73. All about Public Sector Undertakings in India
All the information you need about PSE's and PSU's
Public Sector Enterprises (PSE's) and Public Sector Undertakings (PSU's) are vital components of India's economy, owned and operated by the government. These entities play a significant role in various sectors, contributing to economic growth, job creation, and the development of critical infrastructure across the country.
Public Sector Enterprises (PSEs)
PSEs are state-owned enterprises with a vital role in India's economy and society.
Classified into Departmental Undertakings, Non-Departmental Undertakings, and Financial Institutions.
Operate in diverse sectors like defence, energy, mining, transport, banking, insurance, etc.
Performance and Categories
PSEs are categorized as Schedule A, B, C, and D based on performance and financial parameters.
Some enjoy special statuses like Navratna, Miniratna, or Maharatna for enhanced autonomy and competitiveness.
Objectives of PSEs
Set up to achieve self-reliant economic growth.
Provide essential goods and services.
Promote balanced regional development.
Create employment opportunities.
Ensure stability in prices and balance of payments.
Maharatna, Navratna, Miniratna Status
Maharatna: Given to select PSEs with exceptional financial performance and global operations.
Navratna: Granted to profitable and efficient PSEs with substantial autonomy in decision-making.
Miniratna: Awarded to smaller PSEs with a track record of profits and functional autonomy.
New Public Sector Enterprise Policy
The government’s recent policy classifies sectors into strategic and non-strategic.
Limited to four PSEs in strategic sectors, promoting focus and efficiency.
Remaining PSEs in strategic sectors and all PSEs in non-strategic sectors considered for privatization or closure.
Status and Benefits
Government grants Navratna, Miniratna, and Maharatna statuses based on performance and financial parameters.
These statuses enhance operational autonomy and competitiveness.
1. Maharatna Companies
Highest status introduced in 2009.
8 companies hold Maharatna status.
🔹Criteria for Maharatna:Average annual turnover > Rs. 25,000 crore in the last 3 years.
Average annual net worth > Rs. 15,000 crore in the last 3 years.
Average annual net profit after tax > Rs. 5,000 crore in the last 3 years.
Significant global presence and international operations.
🔹Benefits of Maharatna:
Enhanced delegation of powers to the Board of Directors.
Investment up to Rs. 5,000 crore or 15% of net worth in a project without govt. approval.
Authority to enter into joint ventures, set up subsidiaries, and overseas offices.
Flexibility in human resources management.
2.Navratna Companies
Second-highest status introduced in 1997.
16 companies hold Navratna status.
🔹Criteria for Navratna:
Four independent directors on the Board.
Score of 60 or above out of 100 on performance parameters.
🔹Benefits of Navratna:
Enhanced delegation of powers to the Board of Directors.
Investment up to Rs. 1,000 crore or 15% of net worth in a project without govt. approval.
Authority to enter into joint ventures, set up subsidiaries, and overseas offices up to 30% of net worth.
Flexibility in human resources management.
3.Miniratna Companies
Third-highest status introduced in 1997.
Two categories: Miniratna Category-I (59 companies) and Miniratna Category-II (15 companies).
🔹Criteria for Miniratna
🔹Category-I:
Profits for the last three years or net profit > Rs. 30 crore in one of the three years.
Positive net worth.
🔹Category-II:
Profits for the last three years.
Positive net worth.
🔹Benefits of Miniratna
🔹Category-I:
Enhanced delegation of powers to the Board of Directors.
Investment up to Rs. 500 crore or 50% of net worth in a project without govt. approval.
Authority to enter into joint ventures, set up subsidiaries, and overseas offices up to 15% of net worth.
🔹Category-II:
Enhanced delegation of powers to the Board of Directors.
Investment up to Rs. 300 crore or 50% of net worth in a project without govt. approval.
🔹To learn more on updated List of the status, follow @ayusshsanghi and visit the link below
https://dpe.gov.in/en/about-us/policy-i-division/list-maharatna-navratna-and-miniratna-cpses
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