In the upcoming Union Budget 2023-2024, Finance Minister Nirmala Sitharaman is expected to push for monetisation of railways assets in order to accumulate more funds for the Indian Railways.
In the year 2022, the target of monetising the railways assets worth Rs 17,000 crore was not achieved due to the very poor response from the private sector. Regardless of the lack of interest shown by the investors in railways’ assets, the government is still hoping for good returns.
What is monetisation of assets
The assets are monetised directly by models such as Operate Maintain Transfer (OMT,) Troll Operate Transfer (TOT), Public Private and Partnership (PPP), and Operations Maintenance and Development (OMD).
Also in monetisation, the government leases assets for a certain time for the operations and redevelopment by a private organization and does not sell assets. It is likely to set a particular goal, although a reasonable one, for the monetisation of the assets of railways, sources said.
Under monetisation of assets, the government transfers the rights of revenue to some private parties for an identified transaction period in return for a share of revenue and commitment of the investments in the assets.
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