THE POWER OF PUBLIC SECTOR HOLDING

Government-owns corporations across various sectors i.e., manufacturing, energy, railways, defense, banks, etc. Public Sector Undertakings (PSUs) have not only captured the attention of investors but also played a substantial role in contributing to the Gross Domestic Product (GDP). These entities are either owned by the central government, the state government, or in some cases both. These government-owned organizations contribute 51% or more share capital with a majority?stake held by the government, these?organizations are subject to greater oversight, transparency, and accountability measures.

It also ensures that operations align with?the nation's interests and that any profits generated are reinvested into public services or developmental initiatives for the benefit of the citizens. Moreover, these government-owned corporations often play a pivotal role in strategically important sectors, such as energy, telecommunications, and transportation. Their mandate extends beyond mere profit-making, encompassing the provision of essential services, the promotion of social welfare, and the safeguarding of national security interests.

Additionally, government ownership allows for better coordination and integration of these organizations' activities with wider national policies and goals. This combined approach can lead to more efficient resource allocation, streamlined processes, and a suitable approach to addressing critical issues, such as infrastructure development, employment generation, and economic growth.

ClASSIFICATION OF PSU?

Central Public Sector Enterprises ( CPSEs )

Public Sector Banks ( PSBs )

State Level Public Enterprise ( SLPEs )?

The Department of Public Enterprises designates CPSEs as Maharatna, Navratna, or Miniratna based on their financial performance and progress.

Maharatna?

Maharatna companies are typically considered the top category of public sector enterprises in India. Qualification for this status necessitates a consistent annual turnover exceeding Rs. 20,000 crore over the preceding three years, along with the maintenance of a net worth surpassing Rs. 10,000 crore on an annual basis throughout the same period. As a first step, it must have been a Navratna company.?

Here is a list of the top Maharatna companies.

Navratna

To be granted the esteemed Navratna status, a company must achieve the Miniratna Category I status with the Schedule "A" classification. Over the past three years, the company should have experienced a steady growth in net worth. The business should have a strong global presence.

This means that these PSUs become financially independent and can invest up to Rs. 1000 crores without the central government's permission.

Here is a list of the top Navratna companies.

Miniratna

Here are two more subcategories:

Miniratna Category-I?

To be eligible, companies must have earned revenue during the past three financial years, achieving a minimum pre-tax profit of 30 crores in at least one of those years.

Miniratna Category-II

For a company to meet the criteria, it must consistently deliver profits over the past three years and maintain a positive net worth. Moreover, these companies have the authority to utilize up to 50 percent of their net worth without requiring government consent.