HAL’s financial reports showed that the MoD owed the defence public sector undertaking a total of Rs 14,000 crores at the end of financial year 2018-19
Bangalore: Hindustan Aeronautics Ltd’s (HAL) cash reserve has dropped to its lowest since 2004 as it settled at a measly Rs 140 crore at the end of financial year 2018-19 as a result of the mounting dues that the Ministry of Defence (MoD) is yet to clear. HAL’s financial reports showed that the MoD owed the defence public sector undertaking (DPSU) a total of Rs 14,000 crores at the end of financial year 2018-19.
Cash reserves plummet by 98%
At the end of financial year 2017-18, HAL had a cash reserve of Rs 6,524 crore. The figures for FY2019 shows that the PSU’s cash-in-hand has went down by a massive 98 percent. The only time that the PSU’s cash reserve had been this low was in 2003-04 when the figure settled at Rs 4,841 crore.
On the other hand, its receivables have nearly doubled from Rs 7,741 crore. The pending bill spertain to products and services that have already been delivered by HAL. A big chunk of these dues is owed by Indian Air Force.
Emails sent to both MoD and IAF for a comment on the matter did not elicit a response.
HAL had to borrow Rs 962 cr in December to pay salaries
Earlier in December last year, the DPSU had been forced to borrow funds to clear its employees’ salaries. It had borrowed Rs 962 crores in December 2018 as its cash-in-hand had gone negative for the first time.
The dues from the armed forces stood at Rs 15,700 crore as of December 31. HAL CMD R Madhavan had then said that it could touch Rs 20,000 crore by March 31. Even though the ministry has partly cleared the bills, the outstanding dues stood at Rs 13,938 crore as on March 31, 2019.
HAL also paid interim dividend of Rs 662 cr
Despite its poor cash position, HAL paid an interim dividend of Rs 662 crore to the government in 2018-19.