- GS-2: Government policies and interventions for development in various sectors and issues arising out of their design and implementation.
- GS-3: Indian Economy and issues relating to planning, mobilization, of resources, growth, development
National Land Monetisation Corporation
Context: Last week, the Union cabinet approved the creation of a National Land Monetisation Corporation to monetise the surplus land holdings of Central Public Sector Enterprises (CPSEs) and other government agencies.
What are the advantages by creating a land monetisation corporation?
- Database of Land: A detailed and comprehensive inventory of the state’s land holding across the country will be created.
- Investor Friendly: Properly marked land parcels with geographical identifiers, boundaries clearly demarcated, and the legality of title well established, will provide greater clarity and certainty to private investors. This will help in creation of a database of potential investors.
- Better Utilisation of assets: Collating large swathes of unused/under used land under a single entity will lead to a more efficient monetisation drive, and better utilisation of these assets. For ex: Total vacant land available with Railways is estimated at around 1.25 lakh acres.
- Increases Government revenue: Proceeds from the monetisation of these assets will help generate additional resources, boosting government coffers.
- Helps reduce Land Prices: Auctioning off surplus land will increase the supply of land, which may address the issue of the “artificial” scarcity of land that exists in certain areas. This could reduce prices and thus have a moderating effect on costs of projects.
- Need for specialised agency: Land monetisation is a complex process that requires “specialised skills and expertise” in areas such as “market research, legal due diligence, valuation, master planning, investment banking and land management.” A dedicated entity with specialised skills is better suited for this task.
What are the challenges that this corporation might face?
- Reluctance to declare: The estimation of surplus land may be a contentious issue. Ministries, departments, and public sector entities may be reluctant to demarcate land parcels as “surplus”.
- Legal- administrative Challenges: The corporation will have to grapple with issues such as the absence of clear titles, ongoing litigation, and muted investor interest. There is also the issue of the encroachment of government land to contend with.
While this monetisation drive should lead to more efficient outcomes, it does raise questions over the management of commons, and whether public purpose can be better looked after by more effective management of public land by the state.
Connecting the dots:
- GIS enabled Land Bank
- Land Reforms
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