The Department of Investment and Public Asset Management (DIPAM) on Monday signed an agreement with the World Bank for advisory services on asset monetisation.
DIPAM is mandated with facilitating monetisation of non-core assets of Central Public Sector Enterprises (CPSEs) under strategic disinvestment or closure and enemy property of value of ₹100 crore and above. It has a framework for monetising non-core assets.
“The World Bank advisory project, approved by the Finance Minister, is aimed at analysing public asset monetisation in India and benchmarking its institutional and business models against international best practices as well as supporting development of operational guidelines and capacity building for their implementation,” a government statement said.
This project is expected to facilitate the non-core asset monetisation process and help unlock the value of these un-used/marginally-used assets that have the potential to augment financial resources for further investments.
The assets of the PSEs and government departments can be categorisedas land and buildings; brownfield operational assets such as pipelines, roads, mobile towers, electricity transmission lines, etc; financial assets such as equity shares, debt securities, other hybrid/structured finance asset units etc; and miscellaneous assets.
Many of the assets are sub-optimally utilised and can be appropriately monetised to create greater financial leverage and value for the companies and the government, being the shareholder.
Four asset categories
DIPM listed four categories of assets where its framework will be applicable.
These include identified non-core assets of CPSEs under strategic disinvestment; immovable enemy property under the custody of a custodian; assets of other CPSEs/PSUs/other government organisations with the approval of the competent authority; and sick/loss making CPSEs under closure (optional).
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