Govt plans to monetise New Delhi’s Ashok hotel run by ITDC
Real Estate

Govt plans to monetise New Delhi’s Ashok hotel run by ITDC

The centre is planning to monetise The Ashok, a strategically located five-star hotel in New Delhi, operated by the India Tourism Development Corporation (ITDC).

The cabinet is likely to approve the asset monetisation plan by January.

The plan may be undertaken by the Cabinet by early next month, a government official told the media, adding that the Centre anticipates the hotel's monetisation to be done by December next year.

An empowered group may be installed by the Cabinet to operate the process, the official told the media, adding that three models have been presented. One is to lease the hotel on a standalone basis with the land parcel kept out of the process.

The Ashok, situated in the diplomatic enclave of Chanakyapuri in Lutyens’ Delhi, was opened in 1956. The sprawling property with 550 guest rooms is held by ITDC, in which the government holds an 87.03% stake.

There have been discussions over the past couple of years about the government aiming to monetise the hotel. Several other ITDC hotels, comprising Jammu Ashok in Jammu, Janpath in Delhi and Kalinga Ashok in Bhubaneswar, have been closed in recent years due to increasing losses.

A report issued by the Department of Investment and Public Asset Management (DIPAM) in 2020 had stated that the government could raise approximately Rs 7,500 crore by selling its hotel properties.

The asset monetisation plan is part of the disinvestment drive being spearheaded by the Centre. The finance ministry has set an ambitious goal of raising Rs 1.75 lakh crore via disinvestments in FY22. It is approximately five times the Rs 32,825 crore raised via divestments in the earlier fiscal.

Image Source

The centre is planning to monetise The Ashok, a strategically located five-star hotel in New Delhi, operated by the India Tourism Development Corporation (ITDC). The cabinet is likely to approve the asset monetisation plan by January. The plan may be undertaken by the Cabinet by early next month, a government official told the media, adding that the Centre anticipates the hotel's monetisation to be done by December next year. An empowered group may be installed by the Cabinet to operate the process, the official told the media, adding that three models have been presented. One is to lease the hotel on a standalone basis with the land parcel kept out of the process. The Ashok, situated in the diplomatic enclave of Chanakyapuri in Lutyens’ Delhi, was opened in 1956. The sprawling property with 550 guest rooms is held by ITDC, in which the government holds an 87.03% stake. There have been discussions over the past couple of years about the government aiming to monetise the hotel. Several other ITDC hotels, comprising Jammu Ashok in Jammu, Janpath in Delhi and Kalinga Ashok in Bhubaneswar, have been closed in recent years due to increasing losses. A report issued by the Department of Investment and Public Asset Management (DIPAM) in 2020 had stated that the government could raise approximately Rs 7,500 crore by selling its hotel properties. The asset monetisation plan is part of the disinvestment drive being spearheaded by the Centre. The finance ministry has set an ambitious goal of raising Rs 1.75 lakh crore via disinvestments in FY22. It is approximately five times the Rs 32,825 crore raised via divestments in the earlier fiscal. Image Source

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