The Ministry of Railways is embarking on its largest private-investment drive by monetising assets worth ₹2.5 trillion over five years under the second phase of the National Monetisation Pipeline (NMP 2.0). This initiative is part of a broader ₹10 trillion pipeline strategy announced by Finance Minister, intended to last until 2029-30. The railways aim to achieve this target through public-private partnership (PPP) models and a multi-asset approach, focusing on revenue-generating operational assets with private sector participation.
Monetisation Strategies
- Gati Shakti Cargo Terminals: The plan includes monetising these terminals and introducing new freight trains through private funding, with proceeds expected from station redevelopment and commercial development around stations.
- Land Parcel Monetisation: High-value land parcels are targeted for monetisation for commercial and residential projects, including areas like Salt Golah in Kolkata and Sewa Nagar-Lodhi Colony in Delhi.
Monetisation Targets
- Revised Targets: Initially, the monetisation target for the railways was ₹1.7 trillion until FY30, which has now been increased to ₹2.5 trillion, marking a nearly 50% hike.
- Previous Targets: Under the first NMP released in 2021, the target was ₹1.52 trillion by FY25, revised over time to ₹1 trillion.
Future Proposals
- Dedicated Freight Corridors: Discussions have commenced on monetising the ₹1.24 trillion eastern and western freight corridors, although the ministry has not confirmed any proposals.
- Private Sector Interest: Experts emphasize the importance of private-sector interest and appropriate risk-allocation frameworks for successful monetisation.
Overall, the monetisation drive aims to leverage private-sector investments to enhance railway infrastructure and operations, with key factors being private-sector interest and government expectations of monetisation value.
