The Union Finance Minister, Nirmala Sitharaman, has launched the National Monetization Pipeline (NMP) today. Through NMP, a list of infrastructural assets of the government will be prepared which will be sold in the next four years. In a statement, the finance minister said that the NMP includes a four-year pipeline of obsolete infrastructure possessions of the central government.
Tuhin Kanta Pandey, Secretary to the Department of Investment and Public Asset Management, said earlier this month that the government was finalizing infrastructure assets worth ₹6 lakh crore, including national highways and power grid pipelines, which would be monetised. He further added that the national monetization plan is underway, which will have multiple assets encompassing energy channels and the TOT (Toll-Operate-Transfer) model of highways and expressways.
In this time’s budget, asset monetization as a means of mobilizing alternative financing for infrastructure was given a lot of emphasis. Finance Minister Sitharaman in her budget speech had said that monetization of operational assets of public infrastructure is a very important financing option for the creation of new infrastructure.
‘Asset monetization’ is a technique of transformation of properties, like freeways, bridges, highways, etc into financial value. The Ministry of Road Transport and Highways (MoRTH) is targeting to raise about ₹30,000 crores through this ‘asset monetization’ process over the upcoming three years. According to the Department of Investment and Public Asset Management (DIPAM), the objective of this step is to extricate the value of investments made in general properties which haven’t generated reasonable returns.