Important Facts For Prelims
National Monetisation Pipeline
- 20 Jun 2024
- 5 min read
Why in News?
Recently, according to a statement by NITI Aayog, assets worth Rs 3.85 lakh crore have been monetised by the government under the National Monetisation Pipeline during the first three years of the financial period spanning from 2021-22 to 2024-25.
- The NITI Aayog is entrusted with the mandate to develop the National Monetisation Pipeline.
What is the National Monetisation Pipeline (NMP)?
- About:
- The NMP envisages an aggregate monetisation potential of Rs 6 lakh crore through the leasing of core assets of the Central government in sectors such as roads, railways, power, oil and gas pipelines, telecom, civil aviation etc, over a four-year period (FY 2021-22 to 2024-25).
- The Monetization through NMP only includes core assets, excluding monetization through disinvestment of non-core assets.
- Currently, only assets of central government line ministries and CPSEs in infrastructure sectors have been included.
- To streamline the process, the monetization of non-core assets, including land, real estate, and infrastructure, is being transferred from the Department of Investment and Public Asset Management (DIPAM) to the Department of Public Enterprises (DPE) within the Ministry of Finance.
- This pipeline is intended to support investments under the National Infrastructure Pipeline (NIP) worth Rs 111 lakh crore in six years through FY25.
- The timeline for the NMP has been strategically set to be co-terminus with the remaining period under the National Infrastructure Pipeline (NIP).
- Status of NMP:
- The total target for the first two years i.e. 2021-22 and 2022-23 under NMP was around Rs. 2.5 lakh crore, against which around Rs. 2.30 lakh crore was achieved.
- During the financial year 2023-24, against the target of Rs. 1.8 lakh crore, which is the highest among all the four years, the achievement has been around Rs. 1.56 lakh crore.
- Further, this achievement in 2023-24 is around 159% of the achievement in 2021-22.
- All the ministries achieved 70% of their monetisation targets with the Ministry of Road Transport and Highways and the Ministry of Coal being the top two achievers with a total achievement of Rs. 97,000 crore in 2023-24.
- Need for NMP:
- Overcapitalisation: The optimum input-output ratio is seldom observed in a majority of government infrastructure projects leading to their overcapitalisation.
- Resource Optimization: The NMP aims to improve resource use by bringing market-driven methods to better match resources with project needs, reducing delays and cost increases.
- Coordination Challenges: The NMP promotes teamwork across government departments and with private firms to improve how infrastructure projects are carried out.
- Boost Economy: NMP connects with PM Gati Shakti, which aims to develop India's infrastructure comprehensively, while NMP seeks to raise funds for new projects by leveraging existing assets.
- Utilising Underutilised Public Assets: The NMP aims to sell unproductive government assets to raise money for new infrastructure and expand green projects.
UPSC Civil Services Examination, Previous Year Question (PYQ)
Prelims:
Q. In India, the term “Public Key Infrastructure” is used in the context of (2020)
(a) Digital security infrastructure
(b) Food security infrastructure
(c) Health care and education infrastructure
(d) Telecommunication and transportation Infrastructure
Ans: (a)
Mains:
Q.1 Account for the failure of manufacturing sector in achieving the goal of labour-intensive exports. Suggest measures for more labour-intensive rather than capital-intensive exports. (2017)
Q.2 The nature of economic growth in India in recent times is often described as a jobless growth. Do you agree with this view? Give arguments in favour of your answer. (2015)
