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National Monetisation Pipeline – Important Points

National Monetisation Pipeline

 

The Union Finance Minister has launched the National Monetization Pipeline for the brownfield infrastructure assets.

  • The NMP comprises a four-year pipeline of the Central Government’s brownfield infrastructure assets.
    • Brownfield infrastructure is any previously developed asset that is not currently in use that may be potentially contaminated.
    • The term is also used to describe land previously used for industrial or commercial purposes with known or suspected pollution including soil contamination due to hazardous waste.
  • It will serve as a medium-term roadmap for the Asset Monetization initiative of the government, apart from providing visibility for the investors.
    • Asset Monetization involves creation of new sources of revenue by unlocking of value of unutilized or underutilized public assets.
  • Incidentally, the 2021-22 Union Budget, laid a lot of emphasis on Asset Monetization as a means to raise innovative and alternative financing for infrastructure.
  • It has to be noted that the government views asset monetization as a strategy for the augmentation and maintenance of infrastructure, and not just a funding mechanism.

Objective of the programme:

  • It estimates total monetization potential of Rs 6 lakh crores through core assets of the Central Government, over a four-year period, from FY 2022 to FY 2025.
  • To unlock the value of investments in brownfield public sector assets by tapping institutional and long-term capital, which can thereafter be leveraged for public investments.
  • To enable ‘Infrastructure Creation through Monetisation’ wherein the public and private sector collaborate, each excelling in their core areas of competence, so as to deliver socio-economic growth.

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