PSU Full Form is Public Sector Undertaking. State-owned corporations or enterprises in India are recognized as PSUs. The government introduces PSUs under its sign and standard for carrying out commercial work. Such state-owned companies are less apprehensive about profit-making and much more oriented on the nation-building directions and developing and expanding the nation’s economy.
What is PSU?
PSU is an abbreviation of Public Sector Undertaking, which usually refers to the government’s business arm or any public administration undertaking. This department is under the direct control of the Government of India. It has been given responsibilities related to welfare, safety, general engineering, procurement, supply, design, operation, maintenance, repair, and redevelopment of all kinds of government facilities. It can also handle the following objects: Social objectives Innovative uses of technology Special projects of national importance Concern for public safety For its concern for the interest of the common man and general public, public sector undertaking companies carry out many operations for the benefit of the people.
Background and history of PSU
Following are the essential characteristics of PSU: Big Company Subsidiaries. PSU companies were re-organized to make them more efficient and operationally feasible. According to the Ministry of Finance, Government of India, there are 81 PSUs in the country. Some of them have been merged, and some have been de-merged. PSUs are part of a conglomerate, and the PSUs themselves carefully manage their commercial interests. Due to strict regulation, the government uses the PSU to help in day-to-day economic and manufacturing matters. State-owned companies are quasi-government agencies regulated by the central government. Such companies generally give incentives to the banks.
Types of PSUs
One can classify PSUs into three groups
- PSEs – Public Sector Enterprises
- CPSEs – Central Public Sector Enterprises
- PSBs – Public Sector Banks
Top PSU Companies in India
Here is the list of Best PSU Companies
- Coal India Limited
- State Bank of India
- Food Corporation of India
- Indian Oil Corporation Limited
- Power Grid Corporation of India
- Bharat Heavy Electricals Limited
- Mahanagar Telephone Nigam Limited
- National Thermal Power Corporation
- Bharat Petroleum Corporation Limited
- Oil & Natural Gas Corporation Limited
The importance of PSUs
In various fields of industry and manufacturing, state-owned companies offer the advantage of work with state control. There is practically no entry barrier for PSUs compared with competition from outside as they need only a degree of funding from the government. Public Sector Projects (PSPs) are going to be vital in reducing the poverty of the country. They must also focus on the education sector and develop professional training institutions as basic social needs. These projects will do the responsibility of development. These will give a new face to the country, as the public sector exclusively carries out building projects. These projects will save a lot of time and money as they are easier to do than to start or complete.
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PSUs and Profit-Making
Despite several distinctions that are specifically and purely done, the PSUs are mainly moneymaking organizations. Their sale value depends upon the profitability they maintain and trade. In India, state-owned companies are generally called PSUs. Even in the face of the introduction of private PSUs, the moneymaking prospects of these companies have not diminished. Since they were set up in every governmental sector, the PSUs are so well known for their profitable results that their sales value has grown manifold. One important distinction which has to be noted is that the profit made by a state-owned enterprise is to the best extent distributed in the interest of the people.
What was the first PSU?
The PSU was born on January 14, 1975, when the government of India, which Indira Gandhi then headed, inducted NTPC Limited (NTPC) into the service on its creation. This was the first PSU in the country’s history. In other words, the PSU is a business partnership in which the government owns 51% of shares and the public sector companies own 49%. Public sector companies are concerned about providing the public the raw material in the service of the public. The traditional role of the public sector is carrying out the nation-building needs in the particular sector of commercial operations. Types of PSUs The PSUs are listed under different categories like The Central Public Sector Enterprises List (CPSE) Rules, 1971, and the Companies Act, 2013.
The objectives of PSUs
- Sustainably provide goods and services
- Promote industrialization
- Entrepreneurship and employment
- Provide employment opportunities
- Contributing to the nation’s economy
Most of the PSUs provide services in a developing country, so they cannot satisfy the market demand. They are underfunded. Hence, they end up importing the products or even producing only around two-thirds of the domestic demand. Why are PSUs Important? PSUs are better than private companies. The PSU companies can easily carry out higher volume production at lower prices. On the other hand, private companies tend to cost-cut costs and charge extra. Here are some reasons why the government should have State-owned companies.
The success and failure of a PSU usually depend on the way it is run. The main reason for failure in PSU as compared to private or profit-making organizations is the direct relationship between the corporate management and the government. If the same relation is maintained in private or profit-making organizations, the private or profit-making company cannot fail. But this direct relationship between the government and PSU is quite the opposite.
A Quick FAQ to PSU
What is PSU Full form?
The full form of PSU is Public Sector Undertaking.
Is PSU a govt job?
Government of India and State Government owned, undertaking companies are called Public Sector Undertaking (PSU) or a Public Sector Enterprise. PSU Government Jobs 2021 for Graduates, Engineers without GATE, Diploma Holders, ITI and 10+2 passed Indian Citizens.
How many PSU are in India?
There are 277 Central Public Sector Undertakings in India.
Who Comes under PSU?
Public Sector undertakings (PSU) can be classified into three following categories: Central public-sector Enterprises (CPSEs) – Companies which are under the direct control of the Central Government or of other CPSEs by 51% or more than 51% of capital share ownership.
Which is the biggest PSU in India?
Check-out, the five largest public companies in India’s Public Sector labeled as Public Sector Undertakings ( PSU ), mentioned below.
1. Indian Oil Corporation Ltd
2. Oil & Natural Gas Corporation Ltd
3. State Bank of India
4. Hindustan Petroleum Corporation Ltd
5. Bharat Petroleum Corporation Ltd
What is difference between PSU and government company?
Public Sector Undertaking or Enterprise refers to a Government Company. Public sector enterprises on the other hand refer to those companies registered under the Companies Act, 1951,which are predominantly owned by Government and which are managed by a Government appointed Chairman and Managing Director.
Do PSU employees get pension?
Pension calculation for PSU employees: There is no separate formula for calculating pension of retired employees of Public Sector Undertakings (PSUs) under EPS 1995. Pension calculation for PSU employees: There is no separate formula, says Government.
What is the role of PSU?
Here we detail about the following nine important roles played by public sector in Indian economy, i.e
(1) Generation of Income
(2) Capital Formation
(5) Strong Industrial Base
(6) Export Promotion and Import Substitution
(7) Contribution to Central Exchequer
Is PSU a permanent job?
You should know it well that PSU job through GATE is permanent as you will be an government employee. But remember if you are involved in unfair means, corruption etc, no job is permanent.
How is PSU salary calculated?
For Example : In basic of 24900/- the gross salary of employee is 55k to 60k (depends on perks of that organization). But after 7th pay revision this same basic will be doubled(approx). Then salary will be calculated as follows. (24900*2)(basic)+0(DA)+24900*2*45%(45% perks) = 75k (approx).
What is PSU retirement age?
The Government had taken a decision to increase the age of retirement from 58 to 60 years of Board level and below Board level employees of Central Public Sector Enterprises (CPSEs) in May 1998.