In news– Recently, Govt. of India accorded ‘Maharatna’ status to the state-owned Power Finance Corporation Ltd (PFC).
What are its effects on PFC?
- An order to this effect was issued by the Department of Public Enterprises, under the Ministry of Finance.
- With the status of Maharatna, the PFC would get greater operational and financial autonomy.
- The grant of ‘Maharatna’ status to PFC will impart enhanced powers to the PFC Board while taking financial decisions.
- The Board of a ‘Maharatna’ CPSE can make equity investments to undertake financial joint ventures and wholly-owned subsidiaries and undertake mergers and acquisitions in India and abroad, subject to a ceiling of 15% of the Net Worth of the concerned CPSE, limited to Rs.5,000 crore in one project.
- The Board can also structure and implement schemes relating to personnel and Human Resource Management and Training.
- They can also enter into technology Joint Ventures or other strategic alliances among others.
- The enhanced powers that come with Maharatna Status will also help PFC in pushing the Government’s agenda of funding under the National Infrastructure Pipeline, national commitment of 40% green energy by 2030.
- It will also enable effective monitoring and implementation of the New Revamped Distribution Sector Scheme with an outlay of more than Rs.3 Lakh crore.
Power Finance Corporation Ltd (PFC)-
- Incorporated in 1986, PFC is the largest Infrastructure Finance Company today, exclusively dedicated to the Power Sector.
- It is under the administrative control of the Ministry of Power.
- PFC was conferred the title of a ‘Navratna CPSE’ in June, 2007 and was classified as an Infrastructure Finance Company by the RBI on 28th July, 2010.
- It is designated as a nodal agency for development of Integrated Power Development Scheme(IPDS), Ultra Mega Power Projects (UMPPs) and bid process coordinator for Independent Transmission Projects (ITPs)
- The company also has the mechanism of rating different state power utilities on their performance.
Criteria for grant of Maharatna status to CPSEs-
- Having Navratna status
- Listed on Indian stock exchange with minimum prescribed public shareholding under SEBI regulations
- An average annual turnover of more than Rs. 25,000 crore during the last 3 years
- An average annual net worth of more than Rs. 15,000 crore during the last 3 years
- An average annual net profit after tax of more than Rs. 5,000 crore during the last 3 years
- Should have significant global presence/international operations.
- Bharat Heavy Electricals Limited.
- Bharat Petroleum Corporation Limited.
- Coal India Limited.
- GAIL (India) Limited.
- Hindustan Petroleum Corporation Limited.
- Indian Oil Corporation Limited.
- NTPC Limited.
- Oil & Natural Gas Corporation Limited.
- Power Grid Corporation of India Limited.
- Steel Authority of India Limited.