Calcutta, Nov. 1: The government plans to accord maharatna status to some large PSUs, enabling them to possess a greater flexibility in their operations.

Nearly 20 PSUs now have navratna status, giving them considerable freedom; some of the larger entities among them will now be upgraded.

“The proposal is now with the cabinet committee and we expect to get its assent in a month or two,” said Bhaskar Chatterjee, secretary, the department of public enterprises and heavy industries. Chatterjee was in city to attend the 34th Foundation Day celebration of Coal India Ltd (CIL).

“The imperative of creating this maharatna status is to give more autonomy to bigger public sector enterprises so that they can play a more important role in the development of the economy,” he said.

The board of directors of a maharatna company can take a decision on their own without referring to, or seeking permission from, the government on investments of up to Rs 5,000 crore. The board of a navratna company can independently take decisions on investments of up to Rs 1,000 crore.

“Unlike a navratna company, the board of a maharatna company won’t have to come to the government for overseas investments within the limit of Rs 5,000 crore,” Chatterjee said.

However, this investment limit of Rs 5,000 crore is capped in some cases. “If a company’s net worth is less than Rs 5,000 crore, its board cannot take independent decision on investments of Rs 5,000 crore,” he said.

Besides, the board of a maharatna company will enjoy autonomy in appointing people at high posts.

The eligibility norms for maharatnas have been made tougher since the government wants a few PSUs in this bracket. “The first criteria is that the company must be listed on the bourses. Secondly, it should have an annual turnover of Rs 15,000 or more in the last three years. Thirdly, it should be a profit-making company for the last three years and lastly, it should have an international presence,” he said.

Initially, five or six large navratnas, such as Steel Authority of India Limited, Oil and Natural Gas Corporation, Indian Oil Corporation and NTPC Ltd, will make it to the maharatna club. “Coal India, which is a navratna PSU now, can become a maharatna company after it gets listed,” Chatterjee said.

Coal regulator

The coal ministry is unlikely to place the bill for an independent regulator in Parliament during the winter session. “We are not yet ready with the coal regulator bill,” said coal secretary C. Balakrisnan on the sidelines of the CIL function.

The proposal for an independent regulator was in the coal ministry’s 100-day agenda after the UPA came into power for the second time.

However, Balakrisnan hoped that the government would be able to place the amendment bill to the Mines and Minerals (Development and Regulation) Act, 1957, in the winter session. The amendments will allow the government to introduce some structural reforms in mining.

The ministry will be able to auction coal blocks to private sector companies for captive use. Coal minister Sriprakash Jaiswal today said CIL had been asked to identify 216 blocks.

“We have made a request to the government for retaining 138 of the 216 blocks while the rest can be auctioned,” CIL chairman Partha S. Bhattacharya said.