Assets monetisation in focus to bridge potential selloff gap

New Delhi: The government is planning to accelerate its asset monetisation programme in this financial year, aiming to boost its resources and make up for any potential shortfall in disinvestment proceeds in the wake of the Iran war-induced stock market volatility and a delay in the IDBI Bank strategic sale, said a senior official.

It had budgeted a combined disinvestment and asset monetisation revenue of ₹80,000 crore for 2026-27, compared with ₹45,306 crore last fiscal, hoping to conclude the IDBI Bank transaction in the first half.

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The market volatility, stoked by the West Asia conflict, has also cast a shadow over the government's plan to dilute parts of its stakes in Life Insurance Corporation and some other entities this fiscal through offers for sale. Besides, market capitalisation of companies across sectors has taken a knock since the start of the US-Israel war against Iran on February 28.

"Considering the potential war impact on the government's tax revenue and spending requirements, asset monetisation assumes even greater importance this fiscal," said the official, who did not wish to be identified. "More importantly, there is a huge scope for revenue there, if implemented well."

The overall asset monetisation target for ministries and state-run entities under them is set at ₹3.26 lakh crore for 2026-27.

The finance ministry is now engaging with various ministries, along with the NITI Aayog and cabinet secretariat, to encourage them to pursue asset monetisation seriously, the official told ET. Efforts will be made to beat the monetisation target for this fiscal, he said.

An empowered core group of secretaries under cabinet secretary TV Somanathan will monitor the progress in asset monetisation.

In February, finance minister Nirmala Sitharaman had launched the second phase of the asset monetisation pipeline of various ministries and public-sector entities, developed by the NITI Aayog, with a monetisation potential of ₹16.7 lakh crore over five years till 2029-30.

To be sure, monetisation proceeds are allocated to different heads, depending on the agencies implementing the projects and the mode of monetisation.