The Union Cabinet approved setting up National Land Monetization Corporation (NLMC) to undertake monetization of surplus land and building assets of central public sector enterprises (CPSEs) and other government agencies.
NLMC has been set up as a government-owned company with an initial authorized share capital of Rs5000 crore and paid-up share capital of ?150 crore, according to a government statement. The statement added that the Board of Directors of NLMC will comprise senior central government officers and eminent experts.
Besides, the Department of Public Enterprise under the ministry of finance, will set up the company and act as its administrative ministry, the government said. Public sector companies have referred nearly 3,400 acres of land and other non-core assets to the government for monetization.
“Going forward, Department of Public Enterprise, Ministry of Finance, will set up the company and act as its administrative ministry," the statement said.
“At present, CPSEs hold considerable surplus, unused and under used non-core assets in the nature of land and buildings. For CPSEs undergoing strategic disinvestment or closure, monetization of these surplus land and non-core assets is important to unlock their value. NLMC will support and undertake monetization of these assets," the statement said.
The formation of the SPV for monetization of land and non-core assets for was announced by finance minister Nirmala Sitharaman last year. With the monetization of non-core assets, the government would be able to generate substantial revenues by monetizing unused and under-used assets, government said in a statement.
Tuhin Kanta Pandey, secretary of the department of investment and public asset management (DIPAM) had earlier told Mint that a lot of land is available for monetization but the government does not have the capacity to carry it out. He had added that SPV as a professional organization would be expected to get a better valuation for the land parcels and non-core assets, that many CPSEs may not be able to monetize on their own.
“NLMC is also expected to own, hold, manage and monetize surplus land and building assets of CPSEs under closure and the surplus non-core land assets of Government owned CPSEs under strategic disinvestment. This will speed up the closure process of CPSEs and smoothen the strategic disinvestment process of Government owned CPSEs. These assets may be transferred to NLMC to hold, manage and monetize these assets," the statement said.
