ET reported that state owned aluminium producer Nalco has funded many educational institutions as part of its corporate social responsibility but no financial assistance has been given to any private university.
Mr Dinsha Patel mines minister of India said that "Financial assistance from Peripheral Development Fund has been provided by Nalco to many educational institutions, trusts, etc, over the years. Financial assistance has not been provided to any private university."
He was replying to a question whether National Aluminium Company Limited has extended financial assistance to a private university from the Peripheral Development Fund in gross violation of laid down norms/guidelines.
According to the Mines Minister, Nalco had provided financial assistance of INR 3.0 million Centurion School of Rural Enterprise Management between 2008 and 2009 and 2009 and 2010 for purchase of aluminium fabrication machines and computers for the benefit of their students.
Mr Patel said that "When the funds were released, Centurian School of Rural Enterprise Management was not a private university but an engineering and management institution. Nalco Board has approved allocation of 1 per cent of profit of the preceding year for periphery development activities in the succeeding year.
He said that out of the allocable amount of PDF, Nalco allocates 40% each to its mines and refinery complex at Damanjodi and smelter and power complex at Angul, while rest 20% is retained for corporate level activities.
He added that an Odisha government constituted Rehabilitation and Periphery Development Advisory Committee decides the expenditure on various peripheral development activities at Nalco's Damanjodi and Angul complexes.
Mr Patel said that Odisha based aluminium producer's net profit has declined in last 3 years due to various reasons, including fall in metal prices in London Metal Exchange, increase in input costs and increase in employee expenditure due to pay revision.
The company had recorded a net profit of INR 1,069 crore in 2010 to 2011. However, this has come down to INR 850 crore during the last fiscal. Besides, the aluminium producer reported a net profit of INR 228 crore during the H1 of the current financial year.
He said that the declining trend of profit of Nalco has been viewed with concern by the government and appropriate directions are given to the company's management by the Mines Ministry after performance review to improve its performance.
