National Land Monetisation Corporation (NLMC)

Context

Recently, the Union Cabinet has approved the setting up National Land Monetization Corporation (NLMC) as a wholly owned Government of India company.

• The setting up of NLMC is in pursuance of the Budget Announcement for 2021-22.

What is National Land Monetization Corporation (NLMC)?

• The NLMC is being formed with an initial authorised share capital of Rs. 5,000 crore and paid-up capital of Rs. 150 crore.
• It will be set up under the administrative jurisdiction of the Department of Public Enterprise, Ministry of Finance.
• 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. 

Need for monetization

• Many Central Public Sector Enterprises (CPSEs) have surplus assets like land and buildings, which are not put into productive use. 
• Monetization of such non-core assets with help in unlocking their value.
• Through monetization, these unused & under-used assets can be productively used to attract investments from the private sector and generate new employment opportunities.
• Monetization of these assets will also generate substantial revenues to the government, which can be used for creating economic and social infrastructure.
• Monetization by National Land Monetization Corporation (NLMC) will speed up the strategic disinvestment process of CPSEs.