The full form of PSU is Public Sector Undertaking. 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 more focused on creating and growing the country’s economy.
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 India’s CAG (Comptroller and Auditor General).
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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, establishing state-owned firms was emphasised in India’s second five-year plan (1956–1960) and the 1956 Industrial Policy Resolution.
- Dr V. Krishnamurthy, the father of India’s public sector enterprises, carried out Nehru’s vision.
PSUs Category
One can classify PSUs into three groups.
- PSEs – Public Sector Enterprises
- CPSEs – Central Public Sector Enterprises
- PSBs – Public Sector Banks
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Famous PSUs in India
- CIL – Coal India Limited
- HPCL – Hindustan Petroleum Corporation Limited
- BHEL – Bharat Heavy Electricals Limited
- FCI – Food Corporation of India
- SBI – State Bank of India
- SAIL – Steel Authority of India Limited
- GAIL – Gas Authority of India Limited
- NTPC – National Thermal Power Corporation
- PGCI – Power Grid Corporation of India
- MTNL – Mahanagar Telephone Nigam Limited