CPSE Categorisation (Indian Economy)
CPSE Categorisation (Indian Economy)
Why In News:
The Ministry of Steel approved the grant of Miniratna Category-I status to MECON Limited, a Schedule 'A' Central Public Sector Enterprise (CPSE), after the company met the eligibility criteria prescribed by the Department of Public Enterprises (DPE).
A 10-member committee headed by Cabinet Secretary T. V. Somanathan has been constituted to review and recommend updated performance standards for PSUs.
Source: PIB Today, 1 July 2026 (one-liner); widely reported, 1 July 2026, 'MECON Achieves Miniratna Category-I Status'.
The Ratna Classification System
CPSEs are graded by the Department of Public Enterprises (DPE) into Maharatna, Navratna, and Miniratna (Category-I and Category-II) based on financial performance, granting graded operational and financial autonomy.
Miniratna Category-I
A CPSE must show continuous profit for three years, with a pre-tax profit of at least Rs 30 crore in at least one of those years, and must have a positive net worth.
A Miniratna Category-I CPSE has the following criteria:
The CPSE must have made profits continuously for the last three years.
It should have earned a pre-tax profit of ₹30 crore or more in at least one of those three years.
These enterprises can approve capital expenditure up to ₹500 crore or their net worth (whichever is lower) without government approval.
They also enjoy greater operational flexibility, including the freedom to form joint ventures and subsidiaries.
Key Facts for Prelims
Maharatna status criteria:
A CPSE must already hold Navratna status.
The company should be listed on an Indian stock exchange with minimum prescribed public shareholding as per SEBI norms.
It must have an average annual turnover of more than ₹25,000 crore during the last three years.
It should maintain an average annual net worth exceeding ₹15,000 crore over the last three years.
The CPSE must record an average annual net profit of more than ₹5,000 crore during the same period.
It should have a significant global presence, including international operations or subsidiaries.
Maharatna companies enjoy greater financial autonomy, including the ability to invest up to 15% of their net worth in a single project (subject to a ceiling of ₹5,000 crore) without government approval.
Navratna status criteria:
The CPSE must first be classified as a Miniratna Category-I company.
It should have obtained an ‘Excellent’ or ‘Very Good’ rating in the Memorandum of Understanding (MoU) in at least three of the last five years.
The company must achieve a composite score of 60 or above based on six performance indicators.
Navratna CPSEs have the autonomy to invest up to ₹1,000 crore or 15% of net worth (whichever is lower) in a single project without prior government approval.
Miniratna Category-II CPSEs criteria:
The CPSE must have recorded profits for the last three consecutive years.
These enterprises can approve capital expenditure up to ₹300 crore or 50% of their net worth (whichever is lower).
However, they have relatively lower financial autonomy compared to Category-I companies.
The Miniratna scheme was introduced in 1997 to grant greater autonomy to profit-making CPSEs.