MoU is a mutually negotiated agreement between the management of the Central Public Sector Enterprises (CPSEs) and the Government of India. Under this agreement, the CPSE undertakes to achieve the targets set in the agreement at the beginning of the year. MoU is a major policy initiative of the Government of India in facilitating the empowerment and enhancing the performance levels of the CPSEs. It is aimed at providing greater autonomy to public sector enterprises and a level playing field vis-à-vis the private sector. The ‘Management’ of the enterprise is made accountable to the government through the promise of a ‘performance contract’. The government continues to exercise control as the principal shareholder over these CPSEs in setting MoU targets, and through performance evaluation during and at the end of the year. All CPSEs are required to sign MoUs with their administrative Ministries/holding companies.
The Company is entering into MOU with Department of Fertilizers every year. The performance of the company of last 5 years in terms of MOU is given below: