Public Sector Undertakings (PSUs) in India are government-owned entities that play a crucial role in the country's economic development. The government has majority ownership (at least 51%) in these entities. PSUs are also formed through joint ventures of multiple PSUs, each performing commercial activities on behalf of the government.
PSUs in India are categorized based on the level of government ownership:
Further classification of CPSUs and SPSUs includes:
The establishment of PSUs in India can be traced back to the country's independence in 1947. India's post-independence economic policies focused on industrialization and self-sufficiency, necessitating government intervention in strategic sectors. The Industrial Policy Resolution of 1956, adopted during the Second Five-Year Plan, laid the foundation for PSUs. It prioritized strategic sectors, nationalized corporations, and subsequently expanded into consumer goods and services. PSUs played a vital role in India's economic growth, increasing exports, reducing imports, driving infrastructure development, and creating employment opportunities.
The government recognizes high-performing CPSUs with the "Ratna" status, offering them enhanced financial autonomy. These include:
The table below showcases the top 10 profit-making CPSUs in financial year 2021-22.
S. No. | CPSE Name | Net Profit (₹ crore) | Share (%) |
---|---|---|---|
1 | Oil and Natural Gas Corporation Limited (ONGC) | 40,305 | 15.27 |
2 | Indian Oil Corporation Limited (IOCL) | 24,184 | 9.16 |
3 | Power Grid Corporation of India (PGCIL) | 17,074 | 6.48 |
4 | National Thermal Power Corporation (NTPC) | 16,111 | 6.11 |
5 | Steel Authority of India Limited (SAIL) | 12,015 | 4.55 |
6 | Coal India Limited (CIL) | 11,202 | 4.24 |
7 | Gas Authority of India Limited (GAIL) | 10,364 | 3.93 |
8 | Rural Electrification Corporation (REC) | 10,046 | 3.81 |
9 | Power Finance Corporation Limited (PFCL) | 10,022 | 3.80 |
10 | National Mineral Development Corporation Limited (NMDC) | 9,398 | 3.56 |
Total (1-10) | 1,60,742 | 60.91 | |
Other CPSEs | 1,03,153 | 39.09 | |
Aggregated profit of profit-making CPSEs | 2,63,895 | 100 |
PSUs in India play a significant role in the country's economic development. Their objectives include:
CPSUs are administered by the Ministry of Heavy Industries and Public Enterprises. The Department of Public Enterprises (DPE), Ministry of Finance, acts as the nodal department for all CPSUs.
The government has implemented privatization measures in recent years, divesting its ownership in some PSUs to raise capital and improve efficiency. This is driven by a desire to streamline the economy and allow for more private sector participation. Here are some notable examples of privatized CPSUs in India:
PSUs in India are evolving to adapt to a changing economic landscape. The government continues to promote privatization while maintaining a strong presence in strategic sectors. PSUs are increasingly focusing on operational efficiency, technological advancements, and international competitiveness. The Ratna status system provides a framework for recognizing and rewarding exceptional performance, encouraging PSUs to strive for greater efficiency and economic contribution.
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