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Home News Power Sector News NTPC, IOC, ONGC and SAIL for maharatna status

NTPC, IOC, ONGC and SAIL for maharatna status

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Maharatna StatusFour major public sector undertaking (PSU) companies — Indian Oil Corporation (IOC), NTPC, Steel Authority of India Limited (SAIL) and Oil and Natural Gas Corporation (ONGC) — are aiming for the ‘Maharatna' status paving way for their financial and boardroom freedom. Sources said that IOC, NTPC, SAIL and ONGC have made presentations before the inter-ministerial committee (IMC) making a claim for the status seeking more autonomy in decision-making and financial investments.

The Union Cabinet had last year set out a criteria for seeking this status. Senior officials from the Department of Expenditure, Department of Public Enterprises, Planning Commission as well as the administrative ministries are represented on the IMC.

Officials said the Maharatna status would provide enhanced financial autonomy for PSUs for taking decisions relating to investments in joint venture companies and mergers and acquisitions.

The idea behind the whole exercise is to give a thrust to the plans of the PSUs with a significant international presence to become global giants. Maharatna status will be reviewed by an apex committee headed by the Cabinet Secretary.

All four companies have increased their international presence in recent years. While ONGC and IOC are looking for opportunities abroad to acquire oil and gas assets,

NTPC and SAIL are hunting for captive coal blocks in foreign lands.

ONGC has been faced with serious constraints in financing OVL's acquisitions of oil and gas assets abroad because of investment ceilings and the need to time and again go back to the Government and the Cabinet to seek approval for such international commitments.

At present, ONGC's investment in any OVL project cannot exceed Rs. 1,000 crore but could stand enhanced to Rs. 5,000 crore if it acquires the Maharatna status.

The companies are required to give convincing reasons to the IMC that they have a strong case for grant of Maharatna status and that it is not seeking the tag just because it meets the minimum criteria laid by the government.

Source- Hindu
 

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