Government’s plan to monetise railway assets by allowing private sector players to operate trains did not attract investors due to improper structuring, so the railway ministry is looking at it afresh, government think tank Niti Aayog’s CEO Amitabh Kant has said.
Addressing a conference on Friday, Mr Kant said that the private sector will invest only if there are assured returns. “Therefore good project structuring is the key to success of any asset monetisation deal. Obviously, the railways trains project was not well structured, it did not attract good private sector participants. On the top of that, IRCTC was also bidding for railway trains,” he said.
“They lacked a good amount of structuring and therefore both the railway trains and the railway stations are being re-looked at, re-examined by the railway ministry and by the railway minister and they will take a call now how to go about it and what should be the model for that. It is being deliberated by the new minister,” Mr Kant informed.
“All the ₹ 6 lakh crore assets that are listed down in the asset monetisation pipeline, are all assets which have revenue generating possibility and it needs to be well structured and it can easily attract investors into these brownfield assets. These are assets where revenue streams are already flowing in. If the projects are not well structured, you will not get the right bidders, you will not get the right value, you will not serve the interest of the country,” the Niti Aayog CEO elaborated.
Speaking at the conference, department of investment and public asset management (DIPAM) secretary Tuhin Kanta Pandey said the policy announced in February 2021 for public sector enterprises is now the guiding policy for divestment.
CommentsAs per the policy, the government will have bare minimum presence in broad strategic areas.