homeeconomy NewsNMP scheme: More ground work done for ports, infra than oil & gas, says Centrum Broking
NMP scheme: More ground work done for ports, infra than oil & gas, says Centrum Broking
Department of Investment and Public Asset Management (DIPAM) Secretary Tuhin Kanta Pandey had earlier this month said that the government is finalising Rs 6 lakh crore worth infrastructure assets, including national highways and power grid pipelines, which would be monetised. "A national monetisation plan of about Rs 6 trillion is in the offing, which will have a range of assets from pipelines to power grid pipelines to national highways, ToT (toll-operate-transfer) and so on," Pandey had said.
The Union government will monetise assets worth Rs 6 lakh crore between this year and 2025 under the National Monetisation Pipeline (NMP) scheme. Finance Minister Nirmala Sitharaman said that the government is looking to unlock value in infrastructure assets across sectors ranging from power to road and railways. Assets of oil and gas players including pipelines, real estate will also be monetised.
Department of Investment and Public Asset Management (DIPAM) Secretary Tuhin Kanta Pandey had earlier this month said that the government is finalising Rs 6 lakh crore worth infrastructure assets, including national highways and power grid pipelines, which would be monetised. "A national monetisation plan of about Rs 6 trillion is in the offing, which will have a range of assets from pipelines to power grid pipelines to national highways, ToT (toll-operate-transfer) and so on," Pandey had said.
Probal Sen, senior vice president at Centrum Broking, said, “If I look at the data that has come out, frankly, the infra guys, the ones that are probably the most well prepared, if I really look at the amounts that are targeted, and the work that has been done, I would presume that, highways, freight terminals, airports and ports are the ones that probably will be first off the block, in terms of the work that has already been done. You have to realise that NHAI has already done a lot of work in terms of working on infrastructure investment trusts (InvITs) and public private partnerships. To that extent, I think, the groundwork has probably been done more so in terms of infrastructure and ports, and all of those sectors rather than oil and gas.”
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On gas pipeline, Sen said, “As far as gas pipelines are concerned, if you really look at it, the operation has been below par or under capacity, because supplies have not been there. So, even a private player coming in, I am not too sure, where he will bring additional utilisation from beyond what GAIL has already been achieving. So the unlocking of value will probably have to happen only on a gradual basis after identifying which pipelines actually have the potential to run at a higher capacity. This, I am talking from an investor perspective. If a private investor has to come in and runs it, he will obviously have to be incentivised in terms of being able to run it at a better capacity level or at a more efficient level than what is already being done.”
He added, “From GAIL or HPCL or BPCL’s point of view, any move that can actually help monetize and take the operation from their hands and as long as they get sufficient consideration for those claims, is definitely a positive. But I am not so sure that is going to happen in a hurry.”
On nature of revenue sharing arrangement, Sen said, “I think that is precisely what is the point, that no one will have to look at the exact revenue share arrangement and the nature of the contracts that is signed either with GAIL itself when it sells to a private party, whether the government gets involved. Also, the contract is tri-party sort of arrangement where the government is the ultimate owner of these assets. By virtue of being the owner of the company itself, they sort of directly intervene. So a lot of minor details are something that we have to look into.”
For full interview, watch the accompanying video.
(Edited by : Dipika)
First Published: Aug 24, 2021 11:39 AM IST
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