Public sector undertakings in India

A state-owned enterprise in India is called a public sector undertaking (PSU) or a public sector enterprise. These companies
are owned by the union government of India or one of the many state or territorial governments or both. The company stock
needs to be majority-owned by the government to be a PSU. PSUs strictly may be classified as central public sector enterprises
(CPSEs) or state level public enterprises (SLPEs). In 1951 there were just five enterprises in the public sector in India, but in
March 1991 this had increased to 246.

CPSEs are companies in which the direct holding of the Central Government or other CPSEs is 51% or more. They are
administered by the Ministry of Heavy Industries and Public Enterprises.

Contents
History
Governance
List of public sector undertakings
See also
References

History
When India achieved independence in 1947, it was primarily an agricultural country with a weak industrial base. There were only
eighteen Indian Ordnance Factories in the country which the British had established for their own economic interest and rule the
subcontinent with brute force.[1] The national consensus was in favour of rapid industrialisation of the economy which was seen
as the key to economic development, improving living standards and economic sovereignty.[2] Building upon the Bombay Plan,
which noted the requirement of government intervention and regulation, the first Industrial Policy Resolution announced in 1948
laid down broad contours of the strategy of industrial development. Subsequently, the Planning Commission was constituted in
March 1950 and the Industrial (Development and Regulation) Act was enacted in 1951 with the objective of empowering the
government to take necessary steps to regulate industrial development.[3] Prime Minister Jawaharlal Nehru promoted an
economic policy based on import substitution industrialisation and advocated a mixed economy.[4] He believed that the
establishment of basic and heavy industry was fundamental to the development and modernisation of the Indian economy. India's
second five year plan (1956–60) and the Industrial Policy Resolution of 1956 emphasised the development of public sector
enterprises to meet Nehru's national industrialisation policy. His vision was carried forward by Dr. V. Krishnamurthy known as
the "Father of Public sector undertakings in India". Indian statistician Prasanta Chandra Mahalanobis was instrumental to its
formulation, which was subsequently termed the Feldman–Mahalanobis model.[5][6]

The major consideration for the setting up of PSUs was to accelerate the growth of core sectors of the economy; to serve the
equipment needs of strategically important sectors, and to generate employment and income. A large number of "sick units" were
taken over from the private sector. Additionally, Indira Gandhi's government nationalised fourteen of India's largest private banks
in 1969, and an additional six in 1980. This government-led industrial policy, with corresponding restrictions on private
enterprise, was the dominant pattern of Indian economic development until the 1991 Indian economic crisis.[3] After the crisis,
the government began dis-investing its ownership of several PSUs to raise capital and privatise companies facing poor financial
performance and low efficiency.[7][8]
Governance
Certain public sector undertakings have been awarded additional financial autonomy. These companies are "public sector
companies that have comparative advantages", giving them greater autonomy to compete in the global market so as to "support
[them] in their drive to become global giants".[9] Financial autonomy was initially awarded to nine PSUs as Navratna status in
1997.[10] Originally, the term Navaratna meant a talisman composed of nine precious gems. Later, this term was adopted in the
courts of Gupta emperor Vikramaditya and Mughal emperor Akbar, as the collective name for nine extraordinary courtiers at their
respective courts.

In 2010, the government established the higher Maharatna category, which raises a company's investment ceiling from Rs. 1,000
crore to Rs. 5,000 crore.[11] The Maharatna firms can now decide on investments of up to 15 per cent of their net worth in a
project while the Navaratna companies could invest up to Rs 1,000 crore without explicit government approval. Two categories
of Miniratnas afford less extensive financial autonomy.

Guidelines for awarding Ratna[12] status are as follows:

Miniratna Miniratna
Maharatna Navratna
Category-I Category-II
A score of 60 (out of 100), based
on six parameters which include
Three years with an net profit, net worth, total
average annual net profit of manpower cost, total cost of
over Rs. 2500 crore, OR production, cost of Have made Have made
Average annual Net worth services, PBDIT (Profit Before profits profits
Depreciation, Interest and continuously for continuously
of Rs. 10,000 crore for 3
Taxes), capital employed, etc., the last three for the last
Eligibility years, OR Average annual AND years or earned three years
Turnover of Rs. 20,000 a net profit of and should
A company must first be a
Rs. 30 crore or have a
crore for 3 years (against Miniratna and have 4 more in one of positive net
Rs 25,000 crore prescribed independent directors on its the three years worth.
earlier)[13] board before it can be made a
Navratna.

up to Rs.
up to Rs. 1,000 crore or 15% of up to Rs. 500 300 crore or
Rs. 1,000 crore - Rs. 5,000
Benefits their net worth on a single project crore or equal to up to 50% of
crore, or free to decide on
for or 30% of their net worth in the their net worth, their net
investments up to 15% of
investment whole year (not exceeding Rs. whichever is worth,
their net worth in a project
1,000 crores). lower. whichever is
lower.

PSUs in India are also categorised based on their special non-financial objectives and are registered under Section 8 of
Companies Act, 2013 (erstwhile Section 25 of Companies Act, 1956).

List of public sector undertakings

As on 13 September 2017 there are 8 Maharatnas, 16 Navratnas and 74 Miniratnas.[14]There are nearly 300 CPSEs (central
public sector enterprises) in total.[15]

List of Maharatnas List of Miniratna-I

National Thermal Power Corporation Airports Authority of India (AAI)

(NTPC) Antrix Corporation
 Oil and Natural Gas Corporation (ONGC)
Steel Authority of India Limited (SAIL)
Bharat Heavy Electricals Limited (BHEL)
Indian Oil Corporation Limited (IOCL)
Coal India Limited (CIL)
Gas Authority of India Limited (GAIL)
Bharat Petroleum Corporation Limited
(BPCL)
List of Navratnas
Bharat Electronics Limited (BEL)
Container Corporation of India
(CONCOR)
Engineers India Limited (EIL)
Hindustan Aeronautics Limited (HAL)
Hindustan Petroleum Corporation Limited
(HPCL)
Mahanagar Telephone Nigam Limited
(MTNL)
National Aluminium Company (NALCO)
National Buildings Construction
Corporation (NBCC)
National Mineral Development
Corporation (NMDC)
Neyveli Lignite Corporation Limited
(NLCIL)
Oil India Limited (OIL)
Power Finance Corporation (PFC)
Power Grid Corporation of India Limited
(PGCIL)
Rashtriya Ispat Nigam Limited (RINL)
Rural Electrification Corporation (REC)
Shipping Corporation of India (SCI)
Balmer Lawrie
Bharat Coking Coal Limited (BCCL)
Bharat Dynamics Limited (BDL)
Bharat Earth Movers Limited (BEML)
Bharat Sanchar Nigam Limited (BSNL)
Bridge and Roof
Central Warehousing Corporation
Central Coalfields Limited
Chennai Petroleum Corporation (CPCL)
Cochin Shipyard (CSL)
Dredging Corporation of India (DCI)
Educational Consultants India (EDCIL)
Kamarajar Port
Garden Reach Shipbuilders & Engineers
(GRSE)
Goa Shipyard (GSL)
Hindustan Copper (HCL)
HLL Lifecare
Hindustan Newsprint
Hindustan Paper
Housing and Urban Development
Corporation
HSCC
India Tourism Development Corporation
(ITDC)
India Trade Promotion Organisation (ITPO)
Indian Rare Earths (IREL)
Indian Railway Catering and Tourism
Corporation (IRCTC)
Indian Renewable Energy Development
Agency
Ircon International
Kudremukh Iron Ore Company
Mazagon Dock Limited
Mahanadi Coalfields (MCL)
MOIL
Mangalore Refinery and Petrochemicals
Limited (MRPL)
Mishra Dhatu Nigam
MMTC Ltd.
MSTC Limited
National Fertilizers (NFL)
National Small Industries Corporation
Limited
National Seeds Corporation
NHPC Ltd.
 Northern Coalfields (NCL)
North Eastern Electric Power Corporation
Limited (NEEPCL)
Numaligarh Refinery
ONGC Videsh
Pawan Hans
Projects and Development India Limited
(PDIL)
RailTel Corporation of India
Rail Vikas Nigam Limited
Rashtriya Chemicals & Fertilizers (RCF)
RITES
SJVN Ltd.
Security Printing and Minting Corporation
of India
South Eastern Coalfields (SECL)
State Trading Corporation of India
Telecommunications Consultants India
(TCIL)
THDC Ltd.
Western Coalfields (WCL)
Water and Power Consultancy Services
Mineral Exploration Corporation Limited

List of Miniratna-II

Artificial Limbs Manufacturing Corporation

of India
Bharat Pumps & Compressors (BPC)
Broadcast Engineering Consultants India
Central Mine Planning and Design Institute
Central Railside Warehouse Company
Engineering Projects
FCI Aravali Gypsum and Minerals (India)
Limited
Ferro Scrap Nigam Limited
HMT (International) Ltd.
Indian Medicines & Pharmaceuticals
Corporation Limited
MECON
National Film Development Corporation of
India (NFDC)
PEC Ltd.
Rajasthan Electronics & Instruments
Limited
 Ministry of new and renewable energy
(MNRE) and Solar Energy corporation of
India Ltd (SECI)

See also
Public sector undertakings in Kerala
Disinvestment of Public Sector Units in India
Indian company law

References
1. http://ofb.gov.in/index.php?wh=history&lang=en
2. "Chapter 1, Industrial Policy Handbook" (https://web.archive.org/web/20150528135133/http://eaindustry.nic.in/ha
ndbk/chap001.pdf) (PDF). Industrial Policy Handbook. Office of the Economic Adviser, Ministry of Commerce and
Industry. p. 2. Archived from the original (http://eaindustry.nic.in/handbk/chap001.pdf) (PDF) on 28 May 2015.
Retrieved 17 September 2015.
3. Jadhav, Narendra. "Industrial Policy since 1956" (http://www.drnarendrajadhav.info/drnjadhav_web_files/Publishe
d%20papers/Indian%20Industrial%20Policy%20Since%201956.pdf) (PDF). Dr. Narendra Jadhav. Retrieved
17 September 2015.
4. Ghose, Shankar. Jawaharlal Nehru. Allied Publishers. p. 243. ISBN 978-8170233695.
5. Ahluwalia, Isher J. (1993). Productivity and Growth in Indian Manufacturing, part of Recent Developments in
Indian Economy: With Special Reference to Structural Reforms, Part 2. New Delhi: Academic Foundation. p. 25.
ISBN 9788171880942.
6. Baldev Raj Nayar, Globalization And Nationalism: The Changing Balance Of India's Economic Policy, 1950–2000
(New Delhi: Sage, 2001)
7. "Disinvestments-A Historical Perspective" (http://www.bsepsu.com/historical-disinvestment.asp). Bombay Stock
Exchange. Retrieved 19 September 2015.
8. Sankar, T.L., Mishra, R.K., Lateef Syed Mohammed, A. (1994). "Divestments in Public Enterprises: The Indian
Experience" (http://www.emeraldinsight.com/doi/abs/10.1108/09513559410055242). International Journal of
Public Sector Management. 7 (2): 69–88. doi:10.1108/09513559410055242 (https://doi.org/10.1108%2F0951355
9410055242).
9. Original govt. announcement about the Navratnas 1997 (http://dpe.nic.in/nm1.htm) Archived (https://web.archive.
org/web/20120209171125/http://dpe.nic.in/nm1.htm) 9 February 2012 at the Wayback Machine
10. "Maharatnas, Navratnas: India's best PSUs!" (https://www.rediff.com/money/slide-show/slide-show-1-the-maharat
nas-navratnas-of-india/20100826.htm). Rediff.
11. "Maharatna status for mega PSUs gets nod" (http://timesofindia.indiatimes.com/biz/india-business/Maharatna-sta
tus-for-mega-PSUs-gets-nod/articleshow/5375541.cms). The Times of India. 25 December 2009. Retrieved
29 December 2009.
12. "bsepsu.com" (http://www.bsepsu.com/maharatnas.asp). www.bsepsu.com. Retrieved 25 July 2016.
13. http://www.archive.india.gov.in/spotlight/spotlight_archive.php?id=78
14. http://dpe.nic.in/about-us/management-division/maharatna-navratna-miniratna-cpse
15. http://www.bsepsu.com/list-cpse.asp List of CPSEs - BSE

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