Public Sector in India
In the Post Independence era, India was facing severe Socio-Economic
regional imbalances in economic development,
lack of trained manpower,
low levels of employment,
weak industrial base,
lack of infrastructure facilities, etc.
• The first Prime Minister of free India, Pandit Jawaharlal Nehru and other
nationalist leaders shouldered the great responsibility of building a strong
and modern India.
• First Industrial Policy was adopted by Govt. of India in 1948 and implemented
the planned economic development polices, which envisaged the roadmap
for Public Sector.
• This resulted in self-reliant development of public sector and economic
growth of our country which paved way for creation of large base and scope
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• Initially, the public sector was confined to core and strategic
industries like Railways, Post & Telegraph, Ordinance Factories
etc. During the first five-year plan (1951-56), there were only 5
CPSEs in the country with a financial investment of Rs. 29Cr.
Witnessed Nationalization of Banks & Industries, takeover of sick units from the
private sector and entry of the public sector into new fields.
Manufacturing, Engineering, Steel, Heavy machinery, Machine tools, Fertilizers,
Drugs, Textiles, Pharmaceuticals, Petro-Chemicals, Exploration, Mining &
Extraction of Minerals, Refining of crude oil, Services such as Telecommunication,
Trading, Tourism and Warehousing and a range of consultancy services.
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As per the DPE Survey 2012-13
• No. of CPSEs in 1956 – 5 Nos. with financial investments Rs.29 Crs.
• No. of CPSEs as on 31.03.2013 – 277 with Financial investment of Rs.
• Growth in the number of CPSEs has directly reflected significant increase in
• Capial employed in all CPSEs as on31.03.2013 was Rs15,32,007 cr
• Total investment in all CPSEs Rs 8,50,599 cr.
• Net Profit earned by all CPSEs Rs 1,15,300 cr
• Total Income of all CPSEs was Rs 19,31,150 crore
• CPSEs contribution in terms GDP at market prices in 2012-13 was of
Rs 1,00,20,620 crore , this a percentage of GDP is ranged from 20% to 24%.
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• CPSEs’ foreign exchange earnings contributes for 9% of the
total export earnings of our country.
• CPSEs offers source of income to Central Exchequer Rs
162402 cr ,in two ways
(i) Payment of dividend through investments in CPSEs and
interest on government loans
(ii) Payment of Taxes & Duties. Central Exchequer sources’
65% of the revenue from CPSEs through payment of
Excise duty and Corporate Taxes.
• CPSEs account for over 20% of BSE’s market capitalization.
• In FY2012-2013, CPSEs employed 1.4 million people, of
which 25% belonged to the managerial and supervisory
cadre. Paid a remuneration of Rs 1,16,375 crore Per capita
wages Rs 8.29 lakhs.(NLC Rs 11.24lakhs)
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Performance of CPSEs
• As a new endeavour of Govt. of India, GoI had introduced the
‘Navratna’ scheme in 1997
• CPSEs which are at the higher end of the ‘Navratna’ category
and have the potential to become Indian Multinational
Companies (MNCs) have been recognized as a separate class
• The objective of the ‘Maharatna’ scheme is to empower mega
CPSEs to expand their operations and emerge as global giants.
• Presently GoI has accorded the status of ‘Maharatna’ to 7
CPSEs, ‘Navratna to 17 CPSEs, ‘Miniratna Category - I CPSEs to
53 & Category - II to 18 CPSEs to empower and equip
themselves to react proactively to market forces.
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Evaluation of CPSEs Performances
• To supervise overall performance of the CPSEs for better
results, to ensure accountability and grant greater
autonomy to PSUs
• Every Financial Year a Memorandum of Understanding
(MoU), a mutually negotiated document is signed
between the management of the PSU and Administrative
Ministry in the Government.
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CPSEs are pioneers in CSR activities
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To over come challenges in industry CSR is required.
CSR leads to good governance by balancing the need of various stakeholders and cordial Industrial Relations.
Considering importance of CSR, the Companies Act 2013 made CSR compulsory- “Comply or explain”
• The importance of CSR was realised and being practiced by CPSEs for decades.
• In 1994, DPE issued Guidelines on “Social obligations of PSU”
• In 2010, issued CSR guidelines directing CPSEs to spend 5% to 0.5% of Net Profit depending on profitability of the
company. ( companies earing Net Profit upto Rs 100 cr 3 to 5%, 100 cr to 500 cr – 2 to 3%, above 500 cr 0.5% to 2%)
• In 2013 CSR guidelines were integrated with Sustainable development guidelines.
• MOU between the Ministries and PSUs, included CSR as one of the MOU parameters
• Thus Indian PSUs started practicing the CSR for decades, where the CSR was not a compulsory one for Indian
Incorporated on 14-11-1956 under Companies act 1956
Core Business – Lignite mining & power generation
Schedule A, Navratna CPSE since April 2011.
Lignite mining capacity: 30.60 MTPA
Power Generating capacity: 2740 MW
Paid up capital Rs. 1677.71 Cr. Net worth Rs 13381 Cr
Market capitalization Rs 18203 in June 2014
Profit After Tax Rs. 1501.88 Cr. in 2013-14.
For 2013-14, an interim dividend of Rs.150.99 cr (10%) paid to GOI. A final dividend of Rs.271.78
cr (18%) is proposed taking the total dividend pay out to Rs.422.77
16566 employees as on 01.08.2014. (Executives: 4298, Non-Executives: 12268).
I. NLC Tamilnadu Power Limited (NTPL) – NLC 89% and TANGEDCO 11%
II. Neyveli UttarPradesh Power Limited (NUPPL) – NLC 51% and UPRVUNL 49%.
Joint Venture: MNH Shakti Ltd (MCL – 70%, NLC– 15% and Hindalco – 15%)
MOU rating : 2011-12 Excellent : 2012-13 Excellent : 2013-14 Excellent (Provisional)August 22, 2014 Neyveli Lignite Corporation Ltd 12
Allocation of Coal blocks by GOI
Pachwara South (279 MT of reserves) – for 1980 MW Ghatambur Thermal
Power Project in UP of NUPPL
Jilga Barpali (396 MT of reserves for NLC) (Jointly with CSPGCL) - for 4000 MW
Sirkali Thermal Power Project of NLC.
Capacity at the End of XII Plan
Addition in XII
Capacity at the
end of XII Plan
Lignite (MTPA) 30.60 6.00 36.60
Lignite based power (MW) 2740 500 3240
Coal based power (MW) 1000 1000
Wind Power (MW) Nil 51 51
Solar Power (MW) Nil 20 20
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CSR -The CSR expenditure of NLC for the year 2013-14 is Rs. 26.30 Cr. i.e, 1.80% of PAT
as against the norm of 0.5%
2011-12 2012-13 2013-14
19902 19988.73In Million Units
Performance in the last three years
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2011-12 2012-13 2013-14
In Lakh Tonnes
Performance in the last three years
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2011-12 2012-13 2013-14
Sales Total income
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1 Dividend on Central Govt. Equity 422.78
2 Central Excise 71.89
3 Service Tax 21.04
4 Custom Duty 22.19
5 Corporate Tax 632.90
6 Dividend tax 51.32
7 Clean Energy Cess 140.48
State Government Exchequers
1 Sales Tax 30.84
2 Royalty 244.43
3 Other Taxes and Duty 5.09
No.of equity shares – 1677709600 of face value of Rs.10 each.
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President of India 90
Financial institutions of State Government 3.56
Financial institutions/Banks 0.11
Insurance companies 4.64
Mutual funds/UTI 0.02
Bodies corporate 0.17
Foreign institutional investors 0.03
Clearing members 0.02
Mines : Output per Man shift (Tonnes)
Company 2011-12 2012-13 2013-14
Coal Mines (OC) * 10.40 11.48 12.18
NLC 11.18 11.97 12.64
Thermal : Plant Load Factor( %)
2011-12 2012-13 2013-14
ALL India 73.47 70.13 65.55
Central Sector Thermal 82.12 79.18 76.11
Lignite based power
73.82 70.87 75.63
NLC 82.57 82.80 83.19
Source : CEA reports
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Name of the Project
( 2 x 250 MW)
Coal based Power project at
( 2 x 500 MW)
( 2 x 500 MW)
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Restructuring of Mine I and IA,
FR completed. MOE&F issued Terms of
Reference for EIA/EMP studies. EIA/EMP report
is under finalization
2 Barsingsar TPS Extension, Rajasthan 250 MW 2094.80
FR prepared. EC obtained. Land is already in
possession of NLC. Due Diligence study in
3 Hadla Lignite Mine, Rajasthan
FR prepared. EC obtained. NLC has paid
Rs.127.43 Lakhs towards reimbursement cost of
1107 ha of land. Due Diligence study in progress.
4 Bithnok TPS, Rajasthan 250 MW 2146.89
FR completed. EC issued by Environment Impact
Assessment Authority, Rajasthan. Water supply
agreement for 25 cusecs from IGNP was entered
on 10th June 2014. Due Diligence study in
5 Bithnok Lignite mine, Rajasthan
EAC of MOE&F recommended environmental
clearance. However MOE&F informed that EC
will be issued after the project is accorded stage-I
forest clearance. In this regard application
submitted on 5th March 2014. Due Diligence study
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6 Coal based TPS, Ghatampur, UP 1980 MW 14375.00
Implementation through JV, NUPPL (Neyveli Uttar Pradesh
Power Limited). PIB recommended the project to CCEA in
January 2013. MOE&F deferred consideration of issue of
EC till Pachwara south coal block , allotted to this project, is
given Stage-I forest clearance. So far Rs.69.16 Cr has been
disbursed for land acquisition.EOI for Steam Generator and
Turbine Generator packages opened in September 2013and
for Balance of Plant in June 2014.
7 Development of Pachwara South coal block 11 MTPA *
GOI allocated this coal block for the proposed Ghatampur
coal based thermal power project. TOR issued by MOE&F
in February 2014 for preparation of EIA/EMP reports.
CMPDIL the contractor for exploratory drilling suspended
the work due to law & order problem.
8 Development of Jilga Barpali coal block 12 MTPA *
GOI allocated this coal block to NLC (396 MT) for the
proposed Sirkali Coal based power project and
Chattisgargh Power Generation Corporation (150 MT).
Activities related to signing of JV agreement is in process.
9 Sirkali TPS, Tamilnadu 4000 MW 28964.00 FR under preparation.
* - Project cost will be known after preparation of FR
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To meet the future coal requirement for the upcoming coal
based power projects
NLC has floated an Global Expression of Interest (EoI) for
acquiring coal assets abroad on 07.02.2013.
Offers have been received for coal blocks in Mozambique,
Indonesia and Australia.
Action is under process for technical, financial and legal due
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• NLC has been awarded “Golden Peacock Occupational Health & Safety Award – 2013” for
TPS-II on 19th July 2013 at New Delhi. The Award instituted by the Institute of Directors
(IOD) New Delhi was presented by Hon’ble Union Minister of State for Information and
• NLC has won the Meritorious Award for the Environmental Excellence & Sustainable
Development 2011-12 instituted by Standing Conferences of Public Enterprises (SCOPE) which
was presented by Hon’ble Shri Pranab Mukherjee, President of India on 26.04.2013 at Vigyan
Bhawan, New Delhi.
• NLC has been conferred “Best Overall Performance (Brown Coal)” Award 2013 and selected
for the “6th India Power Award” instituted by “The Council of Power Utilities”.
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• NLC has bagged the National Energy Conservation award for its Mine unit for the year 2013 instituted
by Ministry of Power. Hon’ble President of India Shri. Pranab Mukherjee, issued the award in a
function held at Vigyan Bhawan, New Delhi, on 16th December 2013.
• The Institute of Engineers (India) awarded CMD, NLC with the “Eminent Personality Award” on 20th
December 2013 during 28th Indian Engineers Congress at Chennai.
• Thermal Power Station-I Expansion of NLC bagged the Silver Shield of the National Environmental
Management Award among the coal and lignite based Thermal Power Stations for the year 2012-13
on 4th February 2014.
• IPE CSR Corporate Governance Award’ instituted by Institute of Public Enterprises at Mumbai on
24.11.2012 to NLC, for its dedicated service to the society.
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Issues in setting up a new mine
• Land acquisition, Rehabilitation & Resettlement of displaced persons,
increasing trend in compensation for land, demand for permanent
employment etc makes mining difficult and costly
• Geological Concentration of lignite reserves confined to limited states.
• “Proven” category of lignite is quantitatively less.
• Deep seated lignite and Limitation of Technology.
• Occurrence of Ground Water Aquifer below lignite Bed.
• Delay in obtaining Environmental clearance, Forest clearance
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• Coal continues to be major fuel source for Power generation and gap between
demand supply continues to widen.
• Needs collective efforts of Government, Power producers, Coal miners and Service
providers to ensure modern and sufficient infrastructure for higher coal production
for meeting coal demand.
• Establishing a single window clearance process for Coal & Power Projects.
• Support in land acquisition and R&R related issues to ensure timely and smooth
• To promote research and exploration activities on new technologies like Coal Bed
methane and Underground Coal Gasification.
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