New Delhi: The Union Cabinet, chaired by Prime Minister Narendra Modi, on Wednesday approved the formation of National Land Monetization Corporation (NLMC), a wholly-owned central government company, to monetise surplus land parcels and building assets of the Central Public Sector Enterprises (CPSEs) and other government agencies which are being sold off or are on the verge of closure.
According to an official statement, NLMC will be set up with an initial authorised share capital of Rs 5,000 crore and paid-up share capital of Rs 150 crore. The proposal is in pursuance of the Union Budget announcement for 2021-22, the statement stated.
With monetisation of non-core assets, the Centre would be able to generate substantial revenues by monetising unused and under-used assets.
Currently, CPSEs hold considerable surplus, unused and under used non-core assets as land parcels and buildings. For CPSEs undergoing strategic disinvestment or closure, monetisation of these surplus land and non-core assets is important to unlock their value.
NLMC, which will support and undertake monetisation of these assets, will enable productive utilisation of these under-utilised assets to trigger private sector investments, new economic activities, boost local economy, and generate financial resources for economic and social infrastructure.
This will speed up the closure process of CPSEs and smoothen the strategic divestment process of CPSEs. These assets may be transferred to NLMC to hold, manage, and monetise. The release said that Department of Public Enterprise and Ministry of Finance will set up the company and act as its administrative ministry.
NLMC will also advise and support other government entities (including CPSEs) in identifying surplus non-core assets and monetising them in an efficient manner to generate maximum value realisation.
NLMC will be a lean organisation with minimal full-time staff, hired directly from the market on contract.
The Board of Directors of NLMC will comprise senior central government officers and experts. The chairman, non-government directors will be appointed through a merit-based selection process. It will hire professionals, similar to other specialised firms like National Investment and Infrastructure Fund and Invest India.