Centre pushes CPSEs towards tech adoption, AI focus to boost efficiency

The Union Finance Ministry has asked the Central Public Sector Enterprises (CPSEs) to channel efforts and investments into advanced technologies, particularly artificial intelligence (AI) to enhance operational efficiency and maintain strategic competitiveness, according to a senior government official.

 

“CPSEs must be more judicious with their resource use. We need a shift from routine spending to a more focused adoption of cutting-edge technologies,” the official said, adding that such an approach would be key to navigating future economic challenges.

 

The Research & Development (R&D) expenditure of all Central Public Sector Enterprises (CPSEs) stood at ₹10,813 crore in FY 2023-24 against ₹7,233 crore in FY 2022- 23 showing an increase of 49.50 per cent according to the latest edition of the Public Enterprises Survey released by the Ministry of Finance.

 

The senior official further explained that the change in traditional approach means CPSEs need to develop more core systems through the new emerging technologies such as AI for their regular work in order to compete in industry 4.0.

 

“This initiative will enable CPSEs to undergo a transformative shift in their manufacturing and industrial operations by embracing digital technologies. The aim is to adopt smart manufacturing practices that integrate advanced tools such as artificial intelligence, the Internet of Things (IoT), robotics, and automation-- resulting in more intelligent, agile, and efficient systems,” the official said. 

 

There were a total 272 operating CPSEs in FY 2023-24 contributing Gross Revenue of ₹ 36.08 trillion. Nine CPSEs whose Gross Revenue is more than ₹1 trillion, contributing 73.10 per cent of the Gross Revenue of all operating CPSEs.

 

The official further noted that the government is planning to introduce additional training programs for CPSE employees to enhance global competitiveness.

 

“These training initiatives will focus heavily on the adoption and application of emerging technologies. The goal is to build a stronger value system within the workforce, ultimately driving greater efficiency and profitability across CPSEs,” the official added.

 

The official said that the public listing of more CPSEs too is in this process. The market capitalisation of listed CPSEs more than doubled in the financial year 2024–25 compared to the previous year. Market capitalisation refers to the total value of a company's shares, determined by multiplying the current share price by the number of outstanding shares.

 

As of March 31, 2024, 66 CPSEs were listed and traded on the stock exchanges of India. The total market capitalization (M-cap) of listed CPSEs on the Bombay Stock Exchange saw a steep 121 per cent growth year-on-year to ₹37.23 trillion as of March 31, 2024 from ₹16.85 trillion as of March 31, 2023.