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FM Sitharaman launches National Monetisation Pipeline scheme, to monetise assets worth Rs 6 lakh crore by 2025

Google Oneindia News

New Delhi, Aug 23: Finance Minister Nirmala Sitharaman on Monday announced the Centre's Rs 6 lakh crore National Monetisation Pipeline (NMP) and said the government will unlock value in infrastructure assets across sectors ranging from power to road and railways.

ational Monetisation Pipeline scheme

She also said the asset monetisation does not involve selling of land and it is about monetising brownfield assets. Projects have been identified across sectors, with roads, railways and power being the top segments.

"NMP estimates aggregate monetisation potential of Rs 6 lakh crores through core assets of central government over the four-year period from FY 2022 to FY 2025," she said.

The government is also looking to monetise 25 AAI-managed airports, including Varanasi, Chennai, Nagpur and Bhubaneshwar, over the next four years, which could bring in investments worth Rs 20,782 crore.

Further, divestment of Airports Authority of India''s (AAI) residual stake in four airport JVs has also been considered under the national monetisation pipeline (NMP) unveiled on Monday. This includes the private sector operated airports in Mumbai (26 per cent stake), Delhi (26 per cent stake), Hyderabad (13 per cent stake), and Bangalore (13 per cent stake).

The total airport assets for monetisation account for 18 per cent of the overall airport assets under management of the AAI. The total value of assets considered for monetisation is estimated at Rs 20,782 crore for FY 2022-25.

Under the ambitious NMP, the government has identified 13 sectors, including airports, which could monetise their brownfield infrastructure assets.

The airports sector contributes 4 per cent to the overall Rs 6 lakh crore NMP unveiled by Finance Minister Nirmala Sitharaman on Monday.

As per the NMP document, 25 major AAI airports are considered for monetisation over FY 2022-25.

These airports include Udaipur, Dehradun, Indore, Ranchi, Coimbatore, Jodhpur, Vadodara, Patna, Vijaywada and Tirupati.

"The larger objective is to focus on monetisation of these 25 airports, while bundling of smaller airports may be explored based on market testing of transactions and investor feedback," it said.

During the current fiscal, the AAI has identified six airports in Tier 2/Tier 3 cities namely, Amritsar, Varanasi, Bhubaneswar, Indore, Raipur and Trichy for the purpose of monetisation through brownfield PPP models.

"To ensure commensurate development of non-profitable airports along with the profitable airports with the help of private sector investment and participation, pairing /clubbing of smaller airports with each of the six bigger airports and leasing out as a package is being explored," it said.

The AAI manages 137 airports, including 24 international airports, 10 customs airports, and 103 domestic airports.

The AAI is a statutory body constituted by an Act of Parliament with the responsibility of creating, upgrading, maintaining, and managing civil aviation infrastructure both on the ground and air space in the country.

"Airport monetisation through brownfield PPP models has been boosted in India by

the success stories of asset monetisation of four airports - Mumbai, Delhi, Hyderabad,

and Bengaluru. This is primarily in terms of improved user experience and increase in

value for all stakeholders," the NMP document said.

During FY 2020-21, six AAI airports were leased out to private sector through PPP based model, namely, Ahmedabad, Lucknow, Mangalore, Guwahati, Jaipur and Thiruvananthapuram and the assets are in process of getting handed over to the operator. Further, this is backed by the presence of a strong regulatory and contractual framework which has helped retain investor confidence, it added.

While smaller airports like Bhubaneswar, Varanasi, Amritsar, Trichy, Indore and Raipur is planned to be monetised in the current fiscal, monetisation of bigger ones like Chennai and Vadodara is expected in 2023-24 fiscal.

Calicut, Coimbatore, Madurai, Jodhpur are among the eight airports listed for monetisation in 2022-23 fiscal, while Dehradun, Agartala and Udaipur will be taken up in the last phase in 2024-25 fiscal.

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