Union Government crosses its asset monetization target for FY22

According to the evaluation made at a high-level review meeting, the central government has exceeded its asset monetization target of 88,000 crore for FY22 and has concluded agreements worth 96,000 crore. Roads, power, and coal and mineral mining are among the industries that have made significant contributions to asset monetisation. The Centre has set an asset monetisation target of over 1.6 trillion dollars for FY23, for which proposals from various ministries are in various stages of processing.

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KEY POINTS:

• Prominent investors who purchased assets in FY22 include CPP Investments, Ontario Teachers Pension Plan, and Utilico Emerging Markets Trust Plc. At the time of publication, emails made to these investors evening had gone unanswered.
• When the final data are in, the total asset sale in FY22 could reach $1 trillion. Senior officials from the finance and infrastructure ministries, as well as the NITI Aayog, attended the meeting, which was headed by Finance Minister Nirmala Sitharaman.
• Finance Minister Nirmala Sitharaman outlined the asset monetisation plan in her union budget for FY22 as a major financing alternative for developing new infrastructure assets.
• The strategy included a pipeline of assets totaling $6 trillion that would be monetised over a four-year period until FY25. As asset acquirers borrow loans and expand their operations, the government anticipates the asset sale completed in FY22 to result in additional $9 trillion in cumulative investments.
• The goal is to crowd in private infrastructure investments, which are a critical part of the government’s economic recovery strategy.

IMPORTANT TAKEAWAYS:

Union Finance Minister: Nirmala Sitharaman

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