Union Cabinet approves creation of a new company for land monetisation

The Union Cabinet on Wednesday approved the creation of a new company to hold and monetise surplus land assets and buildings of government departments and PSUs that are being privatised or shut down.
 
The special purpose vehicle (SPV), called the National Land Monetisation Corporation (NLMC), will be set up as a wholly state-owned company with an initial authorised share capital of Rs 5,000 crore and paid-up share capital of Rs 150 crore, said an official statement.
 
“NLMC will undertake monetisation of surplus land and building assets of Central Public Sector Enterprises (CPSEs) and other government agencies. With monetisation of non-core assets, the government will be able to generate substantial revenues by monetising unused and under-used assets, it said.

 

“At present, CPSEs hold considerable surplus, unused and underused non-core assets in the nature of land and buildings. For CPSEs undergoing strategic disinvestment or closure, monetisation of these surplus land and non-core assets is important to unlock their value. NLMC will support and undertake monetisation of these assets,” the statement said.
 
This will also enable productive utilisation of these under-utilised assets to trigger private sector investments, new economic activities, boost the local economy and generate financial resources for economic and social infrastructure. NLMC will take over the surplus assets from government departments and PSUs. It will own, hold, manage and monetise the surplus land and building assets.

 
The statement, however, did not detail the modalities of transferring the surplus land and buildings to NLMC.
 
NLMC will hire professionals from the private sector just as in the case of similar specialised government companies like the National Investment and Infrastructure Fund (NIIF) and Invest India, the statement said.
 
The new company, which will be set up under the administrative jurisdiction of the Finance Ministry, will be a lean organisation with minimal full-time staff, hired directly from the market on a contract basis.
 
The Board of Directors of NLMC will comprise senior central government officers and eminent experts to enable professional operations and management of the company.