The Railway Ministry has dropped the proposal for the monetization of railway stations on PPP (Public Private Partnership) mode, and the projects are now being taken up under EPC (Engineering, Procurement & Construction) mode. The Railway Ministry has been asked to expedite to monetization of other assets, including hill rails, trains, good sheds, railway land parcels, and railway colonies among others, sources told to PTI.
According to sources, the largest asset class dropped, and railway stations earlier proposed on Public Private Partnership mode are now being taken up by Engineering, Procurement & Construction. Likely realized from an asset monetization of Indian Railways assets under the National Monetization Pipeline (NMP) in the current fiscal has been now estimated at Rs.4999 Cr.
Railway stations earlier proposed on Public Private Partnership mode are now being taken up by Engineering, Procurement & Construction
Further, the source added, the railway ministry has so far raised only Rs. 1829 Cr. against the target of Rs.30000 Cr in the current financial year.
To review the progress of the National Monetization Pipeline (NMP) implementation, Finance Minister Nirmala Sitharaman met with the Chief Executive Officer (CEO) of Niti Aayog Parameswaran Iyer on November 14.
Earlier this year, then-Chief Executive Officer of Niti Aayog Amitabh Kant had said the govt was planning to monetize railway assets by allowing private players to run trains did not attract enough investors due to a lack of proper structuring, and the ministry of the railway is looking at it afresh.
According to the NMP docs, 90 passenger trains, 400 stations, railway colonies & stadiums, and the famed Konkan & hill railways were among the assets identified by the govt. for monetization.
The railway ministry has so far raised only Rs. 1829 Cr. against the target of Rs.30000 Cr in the current financial year.
In August 2020, Finance Minister Nirmala Sitharaman announced the Rs.6 lakh crore National Monetization Pipeline over 4 years to unlock value in infrastructure assets across the sectors.
The asset of monetization is about monetizing brownfield assets not involving selling land.
Assets are monetized through models like PPP, OMT (Operate, Maintain, Transfer), TOT (Toll, Operate, Transfer), and OMD (Operations, Maintenance, and Development) modes.
In Engineering, Procurement & Construction project, govt. pays the developer for the construction of the highway while the toll revenue accrues to the govt.
The govt. has so far monetized assets worth Rs.33422Cr. under the NMP in 2022-23, with the Ministry of Coal leading the list raising Rs.17000cr. and surpassing the overall financial objective of the ministry of ports and shipping has done.
In 2021-22, the govt surpassed the first-year target program of Rs.88000Cr. by completing a transaction worth Rs.1 lakh Cr.