Meaning of Public Sector Company
Public Sector Company means a company in which 51% or more of the subscribed and paid-up equity is owned and controlled by the Central or a State Government, jointly or severally, and includes any undertaking designated intrinsically by the Department of Public Enterprises and corporations during which majority stake is held by Public Sector Companies aside from financial institutions.
Types of Public Sector Companies In India
Public sector companies in India are formed in three different forms:
- Departmental undertakings
- Public corporations/statutory corporations
- Government company
Departmental Undertakings
A Departmental Undertaking is a public sector enterprise that is run as a part of a government department and under the direction of the Minister concerned.
Statutory Corporations or Public Corporations
Statutory Corporations are created by a special Act of Parliament or State Legislature. The Act defines their powers, functions, rules, and regulations governing them. These have a separate legal existence and have to act in their own name. These are backed by the power of government and have considerable flexibility as these are corporate bodies.
The government finances the entire capital of a statutory corporation and these also have the right to borrow from the public.
Government Companies
The Companies Act, 2013 defines a Government Company thus- “A Government Company means any company in which not less than 51% of the paid-up capital is held by Central Government or by any State Government or partly by Central Government and partly by one or more State Governments.”
It is established under the Indian Companies Act and is managed by the provisions of this act. These companies are established for business purposes and these can compete with companies in the private sector. The government is the majority shareholder in these enterprises and it exercises full control over the paid-up capital of the company. Its shares are purchased in the name of the President of India.
Government companies are of two types:
(i) Wholly owned government companies where entire capital is held by the government.
(ii) Partly owned government companies where government and public are joint owners but a major part of the capital is provided by the government.
Examples of government companies are:
(i) Steel Authority of India Ltd. (SAIL)
(ii) Hindustan Machine Tools Ltd (HMT)
(iii) Bharat Heavy Electricals Ltd (BHEL)
(iv) Gas Authority of India Ltd (GAIL)
(v) State Trading Corporation (STC) etc.
Importance of Public Sector Companies In India
Public sector undertakings (PSUs) are considered to be vital and crucial pillars for strengthening a country’s economy. The prime purpose of starting public sector enterprises was to fabricate infrastructure for economic growth and economic development. Since their birth PSUs have played an essential role in achieving the goal of economic development.
Various factors such as deterioration of financial performance of PSUs, rising fiscal deficit forced Government to adopt a radically new approach towards the working of PSUs. The policy measure implemented involved the Disinvestment of public sector undertakings (PSUs). During the regime of P.V Narasimha Rao, the entire new economic policy of Liberalisation, Privatisation, and Globalisation (LPG) was introduced in India in the year 1991. Dr. Manmohan Singh was the finance minister who successfully implemented the policy of Liberalisation, Privatisation, Globalisation (LPG) into India.
The goal of the Disinvestment policy was as follows:
- Improving the financial performance of PSUs.
- Generating resources to reduce the fiscal deficit.
- Promoting extensive public participation (including employees).
List Of Public Sector Companies In India
Certain public sector undertakings have been awarded additional financial autonomy. These “public sector companies in India have comparative advantages”, giving them greater autonomy to compete in the global market to “support them in their drive to become global giants”. Financial autonomy was initially awarded to nine PSUs as Navratna status in 1997. Originally, the term Navaratna meant a talisman composed of nine precious gems. Later, this term was adopted in the courts of Gupta emperor Vikramaditya and Mughal emperor Akbar, as the collective name for nine extraordinary courtiers at their respective courts.
In 2010, the Government established the higher Maharatna category, which raises a company’s investment ceiling from ₹1,000 crore to ₹5,000 crores. The Maharatna firms can now decide on investments of up to 15 percent of their net worth in a project while the Navaratna companies could invest up to ₹1,000 crores without explicit government approval. Two categories of Miniratnas afford less extensive financial autonomy.
As of 23 October 2019, there are 10 Maharatnas, 14 Navratnas, and 74 Miniratnas. All the companies in the Maharatana and Navaratna category are listed in the Stock Market.
List of Maharatnas (Public Sector Companies In India)
- National Thermal Power Corporation (NTPC)
- Oil and Natural Gas Corporation (ONGC)
- Steel Authority of India Limited (SAIL)
- Bharat Heavy Electricals Limited (BHEL)
- Indian Oil Corporation Limited (IOCL)
- Hindustan Petroleum Corporation Limited (HPCL)
- Coal India Limited (CIL)
- Gas Authority of India Limited (GAIL)
- Bharat Petroleum Corporation Limited (BPCL)
- Power Grid Corporation of India (POWERGRID)
List of Navratnas (Public Sector Companies In India)
- Bharat Electronics Limited (BEL)
- Container Corporation of India (CONCOR)
- Engineers India Limited (EIL)
- Hindustan Aeronautics Limited (HAL)
- Mahanagar Telephone Nigam Limited (MTNL)
- National Aluminium Company (NALCO)
- National Buildings Construction Corporation (NBCC)
- National Mineral Development Corporation (NMDC)
- NLC India Limited (NLCIL)
- Oil India Limited (OIL)
- Power Finance Corporation (PFC)
- Rashtriya Ispat Nigam Limited (RINL)
- Rural Electrification Corporation (REC)
- Shipping Corporation of India (SCI)
List of Miniratna Category – I CPSEs (Public Sector Companies In India)
- Airports Authority of India
- Antrix Corporation Limited
- Balmer Lawrie & Co. Limited
- Bharat Coking Coal Limited
- Bharat Dynamics Limited
- BEML Limited
- Bharat Sanchar Nigam Limited
- Bridge & Roof Company (India) Limited
- Central Warehousing Corporation
- Central Coalfields Limited
- Central Mine Planning & Design Institute Limited
- Chennai Petroleum Corporation Limited
- Cochin Shipyard Limited
- EdCIL (India) Limited
- Kamarajar Port Limited
- Garden Reach Shipbuilders & Engineers Limited
- Goa Shipyard Limited
- Hindustan Copper Limited
- HLL Lifecare Limited
- Hindustan Newsprint Limited
- Hindustan Paper Corporation Limited
- Housing & Urban Development Corporation Limited
- HSCC (India) Limited
- India Tourism Development Corporation Limited
- Indian Rare Earths Limited
- Indian Railway Catering & Tourism Corporation Limited
- Indian Railway Finance Corporation Limited
- Indian Renewable Energy Development Agency Limited
- India Trade Promotion Organization
- IRCON International Limited
- KIOCL Limited
- Mazagaon Dock Shipbuilders Limited
- Mahanadi Coalfields Limited
- MOIL Limited
- Mangalore Refinery & Petrochemical Limited
- Mineral Exploration Corporation Limited
- Mishra Dhatu Nigam Limited
- MMTC Limited
- MSTC Limited
- National Fertilizers Limited
- National Projects Construction Corporation Limited
- National Small Industries Corporation Limited
- National Seeds Corporation
- NHPC Limited
- Northern Coalfields Limited
- North Eastern Electric Power Corporation Limited
- Numaligarh Refinery Limited
- ONGC Videsh Limited
- Pawan Hans Helicopters Limited
- Projects & Development India Limited
- Railtel Corporation of India Limited
- Rail Vikas Nigam Limited
- Rashtriya Chemicals & Fertilizers Limited
- RITES Limited
- SJVN Limited
- Security Printing and Minting Corporation of India Limited
- South Eastern Coalfields Limited
- Telecommunications Consultants India Limited
- THDC India Limited
- Western Coalfields Limited
- WAPCOS Limited
List of Miniratna Category-II CPSEs (Public Sector Companies In India)
- Artificial Limbs Manufacturing Corporation of India
- Bharat Pumps & Compressors Limited
- Broadcast Engineering Consultants India Limited
- Central Railside Warehouse Company Limited
- Engineering Projects (India) Limited
- FCI Aravali Gypsum & Minerals India Limited
- Ferro Scrap Nigam Limited
- HMT (International) Limited
- Indian Medicines & Pharmaceuticals Corporation Limited
- MECON Limited
- National Film Development Corporation Limited
- Rajasthan Electronics & Instruments Limited
Public Sector Banks
Public Sector Banks (Government Shareholding %, as of 1 April 2020)
- State Bank of India (61.00%)
- Bank of Baroda (63.74%)
- Union Bank of India (67.43%)
- Punjab National Bank (85.58%)
- Canara Bank (72.55%)
- Punjab & Sind Bank (79.62%)
- Indian Bank (81.73%)
- Bank of Maharashtra (87.01%)
- Bank of India (87.0535%)
- Central Bank of India (88.02%)
- Indian Overseas Bank (95%)
- UCO Bank (93.29%)
Payments Bank (PB)
- India Post Payments Bank (IPPB) (100%)