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Govt to start asset monetisation plan by leasing GAIL’s gas pipelines
OIL & GAS

Govt to start asset monetisation plan by leasing GAIL’s gas pipelines

The monetisation programme of the central government worth Rs 6 trillion is starting by leasing out over 2,229km of gas pipelines of GAIL (India) Ltd to the private sector.

The government already started appointing finance advisers for the proposed deal, and many domestic and foreign investment banks have shown interest. By floating an infrastructure investment trust (InvIT), the plan is to monetize these assets where investors can put in funds and receive a part of the income as returns.

On 23 August, the finance minister, Nirmala Sitharaman, revealed plans to collect Rs 6 trillion between FY 2022-25 by renting various assets to the private sector as a part of a National monetisation Pipeline (NMP).

According to the media reports, the government believes that currently, GAIL pipelines have the strongest demand from private investors compared to all other assets headed for monetisation.

Recently, NITI Ayog informed that GAIL contributed to the development of the gas pipeline infrastructure and natural gas market. Currently, it has a gas pipeline network of 13,389 km, including a capacity of 204 million standard cu. m per day (mmscmd). The government plan is to monetize 8,154 km of these kinds of pipelines.

In recent years, GAIL has been running at 49-52% capacity usage levels. Though the cross-country pipelines record higher capacity utilisation levels, the total usage is still suboptimal.

For FY22, two pipelines with an overall length of 2,229 km Dahej-Uran-Panvel-Dabhol pipeline and the hol-Bengaluru pipeline, have been identified for monetisation. For FY 2023-25, an additional 5,925 km GAIL pipeline has been considered for monetisation.

The monetisation list of the government comprises 400 railway stations, 26,700 km of roads, 90 passenger trains, 286,000km of BharatNet fibre network, 28,608 circuit km transmission lines, and 14,917 towers maintained by Bharat Sanchar Nigam Ltd and Mahanagar Telecom Nigam Ltd. (BSNL).

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Also read: Govt’s infrastructure asset monetisation plan to raise Rs 6 lakh cr

Also read: Govt plans to monetise 25 AAI airports in next four years

The monetisation programme of the central government worth Rs 6 trillion is starting by leasing out over 2,229km of gas pipelines of GAIL (India) Ltd to the private sector. The government already started appointing finance advisers for the proposed deal, and many domestic and foreign investment banks have shown interest. By floating an infrastructure investment trust (InvIT), the plan is to monetize these assets where investors can put in funds and receive a part of the income as returns. On 23 August, the finance minister, Nirmala Sitharaman, revealed plans to collect Rs 6 trillion between FY 2022-25 by renting various assets to the private sector as a part of a National monetisation Pipeline (NMP). According to the media reports, the government believes that currently, GAIL pipelines have the strongest demand from private investors compared to all other assets headed for monetisation. Recently, NITI Ayog informed that GAIL contributed to the development of the gas pipeline infrastructure and natural gas market. Currently, it has a gas pipeline network of 13,389 km, including a capacity of 204 million standard cu. m per day (mmscmd). The government plan is to monetize 8,154 km of these kinds of pipelines. In recent years, GAIL has been running at 49-52% capacity usage levels. Though the cross-country pipelines record higher capacity utilisation levels, the total usage is still suboptimal. For FY22, two pipelines with an overall length of 2,229 km Dahej-Uran-Panvel-Dabhol pipeline and the hol-Bengaluru pipeline, have been identified for monetisation. For FY 2023-25, an additional 5,925 km GAIL pipeline has been considered for monetisation. The monetisation list of the government comprises 400 railway stations, 26,700 km of roads, 90 passenger trains, 286,000km of BharatNet fibre network, 28,608 circuit km transmission lines, and 14,917 towers maintained by Bharat Sanchar Nigam Ltd and Mahanagar Telecom Nigam Ltd. (BSNL). Image Source Also read: Govt’s infrastructure asset monetisation plan to raise Rs 6 lakh cr Also read: Govt plans to monetise 25 AAI airports in next four years

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