Union cabinet gives nod to set up company to monetise surplus land monetisation

The Union cabinet on Wednesday approved the setting up of the National Land Monetization Corporation (NLMC) as a wholly owned company by the Centre with an initial authorised state capital of ₹5,000 crore and paid-up share capital of ₹150 crore. The NLMC will be set up as a Special Purpose Vehicle (SPV) for undertaking monitisation of surplus land and building assets of the Central Public Sector Enterprises (CPSEs) and other government agencies, an official statement read.The cabinet is chaired by Prime Minister Narendra Modi.“At present, CPSEs hold considerable surplus, unused and under used 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,” the statement added.Besides undertaking the monetisation of these assets, the NLMC will enable effective utilisation of them for private sector investments, new economic activities, augment local economy, and generate financial resources for economic and social infrastructure.Here are other key elements to be noted about the NLMC as laid down by the Centre in its statement:It will speed up the closure process of CPSEs and ease the strategic disinvestment process of government-owned CPSEs.NLMC will “advise and support” other government entities (including CPSEs) in recognising their surplus non-core assets and monitising them in a professional and efficient to generate maximum value realisation.The statement further stated that it is expected that the NLMC will act as a “repository of best practices in land monetisation, assist and provide technical advice to Government in implementation of asset monetization programme.”The NLMC will have necessary technical expertise to “professionally manage and monetise land assets on behalf of CPSEs and other government agencies,” the statement read.Who will be present in the NLMC?The board of directors of the corporation will comprise senior central government officers and experts in order to allow professional operations and management of the firm. The chairman, and non-government directors of the NLMC will be appointed via a merit-based selection process.Who else will be present in the NLMC?Professionals from the private sector, similar to other specialised government companies such as the National investment and infrastructure Fund (NIIF) and Invest India, will be recruited to be part of the corporation. “[The] NLMC will be a lean organization with minimal full time staff, hired directly from the market on contract basis. Flexibility will be provided to the Board of NLMC to hire, pay and retain experienced professionals from the private sector,” the statement read.Going ahead, the department of public enterprise under the Union finance ministry will set up the NLMC and act as its administrative ministry.