Under this scheme, the Government has delegated higher powers to CPSEs having a comparative advantage and the potential to become global players. Presently, the Navratna CPSEs are:-
- BHARAT ELECTRONICS LTD.
- BHARAT PETROLEUM CORP.LTD.
- ENGINEERS INDIA LTD.
- HINDUSTAN AERONAUTICS LTD.
- HINDUSTAN PETROLEUM CORP.LTD.
- MAHANAGAR TELEPHONE NIGAM LTD.
- NATIONAL ALUMINIUM CO.LTD.
- NATIONAL BUILDINGS CONSTRUCTION CORP.LTD.
- NEYVELI LIGNITE CORP.LTD.
- NMDC LTD.
- OIL INDIA LTD.
- POWER FINANCE CORP.LTD.
- POWER GRID CORP.OF INDIA LTD.
- RASHTRIYA ISPAT NIGAM LTD.
- RURAL ELECTRIFICATION CORP.LTD.
- SHIPPING CORP.OF INDIA LTD.,THE
Source: Department of Public Enterprises (as on June, 2014)The powers presently delegated to the Boards of Navratna PSUs are as under:
- To incur capital expenditure on purchase of new items or for replacement, without any monetary ceiling
- To enter into technology joint ventures or strategic alliances
- To obtain by purchase or other arrangements, technology and know-how
- To effect organisational restructuring including establishment of profit centers, opening of offices in India and abroad, creating new activity centres, etc.
- Creation and winding up of all posts including and upto those of non Board-level Directors, i.e. Functional Directors, who may have the same pay scale that of Board level Directors, but who would not be members of the Board. All appointments upto this level would also be in the powers of the Boards and would include the power to effect internal transfers and redesignation of posts
- To further delegate the powers relating to Human Resource Management (appointments, transfer, posting etc) of below Board level executives to sub-committees of the Board or to executives of the CPSE, as may be decided by the Board of CPSE.
- To raise debt from the domestic capital markets and for borrowings from international market, which would be subject to the approval of RBI/Department of Economic Affairs as may be required and should be obtained through the administrative ministry.
- To establish financial joint ventures and wholly owned subsidiaries in India or abroad with the stipulation that the equity investment of the CPSE should be limited to the following:-
a.¬†Rs 1000 crore in any one project
b.¬†15 % of the net worth of the CPSE in one project
c.¬†30 % of the net worth of the CPSE in all joint ventures/subsidiaries put together
- To undertake mergers and acquisitions, subject to the conditions that (i) it should be as per the growth plan and in the core area of functioning of the CPSE, (ii) conditions/limits would be as in the case of establishing joint ventures/subsidiaries, and (iii) the Cabinet Committee on Economic Affairs would be kept informed in case of investments abroad.
- To approve business tours abroad of functional directors upto 5 days duration (other than study tours, seminars, etc) in emergency, by the Chief Executive or the CPSE under intimation to the Secretary of the Administrative Ministry. In all other cases including those of Chief Executive, tours abroad would continue to require the prior approval of the Minister of the Administrative Ministry/Department.
- Proposals must be presented to the Board of Directors in writing and reasonably well in advance, with an analysis of relevant factors and quantification of the anticipated results and benefits. Risk factors if any must be clearly brought out.
- The Government Directors, the Financial Directors and the concerned Functional Director(s) must be present when major decisions are taken, especially when they pertain to investments, expenditure or organisational/capital restructuring.
- The decisions on such proposals should preferably be unanimous
- In the event of any decision on important matters not being unanimous, a majority decision may be taken, but at least two thirds of the Directors should be present including those mentioned above, when such a decision is taken. The objections, dissents, the reasons for over ruling them and those for taking the decision should be recorded in writing and minuted.
- No financial support or contingent liability on the part of the Government should be involved.
- These CPSEs will establish transparent and effective systems of internal monitoring, including the establishment of an Audit Committee of the Board with membership of non-official Directors.
- All the proposals, where they pertain to capital expenditure, investment or other matters involving substantial financial or managerial commitments or where they would have a long term impact on the structure and functioning of the CPSEs, should be prepared by or with the assistance of professionals and expert s and should be appraised, in suitable cases, by financial institutions or reputed professional organisations with expertise in the areas. The financial appraisal should also preferably be backed by an involvement of the appraising institutions through loan or equity participation.
- The exercise of authority to enter into technology joint ventures and strategic alliances shall be in accordance with the Government guidelines as may be issued from time to time.
- The Boards of these CPSEs should be restructured by inducting at least four non-official Directors as the first step before the exercise of the enhanced delegation of authority.
- These public sector enterprises shall not depend upon budgetary support or Government guarantee. The resources for implementing their programmes should come from their internal resources or through other sources, including the capital markets.