India to raise US$81 billion by leasing out state-owned infrastructure assets
- The National Monetisation Pipeline document unveiled by Finance Minister Nirmala Sitharaman is in line with PM Narendra Modi’s strategic divestment policy
- Assets including roads, railways, airports, stadiums, power lines and gas pipelines will be leased to private operators to fund new capital expenditure
The proposal involves handing assets including roads, railways, airports, sports stadiums, power transmission lines and gas pipelines to private operators, according to a National Monetisation Pipeline document unveiled by Finance Minister Nirmala Sitharaman in New Delhi on Monday.
The plan is in line with Prime Minister Narendra Modi’s strategic divestment policy, under which the government will retain presence in only a few identified areas with the rest tapping the private sector. The programme will free up the government’s budget money for infrastructure creation, while giving investors access to sectors such as railways that were until now a state monopoly.
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“It was very clear public expenditure in infrastructure will have to be increased,” Sitharaman said. “What the asset monetisation pipeline does today is to take this entire thing to the next phase – of public-private partnership.”
Ownership of the assets will remain with the government, she said, adding that private operators are required to hand them back to the state after the agreed period.
Revenue from monetising roads is pegged at 1.6 trillion rupees, while that from railways is seen at 1.5 trillion rupees, said Amitabh Kant, the chief executive officer of government think-tank NITI Aayog.
As many as 160 coal projects, 25 airports and 31 projects spread across nine ports will also form part of the pipeline, he said.