Ministries will also be motivated to meet the target of Assets Monetization, for this their budgetary allocation in future can be linked to the performance on the asset monetization front.
The central government has given new targets to the ministries regarding asset monetization.
Asset Monetization: The Central Government has asked the Ministries and Departments to identify new assets that can be rapidly monetised. So that the process of monetization (Assets Monetization Process) Can bring back on track, which is currently the budget target for this financial year (Budget Target) is much less than National Monetization Pipeline for the financial year ending March (National Monetization Pipeline) The government’s income from asset sales in the first seven months was only Rs 33,443 crore, against a target of Rs 1.6 lakh crore under the AAP.
Asset monetization will be linked to budget allocation
The Center is now expecting that its revenue from the sale of assets will miss the budget estimate and according to people will come to Rs 1.24 lakh crore. A person familiar with the matter said that there are several ministries which have not been able to meet the target…they have been asked to identify additional or alternate assets to increase the speed. Ministries will also be motivated to meet the target, for which in future their budgetary allocation can be linked to the performance on the asset monetization front.
A set of principal guidelines may also be issued to ministries and departments to aid the process. Some ministries have already dropped the identified assets in the middle of the financial year and on some others have decided to carry forward the process to the next financial year. These ministries include Telecom, Railways and Petroleum.
According to a government official, the Telecom Department was asked to identify alternative or additional assets to replace the BharatNet Public-Private Partnership (PPP) project, which has been dropped from the asset monetization pipeline. Among other assets identified under the ministry, Bharat Sanchar Nigam Limited’s tower monetization bid is expected to start in the current financial year, but earnings will be due only next year. Against the target of Rs 20,180 crore from the telecom sector, the sale of assets worth only Rs 4,700 crore is currently under process and no income is expected till the end of the current financial year, the official said.
With several stations proposed for redevelopment under the PPP model now being offered under engineering, procurement and construction (EPC) contracts, the railway ministry has been asked to look at new options that would generate direct income. Other assets considered for monetization included track-overhead equipment, goods shed, hill rail and stadium to achieve Indian Railways’ Rs 30,000 crore target in FY2023.
An official said, “The biggest asset class stations have been removed and now those which were earlier proposed on PPP mode are being taken up under EPC mode.” Railway projects worth about Rs 3,170 crore are in the monetization process and would be able to end the year with Rs 4,999 crore against the target of Rs 30,000 crore, the official said.