Vazhakulam Agro and Fruit Processing Company Limited in which the State government has majority stake is virtually closed for lack of working capital. A senior company official said repeated requests for working capital were pending with the government.
The company has substantial arrears to be paid to the Kerala Electricity Board (KSEB). The KSEB was on the verge of cutting power supply but is learnt to have refrained from doing so since a fruit processing unit is still operational.
The salary of around 100 employees has been paid partially for the month, while top managers have resigned and left the company. Lack of experts in areas such as processing, marketing, technical control, and production has affected the functioning of the organisation, said other sources in the fruit processing company behind ‘Jive’, a brand of fruit drinks.
The company official who said that the fruit processing facility was virtually closed indicated that it could not survive the ordeal as of now. Though the government had earlier promised a working capital loan of ₹2 crore at 9% interest, that has not been forthcoming. The government is of the view that there is no provision for extension of working capital.
The crisis has also almost stalled new projects that had been lined up at the Vazhakulam-based company, which was founded to help pineapple farmers with a support price when market conditions demanded.
The agro fruit processing unit was set up in 1998 under an initiative of the erstwhile Horticulture Development Programme with support from the European Union.
