Part of: GS Prelims and GS-III- Economy; Infrastructure
In news
The Cabinet Committee on Economic Affairs has approved monetisation of assets of POWERGRID.
It is a Public Sector Undertaking (PSU) under the Ministry of Power, through the Infrastructure Investment Trust (InvIT) model.
This is the first time any PSU in the Power Sector will undertake asset recycling by monetising its assets through the InvIT model.
It will use the proceeds to fund the new and under-construction capital projects.
This approval would help POWERGRID to monetise in the first lot, assets with gross block value of more than 7000 crore.
These assets, which are mainly High Voltage Transmission lines and substations, are held by POWERGRID in form of Special Purpose Vehicles (SPVs).
Important value additions
Infrastructure Investment Trusts (InvIT)
It is like a mutual fund.
It enables direct investment of small amounts of money from possible individual/institutional investors in infrastructure to earn a small portion of the income as return.
Do you know?
POWERGRID, a public limited company under the administrative control of the Ministry of Power, Government of India, started its commercial operation in the year 1992-93 and is today, a Maharatna company, engaged in the business of power transmission.
