Monday, September 20, 2021

FM Nirmala Sitharaman to launch National Monetisation Pipeline Today

Union Finance Minister Nirmala Sitharaman today, August 23, 2021, will launch the National Monetisation Pipeline (NMP), which will list out the government’s infrastructure assets to be sold in the next four years, according to the finance ministry.

“The NMP comprises a four-year pipeline of the Central Government’s brownfield infrastructure assets. Apart from providing visibility to investors, the NMP will also serve as a medium-term roadmap for the Government’s Asset Monetisation Initiative,” the Finance Ministry said in a statement on Sunday.

Department of Investment and Public Asset Management (DIPAM) Secretary Tuhin Kanta Pandey said earlier this month that the Government is finalising infrastructure assets worth Rs 6 lakh crore, including national highways and power grid pipelines, which will be monetised. Tuhin Kanta Pandey had said, “A national monetisation plan of about Rs 6 trillion is underway, which will have multiple assets ranging from pipeline to power grid pipeline to national highways, TOT (toll-operate-transfer) and so on.”

The Union Budget 2021-22 laid great emphasis on asset monetisation as a means of mobilising innovative and alternative financing for infrastructure. In her budget speech, Finance Minister Nirmala Sitharaman had said that monetisation of operating public infrastructure assets was a very important financing option for new infrastructure construction.

Asset Monetisation

The Union Finance Minister had launched the “National Monetisation Pipeline” of potential brownfield infrastructure assets stating that monetising operating public infrastructure assets are a very important financing option for new infrastructure construction. The Minister informed that an Asset Monetisation dashboard will also be created to track the progress and provide visibility to the investors.

Some important measures in the direction of monetisation are as follows:

  1. National Highways Authority of India and PGCIL each have sponsored one InvIT that will attract international and domestic institutional investors. Five operational roads with an estimated enterprise value of Rs 5,000 crore are being transferred to NHAIInvIT. Similarly, transmission assets of the value of Rs. 7,000 crore will be transferred to PGCILInvIT.
  2. Railways will monetise the dedicated Freight Corridor assets for operation and maintenance after commissioning.
  3. The next lot of Airports will be monetised for operations and management concession.
  4. Other core infrastructure assets that will be rolled out under the Asset Monetization Programme are:- (i) AAI Airports in Tier II and III cities (ii) Oil and Gas Pipelines of GAIL, IOCL and HPCL (iii) Transmission Assets of PGCIL (iv) NHAI Operational Toll Roads (v) Other Railway Infrastructure Assets (vi) Warehousing Assets of CPSEs such as Central Warehousing Corporation and NAFED among others and (vii) Sports Stadiums.
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