Centre relaxes norms for Maharatna status for PSUs

Centre relaxes norms for Maharatna status for PSUs

The conferment of Maharatna status to PSU gives the state-owned enterprise more financial autonomy. The new guidelines proposing relaxation of norms for according Mahartna status to PSUs have been recently approved by an inter-Ministerial committee.

As per the new guidelines issued by the Department of Public Enterprises (DPE), a company qualifying for the Maharatna status should have an average annual turnover of Rs 20,000 crore during the last three years, as against Rs 25,000 crore prescribed earlier.

Criteria for grant

The criteria for grant of Maharatna status to CPSEs has been re-examined in the context of representations received from various administrative ministries and departments and the need to suitably empower mega Navratna CPSEs so that they can effectively face the challenges of competition, both domestic and foreign and further expand their operations, the DPE said in a memorandum issued here.

As per the guidelines of DPE, a company with an average annual net worth of Rs 10,000 crore and net profit of Rs 2,500 crore for three years in a row will qualify for the status.

Earlier, companies with required average annual net worth of Rs 15,000 crore and net profit of Rs 5,000 crore for three consecutive years, were eligible for the Maharatna status.  At present, there are four PSUs which have acquired the Maharatna status. These include the state-owned oil explorer ONGC, oil marketing major Indian Oil Corporation, steel major Steel Authority of India Limited (SAIL) and power manufacturer National Thermal Power
A PSU with Maharatna status can invest up to Rs 5,000 crore in a project independently, while the limit for Navratna companies is Rs1,000 crore.