The government has confered the Mini-ratna II status to National Small Industries Corporation (NSIC), providing it greater financial autonomy, Micro, Small and Medium Enterprises Minister Virbahdra Singh today said.
A Mini-ratna II company can incur capital expenditure on new projects, modernisation and purchase of equipment without the government approval up to Rs 150 crore or up to 50% of their net worth, whichever is lower.
"NSIC has been made a Mini-ratna company because of its persistent good performance. I hope from mini-ratna, it may try to become a Maharatna company and in the process also give a fillip to the small industries," Singh said during a function here.
The company has become Mini-ratna under Category-II by fulfilling the eligibility criteria.
According to the norms, the public sector enterprise (PSE) should have made profit for three successive years and should have a positive net worth.
During 2009-10, the state-owned unit has registered a net profit and net worth of Rs 24 crore and Rs 107 crore, respectively. In 2008-09, the company's net profit stood at Rs 6 crore and net worth at Rs 89 crore, while in 2007-08, its profit after tax was Rs 4 crore and net worth Rs 84 crore.
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For forming joint ventures and subsidiaries in India, it is necessary that the equity investment of the PSEs should be limited to Rs 50 crore in any one project and should not exceed 5% of the net worth of the state-owned company in any one project.
Besides, NSIC today signed an agreement with the Ministry of Micro, Small and Medium Enterprises for 2011-12 for fixing MOU targets. The company has set up a higher target of 40-50% growth in its turnover to Rs 9,000 crore for 2011-12 compared to the current fiscal.
NSIC has been working towards promotion and fostering growth of small scale industries and micro, small and medium enterprises in the country.