The government is in the process of giving more operational and financial autonomy to central public sector enterprises (CPSEs). For this it is starting a new category called ?Maharatna?, which will define the level of independence for the CPSEs.
?Till now, you knew Navratna and Mini-ratna. Now we will introduce Maharatna category. All Navratna CPSEs will be qualified to be Maharatna,? Minister for Heavy Industry and Public Enterprises Vilasrao Deshmukh told reporters here unveiling his ministry?s agenda for the next 100 days. The ministry has floated a cabinet note and is confident of introducing the new title in the next 100 days. ?We have sought the comments of other ministries and the policy would be formulated in 100 days,? Department of Public Enterprises secretary R Bandyopadhyay said.
Under the proposed guidelines, the Mahartana CPSEs would be given more powers for investment and formation of joint ventures and subsidiaries. Giving an example, the secretary said, ?Presently, a Navratna can enter mergers and acquisitions and form joint ventures with investment of upto 30% of its networth. This limit will go up to 50% for Maharatna?.
There are 18 Navratna CPSEs at present. The list includes Bharat Electronics Ltd, Bharat Heavy Electricals Ltd, Bharat Petroleum Corp Ltd, Coal India Ltd and Gail (India) Ltd. Besides investing 30% of their networth in joint ventures, these companies can make capital expenditure and invest upto Rs 1,000 crore in a single project without the prior permission from the government.
However, Bandyopadhyay clarified that the government?s interference in the operations of CPSEs would not completely end even for Maharatna CPSEs. ?The government?s interference could never be zero, as the government is answerable at the floor of the house (Parliament),? he said.
The ministry has also proposed announcement of Rs 1,000-crore Automotive Development Fund in the budget. ?The fund would offset the loss incurred on interest earnings by the financial institutions by way of reimbursing them for the difference in interest. DHI (Department of Heavy Industry) proposes to pursue this for obtaining early approval,? the 100-day agenda document read.
The ministry wants to declare a policy on corporate social responsibility for CPSEs with the 100 days. ?The corporate social responsibility has to be encouraged with the social and environmental concerns related to the business of the company. The government will bring out a comprehensive policy on corporate social responsibility covering all aspects, i.e. planning, implementation, funding and monitoring of activities undertaken as parts,? the paper added.