Finance Minister launches National Monetisation Pipeline

Union Finance Minister Nirmala Sitaraman on Monday launched the National Monetisation Pipeline (NMP) and listed out government’s infrastructure assets, which will be monetized over the next four years. Among the sectors which are included under this plan are Roads, Power Transmission, Power Generation, Natural Gas Pipelines, Warehousing Assets, Railways, Telecom, Aviation, Shipping, Coal Mining, Mineral Mining, Sports Stadiums and Urban Real Estate.

NITI Aayog CEO, Amitabh Kant elaborated on the framework of the plan and emphasised that the ownership of these assets will remain with the government and there will be a mandatory hand over of these assets to the government. The Finance Minister also stressed on this point and said, “There is no land here, the NMP talks about brownfield assets where investment has already been made or where there are assets which are languishing, not fully monetised or are underutilized.” 

 She added that by bring private participation, the assets will be monetised in a better way and the resources which will be obtained out of it will further be put for infrastructure building. “Ownership of assets will remain with the government,” she said. The Pipeline is "coterminous" with the National Infrastructure Pipeline which was launched in December, 2019. 

The various models which will be used for monetisation of core assets under the plan include Operate Maintain Transfer (OMT), Toll Operate Transfer (TOT), Operations, Maintenance & Development (OMD), Rehabilitate Operate Maintain Transfer (ROMT), InvITs and REITs.

In order to strengthen the spirit of cooperative federalism, the Finance Minister also announced a 3 point program through which the Central Government will be supporting the state governments. Among this, the first one includes 100% matching and transfer of the amount to the states which they will realise after disinvesting completely from a PSU and also giving up their managerial control. The second includes up to 50% matching and transfer of the amount which the states will realise upon listing a PSU and about 33% of the transfer when they just go for monetisation of assets.

She also announced that about 10,000 crore will be given to the states for infrastructure building and highlighted that about 12,000 crore were announced for the states last year as interest free loans for 50 years, out of which 11,900 crore has already gone to the states. “This monetisation pipeline is coming at a time when states are also keen to move forward. We are with the states and want to work together with them,” she said.