Odisha Cabinet Approves Rs 200 Crore to Liquidate Defunct Textile Units

Odisha is rolling out a comprehensive restructuring plan to turn around its struggling textile sector, hoping to unlock valuable land and draw new manufacturing investment. On the eve of its two-year anniversary, the Odisha Cabinet, led by Chief Minister Mohan Charan Majhi, approved eight major proposals spanning six departments. Among the highlights: the Handloom, Textiles and Handicrafts Department got the green light to liquidate several non-functional cooperative spinning mills, powerloom units, and a failed sizing unit—all casualties of heavy losses, outdated equipment, and shifting market dynamics.

To cut through the legal and financial hurdles tied to these properties, the Cabinet set aside Rs 200 crore as an initial funding injection. This money pays for a one-time settlement with creditors, banks, and other stakeholders. The Empowered Committee, appointed by the state, thoroughly reviewed the assets and liabilities of the defunct units operating under the Odisha State Co-operative Spinning Mills Federation Ltd. (SPINFED), tallying up a total of Rs 361.67 crore in unpaid dues.

Paying off these old debts clears the way for the state to reclaim roughly 261.2 acres of prime land scattered throughout Odisha. After the liquidation and settlements wrap up, these land parcels will go to the Odisha Industrial Infrastructure Development Corporation (IDCO). IDCO will then redevelop the sites, targeting new, job-rich projects—especially fresh textile and apparel manufacturing facilities.

Chief Secretary Anu Garg, briefing reporters after the meeting, linked the move to the government’s broader track record. The 42nd meeting marks 301 decisions in the two years since this administration took office. Officials say this focused approach positions Odisha as a top hub for garment and textile manufacturing in eastern India. At the same time, it wipes out old financial baggage and promises to spark new jobs for local communities.