Recently, the Union Cabinet has approved the setting up National Land Monetization Corporation (NLMC) as a wholly owned Government of India company.
Context
Recently, the Union Cabinet has approved the setting up National Land Monetization Corporation (NLMC) as a wholly owned Government of India company.
- The setting up of NLMC is in pursuance of the Budget Announcement for 2021-22.
What is National Land Monetization Corporation (NLMC)?
- The NLMC is being formed with an initial authorised share capital of Rs. 5,000 crore and paid-up capital of Rs. 150 crore.
- It will be set up under the administrative jurisdiction of the Department of Public Enterprise, Ministry of Finance.
- A chairman will be appointed to head the NLMC through a merit-based selection process.
- The Board of Directors will comprise senior Central Government officers and eminent experts to enable professional operations and management of the company.
- The Board of NLMC can also hire, pay and retain experienced professionals from the private sector.
Functions of NLMC
- To undertake monetisation of surplus land and building assets of Central public sector enterprises (CPSEs) as well as other government agencies.
- 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.
- To advise other government entities to identify their non-core surplus assets and ‘generate maximum value’ by monetising them ‘in a professional and efficient manner’.
- To act as a repository of best practices in land monetization, assist and provide technical advice to the Government in the implementation of asset monetization programmes.
Significance of NLMC
- Firstly, with the monetization of non-core assets, the Government would be able to generate substantial revenues by monetizing unused and under-used assets.
- Secondly, it will speed up the closure process of CPSEs and smoothen the strategic disinvestment process of Government-owned CPSEs.
Need for monetization
- Many Central Public Sector Enterprises (CPSEs) have surplus assets like land and buildings, which are not put into productive use.
- Monetization of such non-core assets with help in unlocking their value.
- Through monetization, these unused & under-used assets can be productively used to attract investments from the private sector and generate new employment opportunities.
- Monetization of these assets will also generate substantial revenues to the government, which can be used for creating economic and social infrastructure.
- Monetization by National Land Monetization Corporation (NLMC) will speed up the strategic disinvestment process of CPSEs.
