Maharatna Scheme

Maharatna Scheme is an initiative by the Government of India to provide greater autonomy, financial authority, and operational flexibility to select Central Public Sector Enterprises (CPSEs). Introduced in 2010, it represents the highest category of recognition for government-owned enterprises, intended to enable them to compete globally and undertake large-scale investments without prior governmental approval.

Background and Purpose

The concept of graded autonomy for public enterprises originated with the introduction of the Navratna Scheme in 1997. This was designed to empower high-performing CPSEs to become global players. However, with the growth of several enterprises in size, profitability, and global presence, the need arose for a higher category of recognition — thus, the Maharatna Scheme was launched in May 2010 by the Department of Public Enterprises (DPE) under the Ministry of Finance.
The principal aim of the scheme is to transform large and profitable public sector undertakings into globally competitive entities by granting them greater decision-making power in strategic and financial matters. It also seeks to reduce bureaucratic delays and encourage professional management within the public sector.

Eligibility Criteria

For a CPSE to qualify for Maharatna status, it must fulfil the following eligibility conditions:

1. Navratna status – The company must already hold Navratna status.
2. Stock Exchange listing – The company must be listed on the stock exchange with a prescribed minimum public shareholding under SEBI regulations.
3. Financial performance (based on the average of the last three years):
   • Annual turnover: at least ₹25,000 crore.
   • Net worth: at least ₹15,000 crore.
   • Net profit after tax: at least ₹5,000 crore.
4. Global presence or international operations must be evident, indicating a scale of operations consistent with the Maharatna designation.

The status is reviewed periodically, and non-performing enterprises may lose their Maharatna title if they fail to meet the criteria consistently.

Powers and Autonomy Granted

Maharatna companies are granted significant operational and financial powers compared to Navratna or Miniratna CPSEs. These powers are designed to give them autonomy similar to large global corporations. Key powers include:

• Investment authority: They can invest up to ₹5,000 crore or 15% of their net worth (whichever is lower) in a single project without prior government approval.
• Joint ventures and acquisitions: They may undertake mergers, acquisitions, or form joint ventures both within India and abroad.
• Human resource management: Freedom to structure pay scales, decide on staff strength (below board level), and frame organisational restructuring proposals.
• Operational decisions: Authority to expand operations, modernise plants, and enter new markets without the need for government clearance.

This degree of freedom allows Maharatna companies to respond quickly to market changes and technological developments, fostering competitiveness and innovation.

List of Maharatna Companies

As of 2025, there are 14 Maharatna CPSEs in India:

1. Bharat Heavy Electricals Limited (BHEL)
2. Bharat Petroleum Corporation Limited (BPCL)
3. Coal India Limited (CIL)
4. Gas Authority of India Limited (GAIL)
5. Hindustan Aeronautics Limited (HAL)
6. Hindustan Petroleum Corporation Limited (HPCL)
7. Indian Oil Corporation Limited (IOCL)
8. National Thermal Power Corporation (NTPC)
9. Oil and Natural Gas Corporation (ONGC)
10. Oil India Limited (OIL)
11. Power Finance Corporation (PFC)
12. Power Grid Corporation of India Limited (PGCIL)
13. Rural Electrification Corporation Limited (REC)
14. Steel Authority of India Limited (SAIL)

Each of these enterprises has demonstrated exceptional financial performance, strategic importance, and a considerable contribution to the Indian economy.

Objectives of the Scheme

The Maharatna Scheme serves several policy and administrative objectives:

• To encourage commercial autonomy and global expansion of India’s largest PSUs.
• To reduce dependence on ministerial approvals for investment decisions.
• To promote professional management and corporate governance in CPSEs.
• To increase competitiveness and productivity in line with global standards.

By conferring the Maharatna title, the government recognises these enterprises as strategic assets with the potential to act as national champions in key sectors such as energy, defence, steel, and heavy engineering.

Significance

The scheme has far-reaching implications for India’s economic development:

• Enhanced decision-making efficiency: Reduced bureaucratic control leads to faster implementation of major projects.
• Greater financial flexibility: Allows large PSUs to compete effectively in international markets.
• Improved accountability: With increased autonomy comes greater responsibility for financial performance and transparency.
• Catalyst for national growth: Maharatna companies play a crucial role in infrastructure development, energy security, and employment generation.

Challenges and Criticism

Despite its success, the scheme faces certain challenges:

• Risk of mismanagement: Greater autonomy can lead to lapses in accountability if oversight mechanisms are weak.
• Market competition: Even with autonomy, PSUs often face inefficiencies and competition from private players.
• Unequal growth: The scheme primarily benefits a limited number of large enterprises, leaving smaller PSUs with fewer opportunities.
• Performance sustainability: Maintaining consistent profitability and global competitiveness is a continuous challenge.

Recent Developments

In recent years, the government has expanded the Maharatna list by including financially strong and strategically important companies such as HAL, PFC, REC, and OIL. These inclusions reflect the government’s commitment to recognising PSUs that play a vital role in national security, energy infrastructure, and technological advancement.
The Department of Public Enterprises continues to review and revise norms for CPSE classification to ensure that the Maharatna, Navratna, and Miniratna categories remain relevant to evolving economic conditions and global business environments.