The Hindu : Business : Unlock value, PSEs told

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Saturday, Jun 23, 2007
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Unlock value, PSEs told

Staff Reporter

Chidambaram confers Navratna status to BEL, HAL, PFC

Navratna status for four more cos. soon
‘PSEs need to set up global benchmarks’

— Photo: V. Sudershan

STATUS SYMBOL: Union Finance Minister, P. Chidambaram (right), along with Minister for Heavy Industries, Santosh Mohan Dev (centre), conferring the Navratna status to Hindustan Aeronautics Ltd., in New Delhi on Friday. A. K. Saxena, Managing Director, HAL, receives the certificate.

NEW DELHI: The Union Finance Minister P. Chidambaram on Friday asked unlisted public sector enterprises (PSEs) to tap stock markets to realise their true potential. “The State-run enterprises need to unlock their true value by listing on stock exchanges, but without changing their character as a PSE,” he said while addressing a function held to confer Navratna status to three Central PSEs.

Mr. Chidambaram said there was a need to reassess the role of public sector enterprises in the changed economic scenario. PSEs need to set up global benchmarks in production, quality and prices, without hiding behind the walls of tariffs. “Public sector enterprises should also be eventually given autonomy to fix remuneration based on performance of their employees. This will also help them in unlocking their potential and making employees accountable,” he added. Besides conferring Navratna status on Bharat Electronics, Hindustan Aeronautics and Power Finance Corporation, the Finance Minister released the “Guidelines on corporate governance for CPSEs”. Mr. Chidambaram hoped that the Navratna status would empower boards of directors of these CPSEs to exercise greater autonomy and powers, substantially improving their performance.

He said during the past four years, the Government had provided equity support of Rs. 31,402 crore and loans worth Rs. 18,667 crore to PSEs.

Referring to the guidelines on corporate governance for CPSEs, he said these would be mandatory for the listed companies and optional for unlisted companies.

Speaking on the occasion, Union Minister for Heavy Industries and Public Enterprise, Sontosh Mohan Dev, said four more companies — National Aluminium Company, National Mineral Development Corporation, Power Grid Corporation of India and Rural Electrification Corporation — would be conferred Navratna status soon.

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