44-573: Power Finance Corporation Ltd. ( PFC ) is an Indian public sector company engaged in infrastructure finance activities. Established in 1986, it provides financing for the Indian power sector and is under the admistrative control of the Ministry of Power , Government of India . PFC was classified as a ' Maharatna ' enterprise on 12 October 2021. Initially wholly owned by the Government of India ,
88-759: A 52.63% controlling stake in REC for ₹ 14,500 crore (US$ 1.7 billion). On 28 March, PFC announced that it had completed making the payment for the acquisition and intended to merge REC with itself in 2020. However, REC has maintained that merging PFC-REC is no longer an option. In 2023, REC was included in the Morgan Stanley Capital International (MSCI) Global Standard Index, effective from 1 September 2023. REC has also diversified into non-power infrastructure & logistics sector to cover areas such as airports, metro, railways, ports, and bridges. REC has 22 regional offices. . REC
132-508: A Miniratna and have 4 independent directors on its board before it can be made a Navratna. PSUs in India are also categorized based on their special non-financial objectives and are registered under Section 8 of Companies Act , 2013 (erstwhile Section 25 of Companies Act, 1956). Public Sector Undertakings (PSUs) can be classified as Central Public Sector Undertakings (CPSUs) or State Public Sector Undertakings (SPSUs). CPSUs are administered by
176-516: A common goal of Rural Electrification (RE) and rural energy development. Today, RECIPMT conducts regular programmes on various aspects of Transmission and Distribution for national and international executives in the power sector, including seminars participated by both private and public utilities. Programmes focus on adoption of innovative and cost effective modern technologies, training in both conventional and non-conventional energy areas and practical demonstrations via an in-house Energy Park. EESL
220-515: A revenue of about ₹24,430,000,000,000 + ₹1,000,000,000,000 during the financial year 2018–19. When India achieved independence in 1947, it was primarily an agrarian entity, with a weak industrial base. There were only eighteen state-owned Indian Ordnance Factories , previously established to reduce the dependency of the British Indian Army on imported arms. The British Raj had previously elected to leave agricultural production to
264-429: A self-sufficient, largely agrarian, communal village-based existence for India in the first half of the 20th century. Other contemporary criticisms of India's public sector targeted the lack of well-funded schools, public libraries, universities, hospitals and medical and engineering colleges; a lack seen as impeding an Indian replication of Britain's own industrialization in the previous century. Post-Independence,
308-623: A sole lender or co-lender or in consortium with or without the status of lead financer. It also provides consultancy, project monitoring and financial/ technical appraisal support for projects, also in the role of nodal agency for Government of India schemes or projects. It engages in ascertaining financial requirements of power utilities in the country in the T&;D sector along with appraising T&D schemes for financing. REC has financed T&D schemes for system improvement, intensive electrification, pump-set energisation and APDRP Programme. The company
352-472: A year. REC was set up in July 1969, in the backdrop of a critical drought situation facing India in the late sixties. The company’s initial mandate was mainly to help State Electricity Boards energise pump-sets across the country to boost agriculture and overcome the crippling impact of three successive years of deficient monsoons. The company also provided finance to accelerate the pace of rural electrification in
396-498: Is also actively involved in physical as well as financial monitoring of T&D schemes. REC also offers loan products for financing Renewable Energy projects. The company has tied up a line of credit for €100M (approximately ₹ 6000M) with KfW under Indo-German Development Cooperation for financing renewable energy power projects at concessional rates of interest. Eligible projects include solar, wind, small hydro, biomass power, and cogeneration power & hybrid projects GARV APP
440-464: Is an Indian public sector company which finances and promotes power projects across India. It provides loans to Central/State Sector Power Utilities in the country, State Electricity Boards , Rural Electric Cooperatives, NGOs and Private Power Developers. It is a subsidiary of Power Finance Corporation (PFC) and is under the administrative control of the Ministry of Power , Government of India . On 20 March 2019, PFC signed an agreement to acquire
484-499: Is an application developed and maintained by REC, incepted to aid the Grameen Vidyutikaran Mission running under DDUGJY (Deen Dayal Upadhyaya Gram Jyoti Yojana). The App "GARV" (Grameen Vidyutikaran), which provides real-time updates on electrification status of 18452 UE villages, was launched on 14 October 2015 The mobile app is accessible to all stakeholders including the general public at large. The company
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#1732779649504528-900: Is currently among the top 500 Global Financial Services brands by UK-based plc Brand Finance. The company is also among the Forbes Global 2000 companies for 2010. Domestic debt instruments of REC are assigned the highest rating "AAA" by credit rating agencies CRISIL , Fitch and ICRA . Moody’s and Fitch have rated its international credit rating at par with India’s sovereign rating. International collaborations have included past tie-ups for External Commercial Borrowings with Standard Chartered Bank (London), DEPFA Investment Bank Limited (Cyprus) etc. as well as current tie-ups with KfW (Germany) and Japan International Cooperation Agency (Japan) under Official Development Assistance. As an IFC, REC can also issue Infrastructure Bonds and raise funds up to US$ 500M through External Commercial Borrowing in
572-673: Is denoted in %, as of 30 September 2024 ): Currently there are 43 Regional Rural Banks in India, as of 1 April 2020: Andhra Pradesh Arunachal Pradesh Assam Bihar Chhattisgarh Gujarat Haryana Himachal Pradesh Jammu and Kashmir Jharkhand Karnataka Kerala Madhya Pradesh Maharashtra Manipur Meghalaya Mizoram Nagaland Odisha Puducherry Punjab Rajasthan Tamil Nadu Telangana Tripura Uttar Pradesh Uttarakhand West Bengal Rural Electrification Corporation Limited REC Limited , formerly Rural Electrification Corporation Limited ,
616-411: Is further classified into Strategic Sector and Non-Strategic Sector. Depending on their financial performance and progress, CPSUs are granted the status of Maharatna , Navaratna , and Miniratna (Category I and II). Following India's independence in 1947, the limited pre-existing industries were insufficient for sustainable economic growth . The Industrial Policy Resolution of 1956 , adopted during
660-483: Is highly sought after in India due to high pay and its job security , with most preferring candidates with a GATE score. In 1951, there were five PSUs under the ownership of the government. By March 2021, the number of such government entities had increased to 365. These government entities represented a total investment of about ₹ 16,410,000,000,000 as of 31 March 2019. Their total paid-up capital as of 31 March 2019 stood at about ₹200.76 lakh crore. CPSEs have earned
704-846: Is the 12th Maharatna Company functioning under the purview of the Ministry of Power . The company is listed on both the National Stock Exchange and the Bombay Stock Exchange . Business operations in India are supported by a network of 22 Regional Offices, with its corporate headquarters at Gurugram and a registered office in New Delhi . : The company is primarily engaged in providing finance for rural electrification projects across India and provides loans to Central/ State Sector Power Utilities, State Electricity Boards , Rural Electric Cooperatives, NGOs and Private Power Developers. The company sanctions loan as
748-506: Is under the ownership of the Government of India or state governments .These type of firms can also be a joint venture of multiple PSUs. These entities perform commercial functions on behalf of the government. Depending on the level of government ownership, PSUs are officially classified into two categories: Central Public Sector Undertakings ( CPSUs ), owned by the central government or other CPSUs; and State Public Sector Undertakings ( SPSUs ), owned by state governments. CPSU and SPSU
792-556: The Ministry of Heavy Industries and Public Enterprises . The Department of Public Enterprises (DPE), Ministry of Finance is the nodal department for all the Central Public Sector Undertakings (CPSUs). As of October 2021, there are 13 Maharatnas, 14 Navratnas and 72 Miniratnas (divided into Category 1 and Category 2). Currently there are 12 Nationalised Banks in India (Government Shareholding power
836-508: The National Common Minimum Programme goal of access to electricity for all. Under the scheme, 90% capital subsidy is provided by Government of India for overall cost of projects. Cumulatively till FY10, works in 190,858 villages have been completed and free connections to over 10 million below poverty line (BPL) households have been released. The REC is the nodal agency under the newly launched SAUBHAGYA Yojana by
880-609: The Planning Commission was formed by a cabinet resolution in March 1950 and the Industrial (Development and Regulation) Act was enacted in 1951 with the objective of empowering the government to take necessary steps to regulate industry. The first Prime Minister of India, Jawaharlal Nehru , promoted an economic policy based on import substitution industrialisation and advocated a mixed economy . He believed that
924-602: The Private sector , with tea processing firms, jute mills (such as the Acland Mill ), railways , electricity utilities, banks, coal mines, and steel mills being just some of the economic entities largely owned by private individuals like the industrialist Jamsetji Tata . Other entities were listed on the Bombay Stock Exchange . Critics of private ownership of India's agricultural and industrial entities—most notably Mahatma Gandhi's independence movement—instead advocated for
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#1732779649504968-702: The Second Five-Year Plan , laid the framework for PSUs. The government initially prioritized strategic sectors, such as communication, irrigation, chemicals, and heavy industries , followed by the nationalisation of corporations . PSUs subsequently expanded into consumer goods production and service areas like contracting, consulting, and transportation. Their goals include increasing exports, reducing imports, fostering infrastructure development, driving economic growth, and generating job opportunities. Each PSU has its own recruitment rules and employment in PSUs
1012-723: The Ministry of Finance, Govt. of India, to raise funds under section 54EC of the Income Tax Act 1961. PFC was the first company to obtain such approval post the budget announcement in February 2017. PFC has raised more 14.7 million dollars under these bonds since their launch in 2017. Since its inception, PFC has been providing financial assistance to power projects across India including generation, transmission, distribution and RM&U projects. Recently, it began financing other infrastructure projects which have backward linkages to
1056-630: The US market. PFC is one of the institutions eligible for raising funds through capital gain tax bonds under section 54EC of the Income Tax Act, 1961 . Over the last two-three years, PFC has focused on diversifying its borrowing portfolio by raising funds from international markets. In November 2017, PFC launched its main Green Bond issue for US$ 400 million, which witnessed the tightest ever spread for any Indian Issuer for its maiden 10-year issue. In
1100-763: The central government established the higher Maharatna category, which raises a public sector unit's investment ceiling from ₹1,000 crore to ₹5,000 crores. The Maharatna public sector units can now decide on investments of up to 15 per cent of their net worth in a project while the Navaratna companies could invest up to ₹1,000 crore without explicit government approval. Two categories of Miniratnas afford less extensive financial autonomy. Guidelines for awarding Ratna status are as follows: The average annual Net worth of ₹10,000 crores for three years, OR Average annual Turnover of ₹20,000 crore for three years (against Rs 25,000 crore prescribed earlier) A PSU must first be
1144-504: The company issued an IPO in January 2007. The issue was oversubscribed by over 76 times, which is one of the largest for an IPO of any Indian CPSU. PFC is listed on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE). It is also an ISO 9001:2000 certified company and enjoys the status of Maharatna PSU in India. On 6 December 2018, the Government of India approved PFC's takeover of REC . The acquisition transaction
1188-423: The crisis, the government began divesting its ownership of several PSUs to raise capital and privatize companies facing poor financial performance and low efficiency. The public sector undertakings are headed by the head of board of directors also known as chairperson cum managing director cum chief executive officer and a vice chairperson cum deputy managing director cum co-chief executive officer along with
1232-628: The establishment of basic and heavy industry was fundamental to the development and modernisation of the Indian economy. India's second five year plan (1956–60) and the Industrial Policy Resolution of 1956 emphasized the development of public sector enterprises to meet Nehru's national industrialisation policy. His vision was carried forward by V. Krishnamurthy , a figure known as the "Father of Public sector undertakings in India". Indian statistician Prasanta Chandra Mahalanobis
1276-513: The first quarter of the Financial year 2020, PFC has raised about US$ 1.3 billion from the international markets. Out of this US$ 1 billion was raised in June 2019, which was the first dual and largest USD bonds transaction for Govt owned Indian NBFC. This was also PFC's first borrowing from the international markets after the successful acquisition of REC Limited. In 2017, PFC was granted approval by
1320-509: The global market so as to "support [them] in their drive to become global giants". Financial autonomy was initially awarded to nine PSUs as Navratna status in 1997. Originally, the term Navaratna meant a talisman composed of nine precious gems. Later, this term was adopted in the courts of the Gupta emperor Vikramaditya and Mughal emperor Akbar , as the collective name for nine extraordinary courtiers at their respective courts. In 2010,
1364-623: The mandate of REC was expanded to include financing of all generation projects without limit on size or location. Today, financing of Generation projects has become a major thrust-area of operations for REC, also attracting majority of its private sector borrowers. Since 2005, REC has been appointed nodal agency by Ministry of Power [1] Archived 15 July 2013 at the Wayback Machine for Government of India scheme Rajiv Gandhi Grameen Vidyutikaran Yojana aimed at building rural electricity infrastructure and household electrification towards
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1408-771: The mechanism of rating different state Power Utilities on its performance. PFC presently has ten subsidiaries, seven of which are SPVs (shell companies) to implement the UMPP project: After the purchase of the entire holding of the Govt. of India in Rural Electrification Corporation Limited , became a subsidiary of PFC in the fiscal year 2018-2019. PFC is also one of the promoters in Energy Efficiency Services Limited ( EESL ), with NTPC , Powergrid and REC being
1452-725: The members of the board of directors also known as executive director cum c-level officer who are Group 'A' gazetted officers appointed by the President of India in case of central public sector undertakings, its subsidiaries & its divisions and appointed by the Governor of States of India in case of state public sector undertakings, its subsidiaries & its divisions. All of the public sector undertakings have been awarded additional financial autonomy. Public Sector Undertakings are government establishments that have comparative advantages", giving them greater autonomy to compete in
1496-495: The national consensus turned in favor of rapid industrialisation of the economy, a process seen as the key to economic development, improved living standards and economic sovereignty. Building upon the Bombay Plan , which noted the necessity of government intervention and regulation in the economy, the first Industrial Policy Resolution announced in 1948 laid down in broad strokes such a strategy of industrial development. Later,
1540-708: The operation in various states and project appraisal. Finance Division looks after the Fund Mobilization and Disbursement. PFC is a lean organization. The number of employees as on 31 March 2023 was around 550. Most of the PFC's funds are raised through rupee-denominated bonds, which have the highest credit rating in the Indian market and in international markets, rated at par with the Indian sovereign rating . It also borrows short term and long term from various banks and other financial institutions, and raised external commercial borrowings (ECB) through private placement in
1584-497: The other promoters. EESL is currently implementing of world's largest energy efficiency portfolio and has been instrumental in energy savings of more than 50 tWh/year and an estimated GHG reduction of more than 40 million tonnes of CO 2 per year. Public Sector Undertakings in India Public Sector Undertakings ( PSU ) in India are government-owned entities in which at least 51% of stake
1628-431: The overall context of planned programmes for increased agricultural production. Besides finance, REC also offered appraising, consultancy, technical support and monitoring of projects, to assist State Electricity Boards/Power Utilities, Rural Electric Cooperatives and other such institutions. Liberalisation by the Government of India (GoI) in 1991 saw introduction of amendments to existing laws and reform measures enabling
1672-465: The power sector like coal mine development, fuel transportation, oil & gas pipelines, etc. The borrower profile includes State Electricity Boards, State sector power utilities, Central sector power utilities and Private sector companies. PFC is also the nodal agency for the implementation of the ambitious Ultra Mega Power Plants (UMPPs) and the R-APDRP program of Govt. of India. The company also has
1716-562: The present Modi government . In 1979, REC established a national training institute in Hyderabad for the development of techno-managerial skill and efficiency in State Electricity Boards (SEBs), Distribution Companies, Rural Electric Cooperatives and other Power Utilities, and also to conduct in-house training programmes for REC’s employees. CIRE also served as a platform for association with other institutions towards
1760-475: The private sector to participate in large-scale in manufacturing industry, services industry and infrastructure. Sectors like power, airports, seaports, roadways, projects were identified for private participation, and nodal agencies were set up to do the initial spade work and later hand over such projects to private players through competitive bidding routes. In April 2006, GoI identified 14 transmission projects worth ₹ 200 billion for development by 2012. REC
1804-604: Was completed on 28 March 2019 with PFC paying almost Rs. 145 million to the government of India for the 52.63% stake. The corporation is headed by the chairman and managing director, who at present is Parminder Chopra . The company has three wings, each headed by a Functional Director namely the Commercial Division, Projects Division and Finance Division. The Commercial Division looks after the credit appraisal and categorization of borrower entities, power sector reforms, review and analysis. The Projects Division controls
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1848-740: Was identified as one of the two GoI-appointed nodal agencies for transferring identified projects to private developers. REC also started extending loans to manufacturers of T&D equipment. Till 2000, REC focused on the Transmission and Distribution aspect of power, with projects for household electrification in rural and semi-urban areas, area electrification in tribal/ dalit areas, intensive electrification, and system improvement projects based on strengthening and improving transmission, sub transmission and distribution systems. REC’s portfolio of Generation projects constituted mainly Mini/Micro Generation Projects up to 25MW capacity till 2000. In June 2002,
1892-482: Was instrumental to its formulation, which was later termed the Feldman–Mahalanobis model . In 1969, Indira Gandhi 's government nationalised fourteen of India's largest private banks, and an additional six in 1980. This government-led industrial policy, with corresponding restrictions on private enterprise, was the dominant pattern of Indian economic development until the 1991 Indian economic crisis . After
1936-439: Was listed on the National Stock Exchange and the Bombay Stock Exchange on 12 March 2008. REC went for Initial Public Offer of 156,120,000 Equity Shares in February 2008 which was oversubscribed by about 27 times, raising a total amount of ₹ 819 crores. Further Public Offer of 171,732,000 equity shares was made in February 2010. The issue was oversubscribed by 3.14 times, raising a total of ₹ 26.47 billion The company
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