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India to monetise $81 bln worth of state assets over next 4 years

New Delhi, August 23 (Reuters): India plans to monetise 6 trillion rupees ($80.90 billion) worth of state assets over the next four years under a plan announced earlier in the 2021/2022 budget to boost infrastructure spending and spur economic growth in Asia’s third biggest economy.

The Indian government aims to hand already built assets such as gas pipelines, roads, railway stations and warehousing facilities among others over to the private sector to operate on a long-term lease, Amitabh Kant, chief executive of government think tank NITI Aayog, told a news conference.

“The strategic objective of the programme is to unlock the value of investments in brownfield public sector assets by tapping institutional and long-term patient capital which can thereafter be leveraged for further public investments.”

The top five sectors, estimated by their potential for monetisation, are roads, railways, power, oil and gas pipelines, and telecommunication.

The government aims to monetise assets worth 880 billion in the current fiscal year that began in April, and a transparent mechanism would achieve “a fair value”, Kant said.

Finance Minister Nirmala Sitharaman said the programme would give an impetus to economic growth.

Earlier this year, Prime Minister Narendra Modi’s administration announced a privatisation plan which would leave government ownership only in a few critical sectors. read more

Although coronavirus lockdowns and the subsequent downturn have slowed the privatisation process, the government still hopes to raise 1.75 trillion rupees from such sales in the current fiscal year to March 2022.

In the current fiscal year, the government expects to list state-run Life Insurance Corp. of India, and privatise state-run oil refiner Bharat Petroleum Corp Ltd. and state carrier Air India Ltd.

Proceeds from privatisation are crucial for India, which witnessed a record fiscal deficit of 9.3% in the last fiscal year to March 2021, when the economy contracted by 7.3%.

By the end of the current 2021-22 fiscal year, the government aims to cut the fiscal deficit to 6.8% and revive economic growth to 10.5%.

($1 = 74.16M rupees)

Disclaimer :- This story has not been edited by The Sen Times staff and is auto-generated from news agency feeds.
Source: Reuters


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