The Indian Telephone Industries (ITI) received a huge financial
assistance of Rs 130 crore from the Government of India. ITI, which is a state
run company, is suffering a huge loss for last few years. It has failed to pay
salary to its employees, so the government is helping ITI to pay due salaries
to its employees. The Cabinet Committee on Economic Affairs has sanctioned this
financial assistance in the form of grants-in-aid to ITI. This aid will help
the suffering company (ITI), which is facing a very hard time, to pay the
salary to its employees for the next four months.
The
government wants to ensure that the employees of the ITI would get their salary
in time so that they could motivate themselves to work in the company. ITI is
on a slow and steady process of comeback trail from being a sick and suffering
company.
ITI
has around 9,655 employees in total, and this aid will directly benefit them
and their families too. They will work hard to bring back the lost glory of
ITI, which the government is eagerly waiting for. ITI, which is mainly a
Bangalore-based company, has already incurred an accumulated loss of Rs 4,149 crore
till the end of September 2011.
There
are a few crucial reasons for what the ITI has not been able to compete on its
own strength area. There has been a huge change in the technology preference in
the recent market. The market is now coupled with inadequate in-house
infrastructure and R&D for catering to an exponential increase in wireless
technology.
The
company was unable to invest in R&D and a few new product lines due to some
social obligation of running some of the non-profitable operation in the past.
The costs were also very high and fixed which cost the company a huge loss
indeed. We seriously hope that the company will achieve better margins in this
highly competitive market in coming future.
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