PSU, or public sector undertaking, is its full name. PSUs are known as state-owned firms or enterprises in India. The government establishes PSUs under its name and guidelines for conducting business. Such state-owned businesses are less concerned with turning a profit and much more focused on creating and growing the economy of the country.
In PSUs with 51% or more equity, the central or state government manages the majority of the company's stock. All PSUs are under the scrutiny of the CAG (Comptroller and Auditor General) of India.
Background of PSU
India attained independence in 1947 as mostly an agrarian nation with a shaky industrial base.
The first Industrial Policy Resolution was published in 1948 and provided a detailed description of the approach and policy for industrial development.
To support Nehru's national industrialization policy, the establishment of state-owned firms was emphasized in both India's second five-year plan (1956–1960) and the 1956 Industrial Policy Resolution.
Nehru's ambition was carried out by Dr. V. Krishnamurthy, who is known as the Father of Public Sector Enterprises in India.
One can categorize PSUs into 3 groups
- PSEs are public sector businesses.
- CPSEs - Central Public Sector Enterprises
- Public Sector Banks (PSBs)
Famous Indian PSUs
- Coal India Limited (CIL)
- Hindustan Petroleum Corporation Limited is known as HPCL.
- Bharat Heavy Electricals Limited, or BHEL
- Food Corporation of India (FCI)
- State Bank of India (SBI)
- Steel Authority of India Limited (SAIL)
- Gas Authority of India Limited, or GAIL
- National Thermal Power Corporation is NTPC.
- Power Grid Corporation of India (PGCI)
- Mahanagar Telephone Nigam Limited is MTNL.