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Context:

Defence Minister Rajnath Singh has approved the grant of Miniratna Category-I status to Yantra India Limited (YIL), marking a significant milestone in the company’s transformation into a profit-making defence public sector undertaking.

Miniratna:

Miniratna CPSEs are profit-making public enterprises that are financially stable but relatively smaller in scale. They are divided into Category I and Category II, based on profitability and net worth. Miniratnas form the base of the PSU hierarchy and play an important role in regional development and sector-specific growth. 

Miniratna Eligibility

Category I

• Profit-making for the last three consecutive years
• At least ₹30 crore profit in any one of those years
• Positive net worth

Category II

• Profit-making for the last three consecutive years
• Positive net worth, though financial strength is lower than Category I  

Miniratna Benefits

Category I enterprises can invest up to ₹500 crore or an amount equal to their net worth, while
Category II enterprises can invest up to ₹300 crore.
Both categories gain flexibility in operational decision-making, helping them improve efficiency and scale up gradually. 

Significance of Mini Ratna status:

Miniratna status plays a crucial role in strengthening the base of India’s public sector ecosystem by empowering smaller yet profitable CPSEs with limited financial and operational autonomy. Its significance can be understood as follows:

• Encourages Efficiency and Performance: By linking autonomy with profitability and net worth, Miniratna status incentivises PSUs to improve financial discipline, productivity, and managerial efficiency.
• Promotes Gradual Autonomy: It acts as a stepping stone between regular CPSEs and higher categories like Navratna, allowing enterprises to adapt gradually to independent decision-making.
• Supports Regional and Sectoral Development: Many Miniratna CPSEs operate in region-specific or niche sectors, contributing to balanced regional growth and strengthening smaller industrial segments.
• Enhances Operational Flexibility: Limited investment powers enable faster execution of projects, procurement decisions, and capacity expansion without excessive bureaucratic delays.
• Builds Future Navratnas: Miniratna enterprises serve as a talent and capability base, nurturing managerial and technical expertise that can later qualify them for Navratna status.
• Employment and Economic Stability: These enterprises generate stable employment, support ancillary industries, and contribute steadily to the national economy. 

Other Ratna’s:

Maharatna: Maharatna is the highest status accorded to CPSEs that are financially strong, strategically vital, and internationally competitive. These enterprises operate on a very large scale, generate substantial profits, and play a critical role in national development. Maharatna companies enjoy extensive financial autonomy, enabling them to make major investment decisions without prior government approval. They are central to sectors such as energy, minerals, infrastructure, transportation and heavy industries.

Navratna: Navratna status is awarded to high-performing CPSEs that demonstrate strong financial health and managerial capability. These enterprises enjoy moderate autonomy and can make investment decisions within prescribed limits. Navratna companies often act as growth engines within their sectors and serve as potential candidates for future Maharatna status. 

Maharatna Eligibility

A CPSE must already have Navratna status and satisfy at least one of the following conditions for three consecutive years:

• Average annual net profit of more than ₹2,500 crore, or
• Average annual net worth exceeding ₹10,000 crore, or
• Average annual turnover above ₹20,000 crore.

In addition, the enterprise should demonstrate sectoral leadership and a significant global presence.

Navratna Eligibility

To qualify for Navratna status, a CPSE must:

• Be a Miniratna Category I enterprise
• Secure a minimum score of 60 out of 100 based on financial and performance parameters such as net profit, net worth, capital employed and cost efficiency
• Have at least four independent directors on its board
• Maintain a consistent profitability record and sound management practices 

Maharatna Benefits:

Maharatna CPSEs can invest up to ₹5,000 crore or 15% of their net worth in a single project without government approval. They enjoy greater freedom in forming joint ventures, mergers and overseas investments, allowing faster execution of large-scale projects and global expansion. 

Navratna Benefits:

Navratna enterprises can invest up to ₹1,000 crore or 15% of net worth in a project. This autonomy enhances their ability to expand operations, enter strategic partnerships, and remain competitive in domestic and international markets. 

Conclusion:

Miniratna status is a foundational reform in India’s PSU framework, providing profitable yet smaller CPSEs with essential financial and operational autonomy. It promotes efficiency, strengthens regional and sectoral development, and creates a pipeline for future Navratna enterprises, while maintaining accountability and fiscal discipline.

Source: DD News