Bangalore: Battered by huge losses, public sector telecom equipment major in India, Indian Telephone Industries Limited (ITI) said on August 5 it plans to close down the Rae Bareilly plant, having a workforce of 5,000, soon and also offer voluntary retirement service (VRS) to at least 3,500 to 4,000 employees in the current financial year.

Chairman and managing director of the Bangalore-headquartered company, Y K Pandey, said as high as 11,000 employees of the total workforce of 19,000 have been identified as "surplus" and various options are being explored to cut staff.

ITI reported a net loss of Rs 374.75 crore on a sales of Rs 1,798.54 crore for 2002-03.

Responding to questions at a press conference, Pandey said in a bid to reduce the workforce, the company is thinking of various steps such as VRS, retrenchment, redeployment and lowering of retirement age.

Excess staff is key to company's huge losses, he said.

Pandey said the company expects that 3,500 to 4,000 employees would opt for VRS in the current financial year.

He said a sum of Rs 150 crore would be needed to fund the VRS, adding, the government has assured to give the company a go-ahead to float bonds to raise the money.

Rai Bareilly plant, which the company plans to close down, mainly manufactures C-Dot exchanges, he said, adding, one of the two plants in Bangalore would have to be closed down as well. The company today has a total of seven plants. "We don't need seven plants," he said.

PTI