National Monetisation Pipeline 2.0
National Monetisation Pipeline
- The National Monetisation Pipeline (NMP) was launched by NITI Aayog in 2021 in collaboration with the concerned infrastructure ministries.
- The objective of the programme is to unlock the value in brownfield (existing/underutilized) public infrastructure assets, targeting Rs 6 lakh crore through leasing to private investors.
- NMP achieved 89 per cent of its target, amounting to ₹5.3 lakh crore.
Why in News?
- The Government of India has launched the second phase of asset monetisation pipeline of Central ministries and public sector entities – ‘National Monetisation Pipeline 2.0 (NMP 2.0)’.
- The second phase of the pipeline has been developed by NITI Aayog, in consultation with infrastructure line ministries, based on the mandate for ‘Asset Monetisation Plan 2025-30’ as announced in the Union Budget 2025-26.
Asset Monetization:
- Asset monetisation is the process of creating new sources of revenue for the government and its entities by unlocking the economic value of unutilised or underutilized public assets.
- As a concept, asset monetisation implies offering public infrastructure to the institutional investors or private sector through structured mechanisms.
- Monetisation is different from ‘privatization’, it signifies ‘structured partnerships’ with the private sector under certain contractual frameworks.
- In India, the idea of asset monetisation was first suggested by a committee led by economist Vijay Kelkar in 2012 on the roadmap for fiscal consolidation.
Highlights of NMP 2.0
- The five-year asset monetisation target (FY 2026 to FY 2030) under NMP 2.0 has been set at an ambitious Rs. 16.7 lakh crore, over 2.6 times higher than that under NMP 1.0.
- As regards the target, highway is expected to garner the highest of Rs 4.42 lakh crore, followed by power Rs 2.77 lakh crore, ports Rs 2.64 lakh crore and Railways Rs 2.62 lakh crore over the five-year period.
- Asset monetisation shall comprise elements such as transfer of assets for a limited period, divestment of portions of listed entities to unlock additional capital, securitisation of cash flows or strategic commercial auctions.
- An empowered Core Group of Secretaries on Asset Monetisation (CGAM) under the chairmanship of Cabinet Secretary will continue to monitor the progress of the Asset Monetisation programme.
- NITI Aayog noted that NMP 2.0 is expected to increase India’s GDP by approximately ₹40 lakh crore over the next 5-10 years.