‘Asset monetisation has multiplier effect on economy’

The government’s National Monetisation Pipeline aims to liquidate already developed yet underutilised public sector assets to raise Rs 6 lakh crore over four years. It is further aimed at helping create a sustained fund pipeline for the infrastructure sector to create structured contractual partnerships between the private and public sectors. Preetham Mehra, ED & head […]

The government’s National Monetisation Pipeline aims to liquidate already developed yet underutilised public sector assets to raise Rs 6 lakh crore over four years. It is further aimed at helping create a sustained fund pipeline for the infrastructure sector to create structured contractual partnerships between the private and public sectors. Preetham Mehra, ED & head of Government Practice, CBRE India, shares with Telangana Today how the government’s asset monetisation efforts will help boost the economy. Excerpts-

Asset monetisation

Identifying and monetising underutilised assets will lead to a multiplier effect on the local economy to boost retail, real estate, industry, tourism, and generate employment opportunities. At the same time, it will also help unlock public-sector potential through investments in infrastructure, tapping private sector efficiencies through public-private partnership (PPP) and creating other revenue sources.

Industrial parks

GIS-based India Industrial Land Bank (IILB) portal allows investors, policymakers, and financial institutions to evaluate the competitiveness of Indian industrial parks against global benchmarks on parameters such as internal and external infrastructure, connectivity, and business services available to make informed location decisions. The IILB has already mapped over 4,500 industrial parks spread across over 5 lakh hectares of industrial land in the country and aims to achieve pan-India integration by the year-end.

Railway land

Various estimates suggest that railways have over 12,000 acres of surplus land spread across the country. The monetisation process has been fairly active over the last few years. Various private companies and consultancies, including CBRE, have been involved with the relevant authorities in this effort. The Railway Land Development Authority has identified 62 railway stations to be redeveloped, a strategy to utilise the surplus land assets for commercial use to generate revenue and create value for the non-performing railway assets. Currently, the expected capital infusion for railway station redevelopment projects is estimated at Rs 96,000 crore, including a railway asset creation component of Rs 28,000 crore over next 8-10 years.

Airport assets

The Airports Authority of India has an estimated overall land bank of 55,800 acres. This land bank is majorly being used for aviation and passenger-related operations. CBRE has been involved in various airport exercises and has advised multiple authorities and agencies for the monetisation process.

Efficient approach

While some methods include sale and disinvestment resulting in the permanent transfer of title to the potential buyer, others involve getting into a partnership with the private sector. These include monetisation structures such as leasing, concessions, joint ventures, etc. However, the most efficient method of asset monetisation depends on the opportunity, location, size, and vision for the landholding.

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