Sitharaman to launch National Monetisation Pipeline today. Details here

According to an official statement, the NMP will list out the Centre’s infrastructure assets which will be sold over the next four years. Policy think tank NITI Aayog’s chief executive officer Amitabh Kant, vice chairperson Rajiv Kumar and other senior officials will be a part of the launch event.
Union finance minister Nirmala Sitharaman. (Mint file photo)
Union finance minister Nirmala Sitharaman. (Mint file photo)
Published on Aug 23, 2021 08:24 AM IST
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Written by Harshit Sabarwal | Edited by Meenakshi Ray, New Delhi

Union finance minister Nirmala Sitharaman will launch the National Monetisation Pipeline (NMP) on Monday in New Delhi. According to an official statement, the NMP will list out the Centre’s infrastructure assets which will be sold over the next four years. Policy think tank NITI Aayog’s chief executive officer Amitabh Kant, vice chairperson Rajiv Kumar and other senior officials will be a part of the launch event.

What is the National Monetisation Pipeline?

According to the NITI Aayog, the NMP consists of a four-year pipeline of the Centre’s brownfield infrastructure assets. Apart from providing visibility to investors, the NMP will also serve as a medium-term road map for the Centre’s asset monetisation initiative.

This year’s budget has laid a lot of emphasis on asset monetisation as a means to raise innovative and alternative financing for infrastructure, and included a number of key announcements, the Niti Aayog said in its statement on Sunday.

Tuhin Kanta Pandey, secretary of the department of investment and public asset management (DIPAM), said earlier this month the Centre was finalising 6 lakh crore of infrastructure assets, including national highways and power grid pipelines, which would be monetised, according to news agency PTI. “A national monetisation plan of about 6 trillion is in the offing which will have a range of assets from pipelines to power grid pipelines to national highways, ToT (toll-operate-transfer) and so on,” Pandey added.

Importance of asset monetisation and how Centre views it

As the word suggests, asset monetisation comprises the creation of new sources of revenue by unlocking of the value of hitherto unutilised or underutilised public assets, according to the DIPAM's website.

Globally, it is recognised that public assets are an important source for all economies. “Monetising these assets that Government's control, including in Public corporations, is widely held to be a very important but inadequately explored public finance option for managing public resources,” DIPAM further says.

The Centre views asset monetisation not just as a funding mechanism, but also as a strategy for augmenting and maintaining infrastructure.

"The objective of the asset monetisation programme of the Government of India (GOI) is to unlock the value of investment made in public assets which have not yielded appropriate or potential returns so far, create hitherto unexplored sources of income for the company and its shareholders, and contribute to a more accurate estimation of public assets which would help in better financial management of government/public resources over time," the DIPAM website further states

In her budget speech, finance minister Sitharaman said that monetising operating public infrastructure assets was a very crucial financing option for new infrastructure construction.

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