Cabinet approves setting up of National Land Monetization Corporation as a Special Purpose Vehicle (SPV) for undertaking surplus land monetization

What is the News?

The Union Cabinet has approved the setting up of the National Land Monetization Corporation (NLMC). The setting up of NLMC is in pursuance of the Budget Announcement for 2021-22.

What is National Land Monetization Corporation(NLMC)?

NLMC will be a wholly-owned Government of India company with an initial authorized share capital of Rs 5000 crore.

Nodal Ministry: It will be set up under the administrative jurisdiction of the Department of Public Enterprise, Ministry of Finance.

Composition: 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. 

Source: This post is based on the article “Cabinet approves setting up of National Land Monetization Corporation as a Special Purpose Vehicle (SPV) for undertaking surplus land monetization” published in PIB on 10th Mar 2022