Finance Minister Nirmala Sitharaman unveiled the government’s ₹6,00,000 crore ‘National Monetisation Pipeline’ (MNP) project on Monday. Under the ambitious NMP, the government has identified 13 sectors — including airports, railways, roads, shipping, gas pipeline among others— which will be privatised as the government aims to monetise its brownfield infrastructure assets. Here’s is a breakdown of everything that is going to be privatised:
Road assets, including 22% of NHs, worth ₹1.60 lakh crore
Road assets worth ₹1.60 lakh crore will be monetised over four years till FY25, which will be implemented by the Road Transport and Highways Ministry and the National Highways Authority of India (NHAI). Niti Aayog CEO Amitabh Kant said the potential models of road assets monetisation would be Toll Operate Transfer (ToT) and Infrastructure Investment Trust (InvIT).
According to the National Monetisation Pipeline (NMP) document, the road assets considered for monetisation during FY 2022 to FY 2025 aggregate to 26,700 km, which is 22% of the total National Highways (NHs).
According to the NMP document, the NHAI InvIT issue is envisaged to be privately placed and indicative value of the fund raise from the current tranche underway is about ₹5,000 crore. "The fund-raise and issue listing is expected to be completed during FY 22 subject to market conditions and stabilisation of toll revenues in wake of COVID-19," it said.
The first tranche of InvIT is expected to consist of 586 km of NH assets in Rajasthan, Gujarat, West Bengal, and Bihar.
TOT is one of the key models for monetisation successfully employed in the roads sector both by central and State entities. The Ministry of Road Transport and Highways (MoRTH) introduced the TOT concession framework in 2016 for monetisation of road assets portfolio by NHAI to long-term investors.
Over 400 railway stations, 90 passenger trains and other railway assets worth ₹1.52 lakh crore
Representational image.
Railways will monetise assets, including certain stations, tracks, passenger trains and Konkan Railway, worth over ₹1.52 lakh crore over four years till FY25.
Key rail assets identified for monetisation during FY22-25 include 400 railway stations, 90 passenger trains, 1 route of 1,400 km railway track, 741 km of Konkan Railway, 15 railway stadiums and selected railway colonies, 265 railway owned goods-sheds, and 4 hill railways.
"The Indicative Monetisation Value is estimated at ₹1,52,496 crore over the NMP period FY2022-25," the NMP document said. Of this, ₹17,810 crore would be monetised this fiscal, ₹57,222 crore in the next financial year (2022-23), ₹44,907 crore in 2023-24 and ₹32,557 crore in 2024-25.
25 airports and other airport assets to be privatised to fetch ₹20,782 crore
The government is looking to monetise 25 AAI-managed airports, including Varanasi, Chennai, Nagpur and Bhubaneshwar, over the next four years, which could bring in investments worth ₹20,782 crore.
Further, divestment of Airports Authority of India's (AAI) residual stake in four airport JVs has also been considered under the NMP. This includes the private sector operated airports in Mumbai (26 % stake), Delhi (26% stake), Hyderabad (13% stake), and Bangalore (13% stake).
The total airport assets for monetisation account for 18% of the overall airport assets under management of the AAI.
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," the NMP document said.
During the current fiscal, the AAI has identified six airports in Tier 2/Tier 3 cities namely, Amritsar, Varanasi, Bhubaneswar, Indore, Raipur and Tiruchi for the purpose of monetisation through brownfield PPP models, 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.
The AAI manages 137 airports, including 24 international airports, 10 customs airports, and 103 domestic airports.
Power Transmission assets worth over ₹45,000 crore
The government aims to garner over ₹45,200 crore by monetising power transmission assets by FY 2025 as part of its ambitious asset monetisation plan. The transmission assets considered for monetisation during FY 2022-25 aggregate to 28,608 circuit (ckt) kms.
These include transmission assets of 400 KV and above of Power Grid Corporation of India Limited (PGCIL). The total value of assets considered for monetisation is estimated at ₹45,200 crore over FY 2022-25, the NMP document said.
Out of the total transmission asset base of PGCIL, the scale of transmission assets with capacity of 400 KV and above (1.56 lakh ckt kms) was estimated. The monetisation potential is available in this category of long-distance transmission assets. This includes a mix of Tariff Based Competitive Bidding (TBCB) and Regulated Tariff Mechanism (RTM) assets.
The transmission assets considered for monetisation over FY 2022-25 depend on factors such as transmission charges, asset availability and asset mix. The total transmission assets considered for monetisation aggregate to 28,608 ckt kms. The indicative monetisation value of the transmission assets has been considered based on a factor of ₹1.58 crore per ckt km.
Coal mining assets worth ₹28,747 crore
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The government has identified 160 coal mining assets worth an estimated at ₹28,747 crore for monetisation over four years till FY25. "The projects are expected to be implemented over the next 2-3 years," according to the NMP document prepared by Niti Aayog and released by Finance Minister Nirmala Sitharaman on Monday.
These include 17 projects on mine developer and operator (MDO) model, establishment of three washeries, one coal gasification plant, 35 identified first-mile connectivity projects for building coal silos/ mechanised loading, operationalisation of four discontinued/ abandoned projects and commercial auction of mines.
About ₹22,625 crore of the assets are expected to be tendered out during FY 2022 itself. However, the actual capital expenditure (capex) will be phased out across the next three years.The monetisation value in the pipeline has been accordingly considered based on actual capex phasing assumed over 4-5 years.
About 761 mineral blocks are expected to be put on auction during FY22-FY25. In FY'22, auction of 138 mineral block assets will take place, followed by 253 mineral block assets in 2022-23, 210 in 2023-24 and 160 in 2024-25.
Telecom assets to fetch ₹35,100 crore
Government's think tank Niti Aayog has valued government telecom assets at ₹35,100 crore which can be monetised by financial year 2024, which include over 2.86 lakh kilometres of optical fibre assets laid by BBNL and BSNL under rural broadband project Bharatnet at ₹26,300 crore.
The NMP has valued 13,567 mobile tower assets of BSNL and 1,350 of MTNL at ₹8,800 crore that can also be monetised by financial year 2024. Both the PSUs jointly own 69,047 mobile towers.
"Indicative monetisation value of ₹26,300 crores has been considered over FY23 and FY 24. It may be noted that the actual private investment towards these packages could be lower than the estimated capex and a portion of capex may be met out of grant," the NMP document said.
The total approved cost for BharatNet project is ₹61,109 crore which includes ₹42,068 crore for BharatNet (Phase-I and Phase-II) and a maximum of ₹19,041 crore on viability gap funding (VGF) for implementation of the PPP model of BharatNet in 16 states, according to government information shared in Parliament.
According to the NMP, 5,25,706 kilometres of optical fibre has been laid under BharatNet project which aims to connect all villages in the country with a high-speed broadband network.
The NMP proposes to realise ₹6 lakh crore from asset sale during FY 22-25 across various sectors of which 6% value is expected to be realised from the telecom sector.
Shipping assets worth ₹12,828 crore
Shipping assets worth ₹12,828 crore will be monetised over the next four years, which will be implemented by the Ministry of Ports, Shipping and Waterways and potential models would be public private partnership (PPP). According to the NMP document, the assets considered for monetisation are spread across 9 of the 12 major ports. "During the NMP period of FY22-25, monetisation value of ₹12,828 crore has been considered on account of estimated capex towards identified 31 projects," it said.
Elaborating further, the document said 31 projects have been identified for private sector participation for improved operational efficiency and capacity utilisation of existing port assets. "Key projects include additional berths, mechanisation, development of oil jetty, container jetties, O&M of container terminal, O&M of International cruise terminal and development of marina," it said.
Warehousing assets worth ₹28,900 crore
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The Centre plans to monetise warehousing assets owned by state-owned firms Food Corporation of India (FCI) and Central Warehousing Corporation (CWC) over the next four years for an estimated ₹28,900 crore under the NMP.
Both FCI and CWC operate under the aegis of Department of Food and Public Distribution.
The existing storage capacity with FCI and other agencies for central pool stocks as on April 1, 2020 is 755 lakh tonnes. Out of this, 412 lakh tonnes is available with FCI and 343 lakh tonnes with the state agencies.
Of the total FCI's storage capacity of 412 lakh tonnes, only 30% is owned while 70% is hired.
CWC operates 422 warehouses with a total operational storage capacity of 109.72 lakh tonnes. This includes custom bonded warehouses, container freight stations, inland clearance depots, air cargo complexes, etc.
The aggregate storage capacity with FCI and CWC is estimated to be around 521 lakh tonnes (412 lakh tonnes with FCI and 109 lakh tonnes with CWC).
"Out of the FCI available asset base, FCI owned storage infrastructure i.e. about 123 lakh tonnes is amenable for monetisation as the facilities have a strong potential for augmentation and capacity expansion.
"CWC’s entire capacity of 110 lakh tonnes is amenable for monetisation as it has a revenue stream (in form of storage charges from FCI & other users) and also a strong commercial potential for augmentation, capacity expansion and O&M," the report said.
"The assets considered for monetisation during FY 2022 to 2025 have an aggregate capacity of around 210 lakh tonnes," the report said.
The food ministry is also in process of developing pipeline of other brownfield assets and finalisation of monetisation mechanisms other than development of Silos and cold storages.
The assets of FCI and CWC considered for monetisation aggregating to around 210 lakh tonnes are about 39% of the existing storage capacity available with the firms.
For monetisation of warehousing assets, the report said that suitable PPP models akin to TOT (toll-operate-transfer) model adopted by NHAI for highways and OMD based model for assets where augmentation and capacity expansion is envisaged.
Realty, hotel assets to fetch ₹15,000 crore
The Centre plans to monetise real estate assets worth an estimated ₹15,000 crore, including several housing colonies in the national capital and eight ITDC hotels, under the NMP.
In the 'urban real estate assets' category under the NMP, the government has identified monetisation of seven colonies under redevelopment as well as development of housing/commercial units on 240-acre land in Ghitorni in the national capital. Eight hotels of India Tourism Development Corporation (ITDC) will also be monetised through different routes.
As per the NMP document, the urban real estate assets have monetisation potential of around ₹15,000 crore during the financial years 2022-25. In this category, the government has identified redevelopment of seven General Pool Residential Accommodation (GPRA) Colonies in Delhi.
These seven colonies are located in Sarojini Nagar, Naoroji Nagar, Netaji Nagar, Sriniwaspuri, Thyagraj Nagar, Mohammadpur and Kasturba Nagar. The total estimated investment on redevelopment of these seven colonies is ₹32,276 crore, it added.
The Centre has also identified development of residential/commercial units on 240-acre land in Ghitorni (Delhi). In this project, 8,000 units of GPRA and 3,000 units for migrant construction workers will be developed. The estimated investment is ₹15,000 crore. "Ministry of Housing & Urban Affairs (MoHUA) owns and manages land through the Land and Development Office (L&DO)," Niti Aayog said in the report.
Under the hospitality assets, the report said that "all 8 hotel assets of ITDC have been considered for monetisation during FY 2022 to 2025." "Long-term leasing, divestment, long term OMT (operate, maintain and transfer) contract may be explored as potential models for monetisation to be ascertained on a case-to-case basis as per detailed asset level due diligence," it added.
The eight hotels are -- Hotel Pondicherry, Puducherry; Hotel Kalinga, Bhubaneshwar; Hotel Ranchi, Ranchi; Hotel Nilachal, Puri; Hotel Anandpur Sahib, Rupnagar; Hotel Samrat, New Delhi; Hotel Ashok, New Delhi and Hotel Jammu Ashok, Jammu.
Jawaharlal Nehru stadium, 3 other SAI assets to be monetised
Jawaharlal Nehru Stadium. File
The government announced plans to monetise the iconic Jawaharlal Nehru (JLN) Stadium in the national capital along with another national stadium and two regional centres under the NMP. The Centre said the indicative monetisation value of these two national stadiums and two regional centres in FY 22-25 will be ₹11,450 crore.
The total potential asset base considered are the assets under the Sports Authority of India (SAI) under the aegis of the Ministry of Youth Affairs and Sports.
The mode of monetisation for the identified assets will be Public Private Parternship (PPP)-based concessions on Operations, Management and Development Agreement (OMDA) model.
The assets are largely managed under the SAI and categorised into three broad categories – stadiums, regional centres and academic institutions.
An integrated multi-use sports infrastructure development model, focusing on optimisation of sports facilities by hosting sporting and non-sporting events, upgrading sports infrastructure technology and mixed-use urban development, can drive the provision of world class sports infrastructure.
While the award of the four assets is planned in a phased manner over 2021-22 and 2022-23, the actual capex may take place over a three-to-four-year period, the report said.
Further, any concession fee, upfront premium and revenue share payments to authority would be over and above this indicative monetisation value and will be discovered based on market testing with transaction.
The total value of assets considered for monetisation is estimated at ₹11,450 crore for FY 2022-2025, with capex phasing as ₹1,650 crore in ₹2022, ₹2,100 crore in FY 2023, ₹3,200 crore in FY 2024 and ₹4,500 crore in FY 2025.
Published - August 24, 2021 06:00 pm IST
