, eminent scientists, administrators, financial experts, professionals as well as experts from the pesticide industry.

3.2    OBJECTIVES

The objective of the Institute is to promote advancement of Pesticide Formulation Technology in India. The Institute aims to develop and promote safer, efficient, economical and environment friendly pesticide formulations and utilities with indigenously available raw materials. The Institute is recognised by the Department of Scientific and Industrial Research, Ministry of Science and Technology, Government of India. The Institute has also been assigned the role of Technical Coordinator Unit of the Regional Network on Safe Pesticides Production & Information for Asia and the Pacific (RENPAP), Programme of UNDP/UNIDO on Pesticide Formulation and Quality Control.

3.3    The Institute has basic research and development laboratories and training facilities on various aspects of formulations like development, manufacture, quality control, safety in use and packaging. It has been recognised as an independent test laboratory by Bureau of Indian Standards (BIS) for analysing / testing of pesticide samples and their formulations. The Institute provides analytical services, method development, method validation and verification of impurity profile of technical pesticides to the pesticides industry and the BIS.

The Institute is headed by a Director and is located on Delhi-Jaipur National Highway No.8 at Sector 20, Udyog Vihar, Gurgan, Haryana.

3.4    SERVICES RENDERED TO THE PESTICIDE INDUSTRY – PESTICIDE FORMULATION :

One of the major objectives of the Institute is to develop and provide the pesticide formulation industry with user and environment friendly pesticide formulations so that the Indian farmers can have access to the user friendly products like their counterparts in the developed countries. The universally acceptable safer formulations are Suspension Concentrants (SC), Micro Emulsion and Controlled Release formulations.

3.5    FORMULATION LABORATORY ;

The Institute is well equipped with most of the facilities required for the development of state-of-the art pesticide formulations. The specialised equipment available at the laboratory includes Dynomill (KDL special), Eiger Mill, Fluid Bed Spray Granulator, Spray Drier, Turbula Pan and Disc.Granulators, Extruder, Micro Pulversor, Silverson, Mixer, climatic Chamber Laser Based Particle Size Analyser, Rheometer, Film, Balance Surface and Interfacial Tensio Meters, Viscometers and Research Microscopes.

3.6    ANALYTICAL LABORATORY:

The Analytical Laboratory of the Institute is fully equipped with the state-of-the-art analytical Instruments namely, Gas Chromatograph coupled with Mass Spectrometric Detector (GC-MSD), High Performance Liquid Chromatograph (HPLC), Super Critical Fluid Chromatograph (SFC), High Performance Thin-Layer Chromatograph (HP-TLC), etc.

3.7    BIO-SCIENCE LABORATORY:

The Bio Science Laboratory which is fully equipped to undertake evaluation of pesticides and their formulations for bio-efficacy, phyto toxicity, compatibility and insect resistance to insecticides has carried out a number of sponsored projects.

3.8    PILOT PLANT:

The Institute has a fully equipped pilot plant for scaling up of new formulations developed in the formulation laboratory upto semi-commercial level. The facility includes Dynomill Fluid Energy Mill, Lodige Mixer, Ribbon Blender and Hammer Mill besides various size reduction Mills. The pilot plant equipments are being utilised for in-house and commercial work on technology development. The equipments are being used for live demonstrations during the training programmes.

3.9    HUMAN RESOURCES:

The Institute has a team of highly qualified, trained and competent scientists and technologies and many of them have been trained in world famous laboratories as part of expertise building programme under the UNDP / UNIDO assistance. Some of the staff members have served as UNIDO consultants in the developing countries.

3.10    REGIONAL NETWORK ON SAFE PESTICIDES, PRODUCTION AND INFORMATION FOR ASIA AND THE PACIFIC (RENPAP)

It is a network programme funded by the UNDP and executed by the UNIDO in association with FAO / WHO / ESCAP / CIRAD. There are 15 countries of Asia and Pacific region, viz., Afghanistan, Bangladesh, China, Indonesia, Iran, Malaysia, Myanmar, Nepal, Pakistan, Philippines, Republic of Korea, Sri Lanka, Thailand and Vietnam participating in this programme. The main thrust of the programme is to replace the hazardous pesticide products and technologies with those which are user and environment friendly through mutual sharing of experience among the member countries of the Network. The Government of India has been providing the Secretariat support facilities to the Regional Coordinating Unit.

VI.   GENERAL

ORGANISATION SET UP OF THE DEPARTMENT

The main activities of the Department are policy making, sectoral planningpromotion and development of chemicals, petrochemicals and pharmaceutical industries. The administrative and managerial control of the public sector undertakings engaged in the manufacture of various chemicals, pharmaceuticals and petrochemical items and some other organisations is a major function of the Department.

2. The Department is headed by Secretary to the Government of India who is assisted by 3 Joint Secretaries. There is a separate section dealing with the work relating to Bhopal Gas Leak Disaster and the Special Act relating thereto. Government has constituted a 3 Member Committee under the Chairmanship of a retired judge of Delhi High Court to review the entire matter relating to the liabilities assessed against drug companies and furnish its recommendations to the Government on a case to case basis.

3. There is an attached office namely "National Pharmaceutical Pricing Authority" which looks after Price fixation/revision of pharmaceuticals and other related matters. It also monitors the prices of decontrolled drugs and formulation and oversees the implementation of the provisions of the Drugs (Price Control) Order. In addition there are 8 public sector undertakings and 4 other organisations under the administrative control of the Department. The names of these are given in Annexure V.

4. Employment of Scheduled Castes/Scheduled Tribes/Physically handicapped in the main Secretariat of the Department of Chemicals & Petrochemicals, as on 31.10.99 is as under :

7. The Department has a Chief Vigilance Officer of the rank of Joint Secretary to look into the complaints against the employees of the Department as well as Board Level Officers of all the Public Sector Undertakings and Organisations under its administrative control . He is assisted by a Deputy Secretary and an Under Secretary along with a Vigilance Section. A Conference of Chief Vigilance Officers of all Public Sector Undertakings and Organisations under the administrative control of the Department was held on 3^rd June, 1999. In the Conference , speakers from Central Vigilance Commission and Department of Personnel and Training participated. The Conference provided to the Chief Vigilance Officers an opportunity to acquaint themselves with the latest instructions of the Government and a forum to discuss various issues concerning vigilance.

8.    A number of complaints were received and investigated and appropriate action was taken against the officials/officers concerned. Some cases have been referred to the CBI for detailed investigation and for taking appropriate action against the concerned officers.

IMPLEMENTATION OF OFFICAL LANGUAGE POLICY

There is a Hindi section in the Department . This section oversees the implementation of various provisions of the Official Language Act, 1963, Official Language Rules 1976 and orders issued thereunder. It also looks after the progressive use of Hindi in the Department of Chemicals and Petrochemicals and the Public Sector Undertakings/Institutions/Organisations under its administrative control .

During 1999-2000, Section 3(3) of the Official Language Act was complied with in the Department. General Orders, Rules, Notifications, Press Communiques etc., were issued in both Hindi and English. Letters received in Hindi were replied to in Hindi. Hindi ‘Pakhwara’ (fortnight) was organised from 1^st to 15^th September, 1999 during which officers and employees of the Department were advised to use Hindi to the maximum extent in their official dealings. Essay Competition, Noting/Drafting Competition , Typewriting Competition and ‘Bhartiya Bhasha Kavita Path Competitions’ in Hindi/other Indian Languages were organised during this period. Four prizes of Rs.550, Rs.450, Rs.350 and Rs.100 each were awarded to the winners of the above competitions. In addition to the above cash prizes, they were also given certificates under the signature of the Secretary, Department of Chemicals & Petrochemicals. Hindi workshop was organised during the last week of July,99 in the Department to train the employees in Hindi noting and drafting . Besides, one Hindi workshop each was organised at National Institute of Pharmaceuticals Education and Research, Mohali, Punjab and in Bengal Chemicals and Pharmaceuticals Limited, Calcutta.

Official Language Implementation Committee

An Official Language Implementation Committee exists in the Department. Its meetings were regularly held and implementation of the official language policy were reviewed in the meetings. For effective implementation of the Official Language, all section officers have been included in this committee as members. Follow up action was also taken on various decisions taken in the above meetings.

Quarterly Progress Reports

The Department continued to receive Quarterly Progress Reports regarding use of Hindi in official work from the companies/institutions and reviewed the progress.

Hindi Teaching Scheme

Staff and Officers of the Department with inadequate working knowledge of Hindi were nominated for Hindi training. Action for imparting training to the staff in Hindi. Typewriting and Hindi Stenography was continued during the year.

Inspection by the Committee of Parliament on Official Language

The first sub-committee of the Committee of Parliament on Official Language visited the Department on 05^th Feb.,99. Oral Evidence of the Secretary, Department of Chemicals and Petrochemicals and Chairman & Managing Directors/Managing Directors of the companies under this Department was taken on 15th April,99 by the Committee of Parliament on Official Language.

In addition to the above, inspections were carried out of Hindustan Organic Chemicals Ltd., Indian Petro Chemicals Corporation Ltd., Hindustan Insecticides Ltd., Hindustan flurocarbons Ltd. and National Institute of Pharmaceutical Education and Research etc by the officers of this Department to review the progress in the implementation of official language.

The Department made the best possible efforts to achieve the targets fixed in the Annual Programme for the progressive use of Hindi received from the Department of Official Language.

NATIONAL INFORMATICS CENTRE OF DC&PC

Introduction

National Informatics Centre, Ministry of Information Technology has been rendering computerization support to the Department of Chemicals & Petrochemicals since middle of eighties. Collaborative efforts of NIC alongwith Department of Chemicals and Petrochemicals have resulted in significant computerization of their functional areas. Efforts on a continued basis have been made to upgrade the hardware, software and Networking platforms, so that users are able to utilize state-of-the art facilities.

Networking

Significant networking has been undertaken in the Department of Chemicals & Petrochemicals, as a result of which every officer having a PC on his desk is in a position to share data and file in a secure manner and to utilise Internet and Email services.

Year 2000 Problem

NIC, in association with the Department, initiated efforts in resolving Year 2000 crisis. Efforts were also made in collecting inventory of hardware items and doing impact analysis. PSUs and attached offices were also directed to collect the inventory and do impact analysis. As a result all PSUs attained full Y2K compliance and successfully moved into the Year 2000.

WEB Site

NIC put in efforts in designing and launching of the website of the Department of Chemicals & Petrochemicals. The site was launched in July'1999. The Hindi version of the site was launched in February, 2000. The address of the site is www.nic.in/cpc

Training

The NIC organised training courses on the following topics for the officers/staff of the Department.

1. Exposure to Windows 95/98
2. MS Word
3. MS Excel
4. File Sharing on NETWORK
5. E-Mail
6. Internet.

Till October,1999, around 50 officials had been trained.

IT Plan

As part of Computerisation and implementation of IT Plan, a sum of Rs. 45.52 lakhs was approved for purchasing the hardware . As a result, 47 PCs, One server and other related hardware have been procured through NICSI.

Database Status

• Production Monitoring System developed for Petrochemicals Division using Oracle database has been converted to windows based environment using Visual Basic 6.0 and SQL Server.
• Payroll is being generated on monthly basis.
• Export/Import Monitoring system is also being developed using HTML and Java.
  
  
  
  
  

                                                                                                                       ANNEXURE-I

LIST OF ITEMS ALLOCATED TO THE DEPARTMENT OF CHEMICALS & PETROCHEMICALS (RASAYAN AUR PETRO RASAYAN VIBHAG)

1. Drugs and Pharmaceuticals
2. Insecticides (excluding the administration of the Insecticides Act, 1968 (48 of 1968)
3. Molasses distribution and pricing
4. Alcohol-industrial and potable (excluding Alcoholic drinks from non-molasses base) including the Indian Power Alcohol Act, 1948 (22 of 1948)
5. Due-stuffs and dye-intermediates
6. All organic and inorganic chemicals not specifically allotted to any other Ministry or Department
7. Planning, development and control of and assistance to all industries dealt with by the Department
8. All attached or subordinate offices or other organizations with any of the subjects specified under this Department
9. Public Sector projects concerned with the subjects included under this Department except such projects as are specifically allotted to any other Ministry or Department
10. Bhopal Gas Leak Disaster-Special Laws relating thereto
11. Petro-chemicals
12. Industries relating to production of non-cellulosic synthetic fibres(Nylon, Polyster, Acrylic etc.)
13. Synthetic rubber
14. Plastics including fabrications of plastic and moulded goods
15. All Public Sector units relating to the above matters
16. All attached and subordinate offices or other organizations concerned with any of the subjects specified in this list.

CAPACITY AND PRODUCTION OF CHEMICALS DURING 1998-99, 1999-2000,
AND ANTICIPATED PRODUCTION DURING 2000-2001.

                                                                                                                                   000MT

* COMBINED CAPACITY, PLANT BEING M ULTIPURPOSE.

CAPACITY, PRODUCTION & PETROCHEMICALS
MAJOR PETROCHEMICALS
( ACTUAL & ANTICIPATED )

(Figures in '000MT)

National Pharmaceutical Pricing Authority

Public Sector Undertakings :

1. Hindustan Organic Chemicals Ltd., Rasayani, Maharashtra.
2. Hindustan Insecticides Ltd., New Delhi.
4. Indian Drugs & Pharmaceuticals Ltd., Dundahera Industrial Complex, Dundahera, Gurgaon, Haryana.
5. Hindustan Antibiotics Ltd., Pimpri, Pune, Maharashtra.
6. Smith Stanistreet Pharmaceuticals Ltd., Calcutta, West Bengal.
6. Bengal Chemicals & Pharmaceuticals Ltd., Calcutta, West Bengal.
8. Bengal Immunity Limited, Calcutta, West Bengal.
9. Indian Petrochemicals Corporation Ltd., PO Petrochemicals, District-Vadodara, Gujarat.

1.  Petrofils Cooperative Ltd., PO Petrofils, District – Vadodara, Gujarat.
2.  Central Institute of Plastic Engineering & Technology, Guindy, Chennai.
3.  Institute of Pesticides Formulation Technology, Gurgaon, Haryana.
4.  National Institute of Pharmaceuticals Education and Research, Mohali, Punjab.