- Concept of National Monetization Pipeline (NMP): Asset Monetisation is defined as transfer of core assets owned by the Government to the private sector for a limited period. The core infrastructure assets include roads, ports, airports, telecom, railways, warehousing, energy pipelines, power generation, power transmission, hospitality and sports stadiums. NMP does not include monetization of non-core assets (such as land, buildings etc).
- NMP is not privatisation since the ownership of the assets would continue to remain with the Government. The assets would be only transferred to the private sector for limited duration of time based upon the contract.
- Note: Assets which are central to the business objectives of the Government have been categorised as Core Assets for the purposes of monetisation.
- Global Examples: Asset Recycling Initiative (ARI) in Australia helped in raising over $ 17 billion for funding infrastructure. Similarly, Indonesia's Limited Concession Scheme (LCS) was also hugely successful.
| Asset Monetization Models | |
| Direct Contractual Models | Structured Financing Models |
| 1. Operate-Maintain-Transfer(OMT) Model: Used as Toll-Operate-Transfer (ToT) Model in National Highways 2. Operate Maintain Develop (OMD): Used as Operation Management Development Agreement (OMDA) in Airports 3. Long term lease Agreements: Used for leasing of Telecom Towers, Bus Terminals, Stadiums etc. | 1. Real Estate Investment Trusts (REITs) 2. Infrastructure Investment Trusts (InVITs) |
- Aim of NMP: Envisages an aggregate monetisation potential of RS 6-lakh crore through the leasing of core assets of the Central government.
- Scope: Roads, railways, power, oil and gas pipelines, telecom, civil aviation, shipping ports and waterways, mining, stadiums and sports complexes.
- Sector accounting for highest share: Roads (27%), Railways (25%), Power, Oil & Gas Pipelines and Telecom. Roads and Railways together account for 52% of the share.
- Duration: Four-year period (FY2022 to FY2025).