not selling assets, unlocking value: fm

OUR BUREAUNew Delhi, August 23

“Monetisation of core infra-structure assets does notmean selling the assets,” saidFinance Minister NirmalaSitharaman, launching the Na-tional Monetisation Pipeline(NMP) — the asset monetisa-tion mechanism of Centralpublic sector entities — onMonday

With the NMP, the govern-ment aims to generate ₹�6-lakhcrore between 2021-22 and2024-25, to be used for creatingnew assets. For the currentfi�scal, the target is ₹�88,000crore.

The NMP was announced inthis year’s Budget.

“Ownership of assets will re-main with the governmentand there will be a mandatoryhand-back. Asset monetisa-tion will unlock resources andlead to value unlocking,” sheadded. Sitharaman explainedthat the new mechanism isbased on the philosophy ofcreation through monetisa-tion and is aimed at tappingprivate sector investment fornew infrastructure creation.

The NMP will be co-ter-minus with the balance periodunder the National Infrastruc-ture Pipeline (NIP). The estim-ated value of ₹�6-lakh crore cor-responds to 14 per cent of theproposed outlay for the Centreunder the NIP (₹�43-lakh crore).This includes more than 12 lineministries and more than 20

asset classes. The sectors in-cluded are roads, ports, air-ports, railways, warehousing,gas and product pipeline,power generation and trans-mission, mining, telecom, sta-dium, hospitality andhousing.

“This is necessary for creat-ing employment opportunit-ies, thereby enabling high eco-nomic growth and seamlesslyintegrating the rural and semi-urban areas for overall publicwelfare,” said Sitharamanadding the NMP has all thecentral assets.

Three-pronged schemeShe said States will also be en-couraged to monetise their as-sets. There is a three-pointscheme for that — If a State gov-ernment is fully divesting itspublic sector enterprises withcontrol, an equal amount ofwhat it gets will be provided bythe Centre; if a State PSU hasbeen listed, then an amountequal to half the realised valuewill be provided; and in case ofany other asset, 33 per cent ofthe value will be provided bythe Centre.

The Minister said ₹�10,000crore has been provided in theBudget for NMP.

Rajiv Kumar, Deputy Chair-man of NITI Aayog, said thatthe strategic objective of theprogramme is to unlock thevalue of investments inbrownfi�eld public sector as-sets by tapping institutional

and long-term patient capital,which can thereafter be lever-aged for further publicinvestments.

Amitabh Kant, Chief Execut-ive Offi�cer of NITI Aayog, saidthat each Ministry will have anannual target. Kant hoped that

as there is huge liquidity, wellstructured assets will get bet-ter realisation. InvITs (Infra-structure Investment Trust)have given good result as havevarious new models in theroad sector.

As part of a multi-layer insti-

tutional mechanism for over-all implementation and mon-itoring of the newmechanism, an EmpoweredCore Group of Secretaries onAsset Monetization (CGAM)under the chairmanship ofthe Cabinet Secretary has beenconstituted. The assets andtransactions identifi�ed underthe NMP are expected to berolled out through a range ofinstruments. These includedirect contractual instru-ments such as public privatepartnership concessions andcapital market instrumentssuch as InvITs. The choice of in-strument will be determinedby the sector, the nature of as-set, the timing of the transac-tion (including market consid-erations), the target investorprofi�le and the level of opera-tional/investment control en-visaged to be retained by theasset owner, etc.

Opposition unhappyOpposition parties, not con-vinced with the NMP, said thegovernment is eyeing thecountry’s public wealth.

“Modi should stop sellingthe wealth of the country. He isfi�lling the exchequer by sellingpublic properties. This govern-ment does not believe in con-structing anything, but isproving destructive for thecountry,” the Congress said ina statement. CPI(M) generalsecretary Sitaram Yechury saidthe Finance Minister has de-tailed the plan for the loot ofnational assets and people’swealth.

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Not selling assets, unlocking value: FMAssets to be leased, ownership to remainwith govt; to generate ₹�6-lakh cr by FY25

Nirmala Sitharaman, Finance Minister, during the launch of theNational Monetisation Pipeline along with Amitabh Kant, CEO of NITI Aayog, in New Delhi on Monday KAMAL NARANG