Maharatna, Navratna and Miniratna�����

In July 1997, the Government had identified 9 Central Public Sector Enterprises as Navratnas. These enterprises had comparative advantage and potential to emerge as global giants. The Navratna PSEs at present are BHEL, BPCL, GAIL, HPCL, IOC, MTNL, NTPC, ONGC and SAIL.

These PSEs have been given enhanced autonomy and delegation of powers to incur capital expenditure, to enter into technology joint ventures/strategic alliances, to effect organisational restructuring, to create and wind up below Board level posts, to raise capital from domestic an international market, to establish financial joint ventures and to wholly owned subsidiaries, etc. In October 1997, the Government had also decided to grant enhanced autonomy and delegation of financial powers to some other profit, making companies subject to certain eligibility conditions and guidelines to make them efficient and competitive.

These companies, called Miniratnas, are in two categories, namely, Category-I and Category-II. The criteria for conferring the Miniratna status are:

(i) PSE should be profit making for the last 3 years continuously and should have positive net worth,

(ii) it should not have defaulted in repayment of loans/interest payment on loans due to Government,

(iii) it should not depend upon budgetary support or Government guarantee (Government guarantee required under the standard stipulations of external donor agencies will not affect the Miniratna status); and

(iv) restructuring of the Board of Directors by inducting non-official Directors. PSEs which have made pre-tax profit of Rs. 30 crore or more in at least one of the 3 years are given Category I status while others are given Category II status. The administrative Ministries are empowered to declare a PSE as a Miniratna if it fulfils the eligibility conditions.

The Government has been delegating enhanced financial and operational powers to the Navratna, Miniratna and other profit-making CPSEs. There are 18 Navratna enterprises. Six more CPSEs, namely the Airport Authority of India Limited, Ennore Port Ltd, Tehri Hydro Development Corporation, Security Printing and Minting Corporation Ltd, Satluj Jal Vidut Nigam Ltd and Indian Railway Catering and Tourism Corporation Ltd. were granted Miniratna status during the year, raising the total number of Miniratna CPSEs to 62.

The enhanced powers delegated to the Boards of Miniratna PSEs included power to incur capital expenditure, to establish joint ventures and subsidiaries in India, to enter into technology joint ventures/strategic alliances and obtain technology and know-how by purchase or other arrangements. The exercise of these powers is subject to various conditions and guidelines laid down for this purpose including restructuring of the Board of Directors by inducting non-official Directors.

The Board for Reconstruction of Public Sector Enterprises (BRPSE) has so far given its recommendations for revival of 59 CPSEs and closure of 3 CPSEs to the Government. Based on the recommendations of BRPSE, Government has so far approved revival of 43 CPSEs and closure of 2 CPSEs envisaging total assistance of Rs. 26,108 crores (cash assistance of Rs. 4,505 crores in the form of infusion of funds and non-cash assistance of Rs. 21,603 crores in the form of waivers/write of interest/loans, conversion of loans into equity, etc.) from Government of India. The remaining 17 cases are at different stages of consideration by the Government.

Categorisation of CPSEs

Maharatna

  • Should be a Navratna;
  • Listed on Indian Stock Exchange with minimum prescribed shareholding under SEBI guidelines;
  • Average annual turnover >Rs. 25,000 Cr. in last 3 years;
  • Average annual networth>Rs. 15,000 Cr. in last 3 years;
  • Average annual net profit >Rs. 5,000 Cr. in last 3 years;
  • Significant global presence or international operations.

Navratna

  • Should be a Miniratna I & Schedule A company;
  • Achieved �excellent� /�very good� rating in 3 of the last 5 MOUs;
  • Obtained composite score of 60 or more for 7 identified parameters /ratios.

Miniratna-I

  • Profits in last 3 years; pre-tax profit of Rs. 30 crores or more in any one of last 3 years;
  • Positive net-worth;
  • No defaults in repayment of principal & interest on Government loans;
  • No budgetary support or Government guarantees;
  • Presence of at least 3 Independent directors on Board

Miniratna II

  • Profits in last 3 years;
  • Positive net-worth
  • No defaults in repayment of principal & interest on Government loans;
  • No budgetary support or Government guarantees;
  • Presence of at least 3 Independent directors on Board

The Department of Heavy Industry, Ministry of Heavy Industries and Public Enterprises is making all efforts for the revival of sick/loss making Central Public Sector Enterprises (CPSEs) by making them competitive and profitable. The Department has started the process of undertaking a fresh appraisal of the status of each such CPSE with a view to assessing the prospects of its revival on case to case basis. As per the process established for considering restructuring/revival of CPSEs, cases of identified CPSEs under the Department are placed before the BRPSE for suitable recommendations. After approval of revival schemes of sick CPSEs by the Government, funds are released to such CPSEs as sanctioned in the revival packages.

Simplification and Liberalization of the Foreign Direct Investment Policy, 2016 100% FDI in Food Products manufactured/produced in India 100% FDI allowed under government route for trading, including through e-commerce, is permitted in respect of food products manufactured and/or produced in India.

Foreign Investment in Defence Sector up to 100% Foreign investment beyond 49% has now been permitted through government approval route wherever it is likely to result in access to modern technology or for other reasons to be recorded.

  • FDI limit for defence sector has also been made applicable to Manufacturing of Small Arms and Ammunitions covered under Arms Act 1959. 100% FDI in Broadcasting Carriage Services
  • FDI upto 100% through automatic route allowed in Teleports (setting up of up-linking HUBs/Teleports);
  • Direct to Home (DTH);
  • Cable Networks (Multi System operators (MSOs) and Local Cable Operators (LCOs));
  • Mobile TV;
  • Headend-in-the Sky Broadcasting Service(HITS)

Written by princy

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