Government achieves 90% target of first asset monetisation plan

NEW DELHI: As the government launches its second asset monetisation plan, sources indicate that it has already achieved 90% of the target set under the first plan by monetising assets belonging to the government and public sector units (PSUs).

The first asset monetisation initiative, known as the National Monetization Pipeline (NMP), aimed to generate R6 lakh crore from core central government assets over four years, from FY22 to FY25. In Budget 2025, the finance minister announced the second asset monetisation plan for 2025-30, targeting R10 lakh crore in new investments.

However, finance ministry sources emphasise that the objective is not to outright sell government assets to raise funds. “The intent is to recycle assets. If an asset generates a cash stream, monetising it upfront allows us to reinvest the funds in building new infrastructure,” explained a government source.

One approach under the new plan involves private sector participation, where private players develop land or other assets and generate revenue on a revenue-sharing basis. “This way, the government doesn’t have to invest directly. Instead, a private player builds the infrastructure, and we grant a concession,” the source added.

The government and PSUs are adopting different models for asset monetisation, including Public-Private Partnerships (PPP), Infrastructure Investment Trusts (InvITs), Toll-Operate-Transfer (ToT) models and Securitisation.

However, the government has clarified that the proceeds from PSU asset monetisation will not appear in the government’s books, as these funds remain within the respective public sector entities.