The National Institution for Transforming India (NITI Aayog) has raised the Asset Monetisation(AM) target for Financial Year 2024-25 (FY25) by Rs 23,000 crore to Rs 1.9 trillion. This move will bring closer to achieve the overall target of Rs 6 trillion set under the National Monetisation Pipeline (NMP) for a period of 4 years i.e. from FY22 to FY25.
- It has estimated that highways monetisation will generate Rs 54,000 crore for the Government of India(GoI) in FY25.
- Also, coal block monetisation is expected to generate Rs 55,000 crore.
About About Asset Monetization (AM):
i.The AM is the process of creating new/alternative sources of revenue by unlocking the economic value of underutilized public assets.
ii.The idea of AM was first suggested by a committee led by economist Vijay Kelkar in 2012.
iii.The Core Group of Secretaries on Asset Monetisation (CGAM) was constituted by the GoI under the chairmanship of Cabinet Secretary to review and monitor the progress of transactions and resolve any structural issue related to the sectors covered under NMP.
Key Points:
i.NITI Aayog has estimated that combined assets of railways, power, and petroleum and natural gas will raise nearly Rs 46,000 crore.
ii.NITI Aayog has observed that over the last 3 FYs, most of the Union Ministries have failed to achieve their original NMP targets but have managed to meet their revised targets, except some sectors like: railways, telecommunications, warehousing, civil aviation, and sports infrastructure.
- It has suggested the railways to focus on the commercial development of railway land and has recommended the civil ministry to pursue the development of 11 airports in Public-Private Partnership (PPP) model.
Status of Various Ministries Covered under NMP:
i.The Ministry of Railways (MoR) has monetised assets worth Rs 20,417 crore over the last 3 FYs and has achieved only 30% of its revised target.
ii.The GoI has monetised assets worth Rs 8,000 crore in warehousing sector, which constitutes 38% of its targeted assets.
- The Ministry of Civil Aviation (MoCA) has monetised only 14% of its target asset base of Rs 2,600 crore.
iii.The Ministry of Coal (MoC) has monetised assets worth Rs 1.54 trillion against its initial 4-year target of Rs 80,000 crore.
- Out of Rs 1.54 trillion, Rs 32,000 crore has been raised through the monetisation of mines, against revised target of Rs 7,300 crore.
Points to Note:
i.NMP was 1st announced by Union Finance Minister, Nirmala Sitharaman in the Union Budget (2021-22).
ii.It was prepared by NITI Aayog in partnership with concerned Infrastructure Ministries.
iii.So far, the Government of India (GoI) has monetised assets worth Rs 3.9 trillion under NMP in the 1st 3 years, ending in FY24, against the set target of Rs 4.3 trillion.
iv.As per the official data of NITI Aayog released on 26th June 2024, the GoI has monetized assets worth Rs 1.56 lakh crore in FY24 as against the set target of Rs 1.8 lakh crore, which was the highest among all 4 years, under NMP.
About National Institution for Transforming India (NITI Aayog):
Chairperson- Narendra Modi, Prime Minister (PM) of India
Chief Executive Officer (CEO)- B.V.R. Subrahmanyam
Headquarters- New Delhi, Delhi
Formed- 2015
