PSU Full Form

What is the full form of PSU?

The full form of PSU is Public Sector Undertaking.Everyone wants to join a government company, that is, a Public Sector Undertaking(PSU). There are many reasons for joining Public Sector Undertakings, these include job security, power, service to the nation, social prestige, retirement benefits, high perks, and so on. And the main reason is job security. Public Sector Undertakings are the most desired job and the dream job that every person thinks about. A very common trend in India is to get a government job. Millions of students in India acquire several degrees with the primary vision of getting a government job. But due to limited vacancies, only a few people get into Public Sector Undertakings.

This Story also Contains

1. What is the full form of PSU?
2. PSU Full Form
3. Brief history of PSU
4. Characteristics of Public Sector Undertakings
5. Categories of Public Sector Undertakings
6. Top profit-making and top loss-making Public Sector Undertakings

We will discuss everything about Public Sector Undertakings in this article.

PSU Full Form

PSU stands for Public Sector Undertakings, defined Sector Undertaking means an organisation in which the Indian Central Government or any Indian State Government (s) either singly or together held shares not less than fifty-one per cent of the paid-up share capital. These sectors are government-owned establishments or government-owned enterprises or government-owned corporations, that is, these are established and owned by the Central Government of India or State Government (s) of India.

After Independence, there were only 5 Public Sector Undertakings under the ownership of the Government sector in India. In March 2021, the number of Public Sector Undertakings increased to 365. All Public Sector Undertakings are divided into four categories, that is, Maharatna, Navratna, Miniratna Category-I, and Miniratna Category-II.

Brief history of PSU

After independence, the Indian economic condition was very weak. It was due to a very weak industrial base, lack of infrastructure facilities, inadequate investments and unemployment. So, the Government used Public Sector Undertakings as a weapon for being self-reliant and for economic growth. Hence, the nation followed a planned economic development policy which led to the establishment of new Public Sector Undertakings in the country and an increase in the Gross domestic product (GDP) of the country. Jawaharlal Nehru, the first Prime Minister of India, promoted an economic policy based on industrialisation which resulted in the development and modernisation of the Indian economy.

Dr V. Krishnamurthy is known as the "Father of Public Sector Undertakings in India" for his contribution to the most profit-making industries in India like Steel Authority of India Limited (SAIL), Maruti Udyog Limited (MUL), Bharat Heavy Electricals Limited (BHEL), and Gas Authority of India Limited (GAIL).

Characteristics of Public Sector Undertakings

The main characteristics of Public Sector Undertakings are:

• Financed by Government: These organisations are either owned by the Indian Government or more than 51% of shares are held by the Indian Government.

• Government Management: Managed and controlled by the Indian Government and are autonomous organisations.

• Financial Independence: These organisations are not dependent on the Indian Government and arrange and manage their own finances.

• Public Services: The primary aim of Public Sector Undertakings is to provide service to society.

• Useful for Various Sectors: Public Sector Undertakings serve all sectors of the economy.

• Helpful in Implementing Indian Government Plans: Economic policies of the Indian Government are implemented through Public Sector Undertakings.

Categories of Public Sector Undertakings

Public Sector Undertakings (PSUs) are classified as Public Sector Banks (PSBs), Central Public Sector Enterprises (CPSEs), or State Level Public Enterprises (SLPEs). Central Public Sector Enterprises (CPSEs) are administered by the Ministry of Heavy Industries (MHI) and the Department of Public Enterprises (DPE).

All CPSUs are divided into four categories which consist of 12 Maharatnas, 12 Navratnas and 73 Miniratnas (including Category I and Category II).

Maharatnas: If a company has an average annual net profit of over ₹2,500 crores within three years, or the average annual net worth of 3 years is ₹10,000 crores, or the average annual Turnover of 3 years is ₹20,000 crores, then the company is eligible for Maharatna Category. The company has benefits of investments up to 1,000 – 5,000 crores.

Major Maharatnas are:

1. Oil and Natural Gas Corporation (ONGC)

2. Bharat Heavy Electricals Limited (BHEL)

3. Bharat Petroleum Corporation Limited (BPCL)

4. Coal India Limited (CIL)

5. Gas Authority of India Limited (GAIL)

6. Hindustan Petroleum Corporation Limited (HPCL)

7. Indian Oil Corporation Limited (IOCL)

8. National Thermal Power Corporation (NTPC)

9. Power Grid Corporation of India(PGCIL)

10. Steel Authority of India Limited (SAIL)

Navratna: A company should pass 60% based on six parameters which include net worth, net profit, the total cost of production, total manpower cost, cost of services, capital employed, Profit Before Depreciation, etc. categorised as Navratna. The company has benefits of investments up to 1,000 crores.

Major Navratnas are:

1. Bharat Electronics Limited (BEL)

2. Container Corporation of India (CONCOR)

3. Engineers India Limited (EIL)

4. Hindustan Aeronautics Limited (HAL)

5. Mahanagar Telephone Nigam Limited (MTNL)

6. National Aluminium Company (NALCO)

7. National Buildings Construction Corporation (NBCC)

8. National Mineral Development Corporation (NMDC)

9. NLC India Limited (Neyveli Lignite)

10. Oil India Limited (OIL)

Miniratnas (Category-I): A company which has made profits continuously for the last 3 years, or earned a net profit of three years more than ₹30 crores is categorised as Miniratnas (Category-I).

Major Miniratnas (Category-I) are:

1. Airports Authority of India (AAI)

2. ONGC Videsh Limited

3. Antrix Corporation

4. Balmer Lawrie

5. Braithwaite and Co.

6. Bharat Coking Coal Limited (BCCL)

7. Bharat Dynamics Limited (BDL)

8. Bharat Earth Movers Limited (BEML)

9. Bharat Sanchar Nigam Limited (BSNL)

10. Bridge and Roof Company (India)

Miniratnas (Category-II): A company which has made profits continuously for the last 3 years, or earned a positive net profit in three years is categorised as Miniratnas (Category-II).

Major Miniratnas (Category-II) are:

1. Artificial Limbs Manufacturing Corporation of India

2. Bharat Pumps and Compressors

3. Broadcast Engineering Consultants India Limited

4. Central Railside Warehouse Company Limited

5. Engineering Projects (India) Limited

6. FCI Aravali Gypsum and Minerals (India) Limited

7. Ferro Scrap Nigam Limited

8. HMT International Limited

9. Indian Medicines Pharmaceutical Corporation Limited

10. Metallurgical & Engineering Consultants Limited (MECON)

11. National Film Development Corporation of India (NFDC)

12. Rajasthan Electronics and Instruments Limited

Top profit-making and top loss-making Public Sector Undertakings

The top profit-making Central Public Sector Undertakings are (in the financial year 2019-20):

1. Oil and Natural Gas Limited (ONGC). It has a net profit of 13,445 crores.

2. Coal India Limited (CIL) with a net profit of 11,281 crores.

3. Power Grid Corporation of India (PGCIL) with a net profit of 10,811 crores.

4. National Thermal Power Corporation (NTPC) with a net profit of 10,113 crores.

5. Gas Authority of India Limited (GAIL) with a net profit of 6,621 crores.

6. Mahanadi Coalfields (MCL) with a net profit of 6,427 crores.

7. Power Finance Corporation Limited (PFCL) with a net profit of 5,655 crores.

8. Northern Coalfields (NCL) with a net profit of 4,971 crores.

9. Rural Electrification Corporation (REC) with a net profit of 4,886 crores.

10. Nuclear Power Corporation of India Ltd (NPCIL) with a net profit of 4,459 crores.

The top loss-making Central Public Sector Undertakings are (in the financial year 2019-20):

1. Bharat Sanchar Nigam Limited (BSNL) with a net loss of 15,500 crores.

2. Mahanagar Telephone Nigam Limited (MTNL) with a net loss of 3,696 crores.

3. Mangalore Refinery and Petrochemicals Limited (MRPL) with a net loss of 1,400 crores.

4. Bharat Petro Resources Ltd (BPRL) with a net loss of 915 crores.

5. Hindustan Copper Ltd (HCL) with a net loss of 569 crores.

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