The Ministry of Finance had agreed to release Rs 50 million to NDL so that the state-owned pharmaceutical company - which was forced to shut down its manufacturing base after failing to improve its manufacturing practices - could spring back into action.[break]
“But the amount allocated by the ministry is short of Rs 50 million of what we asked for and is not enough to start production,” Navin Kumar Jha, general manager of NDL, told Republica.
Earlier, NDL had formally asked the ministry for Rs 100 million to upgrade its manufacturing facilities and purchase raw material required for production of around 20 different types of medicines. But the finance ministry did not fulfill its request citing budget crunch.
NDL has claimed the money allocated for it is not enough as almost Rs 15 million of what it is getting would go into clearing liabilities of staff who have retired.
“Another Rs 8.4 million will go into paying two months of salaries of staff,” Jha said, adding, “the remaining of around Rs 26 million won´t be enough to serve our purpose”.
The finance ministry has, however, asserted the money that is being given away should be used for resuming the company´s operation. “The money is not being given to finance administrative expenses. So it shouldn´t be spent in any other areas other than production of drugs,” a high-ranking official of the finance ministry said, adding, a meeting will soon be held with top NDL management officials on the issue.
NDL, a troubled state-owned enterprise, shut down its operations almost three years ago after the Department of Drugs Administration refused to renew its operating license saying that its production standard did not comply with minimum manufacturing standard set by the drugs regulator.
Since then the government has been providing a sum of around Rs 4.2 million per month to cover salary expenses of 279 staff at the company.
The government has been trying to reduce this liability by introducing voluntary retirement scheme but the company has demanded Rs 579.1 million to lay off staff, which the finance ministry has said is an “exorbitant amount”.
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