Ministry of Finance and Corporate Affairs launched National Monetisation Pipeline (NMP) 2.0, developed by NITI Aayog, to operationalise the Asset Monetisation Plan 2025–30, as announced in the Union Budget 2025–26.
The programme sets a monetisation target of about ₹10 lakh crore, while the broader Total Monetisation Value (TMV) is estimated at ₹16.72 lakh crore over five years (FY 2026–30). It builds upon the first phase (FY22–FY25), which achieved nearly 90% of its ₹6 lakh crore target.
What is National Monetisation Pipeline (NMP) 2.0?
NMP 2.0 is a structured programme to generate resources by leasing operational brownfield public infrastructure assets to private entities for a fixed period.
Key points:
- It involves leasing, not selling, public assets.
- Ownership remains with the government.
- Private players operate and maintain assets.
- Revenue is shared as per agreement.
- Proceeds are reinvested into new infrastructure.
This model is known as Asset Recycling — unlocking value from existing assets and reinvesting it into fresh capital expenditure (CAPEX) without increasing budgetary pressure.
Governance & Implementation Framework
- Developed by NITI Aayog
- Implemented under the guidance of the Ministry of Finance
- Monitored by the Core Group of Secretaries on Asset Monetisation (CGAM) chaired by the Cabinet Secretary
This ensures a “whole-of-government” approach.
Key Features of NMP 2.0
1. Sectoral Coverage (12 Major Sectors)
- Highways
- Railways
- Power
- Ports
- Coal
- Mines
- Telecom
- Petroleum & Natural Gas
- Civil Aviation
- Warehousing
- Urban Infrastructure
- Tourism
Highways, multi-modal logistics parks (MMLPs), and ropeways account for the largest share.
2. Total Monetisation Value
- Aggregate potential: ₹16.72 lakh crore
- Includes private sector investment of ₹5.8 lakh crore
- 2.6 times higher than NMP 1.0
3. Top 5 Sectoral Shares (FY 2026–30)
- Highways, MMLPs & Ropeways – 26% (₹4.42 lakh crore)
- Power Sector – 17% (₹2.76 lakh crore)
- Railways – 16% (₹2.62 lakh crore)
- Ports – 16% (₹2.63 lakh crore)
- Coal – 13% (₹2.16 lakh crore)
Coal and mining assets are expected to generate substantial revenues.
4. Monetisation Instruments
- Public-Private Partnership (PPP) concessions
- Infrastructure Investment Trusts (InvITs)
- Securitisation of cash flows
5. Revenue Allocation
Proceeds are distributed based on the implementing entity:
- Consolidated Fund of India (Ministry-led projects)
- PSU/Port Authorities (entity-led projects)
- State Consolidated Funds (mining royalties)
- Separate head for direct private investment in projects involving construction or major maintenance
NMP 1.0 Performance
The first phase (FY22–FY25):
- Target: ₹6 lakh crore
- Achievement: ~90%
- Provided baseline best practices
- Revealed operational challenges
NMP 2.0 incorporates lessons learned from Phase 1.
Economic Vision and Strategic Importance
NMP 2.0 aligns with:
- Infrastructure-led growth strategy
- Viksit Bharat vision
- Sustainable infrastructure financing
Significance:
- Creates fiscal space for new CAPEX
- Improves operational efficiency through private sector expertise
- Provides medium-term visibility to investors
- Mobilises long-term capital
- Reduces pressure on government borrowing
- Offers alternative financing during global economic uncertainty
Concept of Asset Recycling
Asset Recycling involves:
- Monetising existing revenue-generating public assets
- Leveraging private sector efficiency
- Reinvesting proceeds into new infrastructure
It differs from privatisation because:
- Ownership remains with the government
- Assets revert to government after concession period
Challenges Identified from NMP 1.0
Despite success, several issues emerged:
1. Uneven Investor Interest
- Roads performed strongly.
- Railways and telecom saw limited participation.
2. Valuation Concerns
- Overpricing deters bidders.
- Underpricing invites criticism.
3. Regulatory Uncertainty
- Policy changes and approval delays impact investor confidence.
- Need for stable frameworks.
4. Public Perception Issues
- Monetisation often misunderstood as privatisation.
- Political resistance may arise.
5. Institutional Capacity Gaps
- Some ministries and PSUs lack PPP structuring expertise.
6. Revenue Risks
- Traffic or usage volatility affects returns.
7. Coordination Challenges
- Requires alignment between Centre, States, and multiple agencies.
- Delays in clearances slowed some projects earlier.
8. Market Conditions
- Investor sentiment and global capital flows influence pace.
Broader Economic Context
NMP 2.0 expands sustainable infrastructure financing at a time when:
- India requires massive infrastructure expansion
- Fiscal prudence is essential
- Private capital mobilisation is critical
- Long-term economic growth depends on infrastructure strength