Department of Public Enterprises Relaxed Norms for Conferring the Maharatna Status on CPSEs

The Department of Public Enterprises of the Indian Government on 17 March 2011 announced relaxation in norms for conferring the Maharatna status to Central public sector enterprises (CPSE). The initiative taken by the government in this respect will enable many CPSEs acquire the Maharatna tag. The Maharatna status will in turn give a company more financial autonomy.

As per the new guidelines issued by the Department of Public Enterprises, a company qualifying for the Maharatna status should have an average annual turnover of Rs.20000 crore in the last three years, as against Rs.25000 crore prescribed earlier.

The criteria for grant of the Maharatna status to CPSEs was re-examined in the context of representations received from various administrative ministries/departments. 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 also led to the revision of the norms.

A CPSE with an average annual net worth of Rs.10000 crore and net profit of Rs.2500 crore for three years in a row will qualify for the status. Earlier companies required average annual net worth of Rs.15000 crore and net profit of Rs.5000 crore for three consecutive years to be judged eligible for the Maharatna status.

The government had in December 2009 announced the Maharatna scheme to give more operational freedom to the top-performing CPSEs.
Currently there are four CPSEs (ONGC, Indian Oil Corp, SAIL and NTPC) enjoy the Maharatna status.