Financial autonomy to all PSUs not on cards: Deshmukh

The government today ruled out giving financial autonomy on the lines of Navratna and Maharatna PSUs to all state-owned firms, stating it would be "very difficult".

Heavy Industries and Public Enterprises Minister Vilasrao Deshmukh said all PSUs, irrespective of their status, should "definitely" not be given the autonomy.

He said the government is generally for giving more functional freedom to the public sector units. "But unless and until they have economically sound status, it is very difficult," he said on the sidelines of signing of an agreement between Engineering Projects (India) and Malaysia- based SCOMI Group.

Public sector units apex body SCOPE had last week pitched for more financial autonomy to all state-run firms, irrespective of their Maharatna or Navratna status.

"The categorisation of PSUs into Maharatna, Navratna and Miniratna is not the real issue as the empowerment of these units' boards with functional autonomy is most essential for their optimal performance and the same may be granted to all PSEs," Standing Conference of Public Enterprises (SCOPE) Chairman Arup Roy Choudhury had said .

A Maharatna company can take investment decisions up to Rs 5,000 crore without government nod against the current limit of Rs 1,000 crore for the Navratnas.

The government has awarded Maharatna tag to four PSUs NTPC, ONGC, IOC and SAIL. At present, there are 15 Navratnas including CIL, BHEL, GAIL and BPCL.

With more PSUs entering the capital markets, it becomes essential for these units to comply with SEBI norms on independent directors, Choudhury said.

There are 246 PSUs in the Central sector as on March 2009.