ONGC, SAIL, NTPC to get Maharatna tag

With the government on Thursday approving a proposal of creating a new Maharatna category for Central Public Sector Enterprises (CPSEs), the boards of mega state-owned companies are set to get greater financial and operational freedom.
The decision to this effect along with criteria to accord such status was taken at a meeting of the Union Cabinet chaired by the Prime Minister, Dr Manmohan Singh. “The main objective of the Maharatna scheme is to empower mega CPSEs to expand their operations and emerge as global giants,” the information and broadcasting minister, Ms Ambika Soni, said during a briefing after the meeting.
Of the total 18 existing Navaratna companies, petr-oleum giant ONGC, power major NTPC and steel utilities major SAIL meet the criteria set by the government.
As already reported by this newspaper in its December 17 edition, the criteria include a three-year track record of annual net profit of over Rs 5,000 crore, net worth of Rs 15,000 crore and turnover of Rs 25,000 crore, besides being listed entities in the bourses.
The coveted status empowers the boards of these firms to take investment decisions up to Rs 5,000 crore as against the present Rs 1,000 crore limit without seeking government approval.
“However, the overall ceiling on such equity investments and mergers and acquisitions in all projects put together will not exceed 30 per cent of net worth of the CPSE,” Ms Soni added.
After the Cabinet meeting, the heavy industries minister, Mr Vilasrao Deshmukh, said: “We are for giving more autonomy to performing PSUs.”
Reacting on the government’s decision to accord Maharatna status to select CPSEs, Standing Confer-ence of Public Enterprises (SCOPE) director-general, Mr U.D. Choubey, said, “Efficiency of the companies should not be just based on the net turnover and corresponding net profit because there may be companies which have less turnover but their profits might be higher.”

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