Inside NMP 2.0: 12 sectors in focus as NITI Aayog lays roadmap for sustainable infra funding—Explained in 10 points

Union minister Nirmala Sitharaman has unveiled the National Monetisation Pipeline 2.0, an ambitious second-generation of a programme aimed at unlocking value by leasing brownfield assets in infrastructure-related sectors like roads, railways and power through private participation and InvITs. The 2.0 drive targets to unlock Rs 16.7 lakh crore worth of value across 12 sectors by FY30, with sectors like highways (26 per cent share), power and railways (17 per cent) and ports (16 per cent) in the spotlight.

First things first, what is the National Monetisation Pipeline 2.0? How is it different from its predecessor?

The National Monetisation Pipeline is an ambitious government-run programme aimed at tapping the monetisation potential of public infrastructure assets. Under the programme, select projects are leased out to private players through the public-private-partnership (PPP) for a pre-determined period.

Introduced by the NITI Aayog, under government's broader infrastructure drive, the national monetisation programme is a structured plan to monetise already-built and operational assets. The rights of the said projects are transferred to private entities for a fixed tenure. This helps the government generate revenue for its other focus areas.

Here are 10 things to know about the NMP 2.0:

• Monetisation potential: The National Monetisation Pipeline 2.0 programme estimates a monetisation potential amounting to Rs 16.72 lakh crore across infrastructure-related sectors. That includes estimated private sector investments worth Rs 5.8 lakh crore under the asset monetisation pipeline of central ministries and public sector entities for the period from FY26 to FY30.

• The lion's share of the proceeds is expected to accrue to the Consolidated Fund of India, followed by direct investment (private), PSU or Port Authority allocation, and the State Consolidated Fund.

• Key sectors: The NMP 2.0 broadly focuses on 12 sectors: highways, railways, power, energy, civil aviation, ports, waterhousing, urban infra, coal, mines, telecom and tourism.
• Out of these sectors, three-fourths of the value is estimated to be tapped through highways, multi-modal logistics parks, ropeways, railways, power and ports.

• Viksit Bharat vision: Unveiling the NMP 2.0 programme in the national capital on Monday, the finance minister said that the initiative aligns with the infrastructure development plans under its broader 'Viksit Bharat' (Developed India) vision. The NMP has the potential to fuel the country's growth momentum, she added.

NMP 2.0 (FY26-FY30) vs NMP 1.0 (FY21-FY25)

• The FM said that the ambitious target of Rs 16.7 lakh crore marks a 2.6 times increase over the NMP 1.0 target.

• The NMP 1.0 was the first-of-its-kind pipeline at a large scale, and the best practices learned by the concerned authorities should be leveraged in NMP 2.0, she said. The Union minister also highlighted that nearly 90 per cent of the NMP 1.0 target of Rs 6 lakh crore was achieved in four years.

• The FM emphasised that the NMP enables the recycling of productive public assets, in turn unlocking resources for reinvestment in new projects and capital expenditure.

• This approach, she said, facilitates efficient mobilisation of funds for capital expenditure (capex) in public assets while minimising the government's budgetary outgo. "The choice of instrument will be determined by the sector, nature of asset, timing of transactions (including market considerations), target investor profile and the level of operational/investment control envisaged to be retained by the asset owner etc.," read a statement by NITI Aayog.

• According to a report by policy think-tank NITI Aayog, the NMP 2.0 is expected to boost the country's GDP by about Rs 40 lakh crore over the next 5-10 years.

Here are answers to frequently asked questions (FAQs) about the article:

What is NMP 2.0?

It is a second-generation government programme aimed at enabling the government monetise key assets through leasing to private players.

How does NMP work?

The programme enables the authorities to unlock value from existing public infrastructure assets. They do so by leasing out these assets to private players for a fixed period.

What is the target under NMP 2.0?

The programme targets asset monetisation worth Rs 16.72 lakh crore in five years, from FY26 to FY30.

How many sectors are covered under the programme?

The NMP 2.0 covers 12 sectors. The NMP 1.0 -- launched in 2021 -- covered 13 sectors.

Which sectors account for the largest share under NMP 2.0?

The top four sectors are: Highways (26 per cent), power (17 per cent), railways (16 per cent) and ports (16 per cent).

What's the main difference between NMP 2.and NMP 1.0?

The NMP 2.0 targets to unlock Rs 16.7 lakh crore through the monetisation of qualifying assets, which is about 2.6 times higher than NMP 1.0.

What was the result of NMP 1.0?

Under the four-year drive, nearly 90 per cent of the total target of Rs 6 lakh crore was achieved.

How does NMP help the economy?

It enables recycling of public assets and helps mobilise funds for new infrastructure projects and capex.

What is the government's broader vision behind NMP 2.0?

The programme aligns with the government’s ‘Viksit Bharat’ ambition and is expected to support long-term economic growth. NITI Aayog pegs a potential GDP boost of around Rs 40 lakh crore over the next 5-10 years.

Which economic benefits does NMP 2.0 offer?

It enables efficient fund mobilisation for capex without increasing budgetary outgo, attracts private investment and reinvests the proceeds into new infrastructure for sustained growth.