The Union Cabinet on Wednesday approved the setting up of a new government-owned firm for pooling and monetising sovereign and public sector land assets. The National Land Monetisation Corporation (NLMC) is being formed with an initial authorised share capital of ₹5,000 crore and paid up capital of ₹150 crore.
The government will appoint a chairman to head the NLMC through a ‘merit-based selection process’ and hire private sector professionals with the expertise required for asset monetisation in areas such as real estate market research, legal due diligence, valuation, master planning, investment banking and land management.
The NLMC will undertake monetisation of surplus land and building assets of Central public sector enterprises (CPSEs) as well as government agencies. “With monetisation of non-core assets, the government would be able to generate substantial revenues by monetising unused and under-used assets,” an official statement said. The proposal is in pursuance of the Budget announcements for 2021-22, which included an ambitious National Monetisation Pipeline to garner revenues from public assets.
The new corporation will also help carry out monetisation of assets belonging to public sector firms that have closed or are lined up for a strategic sale. As per the plan, the surplus land and building assets of such enterprises may be transferred to the NLMC, which will then manage and monetise them.
‘Hasten closure process’
“This will speed up the closure process of the CPSEs and smoothen the strategic disinvestment process,” the statement said, noting that the CPSEs hold ‘considerable surplus, unused and under used non-core assets’ in the form of land and buildings.
Apart from executing the monetisation plan, the NLMC will advise other government entities to identify their non-core surplus assets and ‘generate maximum value’ by monetising them ‘in a professional and efficient manner’.
“…NLMC will undertake surplus land asset monetisation as an agency function. It is expected that NLMC will act as a repository of best practices in land monetisation, assist and provide technical advice to government in implementation of asset monetisation programme,” the official communique said.