RITES Ltd Attains ‘Navratna’ Status: A New Milestone in India’s Public Sector

RITES Ltd Attains 'Navratna' Status: A New Milestone in India's Public Sector
RITES Ltd Attains 'Navratna' Status: A New Milestone in India's Public Sector

RITES Ltd is renowned for its contributions in the domains of transport infrastructure consultancy, railway inspection, rolling stock leasing and maintenance, and related services. Its elevation to Navratna status is a testament to its substantial role in the nation’s growth and development.

Earning Navratna status brings a host of advantages for RITES Ltd, including:

  • Empowered Board of Directors, allowing the undertaking of mergers and acquisitions both in India and overseas, thus bolstering the company’s growth potential.
  • While foreign investments are permissible, they necessitate approval from the Cabinet Committee on Economic Affairs (CCEA), thereby presenting opportunities for global expansion.
  • The Chief Executive of the PSU gains authority to approve international business trips for functional directors, especially in emergency situations, for durations of up to five days (excluding study tours and seminars) with communication to the administrative ministry’s Secretary.

The Government of India categorizes Public Sector Undertakings (PSUs) into three distinct classes: Maharatna, Navratna, and Miniratna. Achieving Navratna status involves fulfilling specific criteria, emphasizing financial performance and operational excellence.

To attain Navratna status, a PSU must meet the following prerequisites:

  • The PSU should already hold the Miniratna-I classification.
  • It must be categorized as a Schedule ‘A’ company, underscoring its significant presence and operations.
  • The PSU should have secured an ‘excellent’ or ‘very good’ rating in its Memorandum of Understanding (MoU) with the government in three of the last five years.
  • The PSU must maintain a composite score of 60 or higher across six performance indicators, demonstrating consistent and substantial performance.

Furthermore, to qualify for Navratna status, a PSU must meet specific financial benchmarks, which encompass:

  • A net profit exceeding Rs 5,000 crore for three consecutive years.
  • An average annual turnover of Rs 25,000 crore over three years.
  • An average annual net worth surpassing Rs 15,000 crore for three years.

The prestigious roster of the 15 existing Navratna PSUs in India includes organizations such as Bharat Electronics Limited, Container Corporation of India Limited, Engineers India Limited, Hindustan Aeronautics Limited, Mahanagar Telephone Nigam Limited, National Aluminium Company Limited, National Buildings Construction Corporation Limited, Neyveli Lignite Corporation Limited, NMDC Limited, Rashtriya Ispat Nigam Limited, Shipping Corporation of India Limited, Rail Vikas Nigam Limited, ONGC Videsh Ltd, Rashtriya Chemicals & Fertilizers Limited, and IRCON.